JAXBA

If you mean the transfer of contracts to Gatwick Ground Services, GGS Ltd. is actually a wholly owned BA subsidiary, so they would technically still be BA staff, with retained seniority, but with reduced 'non-airline subsidiary' benefits. It's more of a shell game, and yes, it can affect morale, but not as much as actual outsourcing.

The subsidiary can of course be later sold off and/or the employees TUPEd to another company, but whether that's planned or not I have no idea.

I too worked for a 'non-airline subsidiary' of BA in JAX - Teleflight Ltd. We were/weren't BA depending on what BA needed...

cameramaker

If the primary differentiator for most pax is price, then why would BA close down its ops at LGW and move them to LHR thus increasing operating costs and eroding margin?

BA need seats filled once the recovery starts, so surely it would make sense to maintain some operations where you can operate with lower costs?

If BA need to fill slots at LHR, surely the best way forward would be to downsize at Gatwick and move some of the less price sensitive routes to LHR? So we could well see most, if not all routes, being operated from one or the other.

Prices may not automatically increase if a route moves from LGW to LHR. If they did, then that would suggest a low price elasticity of demand for BA fares, which we know isn’t the case due to the enhancements down the back and unbundling of fares. Upfront, we may see prices increase slightly due to the premium attached to a LHR departure and an increase in demand for seats from connecting traffic.

When the economy does recover, it’d be far easier to expand quickly at LGW again, having maintained a more streamlined operation than a complete withdrawal.

A rationalisation of the cabin crew fleets makes absolute sense in terms of operational efficiency and cost reduction. Surely this would’ve been a necessary next step for Cruz and his hatchets despite the pandemic and can only be a good thing for the future prospects of BA.

The company needs to shed cost now but maintain an ability to quickly expand again, but do so at a lower cost than it does today. Conceding territory at LGW is only going to increase competitive pressures once the economy grows again in the mid to long term.

rockflyertalk

Also to add...what happened to the Monarch slots? Didn’t BA take those? What happens to those now?

BAeuro

So BA took most on, with some more going to the other IAG members (Vueling, LEVEL...). They also lent some to Qatar I believe, so that they could start LGW-DOH.

Thomas Cook were leasing a bunch but I guess they’ve been returned to IAG since they failed.

There’s so many slots at LGW it would seem ridiculous to pull out altogether.

Chris_G

Paris...??

ISTFlyer

IAG has the potential to build a new hub at Gatwick for Vueling or LEVEL.
With a new subsidiary ( LEVEL UK ), they could easily open routes to the Caribbean, New York, etc... with Premium Economy and Economy only aircraft ( re-configure older BA 777-200's or purchase new aircraft ) and they could easily serve most of the seasonal routes with their A320 aircraft. And, they could move all essential operations to Heathrow.

Plus they could close their LGW lounges and save tons of money.

BAeuro

That’s served by Vueling (LGW-CDG), not BA.

BA6501

Paris is operated by VY.

cameramaker

IAG could do that, but it'd incur further costs in the rebranding exercise and reconfiguring a fleet of 772s which have only just been refurbished. Vueling and Level don't have a strong brand in the UK, so they'd incur further costs in increasing brand awareness and their average revenue per seat would be lower. The UK market is willing to pay more for BA seats due to the strength of its brand and its loyalty scheme. Remove that and they'll be competing pretty much solely on price from Gatwick.

Swissroll

My guess, BA would not want to completely give up Gatwick for now just in case there is rapid recovery. If not and the aviation industry is seriously downsized for the long term - then all bets are off.

PJSMITH0

Me too as a Manchester based flyer all Caribbean slots and Jersey to LHR would be brilliant

FlyerTalker39574

There are so many significant unknowns it really is a guessing game. It’s wait and see what happens to Virgin, Norwegian and TUI at LGW. If some of BA’s densified B772s are needed at LHR, that’s also a big question mark.

T8191

... and I'll add a few others like CPT as well.

There's obviously a strong Summer demand for s/h flights to Europe [especially the Mediterranean] but there's also a large l/h Leisure market to sunny places in the Winter. KIN, BGI, ANU, UVF, CPT/JNB and the like attract, IME, full aircraft year-round ... despite the current price levels on those routes. BA will need to keep them operating, once Borders re-open, although I do acknowledge that post-Covid there may be fewer people willing/able to pay for it. Remember that a lot of pax, especially in Y, are nationals visiting family to/from UK.

ISTFlyer

You are absolutely right at some point, the people in the UK are willing to pay more to BA for the brand name ( Eg. Honeymooners paying extra to fly BA + PG via BKK to HKT instead of cheaper QR fares via DOH, then these people complain about seat fees in CW or being separated because they haven't paid for seats )

However, similar to the IB - LEVEL relationship, BA could easily sell LEVEL flights under the BA code.
Iberia wiped out BCN operations and transferred their ops to Vueling, and people who specifically want to fly Iberia, now fly via MAD.
BA could easily remove all their LGW inventory and passengers who specifically want to fly BA would drive to Heathrow.

By the way, my suggestion could also be done under a brand name like " XXXXXX by British Airways " rather than the brand of Vueling or LEVEL.

JerseyPilot

Just a word from the inside at BA. The “closing Gatwick” one's been doing the rounds for a while. It's all part of project fear. Internal sources have confirmed there's no plan to close the base entirely, but it's likely to be a smaller operation. They'd be mad to close it and give up all the slots to the competition.

The BBC headline has twisted what was actually in the memo. All it said is we cannot be sure when it will be reopened.