Heathrow airport reports £2 billion annual loss

24 Feb 2021 by Hannah Brandler
Heathrow, Terminal 2, Fly Safe

Heathrow airport has reported an annual loss of £2 billion for 2020, with passenger numbers dropping to 1970s levels as a result of the Covid-19 pandemic.

The number of passengers passing through the airport fell to 22.1 million in 2020 as a result of closed borders and travel restrictions. Over half of these customers travelled in January and February of last year before the onset of the pandemic. Cargo volumes also dropped by 28 per cent during 2020.

The airport said that, while it had taken “decisive action to weather the storm”, airports have very high fixed costs. It added that it had received no government support other than furlough, and had not benefitted from business rates relief, unlike other airports, as well as retail, hospitality and leisure businesses. The airport ended the year with £3.9bn of liquidity, which it states is “enough to see us through until 2023”.

Additionally, Heathrow warned that “economic recovery will be held back” until long-haul passenger flights to key markets such as the US are restarted.

The airport called on Chancellor Rishi Sunak to provide 100 per cent business rates relief, an extension of the furlough scheme and a reversal of the tourist tax in next week’s budget “to support aviation’s recovery”.

The company has welcomed the Prime Minister’s four-step roadmap to ease lockdown measures in England, which includes plans to resume international travel by May 17, and will work with the Global Travel Taskforce to “safely restart international travel and trade at scale”.

Heathrow CEO John Holland-Kaye said:

“2020 has been one of our most challenging years – but despite £2bn of losses and shrinking to passenger levels we haven’t seen since the 70s, I am hugely proud of the way that our colleagues have kept our passengers safe and the UK’s hub airport open for vital supplies throughout. We can be hopeful for 2021, with Britain on the cusp of becoming the first country in the world to safely resume international travel and trade at scale.

“Getting aviation moving again will save thousands of jobs and reinvigorate the economy, and Heathrow will be working with the Global Travel Taskforce to develop a robust plan underpinned by science and backed by industry. The Prime Minister will then have the unique opportunity to secure global agreement on a common international standard for travel when he hosts the G7 in June. In the meantime, we need next week’s Budget to support aviation’s recovery by extending furlough and providing 100 per cent business rates relief.”

Since Boris Johnson’s announcement regarding the easing of England’s lockdown measures, airlines have reported a surge in overseas holidays bookings. The UK’s biggest holiday operator, Tui, reported that bookings have increased by 500 per cent overnight, while Easyjet said that flight bookings jumped by over 300 per cent.

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