December traffic stats - 12.1% fall in premium traffic
Jan 6, 2009, 7:34 am
#1
Original Poster
Join Date: Jan 2003
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December traffic stats - 12.1% fall in premium traffic
Out now - cargo down 14%
Looks like the back end of the bus is holding up reasonably ok - but given BA's model, that premium traffic fall is going to hurt...
Originally Posted by BA
Summary of the headline figures
In December 2008, passenger capacity, measured in Available Seat Kilometres, was 3.0 per cent below December 2007. Traffic, measured in Revenue Passenger Kilometres, fell by 3.4 per cent. This resulted in a passenger load factor decrease of 0.2 points versus last year, to 76.7 per cent. Traffic comprised a 12.1 per cent decrease in premium traffic and a 1.7 per cent fall in non-premium traffic.
Cargo, measured in Cargo Tonne Kilometres, fell by 14.3 per cent.
In December 2008, passenger capacity, measured in Available Seat Kilometres, was 3.0 per cent below December 2007. Traffic, measured in Revenue Passenger Kilometres, fell by 3.4 per cent. This resulted in a passenger load factor decrease of 0.2 points versus last year, to 76.7 per cent. Traffic comprised a 12.1 per cent decrease in premium traffic and a 1.7 per cent fall in non-premium traffic.
Cargo, measured in Cargo Tonne Kilometres, fell by 14.3 per cent.
Jan 6, 2009, 7:57 am
#2
Join Date: Jun 2006
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hurting
I can still fly in the middle of the bus either in WTP or CW, but and it is a big but if, i can get an equivalent seat with another carrier at half of the price, with perhaps a little inconvenience, guess where the company wants me to sit?
I am having fish to Japan with finnair this month, which is not that bad. BA needs to sit up and take notice. Thats 360 TP as well!
I am having fish to Japan with finnair this month, which is not that bad. BA needs to sit up and take notice. Thats 360 TP as well!
Jan 6, 2009, 9:22 am
#3
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I can still fly in the middle of the bus either in WTP or CW, but and it is a big but if, i can get an equivalent seat with another carrier at half of the price, with perhaps a little inconvenience, guess where the company wants me to sit?
I am having fish to Japan with finnair this month, which is not that bad. BA needs to sit up and take notice. Thats 360 TP as well!
I am having fish to Japan with finnair this month, which is not that bad. BA needs to sit up and take notice. Thats 360 TP as well!
Jan 6, 2009, 9:38 am
#4
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Interesting to note that Asia/Pacific was the hardest hit region with a drop of about 12% in loads and revenue passanger carried.
You may still have ahead bookings but it seems that some regions traffic is nosediving, notably North America and Asia/Pacific. The fall in cargo traffic is also worrisome therefore BA should plan more carefully where to deploy the B747s.
Rgs,
You may still have ahead bookings but it seems that some regions traffic is nosediving, notably North America and Asia/Pacific. The fall in cargo traffic is also worrisome therefore BA should plan more carefully where to deploy the B747s.
Rgs,
Jan 6, 2009, 10:13 am
#6
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It could be BA are talking about revenues not numbers of occupied seats. There are a lot of scenarios where the revenue won't drop off as fast as the passenger numbers. Of course it may just be their duck impressions - hopefully they will be paddling like crazy under the surface if that's the case.
Jan 6, 2009, 10:26 am
#8
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I can still fly in the middle of the bus either in WTP or CW, but and it is a big but if, i can get an equivalent seat with another carrier at half of the price, with perhaps a little inconvenience, guess where the company wants me to sit?
I am having fish to Japan with finnair this month, which is not that bad. BA needs to sit up and take notice. Thats 360 TP as well!
I am having fish to Japan with finnair this month, which is not that bad. BA needs to sit up and take notice. Thats 360 TP as well!
What I'm puzzled about is what you think BA ought to do? I'd hazard a guess that they're barely breaking even at present. How high would they have to get the CW load factor if they cut the prices by, say, 25%? Would they achieve more total revenue and be more profitable overall? For that matter how can the AY price be sustainable? Surely their total costs have to be higher for indirect routes?
Yes, the next year or two are going to be tough but I hope BA can get through this without suicidal discounting and without feeling even more pressure to race to the bottom.
Jan 6, 2009, 10:28 am
#9
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BA has already taken 3 747s out of service and the new 777s arriving this year will be used as replacements, rather than for growth as had originally been planned. One HKG route is going down to a 777.
Originally Posted by hardiwv
Interesting to note that Asia/Pacific was the hardest hit region with a drop of about 12% in loads and revenue passanger carried.
You may still have ahead bookings but it seems that some regions traffic is nosediving, notably North America and Asia/Pacific. The fall in cargo traffic is also worrisome therefore BA should plan more carefully where to deploy the B747s.
Rgs,
You may still have ahead bookings but it seems that some regions traffic is nosediving, notably North America and Asia/Pacific. The fall in cargo traffic is also worrisome therefore BA should plan more carefully where to deploy the B747s.
Rgs,
Jan 6, 2009, 10:30 am
#10
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Are they? Everything I have seen from Martin Broughton and WW has been unambigously negative, describing this as "the bleakest trading environment the industry has ever faced".
Originally Posted by LH/LX
Quite shocking to see premium travel traffic is dropping while BA executives keep on claiming that it has not been effected much.
Jan 6, 2009, 11:00 am
#11
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How high would they have to get the CW load factor if they cut the prices by, say, 25%? Would they achieve more total revenue and be more profitable overall?
...
Yes, the next year or two are going to be tough but I hope BA can get through this without suicidal discounting and without feeling even more pressure to race to the bottom.
...
Yes, the next year or two are going to be tough but I hope BA can get through this without suicidal discounting and without feeling even more pressure to race to the bottom.
What makes more money: fewer people paying more or more people paying less?
They've done the math and - possibly learning from recent past history - worked out that the former strategy works better for them
Jan 6, 2009, 11:17 am
#12
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They should start by looking at what the other big players do- like for example having a strategy that doesn't depend so heavily on one set of routes (North America) and one (out of the four they've got!) class of service (CW).
But even then, AY benefit from shorter sectors to/from Asia, which means they have to fly the big seats for fewer hous.
Jan 6, 2009, 11:50 am
#13
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I guess exactly that is driving the strategic direction they have chosen.
What makes more money: fewer people paying more or more people paying less?
They've done the math and - possibly learning from recent past history - worked out that the former strategy works better for them
What makes more money: fewer people paying more or more people paying less?
They've done the math and - possibly learning from recent past history - worked out that the former strategy works better for them
Whether they've managed to learn anything from their mistakes is what remains to be seen.
Jan 6, 2009, 1:44 pm
#14
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BA has already taken 3 747s out of service and the new 777s arriving this year will be used as replacements, rather than for growth as had originally been planned. One HKG route is going down to a 777.
BA has already taken 3 747s out of service and the new 777s arriving this year will be used as replacements, rather than for growth as had originally been planned. One HKG route is going down to a 777.
In the meanwhile, it seems Africa and Latin America remain resilient markets. We could therefore expect BA to carefully examine these markets such as more frequencies to GIG nonstop, split GRU and EZE so that both have dedicated flights, and more capacity to East Africa in general.
Rgs,
Jan 6, 2009, 1:48 pm
#15
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There's also a reminder in the statement that figures now include frequent flyer mileage redemptions, and if I read it correctly they have restated the 2007 figures so that they are on the same basis. I don't have the old figures, but this should make it possible to work out the percentage of passengers travelling on redemption tickets for each market (for Q4 07 at least), if anyone is interested.
I assume if premium loads remain weak there will be another mile sales later in the year, to help keep the load factor up and reduce the number of miles in circulation.
I assume if premium loads remain weak there will be another mile sales later in the year, to help keep the load factor up and reduce the number of miles in circulation.