Virgin to halt Heathrow payments

Virgin Atlantic says Christmas airport shutdown due to huge snowfall has cost the company millions of dollars in losses. Last Modified: 10 Jan 2011 12:14 GMT

Heavy snowfall and freezing conditions triggered the Heathrow airport to shutdown before Christmas [AFP] Virgin Atlantic Airways has made plans to withhold landing fees from Heathrow after the chaos caused by the airport's shutdown last month. A report said on Monday that Richard Branson, the Virgin Group has stopped making payments to BAA, the operator of London's Heathrow airport, because of the severe disruptions of flights during the massive snow storm that struck Europe in December. The chairman of the company made the decision to stop paying bills due from January 1 until the results of an internal inquiry into the disruption, due to be published in March, will be made public. Tens of thousands of passengers were stranded when the Heathrow airport closed down for several days before Christmas after heavy snowfall and freezing conditions iced up the runways and jet stands. The shutdown dealt a heavy financial blow to airlines as they bore costs such as ticket refunds and rescheduling of flights. Airline hits back Steve Ridgway, Virgin's chief executive, told the Financial Times: "While we accept, and indeed we did, step up to our responsibilities to look after our customers, we feel [BAA] should also feel some of that accountability." One day of heavy snowfall on December 18 triggered chaos at Heathrow, all but closing one of the world's busiest international passenger airports for several days and leaving thousands of angry passengers to bed down in terminals. Ridgway expects the chaos will have cost Virgin Group a minimum of $15.5 million dollars. Heathrow earns more than $1.5bn a year from its airline clientèle, which amounts to half the airport's total annual revenue. While the amount Virgin could hold back may not cause any immediate damage, BAA, the country's largest airports operator, could potentially suffer a long-term financial dilemma if the rest of Heathrow's 90 airline users follow suit. The BAA, which is owned by a Spanish infrastructure group, said in response to Virgin's move: "Heathrow's conditions of use do not provide any basis for Virgin Atlantic or any other airline to withhold airport charges."

Source: Al Jazeera and agencies