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BA exit LGW

Old 29th May 2012, 08:51
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Originally Posted by davidjohnson6
what are the big extra costs that causes BA shorthaul to lose money.
Wages ? Old aircraft burning more fuel ? Longer turnaround ? Not imposing baggage charges ? Something else ? I'm sure everything contributes but am interested to know which are the major factors and not just minor
The biggest issue for established carriers is on the revenue side, not the cost side, and it is transfer passengers. Say tickets from Gatwick to Barbados are being sold for £600. You will find that Manchester to Barbados is being sold for maybe £650, or even £600, or once in a while for £550. This is because revenue is determined by what you can get for it, governed by demand and competition, and only obliquely related to cost.

So if it's £650 from Manchester, how is that attributed between the two flights. There are an infinite number of ways of doing it, but almost all result in the domestic/short-haul connection getting only a fraction of the revenue that the same flight would receive from an O&D ticket on the route. A fair few such passengers on the flight means a loss.

Through tickets are almost always less than the sum of the two O&D sectors added together, yet there are acually additional costs compared to two equivalent single-sector passengers, in terms of handling misconnected passengers (Manchester inbound is late, Barbados operates only once a day, and the hotac eats up any profit) along with increased transfer baggage mishandles etc.

Easyjet do not do connecting tickets and thus are not in for any of this.
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Old 29th May 2012, 16:41
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....yet we are told that there few connecting pax using LGW...?
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Old 29th May 2012, 17:33
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No, it has been explained on countless occasions why this connectivity struggles to grow to a mass critical to sustaining a hub and spoke operation, with all the costs that come with it, profitably on a legacy cost base.
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Old 29th May 2012, 23:36
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BA's problem at LGW is largely one of revenue not cost. And competing against easyJet isn't simply an issue of price. easyJet pax I talk to, on the whole, like the easyJet service and experience. And easyJet's marketing and branding has really sharpened up over the past year. The "Where are you going?" campaign was much more inviting and aspirational than easyJet's historical marketing.
Can I just say how nice it is to hear someone on forums such as this to acknowledge that Easyjet pax aren't necassarilly trading down or "slumming up" by flying Easyjet.

Now, I've worn both the BA and EZY uniform and things at Easyjet aren't always spot on but many of the latters passengers really do champion the easyjet brand. I must admit that one of the main reasons seems to be the crew. As a cabin manager the amount of comments I am always astounded by the amount of postive comments I receive specifically about my colleagues. Easyjet might not be the least stressful carrier to fly with and it's still low cost however much it moves towards being hybrid, but there appears to be something about the crew and general product that people seem to like.

The new marketing campaign does look very smart in my opinion and along with very good on time performance and some other improvements hopefully Easyjet can build on the momentum. Incidentally, the allocated seating trial appears to be going very well and it is looking increasingly likely that it will be rolled out across the network............not that there was any doubt in my mind anyway.
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Old 30th May 2012, 09:54
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I have flown several times with EZY usually because there is no alternative. I have never had a good flight yet. Poor timekeeping, pathetic speedy boarding procedures ( sometimes no facilities for it at airports), high on-board prices, have all contributed. I have never had any problems with RYR.
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Old 30th May 2012, 10:07
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You're own experience is exactly that. What I will say though Is that Easyjet's on time performance is now amongst the best out there. It is something like 84% for departures and higher for arrivals.

Although most stations handle speedy boarding well, certain destinations always can't seem to handle it. HAM yesterday for instance.... Usually an air bridge but couldn't handle it with bussing. Allocated seating is now looking very likely as I said.... Something Ryanair isn't offering.

Onboard prices.... Easyjet is expensive but on a par with other carriers pretty much. Ryanair on the over hand are definitely more expensive. A simple comparison of the sales brochure would show that.
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Old 30th May 2012, 11:06
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I have never had any problems with RYR
I have, for all the same reasons you mention for EZY. No airline is perfect but I think that EZY have been a massive shot in the arm for LGW and have to be credited with fuelling the flame of rumours that BA short haul at LGW is to be axed: they serve far more destinations and are successfully morphing into a hybrid carrier that is becoming more attractive to all pax types and profiles. If allocated seating does become a reality that will be another nail in the BA coffin at LGW.
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Old 8th Jun 2012, 10:34
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Realistically the only way BA can continue LGW short-haul in the long term is if the feed from these services to their long-haul flights is good enough. BA currently fly several times a day to the likes of MAN, GLA, EDI, AMS from Heathrow, Gatwick and City airports, surely this isn't economical? If Gatwick long-haul could be profitable without a feed (which it is for Virgin), it would be much better to just run short-haul flights to LCY for business and Heathrow for connecting. Any leisure routes currently run out of LGW that are worth keeping could easily be transferred to LHR or LCY as appropriate.

As for the competition with Easyjet, I wouldn't have thought BA would be too concerned with Easyjet having a monopoly over LGW short-haul would they? After all, Gatwick is primarily a O/D leisure airport, it will not have much impact on their core business at Heathrow.
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Old 8th Jun 2012, 10:52
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As for the competition with Easyjet, I wouldn't have thought BA would be too concerned with Easyjet having a monopoly over LGW short-haul would they? After all, Gatwick is primarily a O/D leisure airport, it will not have much impact on their core business at Heathrow.
I wouldn't be so sure of that. easyJet has built up such a presence at LGW (including 45% of slots during the "first wave" of early morning departures for out-and-back-in-a-day business travellers) that it appears to be impacting BA short-haul at LHR.
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Old 8th Jun 2012, 12:23
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The BA business model for LGW is point to point leisure. Now you can connect, but LGW was de-hubbed under Rod Eddington.

The thing people are missing about feeding long haul, is it needs a critical mass. LGW has <= 9 long haul departures every day, mostly before 1pm.
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Old 8th Jun 2012, 13:17
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But as far as I had heard the plan is to slowly increase LGW longhaul flying when aircraft are available to do so


cs
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Old 8th Jun 2012, 16:25
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Quote below from British Airways' chief executive Keith Williams, in this interview with Flightglobal's Airline Business magazine.

British Airways may take more 777-300ERs as it ponders


Meanwhile BA is also turning its attention to the replacement of the ageing 737-400 fleet that serve its short-haul network from London Gatwick. But Williams says that he must be sure of a sound business case for Gatwick's short-haul operations. "I need to justify that [fleet replacement] to IAG with a plan that is built around the ability to make a return," he says
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Old 8th Jun 2012, 16:55
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An interesting article, not just for Gatwick but for BA overall.

But I'm conscious of the fact that if you wait for something and it never turns up eventually you don't have any aircraft."
This seems to be a none-too-veiled reference to the 787.

BA has taken six of eight 777-300ERs it has on order
That's one of the problems for BA long haul. With only two 777s and a handful of A380s due in the next 3-4 years, the 787 still out of sight (because nearly a year after the first delivery, Boeing seems unable to manage more than a couple of deliveries per month, and BA is far the list), with all those new slots at Heathrow to fill, and the 747s and 767s getting ever older and needing more downtime, I just can't see where BA are going to get any significant long-haul capacity from for Gatwick.

Meanwhile BA is also turning its attention to the replacement of the ageing 737-400 fleet
The obvious replacement is the 10-15 year old A319 fleet currently at Heathrow, which regularly seem too small and could do with a significant tranche of A320s to replace them there.
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Old 8th Jun 2012, 16:58
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I just can't see where BA are going to get any significant long-haul capacity from for Gatwick.
Depends on whether the expense of re-activating the four stored B744s is worth it to release more B772s.
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Old 8th Jun 2012, 17:14
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Originally Posted by Skipness One Echo
Depends on whether the expense of re-activating the four stored B744s is worth it to release more B772s.
I believe all the 747s that were worthwhile reactivating have been done; they obviously did the best ones first, the remainder now being beyond redemption. Aircraft back from the desert tend to have a poor reliability record.

However oil has fallen in four months from $109 in February to $83 today, which must have some impact - provided the Chancellor doesn't grab the whole lot back by yet another doubling of APD.
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Old 8th Jun 2012, 18:40
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No mention of B747-8s in the fleet renewal programme, are these not on the agenda?
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