Overview from the Simply Flying Article - by Pranjal Pande
Heathrow is revising its passenger forecast for 2022 as it expects a strong wave of summer travellers. Europe's busiest airport now expects 52.8 million passengers, up 16% from previous estimates. However, even this increase won't put the airport into profitability, and more challenges remain.
Passengers are back, but only for a while.
In an update today, seen by Bloomberg, London Heathrow Airport (LHR) announced that it expects to see a return to 65% of pre-pandemic passenger traffic in 2022. This represents 52.8 million passengers, driven primarily by easing travel restrictions and high booking demand for this summer.
Despite this jump, which is more than the last two years combined, Heathrow is nowhere near its break-even profit point of 65 million passengers. This means another year of losses for the airport, but it did manage to turn a positive EBITDA in the first quarter of 2022, a good sign for the future.
Heathrow isn't optimistic for the whole year, however. The airport expects a "winter freeze" once the summer passes, where passenger counts will fall dramatically and airlines will scale back services. In a statement, CEO John Holland-Kaye said,
"There’s a huge amount of uncertainty. A lot of the demand that we’ve seen coming through involves people cashing in vouchers or taking postponed journeys. In a worst case scenario this wouldn’t continue, and we’d see a new wave of coronavirus in the autumn.”
One of the biggest problems plaguing Heathrow is a staffing shortage. The airport is pushing for a record fee of £42 ($53.4) per passenger flying from there to tackle this. This goes far behind the Civil Aviation Authority's (CAA) current cap of £30.19 ($38.9) and the proposed increase to £34.4 ($43.75).
The move is being resisted by airlines, which do not want to charge extra on UK routes that already carry the heavy Air Passenger Duty. However, Holland-Kaye warns that without higher fees, the current staffing shortage will only be exacerbated as the airport expands with less staff.