Airlines are wary over NATS plan

City A.M. Reporter
AIRLINES do not want the government to reduce its dominant stake in the country’s air-traffic control system below 25 per cent, it is understood.

The government is considering reducing its 49 per cent stake in the air-traffic control system NATS as part of measures to pay off the ballooning public debt.

But the Airline Group, a consortium of airlines which owns 42 per cent of NATS, is understood to think that a reduced government stake would weaken national influence over European Union air traffic policy.

“It would be highly damaging if we were left on the sidelines to watch while others, notably France, Germany and Spain, decided the future of the air traffic control industry,” Airline Group chairman Peter Read wrote in a letter to transport secretary Philip Hammond.

The government will decide by the time of its 23 March budget whether to sell the stake.

Potential bidders for the stake include services company Serco, the owner of London’s Gatwick airport Global Infrastructure Partners and US defence company Lockheed Martin.

Airlines which own a stake in NATS include British Airways, Virgin, Lufthansa-owned bmi, Monarch Airlines, Thomas Cook and Tui Travel.

•Rolls Royce is understood to be discussing a deal with Qantas that would see the Australian airline get free servicing of its engines rather than cash compensation for last November’s engine troubles.

The engine maker still expects to book a £50m-£60m one-off change for the engine failure that forced Qantas to ground its Airbus A380 fleet.