British Airways, part of airline conglomerate International Consolidated Airlines Group (LSE:IAG), is considering shifting all its short-haul operations into a new low-cost subsidiary based at Gatwick Airport, according to reports today.
The airline suspended flights from the airport at the start of the pandemic to use vacant slots at Heathrow but with flights starting to edge back towards pre-pandemic levels, the airline is said to be keen to re-establish its presence in the shorter flight end of the market.
British Airways has traditionally earned much of its revenue from long-haul especially the US to UK routes and has been hit hard by Covid as these flights have almost all been halted by the pandemic.
A subsidiary would allow it to lower its cost base and compete more effectively with dominant European discount carriers such as Ryanair PLC, EasyJet PLC and WizzAir PLC.
A British Airways spokesman told the Wall Street Journal any progress on the new subsidiary will require agreement being reached with the group’s unions.
Earlier today, Gatwick, which is owned by French industrial group Vinci, said it was considering a way to boost capacity at the airport by converting its emergency runaway into a second landing and take-off strip.
The conversion would cost GBP500mln and see the existing northern runway moved 12m sideways and upgraded.
Previous attempts by Gatwick to add a second runway have into fierce local opposition and Communities Against Gatwick Noise Emissions (CAGNE) again condemned the plan.
The expansion “flies in the face of the climate emergency we are all facing” and would one million tonnes of additional carbon on top of Gatwick’s pre-Covid-19 flight figures said the group.
Shares in IAG fell 1% to 161.7p.