The UK government has moved forward with plans to expand Heathrow Airport by adding a third runway, a decision that has been in the works for nearly two decades. The announcement was made today by Chancellor Rachael Reeves, who emphasized the potential for growth that the expansion would bring.
Alun Cornish, Managing Director for Ramps and Gateways at FedEx Europe, welcomed the expansion, calling it a positive step for UK growth. He stressed the importance of incorporating cargo capacity into the expansion plans to support the efficient movement of goods, which he believes is vital for the country’s economic development.
Cornish also highlighted the significance of trade in the UK economy, noting that the UK remains a leading exporter to both the EU and other global markets. He stated that increased capacity within UK supply chains would be beneficial for future economic growth.
The Chancellor’s announcement also included a call for proposals from developers, with a plan for a “full assessment” to ensure the project offers value for money and aligns with legal, environmental, and climate objectives. Provisions for financing any related service transport costs are expected to come from private funding.
While the announcement was met with optimism, some industry leaders, such as Steve Parker, Director General of the British International Freight Association (BIFA), expressed concerns over the timeline of the project. Parker indicated that BIFA’s members are ready to collaborate with airport authorities to streamline services, particularly with respect to cargo capabilities. He pointed out that redevelopment of the airport’s cargo estate is planned for the next two to three years, focusing on modernization and improving cargo flows.
David Wells, CEO of Logistics UK, welcomed the decision but emphasized the importance of swift planning and delivery of projects. He noted that the UK’s logistics capabilities have declined in recent years, pointing to a drop in the World Bank’s Logistics Productivity Index from fourth to nineteenth place. He urged the government to make logistics a priority in its Industrial Strategy Council to ensure the sector can continue to drive economic growth.
Wells also pointed out that the success of Heathrow’s expansion is closely tied to the development of the £9bn Lower Thames Crossing tunnel, which is expected to alleviate congestion and improve connectivity for exports from key ports such as Dover, Felixstowe, and Harwich.
Andrew Baxter, CEO of Europa Worldwide, highlighted the logistical inefficiencies caused by congestion at Dartford, estimating a £200m annual loss in productivity. He believes the Lower Thames Crossing will significantly reduce delays and improve trading opportunities with both UK and European markets, supporting the government’s economic growth objectives.
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