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Heathrow and Arora: The battle to expand the UK’s busiest airport

The proposed expansion of Heathrow has been in the works for some time but a new proposition from Arora Group threatens to steal the infrastructure project from the airport’s operator

 

Three years since Heathrow Airport Holdings Limited announced its intention to expand the UK’s busiest airport, a company has unveiled an alternative plan to carry out the project that can carry 50 million more passengers.

Property owner Arora Group believes its plans, which were drawn up by architectural practice Corgan, for a new terminal and runway are superior to that of Heathrow’s operator – while they would apparently cost half the price.

As the two companies battle it out, we take a look their respective proposals and why the expansion is needed.

Why expand?

Heathrow’s location on the outskirts of London makes it a prime location for transfer passengers and it’s this connectivity that boosts business investment in the UK.

With 78 million passengers and 81 airlines serving 204 destinations in 85 countries, is it the UK’s largest airport.

However, its runways are currently operating at 99% capacity, which leads to delays, disruptions and ticket unavailability – while airlines have chosen other European hubs like Paris and Frankfurt to grow.

The Department for Transport has previously said no expansion would mean London’s five airports reach full capacity by 2034.

It is estimated that the project could generate up to £187 billion in economic growth across the UK, create up to 180,000 new jobs nationally and provide new domestic routes.

Heathrow, UK, Airport, Arora
Arora threatens to steal Heathrow expansion project

The third runway

Heathrow Airport Holdings, which operates the airport, plans to build a third runway that would increase capacity from 85.5 million annual passengers to 130 million.

It would also increase the number of flights each year from 474,000 to 740,000.

Rather than build a sixth terminal, it would accommodate the extra passengers by extending terminals 2 and 5, as well as in another new unspecified building.

Heathrow, Airport, UK
The proposed expansion to Heathrow promises to radically change the airport.

The plan also involves overhauling the airport cargo facilities and trebling Heathrow’s rail capacity from 18 to 40 trains, in order to provide transport for 30 million more people to the airport by 2030.

Work would be scheduled to start in 2021, with the third runway completed by 2025.

Heathrow Airport Holdings says its plan, which was recommended by the Airports Commission in 2015, would likely cost £14bn.

But this figure is disputed by Arora, which states that the Airports Commission recently costed the scheme at £31bn.

Arora claims Heathrow Airport Holdings’ projections “are not comprehensive and are misleading”.

The ‘Western Hub’

Arora – owned by Indian businessman Surinder Arora, who owns hotels and properties near the airport – has proposed to build a new terminal and runway at a cost of £14.4bn, which would provide capacity for an extra 50 million passengers.

Known as the ‘Western Hub’, it would focus on a single area on the western side of Heathrow between Terminal 5 and the M25, avoiding the need to redevelop any terminals already in place.

It would integrate new passenger facilities with Terminal 5 into a single hub campus, with a central concourse at the heart that would serve as a single front door for all 85 million passengers using the Western Hub.

One of the UK’s largest rain interchanges would be based here, while the concourse would provide fast and easy access to both Terminal 5 and the new Terminal 6.

Heathrow Airport
Artist’s impression of the sixth terminal at Heathrow Airport under Arora Group’s proposal

Arora Group founder and chairman Mr Arora said: “Heathrow has been in monopoly control for too long and our proposals show what can be achieved through an alternative approach and Heathrow fully welcoming competition.

“We are passionate about developing a Heathrow that delivers a truly world-leading experience; one that works for airlines; one that offers a top-class journey; and one that has the commercial grounding to be a long-term success for the nation to take pride in.”

The company has the backing of former British Airways CEO Sir Rod Eddington, who sits on the Arora Group Heathrow expansion advisory board.

He said: “Heathrow used to be the premium global aviation hub but has suffered under the current monopoly, which has seen it drop below other European airports.

“Arora is best placed to deliver true competition and return Heathrow to its place as the top-tier international airport, which is critical in a post-Brexit Britain.”

 

What’s the view on Arora’s Heathrow expansion plans?

Arora’s competing proposal has been welcomed by key airlines, with Virgin Atlantic CEO Craig Kreeger urged it to be given “serious consideration”

“Heathrow expansion is a once-in-a-generation opportunity to challenge the status quo and build the right airport for the future,” he said.

“Arora has developed a plan that will bring down the cost of construction and inject competition at the UK’s hub airport. At first look, this plan appears to be a credible alternative.”

A spokesman for International Airlines Group (IAG), the holding company of airlines including British Airways, added: “Competition at Heathrow is critical to keeping costs low and we call on the Government to break up the airport’s monopoly and allow third parties to run terminals.

Heathrow, Airport, Arora
Heathrow’s expansion is upcoming but the company undertaking the project is still in question.

“The Arora proposal looks very interesting and deserves to be properly evaluated so that customers can get the best facilities at the most affordable price.”

But Heathrow chief executive John Holland-Kaye believes the plans are not serious, adding that they “show a complete lack of understanding of airport operations and disregard those living closest to the airport”.

The principle of a third runway has long been championed by the CBI, which speaks on behalf of 190,000 businesses of all sizes and sectors in the UK.

Speaking last month, managing director for infrastructure and people Neil Carberry said: “Improving the UK’s infrastructure really has to be at the heart of our industrial strategy, if it is to have the desired effect of giving the British economy a shot in the arm.

“With the new global links that it will bring, and the opportunity to unlock jobs right across the UK, getting on with building the third runway at Heathrow is a vital part of this equation.”