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BBT July/August 2018
July/August 2018
For Business, Corporate Travel & Meeting Buyers & Arrangers

In Brief

BA profits drop

BA reported a drop of £53m in its third quarter pre-tax profits to £113m compared to £166m for the same period in 2005.
Operating profits for three months to December 31 also fell by £47m from £176m in 2005 to £129m.
The airline said its margin for the quarter has also dropped by 2.4% to 6.2%. 
Willie Walsh, BA's ceo, said the figures as "mixed results" and said that revenue had been hit by a "variety of external factors."
These included the continued impact of the disruption at Heathrow in Augusts, breakdowns of the BAA baggage system at the airport and severe fog just before Christmas.
The cost of these factors in the quarter was £40m.

Aer Lingus and JetBlue sign alliance

Irish airline Aer Lingus and the US low cost carrier JetBlue have signed a ticket-booking agreement.
It is understood to be the first such alliance between international budget carriers.
Aer Lingus said it a statement that the deal would "significantly extend Aer Lingus's reach into North America."
The two airlines said the agreement did not extend to code-sharing allowing them to sell seats on each other's planes.
But visitors to each of the carriers' websites would find a link to the other.
Dermot Mannion, ceo of Aer Lingus which is leaving the oneworld alliance in April, said the JetBlue deal was a "very low cost booking process between two low-cost carriers."
It is due to come in effect this summer.

Full content display may disappear – ECTAA

The neutral and complete fare display provided by agents is in danger of disappearing, ECTAA, the association representing European agents, warned this week.
It said that airlines were increasingly posting different fare types on various channels.
But while current EC laws on CRSs ensured a fair display, these laws were "no longer adapted" to developments like the Internet.
ECTAA called on the EU to require all airlines to provide access to all fares at no extra cost.
Jan Van Steen, president of ECTAA, said: "If the European legislation is not adapted to the new market environment, then we loose the functionality of a neutral and complete display of fares provided by CRSs.
"This would bring us 30 years back, where information was completely decentralised. With an increasing offer of routes and fares, losing a centralised information tool would be detrimental for agents and their customers."   

Open Skies talks resume

EU and US negotiators have begun a new round of Open Skies talks.
Talks have failed twice in recent years, the last time in December 2006, because of deadlock on EU demands that the Americans relax their laws on foreign ownership of airlines in the country.
The move has been strongly opposed by US Congressmen and unions.
Jacques Barrot, EC commissioner on transport, said: "I know that there are some difficult issues on the table for the negotiators to solve this week.
"But I stress once more that the status quo is not an option and that failure is not an option."

Finnair reports 4th quarter loss

Finnair reported a fourth quarter loss in operating profits of €24.4m compared with a €400,000 profit for the same period in 2005.
The airline blamed the turnabout for the three months to December on re-structuring and the high cost of fuel.
But Finnair said the prospects for 2007 were better. Jukka Hienonen, airline ceo, said: "Our outlook is significantly better than in 2006. We are lacking many of the one-off costs we had in 2006. Demand is at a strong level."

Italy wants Alitalia rescues plan by end of March

The Italian Government has asked the 11 potential bidders for Alitalia to submit their rescue plans for the ailing airline by the end of March.
It has also indicated it wants concrete offers by the end of May.
Eleven potential buyers have come forward since the Italian Government said it wished to sell at least 30.1% of its 49.9% in the loss-making Alitalia.
Some are investment companies which has led to speculation that they could be acting on behalf of other airlines like Air France or, in one report, Lufthansa.
The Italian Government plans to cut the list to the “serious” contender by the end of the month.

Flybe acquisition cleared by UK authorities

The UK Office of Fair Trading (OFT) has cleared the take over of the BA regional franchise BA Connect by low cost carrier flybe.
Mike Rutter, flybe's chief commercial officer, said he expected to complete the deal with BA shortly.

US withdraws bid for Delta

US Airways withdrew its $10.2bn hostile bid for Delta Air Lines after it became clear that the latter's creditors would not back it.
The Delta creditors said in a statement that it would back the "stand alone" stance of the Delta board.
Doug Park, chairman and ceo of US, said he was "disappointed that the committee, which has been chosen to act on behalf of all Delta creditors, is ignoring its fiduciary obligation to those creditors."
Gerald Grinstein, Delta's ceo, said: "This is a proud day for the thousands of Delta people, customers, communities, civic leaders and others who stood up for our standalone plan and said, emphatically, 'Keep Delta My Delta.'
"Our focus now is on the work still before us to emerge from Chapter 11 this spring as a strong, healthy, and vibrant global competitor."

Three airlines to join oneworld in April

Japan Airlines, Malev, the Hungarian national carrier and Royal Jordanian Airlines will join the oneworld alliance eon April 1.
On the same day, Aer Lingus will formerly withdraw from the alliance.

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