Michael Race
Business reporter, BBC News
Heathrow Airport is set to confirm a multi-billion pound investment plan to expand two of its terminals ahead of submitting proposals for a third runway to the government this summer.
On Wednesday, chief executive Thomas Woldbye will unveil funding to increase capacity at terminals two and five, reconfigure the airfield and improve bus connections.
The plans, which will be paid for with private cash, come after Chancellor Rachel Reeves backed a third runway at the UK’s largest airport last month as part of efforts to grow the UK economy.
During his speech at British Steel’s Scunthorpe plant, Mr Woldbye will also sign a pact to use of the company’s steel to build new infrastructure.
The commitment to use UK-made steel comes amid concern in the industry over the impact of tariffs being placed on imports of the metal to the US by President Donald Trump.
The US import taxes could lead to excess steel being offloaded to the UK at cheaper prices, with the potential to undercut domestic businesses.
While the detailed plans for a third runway at the UK’s largest airport, are yet to be finalised, the construction of terminal five, which opened in 2008, required some 80,000 tonnes of steel.
On Wednesday, Mr Woldbye will outline the expansion plan ahead of the new runway, which will see upgrades to terminal buildings to “enhance passenger experience and improve resilience and sustainability”.
“This privately funded programme will upgrade existing infrastructure while laying the groundwork for a third runway, boosting UK investment and economic growth, with tangible benefits felt this year,” he will say.
The chancellor has said expansion at Heathrow is “badly needed” and could create 100,000 jobs.
Zengwei An, chief executive of British Steel – which has the only facility in the country to make primary steel – said its workers in Scunthorpe and Teeside had a “distinguished history of supplying world-class products into projects like Heathrow’s expansion”.
Gareth Stace, director-general of the steel industry body UK Steel, added that Heathrow committing to using domestically-made steel was a “major vote of confidence in UK steelmaking and British businesses full stop”.
The expansion of Heathrow is highly controversial and faces opposition from environmental groups, some politicians, local authorities and nearby residents.
Some have argued that it will take much longer than a decade for a third runway to become reality.
A formal planning process has to take place, which could take between 18 months and two years. Any judicial review of the plan could take another year and a half, while actually building it could take about seven years.
Reeves has said she wants to see “spades in the ground” before 2029 and planes to start using the runway by 2035, but Mr Woldbye has previously warned the project would take years and need “Churchillian resolve” to deliver.
In his speech, the Heathrow boss will say the airport’s expansion plans will be carried out with “strict environmental safeguards”
“This project can only go ahead if we meet the rules on noise, air quality and carbon… it’s as simple as that,” he will add.
“I want to assure you that we are committed to listening and working with our local communities to provide them with the certainty they deserve, ending years of doubt.”
Heathrow currently handles £200bn worth of trade a year and provides a key avenue for exports, particularly for small and medium-sized businesses.
But Heathrow’s infrastructure is strained: last year, a record 83.9 million passengers passed through its terminals with its two runways handling around 1,300 landings and take-offs every day.
Flights from the airport are currently capped at a maximum of 480,000 per year and in practical terms it has reached that limit. A third runway would potentially increase the number of flights permitted to 720,000.
