British Airways’ parent company has described hotel tycoon Surinder Arora’s Heathrow expansion as “credible”.
International Airlines Group (IAG) chief executive Luis Gallego said “competition is good to improve things”.
Mr Arora and Heathrow’s owners submitted rival third runway plans to the Government this week.
The former is proposing to build a shorter, 2,800-metre (9,186ft) runway so the M25 motorway does not need to be diverted.
His Arora Group company claims this would result in “reduced risk” and avoid “spiralling cost”.
In contrast, Heathrow is seeking permission for a full length, 3,500-metre (11,482ft) runway.
It says a short runway would reduce operational flexibility, and still require either additional capacity on the M25 or alternative rail schemes.
British Airways is the largest airline operating at Heathrow.
Mr Gallego said: “We need to work closely with both parties to understand better what they have proposed because the proposals are not comparable.”
He said they are “different solutions that we need to analyse”.
Mr Gallego added: “We have two credible proposals.
“We always think that competition is good to improve things, and we have seen that in commercial aviation in the past.”
Mr Gallego continued: “We need to work with both of them. We don’t have any preference.
“We only want to build something affordable that’ll allow everybody to have more passengers, but they don’t have to pay the level they are paying today.”
He said a change in Heathrow’s regulatory model is required if a third runway is to be built, as “this level of investment is not possible with the current one”.
Heathrow said its runway and airfield plan would be privately funded at a cost of £21 billion.
Its total plan, including terminals and supporting infrastructure, would be expected to cost £49 billion.
Mr Arora’s plan has a cost estimate of under £25 billion, not including the redevelopment of the airport’s existing central area.
Transport Secretary Heidi Alexander will consider the third runway plans over the summer so that a review of the Airports National Policy Statement (ANPS) can begin later this year.
The ANPS will provide the basis for decision-making on any development consent order application.
Chancellor Rachel Reeves said it is “essential” the UK increases its airport capacity “to ensure the things that we make here in Britain can be exported and sold throughout the world”.
Asked about the proposals to expand Heathrow during a visit to Scotland, she told the PA news agency: “Two of the biggest exports from Heathrow are Scottish salmon and Scotch whisky, so this is good for the whole United Kingdom.”
She added: “This Government are absolutely determined to seize the opportunities that come from being an open trading economy.”
Pressed on Mayor of London Sir Sadiq Khan’s opposition to the expansion, Ms Reeves said: “These are decisions the national government make, and this Labour Government backs Heathrow expansion.”
