British Airways Releases January's Traffic Figures
British Airways | Feb. 05, 2007
Summary
In January 2007, British Airways' passenger capacity, measured in Available Seat Kilometres, was 1.5 per cent above January 2006. Traffic, measured in Revenue Passenger Kilometres, was lower by 2.8 per cent. This resulted in a passenger load factor down 3 points versus last year, to 69.5 per cent. The decrease in traffic comprised a 3.1 per cent decrease in premium traffic and a 2.7 per cent decrease in non-premium traffic. Cargo, measured in Cargo Tonne Kilometres, decreased by 18.1 per cent. Overall load factor fell by 3.2 points to 64.9 per cent.
This month's statistics were significantly impacted by the threat of industrial action. Premium volumes suffered the largest reductions as most tickets are flexible and refundable, and customers are easily able to move to other carriers. The ballot result in favour of strike action was announced on January 15 and the strike averted on January 29.
Market Conditions
The market continues to show good demand in premium cabins. The weakness in some non-premium segments is also still a feature. The revenue outlook for the fourth quarter has been impacted by the threat of industrial action by the T&G. While the strike was averted, the estimated revenue loss is still some 80 million pounds. Revenue guidance for the full year is now 3.25 - 3.75% growth.
Costs
While cost control remains strong, full year costs excluding fuel are expected to be some 50 million pounds higher than last year. This reflects higher costs in the first quarter. Our full year fuel guidance has been revised down by 40 million pounds reflecting the reduction in fuel prices. The fuel bill will now be accounted for on a continuing operations basis, and is expected to be some 1.95 billion pounds.
Strategic Developments
Following a ballot for industrial action the T&G announced a series of planned strikes. As a result the airline cancelled 1,300 flights over a 48 hour period. While the dispute was averted and the schedule reinstated, supported by a seat sale of 500,000 tickets, the impact on lost bookings and revenue is expected to be some 80 million pounds in the fourth quarter.
The BA Forum, which represents British Airways' unions, issued a statement recommending acceptance of changes to benefits to tackle the 2.1 billion pounds deficit in the New Airways Pension Scheme (NAPS).
The airline reduced its fuel surcharge on longhaul flights under nine hours by from 35 pounds to 30 pounds per sector as a result of a fall in the price of oil.
British Airways announced modifications to its uniform rules to allow staff to wear a symbol of faith openly. The decision came after a comprehensive review of the airline's uniform policy and extensive consultation with a wide range of religious groups including representatives from the Church of England, the Catholic Church and the Muslim Council of Britain. The new policy was introduced on February 1, 2007.
The airline announced a new daily service between London Gatwick and Newquay. The flights will start on Monday March 20, 2007 operating on a Boeing 737.
Note: Traffic statistics will continue to include BA Connect until the transaction is completed.