Airlines Decide Who Should Pay for Alert

The Associated Press
Tuesday, August 15, 2006; 12:58 PM

LONDON -- As the immediate security threat at British airports wanes, airlines are beginning to count the multimillion dollar cost of the terrorist alert _ and consider who should pay.

British Airways PLC on Tuesday led a growing campaign against the British Airports Authority, which many carriers claim was ill-prepared for the emergency that led to hundreds of canceled or delayed flights.

A joint compensation claim against BAA, which operates seven airports around Britain including London's Heathrow, Stansted and Gatwick, could run as high as 300 million pounds ($570 million), based on analyst estimates of the airlines' daily losses.

Airlines say BAA was too slow to respond when the government imposed strict security checks on all passengers and a ban on onboard baggage last week after the discovery of a plot to blow up several airplanes on the trans-Atlantic route.

The alert crippled airport operations on Thursday and BAA has struggled to get flight schedules back to normal since then.

Analysts estimate that the crisis could be costing British airlines a combined 50 million pounds ($95 million) a day, putting the total costs at 300 million pounds ($570 million) by the end of Tuesday.

BAA, which was recently acquired by Spanish construction giant Ferrovial SA for 10 billion pounds ($19 billion), called accusations that it lacked adequate plans "neither fair nor accurate."

It pointed out that Heathrow, where much of the criticism has been leveled, was designed to cater to a maximum of 55 million passengers per year, but is currently handling 68 million.

"The fact is that Heathrow, the world's busiest international airport, is at the best of times significantly overstretched because of the difficulties over many years of securing permission to grow capacity at the airport," BAA said in a statement. "The scale and suddenness of the measures imposed last week could not be managed without significant disruption."

The airports operator kept bans on hand luggage in place for an extra day after the government eased the security threat level Monday. In a bid to ease congestion, it also ordered all airlines to cut the number of their departures by between 20 percent and 30 percent each day since the alert, with the threat of losing all their flight slots if they did not.

BAA lifted that requirement Tuesday but British Airways again canceled 20 percent of its flights and said there would be more cancellations Wednesday, blaming the scrapped flights on BAA's inability to cope.

The airline said it was actively considering whether to pursue BAA for compensation.

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