In a very interesting and enjoyable speech and question and answer session at the Business Travel Show in London yesterday Willie Walsh, boss of IAG, had a very clear stance on issues confronting the airline industry and the UK economy, including the negative effects of the APD tax, the Chinese visa situation and the UK Government avoiding the airport expansion issues.
Airport expansion
On airport expansion he said “My own view is that we are not going anywhere with this. British Airways has planned its business on the basis that there will be no third runway at Heathrow. In 50 years time I expect that BA will still be operating from a two runway airport at Heathrow.”
Mr Walsh added that even though there was an “overwhelming need for more capacity” – a solution was not likely to be found without cross-party support.
He added that there was also “no demand” from airlines for new runways at either Stansted or Gatwick.
“I have heard Gatwick talking about a second runway but that is assuming that airlines are willing to pay for it,” Walsh said. “I am not going to spend one penny on new runways at Stansted or Gatwick.”
Mr Walsh said that building a new hub airport would be “economic suicide” as it would never be able to secure commercial funding and the charges to airlines were likely to be “excessive” to pay for the project.
So what does Mr Walsh want?
Asked on BBC Question Time in October 2012 if he wanted a third runway he said – ‘No – I don’t.’
He said that BA did not have a problem at Heathrow but other airlines at the show might have. Well Virgin did have a large (and wonderful) stand close to the Walsh stage.
He added that while BA how had managed to address its short-term lack of capacity at Heathrow through its purchase last year of Bmi, there were other airlines who were unable to add routes to fast-growing economies in the Far East and Latin America from Heathrow.
Walsh also used his opening address to declare his confidence in the Boeing Dreamliner. BA is due to receive its first B787 later this year.
Iberia
The situation seems to be more of the same as at BA when Mr Walsh had problems there.
Answering a number of questions he said that he had not foreseen the eurozone problems that are affecting Iberia and that Iberia will be changed. There will be short term pain for long term gain.
There seems no doubt that Mr Walsh is heading for a major dispute in Spain and he seemed to be relishing this.
