Heathrow reveals grand outline for £49 billion third runway development
The UK government has approved a £49-billion expansion plan for London's Heathrow Airport, marking a significant step towards increasing the airport's capacity and boosting the country's economic growth. The plan involves building a new north-west runway and expanding existing terminals, with the aim of serving up to 150 million passengers annually.
Cost Breakdown
The expansion plan is set to cost around £48-50 billion, with the breakdown as follows:
- Approximately £21 billion is allocated for the new runway and airfield infrastructure.
- Around £12 billion will be spent on new terminal and stand capacity, including a large new terminal called T5X.
- About £15 billion is planned for modernizing the airport, expanding Terminal 2, and closing Terminal 3.
Key Features
The new runway would be up to 3,500 meters long, and capacity would increase to serve up to 756,000 flights per year. Improvements include enhanced public transport connections, new road tunnels, and upgraded bus and coach facilities. Heathrow also commits to achieving net zero carbon emissions by 2050 alongside targets to reduce noise and improve air quality.
Timeline
Heathrow has submitted its proposal to the UK government, and the blueprint has been submitted to the government in 2025. Consultations with stakeholders are expected to start in 2026, and the formal planning application is expected to be submitted in 2028. Construction and operational timelines beyond this have not been fully detailed but expansion is expected to take several years following approval.
Competing Proposals and Concerns
The Airports Commission in 2015 shortlisted the north-west runway at Heathrow, an extension at Heathrow, and a second runway at Gatwick, with the north-west runway at Heathrow being approved by the government in 2016. However, the expansion plan faces financial and stakeholder challenges, including airline opposition due to anticipated fee hikes and competing proposals from the past focusing on alternative expansions including Gatwick.
There are strong concerns from airlines, including British Airways and IAG, about the financial model. They warn that the expansion could lead to significantly higher passenger fees, potentially increasing from about £25 to over £100 per passenger to cover construction costs, risking underuse of the runway and impacting airport competitiveness. Heathrow’s financing remains complex, given its currently high borrowings and modest shareholder equity, raising questions about funding arrangements.
Despite opposition from environmentalists and local residents, the London mayor Sadiq Khan and some Labour MPs supported the new runway. The government is expected to also back expansion at Gatwick airport, south of the capital, in October. Heathrow Airport expects flights to start within a decade.
References
[1] Heathrow Airport (2021). Heathrow expansion [2] BBC News (2016). Heathrow expansion gets go-ahead [3] The Guardian (2016). Heathrow expansion approved: what happens next? [4] The Telegraph (2021). Heathrow expansion: What will it mean for passengers? [5] The Independent (2021). Heathrow expansion: Airlines warn of higher fees and underuse
The expansion plan for London's Heathrow Airport, costing around £48-50 billion, includes building a new terminal called T5X as part of the £12 billion allocated for new terminal and stand capacity. This airport development could potentially enhance travel for up to 150 million passengers annually, enriching the lifestyle of many individuals by offering more international flight opportunities. However, concerns have been raised by airlines like British Airways and IAG, who fear significant increases in passenger fees, potentially reaching over £100 per passenger, which could affect the airport's competitiveness.
