Heathrow third runway competition sees billionaire propose shorter cheaper plans

A new challenger has emerged in Heathrow Airport’s third runway expansion project as billionaire hotelier Surinder Arora unveils plans to deliver the development at a significantly lower cost. Arora, who owns considerable land near Heathrow through his property empire, has partnered with US engineering firm Bechtel to present an alternative to Heathrow’s existing proposal.

The government has recently signalled its willingness to consider rival bids for the project. Aviation Minister Mike Kane confirmed proposals from Heathrow or third-party developers would be evaluated, providing an opportunity for Arora’s group to showcase their efficiency-focused solution. He maintains that the project could be completed at 32 to 34 per cent lower costs than Heathrow Airport Limited’s plans, representing substantial savings for airlines and passengers.

Key to Arora’s proposal is the introduction of a shorter third runway. A reduced runway length could cut costs and accelerate the project’s timeline by removing the need to reroute the M25 motorway, the busiest in Britain. This alternative would still serve 90 per cent of flights while addressing airlines’ concerns about the financial burden associated with the longer runway.

The price tag of Heathrow’s original proposal has drawn criticism from airlines, with estimates now stretching to as much as £63 billion. The extended length and M25 diversion have been labelled unnecessary by major carriers, some of whom have voiced support for a shorter option to ease costs and avoid a rise in ticket prices as high as £100 per passenger.

British Airways, which operates the largest share of flights at Heathrow, along with Virgin Atlantic, has expressed cautious support for competitive alternatives that prioritise efficiency and cost-effectiveness. Airlines have criticised the airport’s previous cost management, raising concerns over the ability of current mechanisms to incentivise economically sound infrastructure investments.

While Arora’s plans offer an enticing option, questions remain about whether the government will prioritise cost reduction or expedite the project to meet projected timelines. Chancellor Rachel Reeves has stated that construction must begin before the next general election, with operations commencing by 2035. This urgency could create challenges for any substantial deviations from the existing planning framework.

The airport expansion debate now looks set to intensify, with competition injecting new possibilities for reshaping the future of Heathrow. The Department for Transport has reiterated that any proposals will be assessed against the government’s stringent legal, carbon, and environmental commitments.