Heathrow lifts passenger numbers guidance but warns of 'challenges'

Britain's Heathrow Airport on Tuesday lifted its 2022 passenger number forecast as demand for leisure travel started to surge, but warned of "significant challenges" and said it would still be lossmaking this year.

The west London airport said it now expected to process 53 million passengers, up from previous forecasts of 45.5 million, after reporting a “strong” April, with 5.1 million passengers.

Demand is being driven by leisure travellers and people cashing in airline vouchers obtained for trips cancelled due to the coronavirus pandemic. The forecast means Heathrow expects passenger numbers to reach 65% of pre-pandemic levels this year.

“The ongoing war in Ukraine, higher fuel costs, continuing travel restrictions for key markets like the United States and the potential for a further variant of concern creates uncertainty going forward," the company said in a statement.

“Together with last week’s warning from the Bank of England that inflation is set to pass 10% and that the UK economy will likely ‘slide into recession’ means we are taking a realistic assessment that travel demand will reach 65% of pre-pandemic levels overall for the year."

Airport managers have faced criticism for trying to increase fees by playing down demand levels as the regulator puts the finishing touches on the five-year cap for Heathrow's charges.

Chief executive John Holland-Kaye defended the company's approach, saying there were "significant challenges ahead".

"The regulator can either plan for them with a robust and adaptable regulatory settlement that delivers for passengers and withstands any shocks, or they can prioritise airline profits by cutting back on passenger service, leaving the industry to scramble when things go wrong in future,” he said.

Airlines and airports have struggled to cope with the surge in demand after the pandemic. Both sectors sacked thousands of workers to cut costs, many of whom have not returned to the industry, creating staff shortages leading to soaring flight cancellations and delays.

Reporting by Frank Prenesti.

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