Heathrow has racked up losses of £2.9billion in the past 6-months, as vaccination travel rules and pricey Covid testing continue to hamper the airline industry’s recovery.
The London airport has undertaken strict cost-cutting measures, which has seen liquidity lift by 49% to £4.8billion since the beginning of the pandemic. The funds it said:
“…will keep Heathrow afloat for now, by providing sufficient cover to meet its commitments until October 2022 in the extreme no-revenue scenario.”
Revenue hit £348million up to the end of June, around 50% in comparison with the £712million revenue in the same period last year. Fewer than 4million travellers passed through the airport in the first 6-months of this year, a figure which in 2019 would have taken just 18-days.
For the year as a whole it now expects 21.5million passengers to travel through Heathrow based on demand for holidays continuing with no further restrictions.
Chief executive John Holland-Kaye said that the airport was beginning to fall behind its rivals due to the government’s current travel policy. He said:
“The UK is emerging from the worst effects of the health pandemic, but is falling behind its EU rivals in international trade by being slow to remove restrictions. Replacing PCR tests with lateral flow tests and opening up to EU and US vaccinated travellers at the end of July will start to get Britain’s economic recovery off the ground.”
Mr Holland-Kaye said that the government’s traffic light system had given travellers more confidence in booking but expensive tests have held back larger families from returning to foreign destinations.
“Recent changes to the government’s traffic light system are encouraging, but expensive testing requirements and travel restrictions are holding back the UK’s economic recovery and could see Heathrow serve fewer passengers in 2021 than in 2020. Britain is losing out on tourism income and trade with key economic partners like the EU and US because ministers continue to restrict travel for passengers fully vaccinated outside the UK.”
The UK’s trade routes continue to be the worst impacted. Britain’s trade with the EU and the US is down 92% below pre-pandemic levels. In comparison, trade routes between the EU and the US have recovered to nearly 50% on pre-pandemic levels.