Airline passenger news and views

For a moment, let me ignore the rights and wrongs of the BA cabin-crew strike. We are where we are with a stand-off between employer and employees. It is very sad but it happens.

BA has said that it must update certain working practices to be competitive. The cabin staff, backed by a strong and combative union, say ‘”not if it affects my job and pay packet”.

British Airways CEO Willie Walsh has, hitherto, had the full support of his board of directors in taking his tough line. BA have £2billion in cash and can afford the battle and, per the company line, cannot afford not to modernize its working practices.

A question that must be exercising the mi nds of the non-executive directors, is can BA really afford the ensuing costs? Next Friday, BA will announce a record £600million loss for last year (following £400million loss for the previous year).  This will not include the full costs of the ash crisis, nor the costs of the strikes, nor the impending changes to Airline Passenger Duty. In fact, if you list BA’s problems including recession, high fuel prices and currency instability, the £2billion does not go that far as a commercial cushion.

Executives of small and large companies will understand the ‘invest now, benefit later’ mindset. It is probably absolutely right that BA need to change practices that were more appropriate to a bygone age. The worry is that having taken the hit, will BA move to the sunny uplands of profitability or will they simply be left fighting for their share of an ever more competitive and fractured market?