UK air traffic falls the most in 7 years as economy slows

BAA Limited, owner of London's Heathrow, Gatwick and Stansted airports, said air traffic in the UK fell the most in seven years as the contracting economy dampened demand for air travel.

Passenger numbers at BAA's seven airports in Britain dropped for an eighth straight month, tumbling 8.9 per cent to 9.8 million travellers in November from 10.8 million a year earlier, the London-based company said Friday in a statement.

The decline was the biggest since November 2001, when people avoided flying following the September 11 attacks in the US.

The International Air Transport Association, the airline industry's main trade organisation, estimates that international and domestic passenger traffic will decline 3 per cent next year, the first drop since 2001.

Carriers including British Airways Plc, Heathrow's biggest user, are cutting capacity as they struggle with waning demand.

"Airport traffic trends are set to get worse as the economic crisis bites and airline capacity cuts are implemented," Andrew Fitchie, a London-based analyst at Collins Stewart, said in a research report. "For this reason, we believe the outlook will deteriorate at BAA."

Grupo Ferrovial SA, the Spanish construction company that owns BAA, fell as much as 8.7 per cent to 20.45 euros (Dh75.1) on Friday.

The stock has fallen 57 per cent this year, valuing the Madrid based builder at 2.91 billion euros (10.7 billion).

Fraport AG's Frankfurt airport, Europe's third-busiest, and Flughafen Wien AG's Vienna International airport both reported traffic declines in November that were the biggest since December 2001.

National Air Traffic Services, the agency overseeing UK airspace, said that the number of flights entering, leaving or flying over the country fell 9.8 per cent from a year earlier to 169,539 in November.
BAA's traffic declines were led by its three London airports.

Source: Bloomberg

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