Heathrow rival could lead expansion, watchdog says

Heathrow rival could lead expansion, watchdog says27 minutes agoShareSaveAdd as preferred on GoogleKaty AustinTransport correspondentReutersHeathrow Airport could be forced to allow rival firms to bid to build its third runway and new terminal, under proposals by the aviation watchdog aimed at keeping a cap on construction costs.It is one of several regulatory changes being considered by the Civil Aviation Authority (CAA) if Heathrow expands, to "better serve the interests of consumers".It follows concerns that Heathrow's £33bn development plan could push up costs for airlines, businesses and consumers.Heathrow Airport Limited (HAL) said it welcomed reforms that improved efficiency but warned against policies that could "undermine" its plans or delay economic growth.Businesses have been calling for a review of the regulations, claiming the current model makes Heathrow the most expensive airport in the world.The CAA said it was looking at four potential changes to how HAL is governed.They include tighter control over its spending and competitive tendering elements of the expansion. 'Direct competition with Heathrow'Another proposal would allow an alternative developer to compete to design, finance, build and operate a new terminal.Under this scenario, the CAA says, the developer could "directly provide services to airlines and recover its revenues from them, in direct competition with Heathrow Airport Limited".This option would depend on a change in government policy regarding airport expansion.In November, the government announced it preferred plans put forward by HAL over those proposed by a rival firm - hotel chain the Arora Group.Heathrow proposed a new 2.2-mile (3.5km) runway, which would require a new road tunnel under the airport and moving a section of the M25.Arora's alternative plan was for a shorter runway at a lower cost, and did not require altering the M25.The CAA will now consult on its shortlist of pot...