British Airways reports £292m six-month loss

British Airways (BA) has recorded a loss of £292 million before tax for the six months to September.

The airline, which has been badly hit by the recession, said the figures represent the first time it has reported a loss for the first half of the financial year.

The interim management report for the six months to September 30th showed operating losses of £111 million, compared to £140 million profit last year, with revenue down 13.7 per cent and total operating costs down 8.7 per cent.

British Airways' chief executive Willie Walsh, said: 'Aviation remains in recession with IATA predicting that the industry will lose $11 billion (£6.62 billion) this year. We were quick to respond to the crisis by taking out excess capacity and, at the same time, driving down unit costs by 5.2 per cent.

'This demonstrates how well our costs have been managed in the first half and it's imperative we continue to deliver on our plans to reduce costs further in the second half. With revenue likely to be £1 billion lower this year, we can't stand still and further cost reduction is essential.'

The airline is currently battling with unions over the implementation of a pay freeze and job cuts. Cabin crew are the first to be affected, with their numbers being reduced on long-haul flights.

The union Unite has said it will continue with strike ballot action over the changes, seeking a high court injunction to have them blocked.

A statement from the union declared: 'Unite is taking its legal challenge to prevent BA from imposing, without agreement, widespread contractual changes upon the cabin crew. BA is seeking to impose these changes, which Unite has described as 'unfair and unworkable', from November 16th, 2009.'

BA staff could strike at Xmas, union warns

British Airways cabin crew could strike unless a mass meeting to discuss planned job cuts and new contracts is resolved.

Staff will be meeting in Surrey today to discuss a strike ballot, with thousands of members of the union Unite expected to be balloted for industrial action.

The airline announced the changes after losing £401 million last year, saying a pay freeze and job losses would be necessary.

Len McCluskey, assistant general secretary of Unite, said: 'BA faces significant difficulties across the business, so why is it also seeking a damaging confrontation with 14,000 cabin crew?

'It needs to think again and abandon plans to force through unfair, unworkable contractual changes.'

A BA spokesman commented: 'British Airways is facing very difficult economic conditions and is heading for a second successive year of financial losses for the first time in our history.

'Everyone within the company knows we must reduce our costs to move back towards profitability.'

Ryanair 'stop stupid tourist taxes'

Ryanair today called for the government to 'stop stupid tourist taxes' and threatened to stop expanding routes if Boeing failed to offer a better deal.

In the airline's half yearly results, net profit was up 80 per cent, while fares were down 17 per cent, but Ryanair warned expansion would be hindered by Boeing's reluctance to 'play its part in our cost reduction programme'.

The average fare charged by the airline stood at 39 euros (£35), with traffic growth up 15 per cent. Ryanair also said their net profit margin was 22 per cent, an industry leading figure.

Average fares could be cut by 20 per cent, the airline said, which could mean a loss for the second half of the year. However, profit is still forecast for the full year.

Ryanair's chief executive Michael O'Leary said: 'We expect average fares to decline by up to 20 per cent during quarters three and four, which will result in both these quarters being loss making. Despite this our full year guidance remains unchanged and will be substantially profitable, at a time when many of our competitors are losing money, consolidating or going bust.'

The airline warned traffic was being affected by passenger taxes, saying: 'Traffic at many Irish and UK airports has slumped, with Ireland facing a decline of 15 per cent of its air traffic, and the UK set to lose almost ten per cent of its traffic. We again call on the British and Irish governments to scrap these stupid tourist taxes and reduce airport charges.'

But Ryanair also warned today that they were making little progress in discussions with Boeing for an order of 200 aircraft for delivery between 2013 and 2016. Mr O'Leary added: 'We won’t continue these discussions indefinitely and have signalled to Boeing that if they are not completed before the year end, then Ryanair will end its relationship with Boeing and confirm a series of order deferrals and cancellations.

'We see no point in continuing to grow rapidly in a declining yield environment, where our main aircraft partner is unwilling to play its part in our cost reduction programme by passing on some of the enormous savings which Boeing have enjoyed both from suppliers and more efficient manufacturing in recent years.'

BA talks over strike action threat

British Airways (BA) staff talks are due to take place later today to prevent threatened strike action.

The talks are a result of an announcement by BA last week that 1,700 cabin crew jobs could go, as well as a pay freeze for staff and lower wages for new employees.

Talks are due to be held at the Advisory, Conciliation and Arbitration Service (Acas), with union leaders saying workers had 'no alternative' but to strike if the changes were put in place.

The proposed cuts could total 3,700 job losses from the airline over the next year.

The union Unite has said the cuts are a 'fundamental attack' on jobs.

The airline has been making huge losses over the last year, warning it expects further losses as the financial crisis damages the tourism trade.

Aer Lingus cuts 800 jobs as BA strike looms

Aer Lingus has said it will cut almost 800 jobs, while British Airways workers are threatening strike action after the airline announced 1,700 jobs will be cut.

The Irish airline said today jobs would have to be cut in a bid to save €97 million (£90 million) by 2011.

Meanwhile at British Airways, unions are warning cabin crew are planning an emergency meeting after the airline said it would make pay cuts and freeze pay.

The news from the two airlines comes in the same week as pilots across Europe protested over long hours which they said were 'putting lives at risk'. British pilots are prohibited from protesting.

The Unite union has said a strike ballot at BA was a possibility, with a meeting of union convenors planned to be held today to consider a response to the airline.

Aer Lingus has said there will be fewer flights, and new working methods to enable job cuts of 676 personnel, in addition to the 100 who have already been told they faced redundancy. Some staff will also see a pay reduction.

The airline says higher fuel costs are partly to blame, as well as a decrease in long-haul passengers.

Chief executive Christoph Mueller, said: 'Against this backdrop, Aer Lingus cannot continue with an operating cost base, which is structurally uncompetitive when compared to that of its closest peers.

'Our plan to reduce our operating cost base and change work practices will secure Aer Lingus' future as a viable and strong airline that can prosper in one of the most competitive travel markets in the world.'

British Airways has expected to make a big loss again this year, and said the job cuts would involve 1,000 cabin crew taking voluntary redundancy and a further 3,000 choosing to go part-time.

From today BA has said they will be introducing an additional fare for passengers who choose to sit with their friends or family on flights.

'Without changes, we will continue to lose more money with every month that passes. It is essential we make ourselves more efficient if we are to ensure our long-term survival,' BA said.

Passengers to pay for 'immigration queue jump'

Passengers may soon be able to pay to jump the queue at immigration at two of London's airports, BAA has confirmed.

Those returning from overseas will be able to take part in a trial, to be introduced next year, which has been designed to reduce delays and allow people faster movement through arrivals.

The fast-track gates will be charged at £40 or £50 a year, allowing regular travellers, or anyone wanting to jump the queue, to fast-track their way through immigration.

They will be installed with biometric passport readers at Stansted and Heathrow, and anyone with the updated version of the passport will be able to jump the queue free of charge.

A spokesperson for BBA said: 'This will be entirely digressional. We estimate it will cost in the region of £40 to £50 annually.

'At the end of the day it’s a discretionary payment that might make your life a bit easier coming through an airport; you don't have to buy it. The more regularly you fly the more cost effective it will become.'

The scheme will cost around £7 million to introduce at Heathrow, an amount it is hoped will be made back by the charging of the service.

Not everyone in the country has a biometric passport, as they were only introduced a few years ago, but the passport office will upgrade a current passport to a biometric one for a fee.

Many passengers can already jump the immigration queue by undergoing the IRIS test which matches passengers’ eyes against their information on a database.

BA to charge passengers who want to sit together

British Airways (BA) has said they will be introducing an additional fare for passengers who choose to sit with their friends or family on flights.

The airline today confirmed that from October 7th passengers will be able to book where they want to sit on the plane for an additional fee, with prices starting at £10 but rising to as much as £60.

Currently, passengers can book their seat up to 24-hours before departure, at no extra cost.

A statement from BA said: 'From October 7th, British Airways is launching a new service to give customers more control over their seating options.

'Customers will now be able to select their seats when booking and secure exit row seats for a fee.

'Customers frequently request specific seats, but in the past we've only been able to confirm them 24-hours in advance or on the day.'

Economy class trips to Europe will see passengers pay an extra £10 to choose their seat, while a long-haul flight in business class will cost up to £60 extra to choose a seat.

The add-on price could significantly raise the flight cost for families flying together.

Ryanair to close 9 of 10 Manchester routes

Ryanair has today announced it will be closing nine out of its ten routes from Manchester at a loss of 600 local jobs.

However, the airline said they hoped to switch the routes to other lower cost competitor airports.

The budget airline said the move came after Manchester Airport refused to lower its charges to 'reflect the lower fares being paid by passengers in the current recession'. The alterations to their routes will result in the loss of 44 weekly flights, 600,000 passengers a year and up to 600 local jobs.

The airline said they had offered the international airport an additional 28 weekly flights and 400,000 new passengers, creating 400 new jobs, if they reduced their charges. However, Ryanair claims the airport rejected the offer, saying they did not think their charges were 'unreasonable'.

From October 1st Ryanair's Manchester routes to and from Barcelona, Bremen, Brussels, Cagliari, Dusseldorf, Frankfurt, Marseille, Milan and Shannon will cease.

The airline said in a statement 'Passengers affected will be emailed directly by Ryanair and provided with a full refund or the alternative of flying to some destinations from competing, lower cost airports in East Midlands, Leeds Bradford and Liverpool'.

Ryanair spokesman Stephen McNamara said: 'Ryanair continues to lower fares to encourage travel, but with passengers paying lower fares airports must lower their charges – particularly high cost airports like Manchester, London (Stansted) and Dublin.

Ryanair had offered new routes, traffic and growth to Manchester Airport but since they prefer to preserve their high cost base than to grow, Ryanair will now switch/close nine Manchester routes to East Midlands, Leeds Bradford and Liverpool from October 1st.

'Ryanair will continue to grow at low cost airports which work with us to deliver the low fares required to keep passengers flying during this recession. Ryanair apologises to passengers affected by these cancelations and will contact them in the coming weeks to provide them with a full refund or a switch to similar flights to/from lower cost airports in the region.'

The airline recently announced new bases at Leeds Bradford and Porto airports.

A Manchester Airport spokesperson responded to today's announcement, saying: 'Not withstanding all of our investment in Manchester Airport including during the current recession, we don't believe that charges as low as £3 per passenger are unreasonable. Clearly, Ryanair do and that's regrettable.

'We've consistently cut our charges for the last 15 years even when faced with increased costs such as security.

'Passengers will still be able to travel directly to the majority of the destinations affected by choosing other airlines.'