Travel industry experts say the closure of London’s Heathrow Airport due to a nearby fire on Friday focuses on the airline industry’s ability to deal with the crisis.
At the time of writing, Heathrow remained closed after a fire broke out on the power engine that caused the blackout on Friday.
“The growth of the (aviation) industry is happening faster than the growth of infrastructure,” said Anita Mendiratta, founder of AM&A.
The Heathrow halt “is to highlight the need to ensure that the entire network of energy supply at airports around the world is sufficiently capable to deal with the crisis,” Mendilatta told CNBC’s “Squawk Box Europe” on Friday. “This is all a very dramatic learning curve.”
According to UK Energy Minister Ed Miliband, backup generators were also affected by the flames, raising questions about the resilience of their supporting energy infrastructure, and Willie Walsh, director of the International Air Transport Association (IATA), described the reliance on a “single” power source as a “clear planning obstacle” by the airport.
In an email statement, Heathrow said it has multiple sources of energy. “Our backup system is a safety system that allows aircraft to land and passengers to safely evacuate, but is not designed to perform full operation,” Heathrow said.
Wideer impact
Mendiratta said the Heathrow incident has ripple effects on aviation that far exceeds flight cancellations. She described the impact of the Heathrow incident as “very broad,” as aviation growth outweighs the growth in support infrastructure.
Mendiratta described aviation growth as “large scale” worldwide.
“It’s extreme in that even 2019’s rates have grown much more,” she said. This raises questions about the industry’s resilience to unplanned weather and geopolitical events, and whether the surrounding infrastructure can support it.
Globally, according to the IATA, both domestic and international air traffic is expected to surpass 19 levels in early 2024, with passenger numbers expected to increase by an average of 3.8% until 2043 compared to 2023.
“Many of the story’s focus is heavily on Heathrow and passengers, but what we need to consider is that more than 4,000 tons of cargo passes through Heathrow every day, more than passenger traffic,” Mendiratta added.
Heathrow Airport handled a record 83.9 million passengers in 2024. This was an increase of nearly 6% year-on-year, but freight transport increased by 10%.
Whether passengers will be able to obtain compensation for cancelled flights depends on the airline’s terms, Mendilatta said. Such a refund may not be paid as the Heathrow fire appears to be out of the airline’s control. City on friday.
Investors will consider short-term costs such as food and drinks, accommodation, alternative flights or land transport for passengers affected by cancellations, Mendiratta will flag and consider ways airlines can manage customer care in the long term.
“In the end, it will be the basis for customer retention that will become very important from an investor’s perspective… that’s a critical calculation,” she said.
The future of aviation
Heathrow Airport’s third runway has long been pressured by the UK government to decide to expand controversially by the end of the year. British finance minister Rachel Reeves said in a January speech that the extra runway was “awful need.”
Meanwhile, the aviation industry is moving forward with sustainable aviation fuel contracts to meet its decarbonization goals.
“As we move into the future and see sustainable aviation, this is where infrastructure can see green technology. This is essential to enable aviation to continue growing, but it grows in a healthy way,” Mendiratta said.
– CNBC’s Jenni Reid contributed to this report.
