British Airways released it performance figures for January 2009. In the month, passenger capacity, measured in Available Seat Kilometres (ASKs), was 2.6 per cent below January 2008. Traffic, measured in Revenue Passenger Kilometres (RPKs), fell by 1.3 per cent. This resulted in a passenger load factor increase of 1 per cent, to 73.2 per cent.
Reflecting the deepening impact of the recession and cost cutting by passengers, premium traffic (first and business class) dropped 13.7 per cent compared to a 1.4 per cent rise in non-premium traffic. A direct barometer of industrial manufacturing ouput, cargo performance, measured in Freight Tonne Kilometres (FTKs), fell by 16.7 per cent, which should be a cause of concern to all of us, as even post 9/11, when global airline fleets were grounded, cargo output fell only 13.7 per cent. It appears global manufacturing has just stopped, because we consumers have stopped buying.
We have to fight the “FUD factor” (Fear Uncertainity, Doubt).
Also, British Airways has re-cast its financial performance and restated it performance for the 9 months ending December 31, 2008
- Operating profit of £89 million (2007: £744 million – restated) down 88 per cent
- Loss before tax of £70 million (2007: Profit £816 million – restated)
- Revenue £7,046 million (2007: £6,634 million – restated) up 6.2 per cent
- Passenger revenue at £6.2 billion was up 6.6 per cent
- Cargo revenue at £537 million up 18.8 per cent, before the recession kicked in
- Cargo performance, (measured in FTKs) down 1.7 per cent primarily due to effects in last quarter of 2008
- Passenger Capacity (measured in ASKs) up 0.2 per cent
- Passenger seat factor 78.4 per cent down 2.3 per cent
- Fuel costs £2,244 million up 48.4 per cent
Cash at the end of December was £1.6 billion, £278 million lower than at March 2008. Net debt was £2.2 billion, up £0.9 billion since the year end, £0.6 billion of this increase due to exchange.
British Airways has responded by adding more discounted fares to its World Offers sale for travel between January and September 2009 with reductions on a range of longhaul destinations including New York, Cape Town and Grand Cayman and shorthaul destinations including Paris, Venice, Milan, Vienna and Prague.
Statements from British Airways clearly indicate the airline is looking at the medium to long term.
The new Club World longhaul cabin has been fitted on 19 of 42 Boeing 777s in addition to all 57 of Boeing 747s. The fitments will be completed by the end of 2009.
For shorthaul passengers, Club Europe will be in a new configuration to guarantee a window or aisle seat from February 23, 2009, with the removal of the use of the middle seat.
Fitments of the new First class cabin will start later this year and will added to the pending Boeing 777-300s due for delivery in 2010.