BA chief in U-turn over airports sell-off

Published on Sunday 29 June 2008 21:17

BRITISH Airways chief executive Willie Walsh has done a U-turn on his calls for the break-up of BAA's control of some of the UK's major airports – demanding tougher regulation instead.

The airline's lobbying, led by Walsh, prompted an inquiry by the Competition Commission, which said in April it was minded to split up the ownership of the airports when it presents its findings in August.

But now BA has written to the commission, saying it is "concerned" that ownership separation may "prove counterproductive", claiming it would divert BAA attention away from other matters, such as expanding runways.

It added: "Reform of the regulatory regime may therefore be preferable in remedying BAA's lack of investment." BAA, which is owned by Ferrovial, owns seven UK airports, including Edinburgh, Glasgow and Aberdeen – as well as Heathrow and Gatwick in London.

It has opposed the idea of separating its airports, accusing the inquiry of factual mistakes and incorrect analysis.

In a letter to Christopher Clarke, who is heading the inquiry, BAA said: "The commission has presented a one-sided view of the operation and development of BAA's airports, relying heavily on the criticisms it received from airlines." It added: "Put simply, separation of ownership of airports would not lead to more competition."

Clarke had previously suggested the inquiry may favour a break-up of ownership, saying common ownership by BAA "adversely affects competition" between airport and airlines.