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Airline Traffic Still Declining – British Airways To Cut Capacity

July 4, 2009 By Chuck

Recall the article I wrote on June 16 ‘Travel The World For One Month Free‘ where British Airways asked employees if they would work 4 weeks without pay. As air travel passenger loads continue to decline worldwide British Airways is now having to go one step further.

LONDON — U.K. flag carrier British Airways PLC Friday reported another month of annual declines in passenger traffic, prompting the company to further reduce summer and winter capacity.

The company also said it expects delays in deliveries of A380 aircraft and that it plans to shed the equivalent of up to 3,700 jobs this financial year.

British Airways said it will reduce capacity from April to October by 3.5%, compared with the planned 2.5%, and will cut its winter schedule by 5%, originally planned as a 4% reduction.

In addition, it said it expects a five-month delay in the delivery of its first six Airbus A380 aircraft, due in 2012. The delivery of the remaining six A380s will be delayed by two years, arriving in 2016.

The company said it expects capital expenditure to be down to £580 million ($951 million) for the financial year ending March 31, 2010, from its original £725 million target.

Traffic measured in revenue passenger kilometers, or RPKs, in June fell 3.8% from a year earlier to 9.93 billion RPKs, with total passenger numbers down 4.9% at 2.9 million. Premium traffic dropped 14.9% , with non-premium traffic off by 1.3%, BA said.

BA’s passenger load factor, an indicator of how many seats an airline fills with paying passengers, fell 1.8 percentage points to 79.6%. (Source: WSJ)

Other Recent Airline traffic reports:

Qantas Airways Ltd: May passenger traffic -2.8% y/y

Grupo Ferrovial, S.A.: Updates 5-month traffic trends: Heathrow -4% y/y, Gatwick -10.3% y/y, Stansted -15.1% y/y

IATA: May International Air Passenger Traffic -9.3% y/y, Air Freight Traffic -17.4% y/y- May airline passenger load factor was 71.2% v 74.5% y/y
- May airline passenger capacity was cut by -5%

McCarren Intl Airport (Las Vegas) passenger traffic in May fell -11.5% y/y

- compares to a 5.9% y/y decline in April.

- US Airways traffic -30.6% y/y
- United Airlines traffic -16.6% y/y
- Southwest Airlines -4.6% y/y
- American Airlines +3.5% y/y

China Eastern Airlines Reports May load factor 60.8% v 62.1% m/m
- Passengers 3.6M v 3.8M m/m
- Cargo 75.4K tons v 77K m/m
- Revenue Passenger Kilometers 4.8B v 5.2B m/m
Air New Zealand Reports May passenger numbers -9.9% y/y
Singapore Airlines Reports May Passenger Load Factor 66.9% v 74.7% y/y
Cathay Pacific Airways Reports May Passenger Load Factor 76.0% v 77.6% y/y
Lufthansa AG Reports May passenger load factor 74.2% v 78.6% y/y
- May freight/post falls 10% y/y
- May passenger volume -5.1% y/y
Iberia Airlines de Espana SA Update: Reports May load factor 78% v 79.5% y/y
- Passenger traffic in May -11.4% y/y
Grupo Aeroportuario Reports May Passenger traffic -39.7% y/y
. Domestic traffic -37.6% y/y
- International traffic -52.7% y/y
SAS Reports May load factor 71.5% v 72.7% y/y

- Passenger traffic -18.1% y/y

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Travel The World For One Month Free!

June 16, 2009 By Chuck

That’s right, but it only applies to management at British Airways. You see, British Airways is asking their employees to work with no salary for up to one month. The employees would continue to work as normal, traveling around the world handing out drinks and boxed up food but would be doing it without any salary.

LONDON — British Airways PLC is urging staff to work periods unpaid as it increases its efforts to conserve cash.

The U.K. flag carrier is offering staff one-week blocks of unpaid leave or unpaid work, with salary deductions spread over three months to six months where possible, it said in the latest edition of its in-house newsletter.

The company, which last month reported a £375 million ($611.9 million) net loss for the fiscal year ended March 31, is expanding a plan that already offers employees unpaid leave or the chance to work part-time. It said more than 1,000 workers already have taken advantage of that plan, which was announced last month.[...]

[...]Mr. Walsh and Chief Financial Officer Keith Williams previously had announced that they would work for no pay during July. Mr. Walsh currently earns £735,000 a year, while Mr. Williams earns £440,000 a year, according to BA’s annual report.

Unions were unimpressed with the plan.

“Willie Walsh can afford to work a month for free,” a Unite spokesman said. “Our members can’t.” Unite represents thousands of cabin crew, baggage handlers and maintenance workers among BA’s workforce of 40,000.

Something tells me that these will not be ‘friendly skies’ at all.

More on this topic (What's this?)
Nothing to Celebrate (Financial Armageddon, 8/5/10)
Adjusting, Adjusting, and Adjusting (Financial Armageddon, 6/21/10)
The Future Food Shortage (Learn Mining News, 6/29/10)
Read more on British Airways, Food & Beverage at Wikinvest
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British Airways Reports Largest Loss In History

May 22, 2009 By Chuck

British Airways, Europe’s third-largest long-haul airline, on Friday reported its worst quarterly loss since records began as it reduced tickets prices to stimulate demand amid a sharp slowdown in air travel.

It also said it would pay no dividend in 2008, did not give any guidance for the year and announced further capacity cuts for the winter. It sees no sign of an economic recovery.

British Airways posted a loss of 231 million pounds ($366 million) in the fourth quarter compared to a profit of 74 million pounds in the year-earlier quarter. Its operating loss came in at 309 million pounds, its worst quarterly performance since records began.

The airline gave a bleak outline of the future and, unlike its rival Air France-KLM, said it sees no sign of stabilization.

Chief Executive Willie Walsh told analysts in a conference call that he believes the airline isn’t suffering more than its peers but is being more truthful.

“I think we’re calling it more accurately and more realistically than perhaps some of our competitors,” he said.

Source: Market Watch

Filed Under: Market Updates Tagged With: ,