ABOUT £220million was wiped off the value of British Airways yesterday as the airline cancelled hundreds of flights.

The company’s share price plunged 5 per cent to 370¼p as investors became worried by the long-term costs of this latest security threat.

Airlines may have to pay for even tighter security and each terror alert temporarily puts passengers off flying.

The London stock market also suffered in early trading, with £26billion wiped off the value of shares at one stage. The FTSE 100 later rallied to close 37.1 lower at 5,823.4. The shutdown at Heathrow could cost BA £40 million as it refunds tickets and arranges new flights for stranded passengers.

It might take a week for the airline to recover from yesterday’s disruption because aircraft and flight crews have been stranded at foreign airports. A spokeswoman for BA said: “It is too early for us to consider the costs. We are just trying to make sure all our passengers get their money back or are put on other flights.”

Other airlines experienced significant share price losses because of the terror alert.

EasyJet, the budget airline, cancelled 300 flights and its share price fell 2 per cent to 414p — wiping £34 million off its value.

A spokesman said: “We are trying to minimise disruption but until the Department for Transport restores normal operations we have to comply with their requirements.”

Ryanair, the Dublin-based budget airline, lost €87 million (£58million) of its value.

BA’s share price was hardest hit because the foiled attack is thought to have targeted a transatlantic route, the most profitable part of its business.

August is traditionally its busiest month, with an estimated 190,000 passengers and 1,250 aircraft departing from Heathrow daily.

Airlines have only recently recovered from the crisis of 9/11, when many people later refused to fly. BA reported last week that profits had risen 20 per cent to £211million during the three months to the end of June. It is also carrying a record number of passengers on each aircraft.

Gert Zonneveld, aviation analyst with Panmure Gordon, said: “There always seems to be something these airlines have to overcome. They have had a difficult time.”

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