BA's strike losses likely to top £45m

Yesterday, as the cabin crew of British Airways began the first of several five-day planned strikes, the carrier's estimated losses are expected to surpass the £45 million (Dh239.52m) it suffered in March during the first strike action period.

A spokesperson for BA told Emirates Business: "The impact of strike action during the month of March was estimated to be between £40m and £45m, which equated to nearly seven per cent of the capacity decline for the month."

Experts say the peak summer period could actually deter travellers from booking on the airline, setting the London-based carrier further back on its monthly projections by at least a few million pounds.

Two strikes over seven days in March also contributed to BA's £425m annual loss that the airline announced earlier this month.

BA has announced it plans to operate more than 60 per cent of its long-haul operations and over 50 per cent of short-haul at Heathrow, while its plans to run a full programme at Gatwick and London City airports.

"We will implement our contingency plan to keep British Airways flying. We are confident that thousands of cabin crew will ignore Unite's strike call and help us fly more than 70 per cent of the customers who were booked to fly with us in the period targeted," said BA.

Yet, the current strike has already resulted in BA cancelling several flights for the Middle East, including a few on the Dubai route.

According to BA.com, between the travel period of May 26 and 30, BA0106, departing Dubai for London, Heathrow at 1.45am has been cancelled. All Abu Dhabi flights are operating normally as per schedule.

"Regrettably, we have had to cancel some flights on the Doha-Bahrain-London Heathrow route, as well as some Jeddah and Dubai services to London during the first wave of strikes. However, we will do our best to reinstate flights wherever possible," said the spokesperson.

The carrier said it is attempting to cover as many countries as possible and the majority of Heathrow long-haul routes will be served across the strike period.

"However, due to the complexity of our Heathrow schedule we will be operating limited flights to parts of network, but will look to reinstate flights where possible," the spokesperson said. Currently, hassled passengers whose flights have been affected are being contacted by the airline, according to the BA spokesperson, and they have either been rebooked for future dates, rerouted, booked on other airlines or refunded. Customers can rebook their flights up to 355 days into the future at no additional cost, subject to availability.

"BA has also made arrangements with more than 50 other airlines, including several regional carriers here, so that it can rebook customers during the actual strike period onto their flights, if they had been due to travel on a BA service which has been cancelled," he said. The carriers include Emirates, American Airlines and Iberia. The airline says it is still available to hold further talks with the Unite union, who are stepping up their protest against BA Chief Executive Officer Willie Walsh's plans to cut staffing levels and the wage bill as he seeks to reverse record losses.

Flight attendants are striking after the United Kingdom Court of Appeal last week overturned a ruling in favour of BA that blocked a five-day walkout that was due to begin on May 18. Subsequent talks that Walsh held with Woodley and Derek Simpson, Unite's joint general secretaries, failed to produce an agreement. This week's walkouts, part of the first sequence of strikes at BA since 1997, could cost the company more than £100m, based on the March losses. That is equal to more than 40 per cent of the £230m operating profit analysts say the carrier will earn this year.

"Unless BA's industrial relations problems are once and for all sorted out and the airline's staff are seen to be right behind it, looking into the future is a futile exercise," Howard Wheeldon, senior strategist at BGC Partners in London, told Bloomberg. "If the dispute is not settled soon, far from breaking even, current year results could be worse than the year just gone."

The damage to the airline's brand image is another blow for BA, which has resulted in UK-based carriers such as Virgin announcing a 20 per cent increase in bookings since March.

BA still maintains a brave face, with the spokesperson saying: "In the short term we have seen some impact on passenger demand as a result of the unjustified and pointless strike action. However, in the medium term our customers have shown tremendous support in our efforts and forward bookings for the months ahead reflect this."

And what does Walsh has to say? "BA will be flying. We will not be grounded by the actions of a tiny minority who are out of touch with reality," was his response to the media.