Who really owns the airport: airlines, airports and slot wars

Regulators. The UK Civil Aviation Authority (CAA), the European Commission (via EU Slot Regulation 95/93), the US Department of Transportation (DOT), and airport slot coordinators (in Europe, Airport Coordination Limited, ACL). They set the rules for who gets access to scarce runway capacity and referee disputes.

Aircraft lessors and manufacturers (Boeing, Airbus, AerCap). Upstream suppliers. They matter for the competitive dynamic (aircraft delivery delays affect who can grow) but are not central to the slot story itself.

Why slots are the real estate that matters

A "slot" is permission to take off or land at a specific airport at a specific time. At uncongested airports, this is a formality. At "Level 3" coordinated airports (the busiest, capacity-constrained hubs under IATA's Worldwide Slot Guidelines), it is the whole game.

Heathrow has effectively been full since the early 2000s, operating at around 98 percent slot utilization on its two runways, a level widely cited by industry analysts and the airport itself. A third runway has been debated, delayed, and legally challenged for over a decade, most recently around the UK government's 2024-2025 planning reviews. Until (if) it's built, supply is fixed. Demand isn't.

Under the EU/UK "grandfather rights" rule (inherited from EU Regulation 95/93, retained in UK law post-Brexit), an airline that uses a slot at least 80 percent of the time keeps the right to it next season, indefinitely. This is why British Airways and other legacy incumbents hold decades-old slot portfolios at Heathrow that a new entrant simply cannot get by asking nicely. New slots only become available when an airline exits, merges, or gives them up, and the airport itself doesn't get to just sell them to the highest bidder. Airlines trade them, informally at first, now increasingly with regulatory tolerance, in what amounts to a secondary market for a scarce public-adjacent resource.

That's the paradox: the airport owns the physical runway, but the airline effectively owns long-term usage rights. The two are not the same, and that separation is the source of most of the power struggle.

Balance of power: who squeezes whom

Airports vs. legacy carriers. Airports control fees but not access. Slot-holding incumbents like BA at Heathrow (historically holding roughly half of all Heathrow slots) co-govern the airport's commercial fate: if BA scales back, Heathrow's revenue outlook shifts. This is a duopoly-style bargaining relationship, not a landlord-tenant one.

Airports vs. LCCs. Here airports hold more power. Ryanair and easyJet built their models around secondary airports (Stansted instead of Heathrow, Beauvais instead of Charles de Gaulle) precisely because incumbents locked up the primary slots and fees were lower. Airports compete for LCC volume with reduced charges, since LCCs bring passenger throughput (and retail spend) without needing prime slots.

Regulators vs. everyone. Regulators referee slot allocation, cap landing charges at some airports (Heathrow's charges are regulated by the UK CAA under a price-cap regime, reviewed periodically), and intervene in mergers (the EU blocked or reshaped several airline mergers partly over slot concentration concerns, and slot divestitures were a condition of approving some past airline alliance and merger deals). Their power is structural, not commercial. They don't run flights, but they decide the rules everyone else plays under.

Airlines vs. each other. This is where "slot wars" gets literal. When Alitalia (now ITA Airways) or a struggling carrier exits Heathrow, remaining slots don't go to auction; they get allocated through a coordination process where existing large slot-holders and new entrants both apply, with rules nominally favoring competition but historically favoring incumbents.

For a deeper regulatory reference point, see the UK CAA's overview of airport slot rules, which lays out the coordination process in plain terms.

Where the margin actually sits

Contrary to intuition, airport operators often earn better and steadier margins than airlines. Airlines fly on razor-thin net margins (historically low single digits, cyclical, and vulnerable to fuel and demand shocks). Airports, especially those with regulated monopoly-like positions and strong non-aeronautical revenue (retail, parking, real estate), post materially higher margins in normal years. This is a big reason infrastructure funds and pension funds like owning airport equity (ADP, Fraport, and various UK regional airports have had exactly this kind of institutional ownership) while few of them want to own airline equity.

The mechanism: airports monetize scarcity (landing fees, retail concessions on captive passengers) and often benefit from a price-cap regulatory regime that guarantees a return on invested capital, since regulators want to prevent monopoly abuse but still need airports to invest in infrastructure. Airlines, by contrast, operate in a genuinely competitive market layered on top of that fixed, scarce infrastructure. They take the demand risk; airports largely don't.

Challengers and the next fight

Low-cost long-haul entrants (Norse Atlantic, JetBlue's transatlantic push before it retrenched) and Gulf carriers (Emirates, Qatar Airways, Etihad) have added a new axis to the power struggle: carriers backed by state capital competing for slots and traffic rights against privately capitalized legacy players, often triggering "unfair subsidy" disputes (a long-running dispute between US legacy carriers and Gulf carriers over alleged state subsidies is a well-documented example, still periodically resurfacing in aviation trade policy discussions).

Meanwhile, secondary and regional airports are trying to escape commodity status by branding themselves as premium alternatives (London Luton and London City positioningpositioningThe mental space you want your brand to occupy in your target customer's mind relative to alternatives.Voir la définition complète → around convenience rather than scale). This won't dislodge Heathrow's slot value, but it shows every player in this chain trying to create some form of defensible scarcity, because scarcity, not service, is what generates pricing power in this industry.

🎬 [VIDEO: "Why Airport Slots Are So Valuable" - youtube.com - search for recent explainers from aviation analysts (e.g. Skift, CNBC, or Simple Flying) covering Heathrow slot economics and the grandfather rights system]

Key Takeaways

• Airport slots, not aircraft, are often the scarce and valuable asset in aviation; at congested hubs like Heathrow, "grandfather rights" let incumbent airlines hold usage rights indefinitely, creating a de facto secondary market worth far more than the flights themselves.
• Power is split three ways: airports own physical infrastructure and set fees, legacy airlines control historical slot portfolios, and regulators (CAA, European Commission, DOT) referee access and pricing, with no single party fully in control.
• Airports frequently earn steadier, higher margins than airlines because they monetize fixed scarcity and often operate under return-guaranteeing price-cap regulation, while airlines absorb the competitive and demand risk.
• Low-cost carriers historically avoided the slot war altogether by building volume at secondary airports with lower fees, a structurally different competitive strategy from fighting incumbents for primary slots.
• Watch for slot divestitures in mergers and state-subsidized long-haul entrants as the two live fronts most likely to reshape this balance of power in the next few years.