BA Needs Competition - Economist

Old Jun 5, 2017, 2:14 pm
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BA Needs Competition - Economist

Hi all,

Haven't seen this posted around here, but please merge if I missed the thread.

Interesting article on the Economist regarding the need for more competition for BA in order for it to improve its service and product standards. Agree with the fact that more competition would result in a better product, however not sure how realistic the proposed idea of a new full-service Heathrow-based carrier is. Seems a bit ambitious and idealistic, especially since my understanding is a third runway is still not guaranteed.

article here: http://www.economist.com/blogs/gulli...6/share-spoils

Cheers,
TUF
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Old Jun 5, 2017, 2:20 pm
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Interesting.

I'm no expert on these matters, but BA does seem to suffer from complacency and arrogance in respect of its position in the marketplace. How that could be shifted is, of course, the $100m question.
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Old Jun 5, 2017, 2:41 pm
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BA do have a competitor, albeit a significantly smaller one - Virgin Atlantic.

In my mind if Virgin had more landing slots and were able to target the business traveller market as BA do, especially since now they have the Delta tie up for domestic US connections, BA would no longer be able to be so complacent.

I don't see the need for a brand new carrier to compete, just take some of BA's landing slots away and give it to the other flag carrier.
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Old Jun 5, 2017, 2:41 pm
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There is competition it's just that BA has a very heavy level of inertia in many of it's customers who will stick with them no matter what they do and only fly with another airline if BA dosen't fly to their destination.

As mentioned on the 2 year extension thread some people might be tempted to try other airlines because their BA status is protected but I don't think the numbers doing that would even register with BA.

And even if people fly AA BA still benefits because of the JV.

Fly EI to Ireland and you are still in the same IAG family.
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Old Jun 5, 2017, 2:46 pm
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Virgin needs a major leg-up to provide realistic competition. Could be a good thing.
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Old Jun 5, 2017, 2:49 pm
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Flown EI s/h. Bleurgh.
Flown AA l/h. Nice.
I accept the JV still brings money, but at least it seems to us to be a better product. YMMV.
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Old Jun 5, 2017, 2:54 pm
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Originally Posted by Flexible preferences
Virgin needs a major leg-up to provide realistic competition. Could be a good thing.
That major leg up would need to involve:

(1) a tie up with an established shorthaul operation that is able to provide feeder traffic;
(2) a significant increase in LHR slots being made available.

The first would be a stretch unless LHR is opened to LCCs or BA is forced to open its shorthaul network on equitable terms to other longhaul carriers by regulatory intervention. The second won't happen until there is at least another runway at LHR and, more realistically, two.
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Old Jun 5, 2017, 3:01 pm
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And lets not forget VS hasn't been the kings of morality themselves in the past.
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Old Jun 5, 2017, 3:05 pm
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Originally Posted by navylad
And lets not forget VS hasn't been the kings of morality themselves in the past.
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Old Jun 5, 2017, 3:08 pm
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The price fixing scandal between the two of them comes to mind.
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Old Jun 5, 2017, 3:10 pm
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What ever residual loyalty BA had to to the UK had long gone. As it is now a Spanish company, run by foreigners and owned by a state accused of sponsoring ISIS I think the a full examination by the government is not a bad idea, with a view to breaking BA up or at least reducing their slots.
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Old Jun 5, 2017, 3:13 pm
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Originally Posted by Worcester
What ever residual loyalty BA had to to the UK had long gone. As it is now a Spanish company, run by foreigners and owned by a state accused of sponsoring ISIS I think the a full examination by the government is not a bad idea, with a view to breaking BA up or at least reducing their slots.
wishful thinking hey.
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Old Jun 5, 2017, 3:16 pm
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Originally Posted by navylad
The price fixing scandal between the two of them comes to mind.
Dirty tricks comes to mind.
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Old Jun 5, 2017, 3:17 pm
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Originally Posted by navylad
The price fixing scandal between the two of them comes to mind.
Was that before or after the 'dirty tricks' campaign that cost BA rather a lot of money?

virgin wins libel battle with BA

And isn't the JV little more than a price fix?
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Old Jun 5, 2017, 3:20 pm
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Arguably it's the competition that has made BA change tactic: Norwegian
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