Friday, October 12, 2012

BAA squeezes more growth out of Heathrow

LONDON (Reuters) - British airport operator BAA squeezed further growth out of stretched London Heathrow in September, calling on an inquiry into capacity constraints to look at every option to allow Britain to tap rising emerging market demand.

BAA, owned by Spanish infrastructure group Ferrovial, said on Thursday that Heathrow, Europe's busiest airport, handled 6.3 million passengers last month, up 0.6 percent from a year ago.

Nearly 9.2 million passengers passed through BAA's five airports - Heathrow, Stansted, Southampton, Glasgow and Aberdeen - a figure unchanged from September 2011.

Strong traffic from Brazil and China counterbalanced a sluggish performance in Europe and a 7 percent decline from India, where India's debt-strapped Kingfisher Airlines is facing possible shutdown and has been grounding planes.

BAA has complained it is falling behind rival European airports in Frankfurt, Paris and Amsterdam in the battle for lucrative emerging markets routes because of constraints on growth at Heathrow.

But Britain's conservative-led coalition government has ruled out building a third runway at Heathrow before the next election in 2015, in part to appease its junior Liberal Democrat partners and boost its green credentials.

A commission chaired by former Financial Services Authority head Howard Davies charged with exploring ways to expand airport capacity in southeast England will report in the summer of 2015 after releasing an interim report next year.

"Traffic to and from the BRIC economies, other than India, demonstrates the on-going importance of hub capacity to connect the UK to growth markets. The Davies Commission must rigorously and objectively assess every option to meet our country's economic needs," BAA's chief executive Colin Matthews said in a statement.

The number of passengers from Brazil and China at Heathrow rose by 14 percent and 5.9 percent respectively.

European traffic was up just 0.2 percent, weighed down by a 4.8 percent decline from Greece and Portugal.

Ferrovial shares were down 0.6 percent in morning trading.

(Reporting by Natalie Huet; Editing by Rosalba O'Brien)

(This story is corrected in ninth paragraph to show statistics refer to Heathrow, not all five BAA airports)


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