Heathrow Hub says, to match Heathrow’s offer, it would cut price of its runway scheme by £2 billion

The backers of the Heathrow Hub scheme, to lengthen Heathrow’s northern runway towards the west, have now said they could cut the price of their scheme by £2 million. This offer comes just days after Heathrow’s Chairman, Lord Deighton, said their north west runway scheme could be cut by up to £3 billion. The Heathrow north-west runway scheme is expected to cost £17.5 billion (or £14.5 billion with the cheaper scheme) – and the Heathrow Hub scheme is expected to cost £12 billion according to their website (or £10 billion with the cheaper scheme). But Heathrow Hub are now telling the press that their scheme could cost £7.5 million. Their Factsheet of November 2014 said the cost of the runway itself would be £9.2 billion, with £2.8 billion for surface access improvements.  In November 2013 they anticipated the cost of diverting the M25 for the runway would be £0.7 billion. Heathrow Hub also proudly say there would be no cost to the public.  In reality, Transport for London said (February 2015) of a larger Heathrow, not differentiating between the two schemes: “Our assessment estimated that in order for a fully developed Heathrow (149 mppa) to achieve all of the above surface access objectives in the long term (2040-50), costs would be around £15-20 billion*. The Heathrow Hub scheme is privately funded, and hopes to license its scheme to Heathrow airport for up to £5m a year for 20 years, if successful.


The Heathrow Hub website says: 


“Minimising the cost of airport expansion and protecting the UK’s economic competitiveness are key.  Heathrow Hub is largely privately funded with a significantly lower capital cost than other options. We estimate that the cost of extending the northern runway and completing the road and rail infrastructure and terminal construction (including land and compensation) to be around £12bn. Our proposals would be phased, allowing capacity to be developed as demand increases.” http://www.heathrowhub.com/our-proposal.aspx


There is a page for Heathrow Hub past documents  http://www.heathrowhub.com/documents.aspx


Heathrow Hub’s “revised” brochure August 2016 does not give an overall figure for the cost of their scheme, but states:

“Quicker, and easier to construct    The first phase, costing £3.7bn and providing
approximately 70,000 additional movements, could be completed as soon as 2023.

Cheaper  We estimate that our scheme is up to £6bn cheaper than Heathrow Airport’s 3rd runway.  This leaves financial headroom to pay for  surface access upgrades, potentially saving  the taxpayer some £5bn.”

They say (without giving any figure for the amount of compensation) that:

“HHL are able to offer a similar extended voluntary purchase area to the west of Heathrow , encompassing 4,200 households (source CACI), 24% less than NWR.”  [Same offer at Heathrow NW runway, of 25% over market value, though whether blighted or non-blighted is not mentioned by Heathrow Hub, and legal fees and stamp duty. No mention of reasonable moving expenses. AW note]

Heathrow 2 schems home compensation area 


The Heathrow Hub response to the Airports Commission  on 10.9.2015    said:

“The Airports Commission estimates that LHR‐ENR is c £3bn cheaper than LHR‐NWR, whilst our assessment shows the difference is likely to be more than £6bn.”




in their Factsheet of November 2014 they say: 

Cost of the runway extension is £9.2 billion. Cost of all surface access improvements £2.8 billion.

Our solution minimises impact on local communities and enables generous compensation packages as a result of its lower overall cost.  [So it is not clear if they see this compensation as included in the £12 billion, or an additional expense on top of it.  It is not included in the above breakdown. ?  AW comment].


The Heathrow Hub submission to the Airports Commission in July 2013 contained this table (compensation does not appear to be included):

Heathrow Hub costs July 2013

TfL Planning TfL response to questions from Zac Goldsmith MP, Chair of the All Party Parliamentary Group on Heathrow and the Wider Economy.

Heathrow airport expansion proposal – surface access.   February 2015 :

“Our assessment estimated that in order for a fully developed Heathrow (149mppa) to achieve all of the above surface access objectives in the long term (2040-50), costs would be around £15-20bn*. This represents delivering a long-term surface access proposition with an ‘optimal’ level of service, maximum sustainable mode share and little impact on future non-airport users of the transport network. It included a number of new rail connections to key airport trip generators in SE England, including southwest and central London, as well as some highway access enhancement (*cost estimates 2014 prices, did not include maintenance and OPEX).”  Link  


‘Heathrow Hub’ backers cut costs at eleventh hour

The group behind a scheme to lengthen one of Heathrow’s runways are reported to have offered to slash the cost by £2 billion in a final effort to win approval from the government.

Heathrow Hub has proposed stretching the northern run­way to 4.2 miles and splitting it in two so that aircraft can take off and land simultaneously. [ie. making two runways, and planes landing on one, taking off from the other].  The project could be delivered for £7.5 billion, the privately funded group now says.

It is vying with two other plans to boost airport capacity in south-east England – a third runway at Heathrow and a second runway at Gatwick.

Last weekend Heathrow offered to cut £3 billion from its £16.8 billion plan for a third runway.

The airport’s chairman Lord Deighton suggested it could scrap proposals to divert the M25 through a tunnel beneath the runway, build cheaper terminal buildings and axe a passenger rail system.

Deighton’s eleventh-hour offer reflected repeated criticism from Heathrow’s biggest customer, British Airways.

Willie Walsh, chief executive of BA owner International Airlines Group, has described the scheme as “gold-plated facilities to fleece airlines and their customers”.

Heathrow Hub, conceived by former BA Concorde pilot Jock Lowe and backed by the Marshall Wace hedge fund manager Anthony Clake, hopes to license its scheme to Heathrow for up to £5m a year for 20 years.

It estimates it will have spent up to £10 million on the project, largely on employing consultants.  Clake has pledged to hand any profit to charity.

Lowe said the cost-cutting modifications would also entail a more basic terminal and scrapping a rail system, the Sunday Times reported.

He admitted they would “lower the quality” of the Hub project for passengers, but said it would be “simpler, cheaper, quicker and easier” than building a third runway.


See earlier:

Times reports that Heathrow plans to offer to cut costs and build runway scheme faster

The Times reports that it has learned how Heathrow is planning to cut up to £3 billion (out of about £17.6 billion) from its plans for a 3rd runway, in order to persuade Theresa May and the Cabinet that the runway could be delivered – and delivered a year earlier. Revised plans include potentially scrapping plans to tunnel the M25 under the 3rd runway, not building a transit system to carry passengers around the airport (using buses instead) and smaller terminal buildings. The aim is not only to get the runway working by 2024 but also -with reduced costs – keeping charges for passengers a bit lower. The Airports Commission estimated the cost per passenger would need to rise from £20 now to £29. Airlines like British Airways are not prepared to pay such high costs, and especially not before the runway opens. BA’s Willie Walsh has described Heathrow’s runway plans as “gold-plated”. The Times expects that Heathrow will announce its new “cheaper, faster” plans by the end of September. There is no mention of the “Heathrow Hub” option of extending the northern runway – a slightly cheaper scheme than the airport’s preferred new north west runway. There is no clarity on quite what Heathrow plans for the M25, if they cannot afford to tunnel all 14 lanes (at least £ 5 billion). Lord Deighton said it might be “diverted” or have “some form of bridge.”

Click here to view full story…

Tania Mathias MP calls for Grayling to step in over proposed £3 billion cuts to Heathrow plan – re-consultation necessary?

Transport Secretary Chris Grayling has been asked by Dr Tania Mathias MP to intervene on Heathrow’s £3 billion cost-cutting proposals it announced last week. In order to cut costs, and perhaps get a runway built faster, Heathrow’s Chairman Lord Deighton suggested that changes to plans would be made – though nothing has been put forward yet, but they might be in the next weeks. The cuts would mean scrapping plans to (expensively) tunnel the 14 lane M25 under the runway, and a transit rail system around the airport. Conservative MP Tania Mathias, whose Twickenham constituency is under Heathrow flight paths, said the new plan had caused local people “considerable anxiety.” She has written to the Secretary of State for Transport, asking him to demand the plan goes back out to public consultation and scrutiny by the Airports Commission (though that has been disbanded). Dr Mathias also wants Chris Grayling to make public any official talks on the late changes, between the airport and government departments. Richmond Park MP Zac Goldsmith also wrote to Lord Deighton that the revised plan would cause Londoners “more environmental misery”. The changes to the roads are not clear, and cutting cost could lead to gridlock on the busiest stretch of the M25. The DfT just said the Government “will continue to consider the commission’s evidence.”

Click here to view full story…