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British Airways In Record £531m Loss  
User currently offlineoa260 From Ireland, joined Nov 2006, 27337 posts, RR: 60
Posted (4 years 7 months 1 week 2 days 3 hours ago) and read 8541 times:

British Airways has reported its biggest annual loss due to lower passenger numbers, higher costs and the impact of strike action.

The flag carrier lost £531m ($766m) in the 12 months to March - BA's biggest loss since it was privatised in 1987.

That adds to the £401m it lost in the 2008-9 financial year, but is less than the £600m loss many analysts feared.

http://news.bbc.co.uk/2/hi/business/10135112.stm

Not as bad as other airlines but still not good, next weeks strikes wont help to reverse the trend either.

70 replies: All unread, showing first 25:
 
User currently offlineRJ111 From , joined Dec 1969, posts, RR:
Reply 1, posted (4 years 7 months 1 week 2 days 2 hours ago) and read 8337 times:

How much of that would you estimate is due to the strike action and volcanic disturbances?

User currently offlineMD11Engineer From Germany, joined Oct 2003, 14139 posts, RR: 62
Reply 2, posted (4 years 7 months 1 week 2 days 2 hours ago) and read 8327 times:

In Europe they have to compete directly with FR and EZ, while on their traditionally strong Far and Middle East routes they have to compete with the likes of Emirates. The the UK got hit very hard by the banking crisis, so many people are only flying if necessary and then use LCCs.

Jan


User currently offlineLHR380 From , joined Dec 1969, posts, RR:
Reply 3, posted (4 years 7 months 1 week 2 days 2 hours ago) and read 8303 times:

Quoting MD11Engineer (Reply 2):

There has also been 3 lots of snow, and the lovely Icelandic volcano that has caused massive problems, as well as the first strike.


User currently offlinesandyb123 From UK - Scotland, joined Oct 2007, 1133 posts, RR: 0
Reply 4, posted (4 years 7 months 1 week 2 days 2 hours ago) and read 8257 times:
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Quoting RJ111 (Reply 1):
How much of that would you estimate is due to the strike action and volcanic disturbances?

It's all to do with market confidence and at the moment there isn't much confidence in BA. The looming strikes, uncertainty over ash cloud restrictions and the fierce competition from all angles is putting the pressure on BA.

Their product is also lagging well behind on the long haul routes too although I think that has less to do with their current problems.

Sandyb123



Member of the mile high club
User currently offlinemacc From Austria, joined Nov 2004, 1073 posts, RR: 3
Reply 5, posted (4 years 7 months 1 week 2 days 2 hours ago) and read 8261 times:

the ash cloud is not included in that numbers. fiscal year ended march as per op.


I exchanged political frustration with sexual boredom. better spoil a girl than the world
User currently offlineLHR380 From , joined Dec 1969, posts, RR:
Reply 6, posted (4 years 7 months 1 week 2 days 1 hour ago) and read 8251 times:

Quoting sandyb123 (Reply 4):
Their product is also lagging well behind on the long haul routes too although I think that has less to do with their current problems.

I don't agree.

New first is rolling out across the 777 fleet (and 74 soon) New J is really nice, and with the new 773 coming in there is a new W and Y product with new IFE.


User currently offlineMD11Engineer From Germany, joined Oct 2003, 14139 posts, RR: 62
Reply 7, posted (4 years 7 months 1 week 2 days 1 hour ago) and read 8226 times:

Quoting LHR380 (Reply 3):
There has also been 3 lots of snow,

Funny thing is that we had lots of snow as well (probably more than in the UK), but our operation kept running.

Jan


User currently offlineLHR380 From , joined Dec 1969, posts, RR:
Reply 8, posted (4 years 7 months 1 week 2 days 1 hour ago) and read 8219 times:

Quoting MD11Engineer (Reply 7):
Funny thing is that we had lots of snow as well (probably more than in the UK), but our operation kept running.

Lets not get into that discussion shall we. That was had during the snow threads.


User currently offlinevv701 From United Kingdom, joined Aug 2005, 7742 posts, RR: 17
Reply 9, posted (4 years 7 months 1 week 1 day 23 hours ago) and read 7942 times:

Quoting RJ111 (Reply 1):
How much of that would you estimate is due to the strike action and volcanic disturbances?

In their review for March 2010 BA stated that they lost £5.5 million per day due to the strike. I believe that there were six days of strikes up to 31 March, the end of the BA financial year. So this suggests an actual loss of £33 million directly due to strikes. However this excludes the unquantifiable lost revenue and lost profit because some passengers may have chosen to fly with another airline because of the threat of the strikes earlier in the year.

There will be no impact from the Icelandic volcanic erruption on these figures. Although the volcano first errupted before the end of BA's 2009-10 financial year on 31 March there was no disruption of BA flights by the resultant ash cloud until the second week of April.


User currently offlineBeyondBristol From United Kingdom, joined Jan 2009, 60 posts, RR: 0
Reply 10, posted (4 years 7 months 1 week 1 day 23 hours ago) and read 7886 times:

Quoting oa260 (Thread starter):
volcanic disturbances?

Keep in mind that these results do NOT include the volcano disruption, which is estimated to have cost cost about £100m. I do remember talk of government compensation but not sure how this is progressing.

The March strike was estimated to lose the airline about £7m per day. It lasted 7 days (I'm almost certain?!) so cost the airline about £50m-ish.

Interestingly, despite having a fall in revenue of about £1bn, BA were able to reduce costs enough to virtually match the loss in revenue. I'm no Square Mile executive but to me, that's pretty impressive.

EDIT: vv701 seems to have a better source for numbers so we'll go with them!

[Edited 2010-05-21 04:21:25]


I'll admit it...I'm a BA & VS cheerleader.
User currently offlinevv701 From United Kingdom, joined Aug 2005, 7742 posts, RR: 17
Reply 11, posted (4 years 7 months 1 week 1 day 22 hours ago) and read 7629 times:

One of the most surprising (and positive) features of the preliminary BA figures for 2009-10 released today is that for BA';s Cash Balances. These actually rose. As at 31 March 2010 they were £333 million above the figure for 31 March 2009 at £1.7 billion. With the credit facilities they have available this would give them access to over £2 billion liquid resources if this was required.

The not-as-bad-as-forecast but still very-far-from-acceptable loss of £531m was on revenues down from £8,992 million in 2008-09 to £7,994 (-£998 million, -11.1 per cent) in 2009-10. Costs were down £987 million (-10.8 per cent). But of these reduced costs as much as £597 million was due to reduced fuel costs. This is but one example of how much today airlines' profits and losses are dependant upon fuel costs and the inexact science of their fuel price hedging.

The figures for the last quarter (1 January to 31 March 2010) are interesting, particularly as this was a period when BA hardly left the headlines because of the threat of the BA FA strike culminating in the first two actual strikes. The airline's loss of £309 million in the same period of 2009 was reduced by 53.1 per cent to £145 million in 2010.


User currently offlineEDICHC From , joined Dec 1969, posts, RR:
Reply 12, posted (4 years 7 months 1 week 1 day 20 hours ago) and read 7373 times:

Quoting LHR380 (Reply 6):
I don't agree.

New first is rolling out across the 777 fleet (and 74 soon) New J is really nice, and with the new 773 coming in there is a new W and Y product with new IFE.

I think you will find that however 'nice' these new products are, they will be no better that the products that have been offered by the worlds leading carriers for a few years now.

For example...if going F to SIN why would one choose BA? Suites on SQ's A380 (which has been available for 2 years will surpass the new 'rolling out' BA first product...so at least 2 years in launching an inferior product. So...

Quoting sandyb123 (Reply 4):
Their product is also lagging well behind on the long haul routes

Has the ring of truth to me.

Quoting vv701 (Reply 9):
There will be no impact from the Icelandic volcanic erruption on these figures. Although the volcano first errupted before the end of BA's 2009-10 financial year on 31 March there was no disruption of BA flights by the resultant ash cloud until the second week of April.

With this and the likelihood of continuing strike action, you can't help but wonder just how bleak next years' figures will look.


User currently offlineLHR380 From , joined Dec 1969, posts, RR:
Reply 13, posted (4 years 7 months 1 week 1 day 20 hours ago) and read 7357 times:

Quoting EDICHC (Reply 12):
For example...if going F to SIN why would one choose BA? Suites on SQ's A380 (which has been available for 2 years will surpass the new 'rolling out' BA first product...so at least 2 years in launching an inferior product. So...

Because not everyone likes being enclosed like in the SQ or EK suites as nice as they may be.

BA found that out from canvassing its own customers.
Why does BA have to copy everyone else, it makes BA F unique does it not?


User currently offlineJacobin777 From United States of America, joined Sep 2004, 14968 posts, RR: 59
Reply 14, posted (4 years 7 months 1 week 1 day 20 hours ago) and read 7323 times:

Quoting LHR380 (Reply 13):
BA found that out from canvassing its own customers.
Why does BA have to copy everyone else, it makes BA F unique does it not?

  

Add FF miles, etc. Those who fly F/J aren't the typical "what is the cheapest flight I can find on the internet ?" -type either.



"Up the Irons!"
User currently offlineEDICHC From , joined Dec 1969, posts, RR:
Reply 15, posted (4 years 7 months 1 week 1 day 19 hours ago) and read 7261 times:

Quoting LHR380 (Reply 13):
Because not everyone likes being enclosed like in the SQ or EK suites as nice as they may be.

A specific answer to a specific example but still doesn't address the wider question...

Quoting LHR380 (Reply 6):
Quoting sandyb123 (Reply 4):
Their product is also lagging well behind on the long haul routes too although I think that has less to do with their current problems.

I don't agree.

New first is rolling out across the 777 fleet (and 74 soon) New J is really nice, and with the new 773 coming in there is a new W and Y product with new IFE.
Quoting EDICHC (Reply 12):
think you will find that however 'nice' these new products are, they will be no better that the products that have been offered by the worlds leading carriers for a few years now.

So this suggests that BA's products are lagging behind. Indeed I gave BA the benefit of the doubt when I described their products as no better than leading carriers, I do suspect that while good they will be inferior to the offerings of SQ, EK, TG or CX.


User currently offlineAirbusA6 From United Kingdom, joined Apr 2005, 2038 posts, RR: 0
Reply 16, posted (4 years 7 months 1 week 1 day 19 hours ago) and read 7151 times:

I suspect BA in its battles with the Unite union isn't unhappy at having "Record £531m" headlines splashed around, as it helps emphasise the seriousness of the financial situation, and further reduces public sympathy for the strikers...


it's the bus to stansted (now renamed national express a4 to ruin my username)
User currently offlineCaptainCrackers From Italy, joined May 2010, 140 posts, RR: 1
Reply 17, posted (4 years 7 months 1 week 1 day 19 hours ago) and read 7143 times:

Quoting AirbusA6 (Reply 16):
I suspect BA in its battles with the Unite union isn't unhappy at having "Record £531m" headlines splashed around, as it helps emphasise the seriousness of the financial situation, and further reduces public sympathy for the strikers...

It could go both ways: Those already inclined to support the strikers will now wonder more than ever why Mr. Walsh doesn't hurry up and sort out the mess he's created...


User currently offlineAirNZ From , joined Dec 1969, posts, RR:
Reply 18, posted (4 years 7 months 1 week 1 day 14 hours ago) and read 6852 times:

Quoting Jacobin777 (Reply 14):
Those who fly F/J aren't the typical "what is the cheapest flight I can find on the internet ?" -type either.

Actually, in a way you'd be very wrong and I can quite assure you that F/J (particularly J) will try to find the cheapest one they can.....and that's mixture of those who actually pay for their ticket, and those who find the cheapest to influence others to pay for it. So no, please don't assume that F/J passengers are any less price conscious than any anyone else.....a huge failing on a.net though.


User currently offlineindolikaa From United States of America, joined Dec 2007, 161 posts, RR: 0
Reply 19, posted (4 years 7 months 1 week 1 day 14 hours ago) and read 6514 times:

Quoting oa260 (Thread starter):
British Airways has reported its biggest annual loss due to lower passenger numbers, higher costs and the impact of strike action.

If they can sustain £932 million over two consecutive years and still function in this credit market, you would think those losses are a non-issue.


Quoting Jacobin777 (Reply 14):
Those who fly F/J aren't the typical "what is the cheapest flight I can find on the internet ?" -type either.

I would agree. When I shop J, I compare cost versus amenities and the airline itself, but I don't always select the cheapest ticket. A lot of the Y crowd I know would jump at saving $1 in return for less breathable oxygen; they'd consider that a value for their dollar.



Vote for Pedro
User currently offlineBeyondBristol From United Kingdom, joined Jan 2009, 60 posts, RR: 0
Reply 20, posted (4 years 7 months 1 week 1 day 13 hours ago) and read 6423 times:

Quoting EDICHC (Reply 12):
With this and the likelihood of continuing strike action, you can't help but wonder just how bleak next years' figures will look.

They're predicting to break-even next year (i.e. Apr 2010-Mar 2011).

[Edited 2010-05-21 14:10:36]


I'll admit it...I'm a BA & VS cheerleader.
User currently offlineVinnieWinnie From United States of America, joined Nov 2005, 803 posts, RR: 0
Reply 21, posted (4 years 7 months 1 week 1 day 13 hours ago) and read 6400 times:

Quoting EDICHC (Reply 15):
So this suggests that BA's products are lagging behind. Indeed I gave BA the benefit of the doubt when I described their products as no better than leading carriers, I do suspect that while good they will be inferior to the offerings of SQ, EK, TG or CX.

If comfort was the only thing influencing travel behavior then no-one would schedule their routes at the optimal timing for passengers.

Point is:

- EK might be way more comfortable, but it still will require a stopover.
- SQ might be way better, but other than Singapore will have to make a stop over as well
- ...

If you include price, frequent flier programs, schedule and convenience, then for a whole lot of travelers BA will be way more convenient than more comfortable alternatives.

For the typical British business customer that goes all over the place and not only to one far flung destination, BA will be more appealing no matter what you think. Also don't forget that a lot businesses do outsource flight bookings to travel agents that at the end of the year give them a hefty discount. There comfort will only have a minimal impact on carrier choice.


Another A.net myth: Comfort!


User currently offlineEDICHC From , joined Dec 1969, posts, RR:
Reply 22, posted (4 years 7 months 1 week 1 day 11 hours ago) and read 5716 times:

Quoting VinnieWinnie (Reply 21):
For the typical British business customer that goes all over the place

How about another a.net myth....all F & J pax are businessmen.

Quoting VinnieWinnie (Reply 21):
- EK might be way more comfortable, but it still will require a stopover.
- SQ might be way better, but other than Singapore will have to make a stop over as well
- ...

And unless you live in London you will need a stopover with BA.   

But all that is irrelevant to the point, it was only an example...as I stated.


User currently offlineAirNZ From , joined Dec 1969, posts, RR:
Reply 23, posted (4 years 7 months 1 week 1 day 8 hours ago) and read 5247 times:

Quoting indolikaa (Reply 19):
you would think those losses are a non-issue.

Hmmm! a loss of £932 million over two consecutive years is a non-issue???? Yep, definitely!

Quoting indolikaa (Reply 19):
When I shop J, I compare cost versus amenities and the airline itself, but I don't always select the cheapest ticket. A lot of the Y crowd I know would jump at saving $1 in return for less breathable oxygen; they'd consider that a value for their dollar.

Just to clarify here....selecting and buying the ticket aren't necessarily the same thing. Are you saying you've never flown in Y class?


User currently offlineJacobin777 From United States of America, joined Sep 2004, 14968 posts, RR: 59
Reply 24, posted (4 years 7 months 1 week 1 day 7 hours ago) and read 5143 times:

Quoting AirNZ (Reply 18):
Quoting Jacobin777 (Reply 14):
Those who fly F/J aren't the typical "what is the cheapest flight I can find on the internet ?" -type either.

Actually, in a way you'd be very wrong and I can quite assure you that F/J (particularly J) will try to find the cheapest one they can.....and that's mixture of those who actually pay for their ticket, and those who find the cheapest to influence others to pay for it. So no, please don't assume that F/J passengers are any less price conscious than any anyone else.....a huge failing on a.net though.

Maybe in a way, but F/J-travelers won't make a big decision if its 100-200 quid or so for the round trip ticket as there are many other variables for them. Y aren't as picky as long as prices are the lowest.

Quoting indolikaa (Reply 19):
Quoting Jacobin777 (Reply 14):
Those who fly F/J aren't the typical "what is the cheapest flight I can find on the internet ?" -type either.

I would agree. When I shop J, I compare cost versus amenities and the airline itself, but I don't always select the cheapest ticket. A lot of the Y crowd I know would jump at saving $1 in return for less breathable oxygen; they'd consider that a value for their dollar.

  



"Up the Irons!"
25 VinnieWinnie : Sorry but they are the vast majority. And that is a fact not a myth. Now yes I admit that in J you also have Y upgrades, people that can afford it, n
26 indolikaa : I was serious! Sit down and make a list of companies that can lose almost £1 billion over two years and still function competitively in an ultra-com
27 AirNZ : But I'm not arguing about arrogance at all, what class people choose to fly or how long a flight is. You answered the question I asked and thanks for
28 RIX : - They are different market. I'd wait until LH or AF or SK or such introduces some SQ-like suites before saying anything about BA inferiority to comp
29 OA260 : Very true as much as I like them I prefer a different design, AF First Class on the A380 is my fav so far.
30 EDICHC : Majority perhaps...vast? Well that is open to question. And is altogether a rapidly dwindling market hence the number of routes that either no longer
31 vv701 : I am perfectly sure.] BA operates but one flight a day between the UK and Australia. On the other hand BA operate 47 flights a day between the UK and
32 timboflier215 : I see the usual suspects have managed to drag yet another BA-related thread off topic. I really hope that BA can sort out the problems with it's crew
33 EDICHC : Here is where your comparison falls down. I didn't solely mention the kangaroo routes but to the far east as well, you could also add to the Indian s
34 indolikaa : I know I'm not the sharpest spoon in the drawer, but...who are the usual suspects?
35 timboflier215 : I simply do not believe that their product is one of the main reasons for this loss. Their wage levels, low fare competition, unpredictable fuel pric
36 VinnieWinnie : You are forgetting something very important here: The ability of BA to offer direct services to the destinations you are mentioning (/Japan/SE Asia a
37 vv701 : OK. But it makes little if any difference. There are two direct BA flights a day to HKG and one direct flight a day to each of NRT, PEK, PVG and SIN.
38 indolikaa : Definitely a myth. When I fly J, it's for reasons that (now) have nothing to do with business. Based on what? Historical numbers? Repeat bookings? Ri
39 VinnieWinnie : Based on transport economics theory, advanced transport market research tools such as stated preference analysis, concepts such as values of time, ho
40 timboflier215 : You wouldn't book an airline unless it had either a) a far superior product, or b) the owner showed humility? I honestly believe you are in the minor
41 EDICHC : Forgetting BKK? I also included India, not because it is in the far east, which it obviously isn't but because EK has a strong presence there and can
42 AirNZ : But it is perfectly clear that is NOT what indolikaa is saying at all.....and I would fully agree with him on the particular matter. On the contrary,
43 BP1 : If BA was to look at long haul cities to cut, which cities do you think it would be? Is Phoenix one of them? BP1
44 vv701 : No. Of course I understand that you would like to add BA009, the BA flight to BKK. But as I am sure you know BA do not have a flight that terminates
45 timboflier215 : I apologise if that was not his intention, but he did state that He did not mention QR's product, price etc. I absolutely do not believe any airline
46 EDICHC : Well if you like to talk specifics my brother is an IT consultant and flies to India regularly. He lives in Lincolnshire and always flies EK, avoidin
47 Woof : You've left out some major portions of the UK there. I live neither in the South East, nor anywhere near Manchester. There is absolutely no incentive
48 BP1 : What cities should BA drop that are very unprofitable to help bring them back into the black??? Thanks, BP1
49 EDICHC : So give or take a few percentage points BRITISH Airways will only appeal to 20% of the population of the country it purports (by title) to serve., an
50 Post contains images timboflier215 : BA have already pared back their l/h flying a lot post-9/11, so I doubt there is a massive amount left to be cut tbh. Maybe cede more s/h to airlines
51 Woof : Now you seem to be either struggling with the calculator, failing to read what was written, or just being plain bullish, I know not which. My own com
52 RJ111 : What do you propose BA do? P2P to countless secondary locations in the UK is pure and utter fantasy.
53 AirNZ : But yet, once again the fact is conventiently ignored that BA withdrew from the UK regions before the like of Easyjet, Ryanair and any LCC had a pres
54 VinnieWinnie : Oh common you know very well that most F & J passengers can mainly be found in London & the southeast. May I remind you that Singapore Airlin
55 EDICHC : Well you failed to make that point clearly...so because you did not communicate your point adequately my arithmetical skills are called into question
56 Post contains images huaiwei : I am not sure if that is supposed to apply to the profile of flyers the world over, but over here, even casual travellers going out for a holiday in
57 Post contains images EDICHC : I could not have put that better myself. Just to add that three of these European rivals offer better connectivity from the UK regions via their hubs
58 huaiwei : The situation is not so clear cut. Before: SIN-MAN: Three times a week, 2 classes. Now: SIN-MUC-MAN: Five times a week, 3 classes. So SQ will be one
59 VinnieWinnie : Yes well in Europe bar a few airlines all airlines are considered to be safe. Also i'm typecasting here a little also but I suppose the Asian culture
60 huaiwei : I am not sure why, but I find the above comment a tad offensive. That is primarily your opinion, of course, but SQ's F class is not offered to just a
61 VinnieWinnie : Not offensive according to me. By the same token it has been well known that Asia prefers flying wide-bodies. Now I struggle to explain this in a man
62 BA174 : Last time I checked they flew to Japan.
63 LHR380 : Im sure I was on BA when I flew to NRT in November?[Edited 2010-05-25 08:29:16]
64 huaiwei : The issue is not whether it is offensive to you. It is how your intended audiences feel, because if you do not know how to make a comment without off
65 timboflier215 : Absolutely. I would never question someone's personal choice in who they decide to fly with. I was merely picking up the fact the he said he would co
66 Jacobin777 : What's BA-5/BA-6 then?
67 VinnieWinnie : I struggle to understand where you are getting at, especially since you haven't even attempted to counter-argue my point, instead calling me offensiv
68 indolikaa : I agree that a lot of passengers are price-sensitive first and foremost. I'm nowhere near as sensitive as that majority. In fact, there are things mo
69 vv701 : No other major international airline is as slot restricted at its home hub as BA is at LHR. The last figures I saw showed only two major internationa
70 Post contains images RIX : - ?? What makes you think I do? I'm flying on BA, and I'm not British. My point is, to cry "BA has inferior product because they don't introduce SQ-l
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