John Holland-Kaye to step down from his role as Heathrow CEO
Heathrow’s chief executive, John Holland-Kaye, has announced his resignation and will leave his £1.5m role at some point in 2023 after 9 years in charge. He has been trying to get a 3rd runway for years, so far without success – and with a new range of problems that make it unlikely. Holland-Kaye took over in 2014, being promoted from development director when he oversaw the building of Terminal 2. Speaking at an aviation conference earlier this week, Holland-Kaye said that more details of renewed plans for a possible 3rd runway would be unveiled later this year. He has overseen several years of rows with the Heathrow regulator, the CAA, about landing charges – with opposition from airlines to any increases. There is speculation about who might be the next CEO. One possibility is Emma Gilthorpe, the chief operations officer, who was previously a director overseeing strategy and planning, including the expansion plans. Chief financial officer Javier Echafe is also a possible contender. Holland-Kaye will remain in post to ensure a smooth handover later in 2023
Heathrow airport boss quits after turbulent year
CEO John Holland-Kaye to resign after nine years at helm amid public souring of ties with airlines
By Gwyn Topham, Transport correspondent (Guardian) @GwynTopham
Thu 2 Feb 2023
Heathrow’s chief executive has announced his resignation after a difficult year for Britain’s biggest airport. John Holland-Kaye will leave his £1.5m role at some point in 2023 after nine years in charge.
His tenure included the long battle to win the right to expand, with the third runway still officially back on the table after court battles and lukewarm government approval.
The airport has suffered billions in losses during the Covid pandemic and has had a chequered recovery, briefly losing its spot as Europe’s busiest airport and coming in for heavy criticism from its main airline customers for imposing a cap on passengers in the peak summer season.
Heathrow’s chair, Paul Deighton, said Holland-Kaye had been “an extraordinary leader of Heathrow”, adding: “During the past nine years, he has worked tirelessly and collaboratively with shareholders, ministers, airlines and other stakeholders to ensure the country can be proud of its front door.”
Holland-Kaye took over in 2014, being promoted from development director when he oversaw the building of Terminal 2. He was credited with improving customer satisfaction, while his idiosyncratic leadership included making workforce “mojo” one of the airport’s official four strategic priorities.
A smooth public operator, he won government backing for a third runway to be built, despite widespread opposition from environmental groups. However, a new government, judicial reviews, falling passenger numbers during the pandemic and concerns about investment levels stalled the project.
Heathrow still hopes to expands its capacity by around 50% by building the runway, raising the prospect of more than 240,000 additional flights a year over London. Speaking at an aviation conference earlier this week, Holland-Kaye said that more details of renewed plans for the controversial plan would be unveiled later this year.
Meanwhile, relationships with some major airlines soured in a blame game for the turbulent 2022 summer, as passenger demand soared for international travel after the pandemic. Emirates criticised Holland-Kaye and initially refused to comply with Heathrow’s capacity limits in the summer, amid rows over who was responsible for the staffing shortages that caused cancellations and delays in 2022.
Holland-Kaye will also be stepping down after a bitter row over landing charges, with old frenemies such as Iata boss Willie Walsh – ex-CEO of British Airways’ owner IAG – accusing him of “gouging” airlines. A final decision over the level of charges will be confirmed by the regulator, the UK CAA, in March.
Heathrow’s board has started looking for his successor. Leading internal candidates are Emma Gilthorpe, the chief operations officer, who was previously a director overseeing strategy and planning, including the expansion of the airport. Chief financial officer Javier Echafe is also a possible contender, with Madrid-based Ferrovial remaining the largest single shareholder.
Holland-Kaye will remain in post to ensure a smooth handover later in 2023
Boss leaves with Heathrow’s future still in the air
John Holland-Kaye’s tenure at Heathrow has been blighted by rows over a third runway, post-Covid staff shortages and how much it should be allowed to charge airlines to use runways
Robert Lea (The Times)
Heathrow is looking for a new chief executive after the announcement that John Holland-Kaye is to leave after nine years running one of the busiest airports in the world.
Holland-Kaye, 57, who joined Heathrow in 2009 as its commercial officer having previously been in housebuilding, had “informed the board of his intention to stand down as chief executive during 2023”, the company said.
His legacy is manifold, but the question that has hung over the airport for years — whether it will get its third runway — remains unanswered. Public opinion has swayed, government support has jack-knifed, legal opinions have differed and 17 years after the proposal was formally put forward the runway is no nearer to being cleared for take-off.
Lord Deighton, the chairman of Heathrow, was generous yesterday, calling Holland-Kaye “an extraordinary leader”. He added: “During the past nine years, he has worked tirelessly and collaboratively with shareholders, ministers, airlines and other stakeholders to ensure the country can be proud of its ‘front door’.”
Yet the outgoing airport boss has antagonised prime ministers and ministers, the regulator, airlines and the travelling public. What challenges will his successor have to deal with?
The third runway could yet be revived. A substantial blockage has been Boris Johnson, who as mayor of London and later as MP for Uxbridge and South Ruislip, Heathrow’s neighbours, said he would lie down in front of the bulldozers rather than see it built, a sentiment he repeated when he was prime minister. Sadiq Khan, the present mayor, and a host of London boroughs also oppose the plan.
Though Heathrow won a long legal battle right up to the Supreme Court, it will need to return to its financial costings and its climate change impact calculations before it gets into the political, societal and planning arguments again.
In short, it still needs to persuade the country that Britain needs an airport capable of carrying 135 million passengers when there is spare capacity elsewhere, and also to explain to a million or two of its neighbours that the disruption will be worth it.
Service levels for airlines and passengers have been a long-running saga. Holland-Kaye drew personal criticism over Heathrow’s lack of readiness to swing back into action after pandemic lockdowns. Up to 20,000 staff short when the skies reopened, Holland-Kaye reintroduced the concept of “Heathrow hassle” into the lexicon as operations descended into chaos.
His successor will be charged with repairing not only Heathrow’s reputation after a trying few years but also recruiting sufficient staff numbers to restore operational capability and profitability.
The latest available data for the Christmas trading period showed the airport was still at 12 per cent below its capacity of 80 million passengers a year. That included a worrying decline in domestic passengers, who have been eschewing a changeover at Heathrow to fly to other western European capitals for their global connections.
Holland-Kaye’s tenure has been blighted further in recent times by rows over how much the airport should be allowed to charge its customer airlines to use its runways and terminals.
When the Civil Aviation Authority looked like it was going to be lenient toward the airlines, Holland-Kaye told the regulator that it didn’t know what it was doing and should go and run its sums again.
Holland-Kaye was accused by Willie Walsh — the former boss of British Airways, Heathrow’s biggest tenant, and latterly head of the International Air Transport Association, the global airlines body — of “gouging” the consumer in his attempt to raise airline charges which would in turn be passed on in higher passenger fares.
Paul McGuinness, chairman of the No 3rd Runway Coalition, said: “Heathrow’s landing fees have long been the highest in the world and Holland-Kaye’s recent efforts to raise them yet higher has led to conflict not only with its airline customers but also the regulator, who sets these rates according to the value of the airport’s asset base.
“Hence the airport’s motivation to seek expansion, despite already being the world’s most disruptive by dint of geographic location.”
Financial performance will be in the in-tray of Holland-Kaye’s successor, too. For the first nine months of 2022, Heathrow racked up losses of £442 million on top of the £2 billion of losses in the previous two years. Its revenues of £2.1 billion are down 9 per cent on pre-pandemic levels, a number that would be far worse after inflation.
There will also be the need to address the short and long-term demands from political and environmental lobbies of delivering net zero in one of the most emission-producing industries, where the alternatives to kerosene to fly 350-seat aircraft across the Atlantic are technologies that have yet to be developed.
Heathrow’s boss may not be the only thing to change at the key airport. The end of Holland-Kaye’s tenure follows speculation that Ferrovial, the Spanish construction company that has been Heathrow’s largest shareholder since the acquisition of the old BAA in 2006, wants to sell, or at least reduce, its 25 per cent stake. Other big shareholders include the sovereign wealth funds of Qatar, with 20 per cent, and China, with 10 per cent. Britain’s lecturers own 10 per cent through their Universities Superannuation Scheme.
Virgin Atlantic has eyes on extra territory
Virgin Atlantic has bought four pairs of take-off and landing slots at Heathrow as the airline prepares to add more routes to the United States and Asia.
One slot pair has been acquired from Aeroflot, the sanctioned Russian carrier, while the others are from KLM, the Dutch airline.
Together the slots could be worth tens of millions of pounds, experts said. They take Virgin Atlantic’s total slot pairs at the London hub to 32 as it prepares to expand its fleet with new fuel-efficient jets.
Several new routes are under consideration. Shai Weiss, 54, the chief executive, said: “The cash from 2022 is going into the growth of Virgin Atlantic.”
Founded by Sir Richard Branson, 72, in 1984 with one aircraft, Virgin Atlantic now flies to dozens of destinations, with key routes to America, the Caribbean and Asia. It remains majority-owned by Branson’s Virgin Group, with Delta Air Lines, the American company, owning the other 49 per cent.
Yesterday, the airline announced that daily passenger and cargo lights from London Heathrow to Shanghai would return in May for the first time since December 23, 2020, after the Covid-19 pandemic.
The airline, which is due to join the SkyTeam alliance within weeks, is also looking at new locations where it can tap links with partners. Codeshares could follow with more of SkyTeam’s 18 members, which include airlines in South Korea, Vietnam, China and Saudi Arabia. The US and the Caribbean, which account for about 70 per cent of Virgin’s business, will remain its primary focus.
Virgin Atlantic will continue to have Heathrow as its sole hub for the foreseeable future. It shut operations at Gatwick during the pandemic.
Weiss was critical of Heathrow for its high landing charges, which are about to go up further. He said: “The most expensive airport in the world is about to double its charges, without doubling service. We have been fighting this with colleagues in aviation. They should do a better job.” He added that Terminal 3, where Virgin was based, was in need of modernisation.
John Holland-Kaye takes over from Colin Matthews as Heathrow CEO on 1st July
Heathrow Airport has confirmed John Holland-Kaye, its development director, will take over as chief executive on 1st July from Colin Matthews, who is leaving the company after six years in the job. Mr Holland-Kaye, aged 49, has taken an increasingly prominent role over the past year in Heathrow’s campaign for a 3rd runway. He has also been overseeing Heathrow’s new Terminal 2 building, which will open to passengers next month. He commented: “My aspiration is to improve Heathrow as much in the next five years as we have in the last five years.” Mr Holland-Kaye’s main task will be to persuade policymakers that a third Heathrow runway is politically deliverable as the airport competes against its rival, Gatwick,to get a new runway. He must know that he’ll have a real prospect of a knighthood if he gets the runway. Details of their runway submission to the Airports Commission are due to be publicised on 13th May.