No and no (latter dependant on the long haul future of BA at LGW which looks OK at the moment.

The Future? | Bizcovering

Could BA look at this to increase future revenue and reduce costs or is even this a step too far for BA?

I very much doubt BA will go under,however its needs to get a move on in its preservation of cash.

I flew longhaul them last week.The round trip went flawlessly with T5 again exceeding expectations.The on board product was good (except the IFE with its limited choice)
Crew were excellent and bags inside the baggage hall before the passengers.

As long as WW doesn't let the product decline they should be a good investment for the future.

Warkman, the "Global Premium Airline" means exactly that.... Premium.

Since when does the ECONOMY baggage allowance relate to Premium? It's economy, a low margin high volume segment.... probably with very little profit.

Its the first and business class sales that will bring home the bacon for BA, therefore the future strategy concentrating on these segments. When BA now has to compete on price with low cost carriers, more so than it has done in the past why should it carry excess baggage galore on short haul flights?

When airlines are loosing so much money and I believe AF KLM reported -9% recently its only natural that Walsh will look for more opportunities to plug the revenue gap... the world has changed and every airline has to change with it.

I wonder now if BA looks back at its decision to ditch 'Go' and thinks it was so shortsighted. Shorthaul ws never a big money spinner, the transfer traffic never stood a chance of working with BA's operation split into T1/4 and LGW and now its just as fragmented.

Hindsight is a wonderful thing but BA had little foresight.

Go was competing against BA short haul. If they had dumped short haul then long haul feed dies. You say things are fragmented, based on what? They had a succesful year last year posting the highest profits in memory paid a shareholder dividend for the first time in years. Terminal 5 is now working really well. Yet you advocate building up a Stansted based low cost airline to eat into and undermine the core BA operation to compete head on with a much bigger and angrier Ryanair. BA can't run short haul well, ( Brymon / British Regional / BA Connect / CityFlyer / Manx etc etc )but up till recently they could just about run a premium long haul airline being fed from a central hub.

Then of course the market they were focussed on died.... I don't think Go is the answer somehow.

I think BA will survive for a number of reasons. One, it is the flag carrier and as such the population would not want to see it go under, there would be a massive media campain to prevent a collapse.
Two, assuming it can get all its costs down, staff, pensions, capital, marketing, then it is in no worse state then any other carrier.
Three. it does have a unique route structure where its Longhaul traffic is fed by its Shorthaul traffic & vice versa. However where I believe it is going wrong at present is its steady destruction of this vital two way feed.
I note that lots of early/late European/domestic flights are being withdrawn. Without these its impossible for pax to interconnect, forcing them to travel with a competitor. You will notice its revenue is well down at present, circa 12%, is not a lot of this caused by the effect I mentioned above? If they marketed this interconnectivity agressively, they would have a headstart within the UK. Even LGW could be drawn in here, why can't they run their own link between LHR-LGW, making life easier for interlining.
BA like most business's at present has a revenue problem, they will not solve it by cutbacks which reduce revenue.

Walnut

Being the flag carrier didn't stop Sabena and Swissair from going under.

Also across the country as a whole I don't believe BA is held in any higher esteem than Woolworth's and look what happened to them.

A media campaign similar to the one to stop "Sir" Fred Goodwin getting his pension? Given how well that worked BA would be wound up overnight!!

BA is increasingly become the flag carrier for london and not the nation, and with there continuen degrading of in flight service and customer care there is a real possibity they could become state owned and all its assets sold off.

BA needs to retain at least 4 months operating capital or the CAA has ever right to pull its licence to operate.
BA is like any other business it can go under. Look at Rover, Woolworths.
BA is trying to be run with a low cost frame of mind and make it work on a full service airline not possible. Yes cut your cost base, but also look at way to improve your revenue stream and generate positive cash flow in the business.
Other airlines are profiting from the problems at BA. I see customers come past me saying they are unsure of BA and what is happening. It’s the negative headlines with the unions and Walsh banging their drums. Talk about talking an airline down.

Walnut,

BA's route structure (hub&spoke) is not unique, AF-KLM and Lufthansa have the same system.

BA is the only flag carrier in Europe with a 3 billion pound pension deficit on it's books, that is unique...

Publicity campaigns will not save an airline, I really wonder if the average UK citizen is willing to part with some cash to save BA.

I don't think anyone wanted the government to bail out Northern Rock, but they did to the tune of billions.

BA is far from needing saving but Mr Flaps is correct about Walsh talking the airline down-where's Colin Marshall when you need him !

Longhitter

Perhaps the only reason that:
Is because "BA is the only flag carrier in Europe" who's pension arrangements are subject to the legislative powers of TCGB?

That is unique!

Gordon Brown as Chancellor was responsible for a massive tax grab on what was one of the best pension structures in Europe ( the country not BA ), however the UK public has the attention span of a retarded goldfish, so even the MPs stealing on expenses is fading and it's back to arsing things up as usual.

The money was redistributed to fund the client welfare state that keeps voting Labour back in.

Brown was named by the Daily Mail as "The Man Who Stole Your Pension" but since pensions are beyond the understanding of many of us, it's hard to make a case in the attention span required. That's a big part of the reason the BA scheme went into meltdown and may yet drag the company into danger.

"post neo-classical endogenous growth theory" anyone?

...and here are some of the figures to prove it, across some of the UK`s largest companies.
Scarey numbers!!!


BBC NEWS | Business | Top firms' pension funds plummet

July Traffic and Load Factor up in July
 

BA have just released their July pax figures.

In July 2009

* Passenger capacity, in Available Seat Kilometres, was 2.7 per cent below July 2008.

* Traffic, measured in Revenue Passenger Kilometres, rose by 1.0 per cent.

* Load factor increased 84.6 per cent up 3.1 points on July 08.

* Their was a 11.0 per cent decrease in premium traffic

* Their was 3.5 per cent increase in non-premium traffic.

* Cargo fell by 6.8%


It looks like BA's removal of excess capacity is starting to work!!.

LGW
 

Looking at the Winter shedules 09/10 ex LGW. Is there another 777 heading down there from LHR with the new routes they are operating MLE/SSH/MBJ?

Latest plan that we have heard about, is that the 4 class aircraft currently operating JFK service will be swapped for a 3 class aircraft, so no more needed at the moment!

A Take on BA's issues
 

I was talking to a City Analyst about British Airways last month, and here are some points. Please note cannot mention names as views expressed are personal and are expressed here for debating purposes.

Simplistically BA has been on the rack since the late 90s over 2 distinct issues, one imposed by the Labour Government, and second by making themselves slaves to an internal goal. There are others such as outdated working practices, and arguably passing over the opportunities presented by KLM and Swissair.

Despite the above BA has proven very adaptable and quite profitable over the period, with some exceptionable managers.

Firstly, Gordon Brown’s Great Pension Theft caused a long term funding problem which directly hit BA’s ability to develop the business as money that would have been re-invested had to be sunk into the pension pit to make up for the money Labour stole. The damage Brown’s Grab caused to British industry has been amazing. I believe an actuarial report a couple years ago showed that Brown’s Grab actually depressed the tax revenue received by the Inland Revenue over the period.

Secondly, the 10% Margin Rule. This was applied across the board, perhaps it would have been better to just apply this to Heathrow services and set a different standard for LGW and the regions. By keeping profitable routes outside LHR despite not hitting the 10% targets would have been cash flow positive to the business as a whole, retained potentially a significant and probably frequent flyer client base, although inevitably there would be losses to the locos.

BA now has virtually all its eggs in one basket, Heathrow, and while a strength as the World’s Premier airport, it is a weakness as BA’s does not seem to have anything else as a fallback, not even Iberia as far as anyone seems aware at this point. Perhaps a closer relationship with FLybe, though at arms length could provide a new start back at least in the UK and Europe, and avoid the cludge that de-evolved into Bacon.

While the financial points are also correct, BA has not only shrunk to just operating at Heathrow, but they narrowed further to over-concentrate on premium classes and corporate-level agreements, which there was a short-term rise in demand for but which has now dropped back, and wholly on the London market rather than connecting traffic. T5 is a poor terminal for connections, they take for ever and I suspect a substantial number are still lost.

Short-term pennypinching on the premium class catering and ancillaries will drive more such passengers away, while for connection BA should look at how many others do it - Lufthansa do published 25-minute connections at Munich, and I've never missed one yet, because they are organised for it. A Heathrowite writing here a while ago about these said firstly that they were illegal, and then when I showed they were officially published just said they should not be allowed. A typical BA attitude to life I am afraid. Lost connections because the inbound aircraft waited 20 minutes for a stand at T5, or because the flight connections security is disorganised and queues are huge, is just bad management.

Does anyone from Waterside ever come down to T5 to think up any improvements ? No, because the prevailing attitude is that management is all about generating spreadsheets in the office and showing conformance to budget, not about developing and improving a product so more people will want to buy it.

As for Willie Walsh, BA is just a placeholder for him until he gets the job he really wants, Chief Exec at Ryanair following Michael O'Leary. And he can indulge in upsetting his future competitor while he's at it. Wonderful.