As a relatively unknown junior education minister, Liz Truss set out her ambitions for Heathrow to become a four-runway airport.
“We do need a hub airport in the south-east of England,” she argued. “If you want to have a hub airport, three runways probably isn’t enough. If we’re imaginative about Heathrow, I don’t see why we can’t build four runways there."
Fast-forward ten years and Truss is now the frontrunner in the crunch Tory leadership race – one of two final candidates to replace Boris Johnson, who in stark contrast once vowed to "lie down" in front of bulldozers to stop the construction of a third runway at Britain's leading travel hub.
The leadership battle coincides with rumours of a possible stake sale by Heathrow's Spanish owner Ferrovial, which last year signalled it will cut the airport off from further investment in a stance that was viewed as a major blow to expansion plans.
Potential ownership changes have revived hopes of a third runway among supporters, especially after progress was disrupted by a sharp fall in air travel during the pandemic.
Sathish Sivakumar, an analyst at Citi, says he expects buyers to begin circling Ferrovial with offers of up to £3bn: “It’s still a very lucrative asset despite what the pandemic has done to the recovery. We’re seeing traffic come back stronger than expected .”
But aviation experts warn that plans to build a new runway remain fragile, even if there is "a different political will" or a new club of investors around the corner, while passenger numbers remain below pre-pandemic levels.
Although Heathrow insiders insist the project remains a critical part of its future plans, consultants warn that environmental pressures, lower passenger numbers and investors who will likely want to ensure capacity remains tight could all work against the project.
It comes as the sector remains in flux, having been hit by the pandemic, and once unthinkable changes are happening across Europe.
Last month, senior airline staff were spooked after the Dutch government said a capacity cap would next year be imposed on Amsterdam Airport Schiphol, Europe's third largest, in order to cut pollution and noise. Some fear similar moves could happen in Britain, especially if passenger numbers at Heathrow remain lower than they did pre-pandemic.
"I've always believed in the commercial logic of a third runway – but I see a mountain to be climbed, particularly in these challenging economic times and where the environment has come to the fore," says airline expert John Strickland, who runs JLS Consulting. "Covid has set us back so far in terms of air traffic volumes and we’re in a state of flux in terms of airline business models."
Heathrow bosses have repeatedly insisted that plans are going ahead. Investors were told last year that while demand has fallen temporarily, the airport is confident it will have recovered to pre-pandemic levels by the time a new runway is operational.
Bosses have "carefully considered the risks to expansion" but still see it as a "probable outcome," investors were told again last month.
Figures published on Thursday show 6.3m people travelled through Heathrow in July, almost 20pc less people than the same month in 2019. The airport has imposed a departure limit of 100,000 passengers per day due to a lack of ground handling staff, a decision its chief executive John Holland-Kaye defended on Thursday by saying the limit had helped “deliver improvements to passenger experience” and "passengers are seeing better, more reliable journeys since the introduction of the demand cap".
It has vowed not to lift the restrictions until it hires more ground handlers.
Investors will be keeping a close eye on passenger numbers and any problems facing Heathrow over the coming months, particularly if some are eyeing up Ferrovial's 25pc stake and weighing up approaching the Madrid-based investor, which has backed Heathrow for 16 years. Yet those who swoop in are expected to want to hold back on more funding.
"Whoever buys [Ferrovial’s stake] will want the most return on an investment. They could do that by ensuring capacity is tight," notes Strickland. Heathrow's other investors include the Qatar Investment Authority, which holds a 20pc stake, as well as Caisse de dépôt et placement du Québec, Singapore’s wealth fund GIC and China Investment Corporation.
Despite plenty of change being afoot, debate over a third runway is expected to rumble on for some time. "I don't think there will be any rapid decision to go ahead, we will continue to go through hoops and hurdles even as the dust settles on the pandemic. The environmental challenge is not going to go away," says Strickland.
Climate change concerns have been a major issue since talks about a third runway began and focus on the subject is accelerating amid rising fears about global warming. Rob Barnstone, a campaign coordinator for the No Third Runway Coalition group, says although Truss and Rishi Sunak both backed a Conservative-led vote in 2018 on the expansion they are also "both committed to maintaining the country’s net-zero climate targets," which conflicts with plans for another runway.
Scrutiny into claims about Heathrow's expansion driving economic growth, particularly outside of London, are also likely to re-emerge over the coming months.
The New Economics Foundation argued in 2020 that a third runway would mean the rest of the country would lose £43bn out of their economies as 27,000 jobs move to London and the South East as a result.
“I don’t know how committed the next government will be to levelling up, but nevertheless, the regions will probably be impacted by a new runway,” warns Barnstone.
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