mishkira

Last weeks I have seen so many threads abour ongoing changes (except NGCW, mostly were not to the better as far as PAX see them), various rumours and foreseen "enhancements"... So I start wondering how BA operations will look like in say 2013. I just picked 6 years horizon (nothing to do with London Olympics) as it is close enough to be real but remote enough to have some space for the changes to happen.

Shall we see more long-haul routes?
Long-haul seem to be the main revenue generator after current "cost savings" programme will kill all non-value-added (in WW eyes) bases and destinations. If that is the way forward, then BA needs to expand much more into Asia and re-think very limited South American network. Both regions rapidly transform into world industry leaders (plus tourism would increase from both sides) so I would welcome BA to fly to much more destinations.

Shall we see many new planes?
I feel BA is long overdue to make some strategy decision (I know it is funny word nowdays while we hurdle those strategic baggage issues) and place orders. All large MiddleEast and Asian competitors do spend big money to upgrage their fleet next years.

Shall we fly on BA at all?
Well, this is a big one. One side, shall we want flying BA if the company will stall on 2 above points? I am sure this is debatable to the hearts and bones. But what I really wonder - will BA be in business independently in 5 years time? Or BA might end up just as brand name belonging to another carrier or even worse... I cannot see British government would safeguard "national carrier" in the same way how French or Americans subsided or chaptered their lots. So, if a proper bid or billionaire want to have it, well, then BA name might be found in the aviation museums... Not something I want but hey we talk about 2013!

Just wonder what you think on above topics

NSFU

I think WW can't see beyond his current bonus target. BA's strategy is pure short-termism and predicated on the anticompetitive edge it gets on transatlantic routes. In slashing its broad portfolio of domestic and international routes it becomes much more vulnerable to global economic and political shifts - or much more able to respond, if that's the way you look at it

There is no sense of 'flag carrier' left

vla

Good thread, mishkira. To my mind Mr Walsh's long-term currency is variable. Shareholders have been rewarded and may even expect a dividend at some time, but ultimately an airline is not only about shareholders' concerns (just look at the recent history of United Airlines, for one). But the underlying fabric of the airline is surely being modified before our eyes and the end result -- if one follows recent whispers and glances -- may be something very different than what we now know.

Mr Walsh's legacy will be the based upon the centralisation of operations at LHR T5. This, really, comes as little wonder in the big scheme of things as the reality of having overlapping operations between LHR and LGW is merely a curiosity related to the overpopulated SE England. Nobody would ever actively choose to connect between the present LHR T4 or T1 and LGW N. It's another London quirk that one may have to deal with sometime. If this could be consolidated under the government's aviation plan and the promise of a third LHR runway and the opening of T5, it may well be the case that present management is in the process of implementing some rather bold plans. Indeed the catchphrase has always been that T5'll getchya'sorted.

This leads to another question: the purchase of BAA by Ferrovial. If the biggest sticking point in BA's operations is the inefficiencies of its LHR ops, and the situation with BAA/España remains probably the topic of dinner party conversations somewhere, who knows. Who knows indeed when all aspects of a modern airline must be profitable -- so says, of course, Mr Walsh.

I suspect an awful lot of people particularly in the British Isles will become really very, and quite genuinely, pissed off in the process. That said who knows what connecting flight, miles and points, and interlining possibilities will become available in the future. But London is clearly on the ups, at least into the medium-term now. I do say, however, that I wonder if Mr Walsh is up to the overall task, if indeed some of the imagery of what could be the direction things may go is beginning to bleed out from behind the canvas.

I agree.

mike turnbull

Let's hope that Mr Walsh doesn't get too friendly with Mr O'Leary over the coming months/years......or even Mr Baggy Jumper.

thegoderic

Route rationalisation will mean that only truly profitable routes will be flown by BA. Therefore the BA route map will show flights between LHR and JFK... er and that's it.

The trend for getting the passengers to do the work will continue. As well as checking yourself in, passengers will be given a task to fulfil during the flight. This may range from serving the drink to flying the plane.

Allocated seats will be limited to BA non-exec directors. All other passengers will be encouraged to bring their own inflatable seats. (Also available in BAA shops)

BAA baggage policies mean that carryon size remains the same, but BA will now charge by the kilo for all hold baggage. A new industry is formed of carryon compactors, who, using technology similar to that seen in scrapyards, will take all of your holiday baggage and crush it into a cube small enough to fit into the BAA template. As a result of this BAA will open a new line in selling anabolic steroids to allow people to build enough muscle mass lift their bags.

Catering has been enhanced. Economy class passengers will not be offered food and passengers will be charged for the nutrients that they breathe in from the air recycled from Club and FIRST. Club passengers will still be given food, but the drinks menu has been streamlined to consist of Irn Bru and Vimto only. FIRST passengers will have a choice of Blue Nun or Lambrini.

Alternately the BA board will sack WW before he creates too much damage and replace him with a CEO who believes that the way to deliver profitability is to understand what customers want and then deliver that. Or is that too far fetched?

redshift27

WW is certainly into service rationalisation, cost-cutting, trimming off the spare fat etc. Every megacorp needs this once in a while, to get rid of the bloat and cruft they acquire with time. The challenge for the BA Board is knowing when to stop the surgery before it goes too far, and at that point they should replace him with a more visionary CEO who will create new product / attract new customers. If they wait too long, the surgeon will have killed the patient.

Boddingtons

Raffles for CEO ^

krug

Not sure about 2013, but in 2004, I wrote this time capsule to see what might be the case ten years hence - quite a bit already coming true......


2014: A British Airways Odyssey

“I waited a long time to book my ticket on this new aircraft; this will be the first flight of the new A380–1000 Next Generation series non stop, direct service to Sydney and I am looking forward to sampling the much trumpeted in flight products, especially getting my first glimpse of the new enhanced sleeper service Y product............................

mishkira

^ many thanks krug, I enjoyed reading your time capsule!
We somehow hit some wwery dangerous and supernatural challenges (aka no food on board dueto catering walk-out and baggage handlers not willing to lift 24 kg) last 3 years so your story in fact sound like it was written by Herbert Wells in early 20th centrury and not in 2004! But great to see we are making steady progress with that brown story so I am sure taxes on miles will be the next big opportunity covered in 2008 budget! Britain doesn't need to wait such remote 2013-2014!

Dickie28

British Airways in conjunction with Irish Airlines (The artist/airline formally know as Ryanair)

Low life Magazine 2013

Connecting passengers LHR T5 Domestic and Intra European

Connecting passengers Domestic or Intra European after arriving at LHR T5 can transfer to our code share partners National Express for all domestic destinations or Eurolines for all European Destinations. Tickets can be purchased onboard, ask one of our crew members for details.

All Gold and Silver BAEC members will receive a voucher for one hot or cold drink (Please note one) to enjoy at their leisure on their onward journey to the provincial parts of The UK outside the M25 (if they must) or that place 21 miles south of Dover and the rest of Europe. In addition they will receive priority boarding and be seated towards the front of the coach and subject to availability be upgraded to “prestige seating” (TM 2010)

Alternatively for a “small” (everything is relative, I would not do it if I was you ) premium supplement you can make your own way to Stansted to continue your journey with Irish airlines who are looking forward to welcoming you onboard.

British Airways would like to inform you that no mileage or tier points will be credited for these journeys regardless of class flown to the UK. British Airways would like to point out to you that it is bears no responsible whatsoever for any lack of service or later complaints arising from flying with Irish Airlines.

We look forward to welcoming you onboard and we value your continued custom.

Sir Wee Willie Walsh

bmiStar

Industrial action of one kind or another

Cyba

I like this thread!

I understand the 10% target and all that. But to your point about new long haul routes, and how they are being somewhat short-termist, I see BA's European competitors expanding fast in the regions you mention with no problems to their profitability. E.g. LH flies 47 flights a week to China vs BA's 31 (a whopping 33 vs 10 if you exclude HKG) and AF flies 26 flights a week (33 if including KL) just to Brazil and Argentina vs BA's 10.

I, for one cannot believe that those competitors are not making money on those routes. OK, the space share of Y on their planes is higher than BA's but so what? Their C loads are stil quite healthy. And LH for instance flies mostly 744s and 346s to China where BA could have flown 777s.

They're either being very short termist here or they really think they can play catch-up. Time will tell.

BearX220

No airline shrinks its way to greater influence.

krug

I think BA have had to spend this year re-grouping - dealing with domestic shorthaul and the unions, introducing www.newclubworld.com and also all the behind the scenes planning for T5, including dealing with the pension issue.

Next year will see T5 and the new fleet order being made; BA is doing the right thing by consolidating on current routes and capacity, and will expand only when it has the capacity to do so.

Being lean allows an airline to ride out a modest economic downturn, and there should be one along any minute IMHO.

ian001

Most companies will only focus on 2-3 major issues at a time, and I don't think anyone would argue that the pension deficit and the move to Terminal 5 should not take priority.

For all the ire that is directed at Willie Walsh on this board, the pension deficit should have been addressed a long time ago and if someone had had the courage to tackle the very difficult issue of archaic and outdated working practices at LHR years ago, the move to Terminal 5 may not be such a daunting task.

The 10% margin target was also set by Rod Eddington, and whilst I wish BA would give it up gracefully, this is not so easy given a bonus scheme has been put in place.

I'm sure there are many routes where BA would love to extend frequencies, but it needs the slots at LHR, the aircraft, and the rights to fly the routes. Many routes are governed by bilateral treaties which restrict frequencies.

Fleet renewal is planned once the pension deficit is sorted. After the move to Terminal 5, I guess the main issues that will drive BA will be:

a) Consolidation. Who to consolidate with, and who not to consolidate with. There are opportunities that could be missed if BA's competitors are ahead of the game, but also deals are not without risk and a badly executed deal and difficult integration could be a massive headache and distraction to the business.

The big question is whether BA wants to merge with Iberia to create dual-hub operation in Europe. Also, is it time to start building a closer working relationship with CX? What will happen to Qantas following the pe deal? If there is another change in ownership in QF 2-3 years after the deal, could it leave Oneworld?

b) The possibility of continued deregulation, and the opening up of LHR.

c) Extending to new routes, particularly India and China.

d) Maintaining leadership in the premium market through continued innovation in the face of competition from carriers at other hubs and, if they prove to be successful, the development of niche all business class carriers.

e) Fixing the "us and them" industrial relations problems, which still have a propensity to flare up once in a while.

Oh, and of course, dealing with whatever shocks are around the corner. At the start of 2006, no-one would have a predicted that a temporary ban on hand-baggage followed by permanent restrictions, the BA uniform, and days of heavy fog at Christmas, would be the major public issues facing BA that year.