Heathrow boss to step down after clashing with airlines over summer chaos
John Holland-Kaye, the boss of Heathrow airport, is to step down after clashing with airlines over restricting flights during last summer’s travel chaos.
Mr Holland-Kaye will quit as the airport’s chief executive later this year after nine years at the helm.
His departure follows Heathrow racking up £4bn of losses during the pandemic as Covid restrictions grounded all but a handful of flights.
Mr Holland-Kaye has repeatedly been on the receiving end of fierce criticism from airlines that claimed the airport was “price gouging” them by increasing landing fees.
And last summer he faced an all-out revolt from some carriers after Heathrow announced it would cap passenger numbers amid fears that the airport could be overwhelmed in the wake of extreme staffing shortages.
Sir Tim Clark, the British head of Emirates, called for Mr Holland-Kaye to resign in October over the chaos after initially refusing to bow to Heathrow’s demands to cancel flights.
Willie Walsh, the former British Airways boss and now head of airlines lobby group IATA, stopped short of calling for Mr Holland-Kaye to fall on his sword - but warned he should quit if there was a repeat of the chaos in 2023.
Mr Holland-Kaye also had to contend with a backlash over plans to build a third runway at Heathrow.
Originally given the green light by parliament in 2018, Heathrow’s expansion was subject to a legal challenge that blocked the Government’s decision. The Supreme Court ultimately sided with Heathrow by overturning the block – but the airport still must return to the drawing board by resubmitting plans to build the third runway.
Asked whether Heathrow’s expansion would still go ahead, Mr Holland-Kaye told an aviation conference earlier this week that “we will say more on that later this year”.
Heathrow chairman Lord Deighton said: “John has been an extraordinary leader of Heathrow. During the past nine years, he has worked tirelessly and collaboratively with shareholders, ministers, airlines and other stakeholders to ensure the country can be proud of its ‘front door’.
“The board would like to put on record our gratitude to John for his dedication and commitment to Heathrow throughout his tenure as CEO.”
Mr Holland-Kaye’s departure comes with the Civil Aviation Authority (CAA) finalising a decision that could have serious implications for Ferrovial – Heathrow’s cornerstone investor.
The Spanish infrastructure fund, which owns a 25pc stake in the airport, explored a sale of its shareholding last summer in the wake of a row over landing charges.
As a regulated monopoly – whose financial structure is more akin to a water company – the CAA determines the charges that Heathrow can charge airlines, which pass them onto customers.
If the CAA does not agree to an increase in charges at a satisfactory level, Ferrovial may conclude that it is unable to generate the necessary level of profit from the airport for its investors and seek to offload its stake. No decision has been made, according to sources in Madrid, however.
On the flipside, increasing charges too much will enrage airlines that already claim Heathrow is too expensive.
Luis Gallego, the chief executive of British Airways owner IAG, has previously warned large increases in airport charges could force the UK flag carrier to expand services at airports on the Continent – such as Paris’s Charles de Gaulle.
He said in November 2021: “From a group point of view, what is very important is the concept of capital allocation. We are going to invest in the places where we are going to have the best return of capital.
“If we are going to have an inefficient hub, it's going to be difficult to invest in that hub. And I think that's going to be a problem for Heathrow, for the UK.”