06 July 2009

BA accelerates capacity cuts

British Airways is cutting capacity further following traffic levels dropping by almost four per cent last month.

Traffic, measured in revenue passenger kilometres in June, fell by 3.8% resulting in a passenger load factor decline of 1.8 points versus last year, to 79.6%.

There was a 14.9% drop in premium traffic and a 1.3% fall in economy.

The airline’s available capacity for this summer will be down by 3.5% against a planned drop of 2.5%.

For the winter, capacity will be reduced by 5% instead of the 4% originally planned.

Three remaining Boeing 757s will be grounded next summer and a further three 747-400s in winter 2010.

The delivery schedule for the first six Airbus A380 mega jumbos has been extended by an average of five months with the first delivery still due in 2012.

The schedule for the remaining six A380s has been extended by an average of two years with the final aircraft arriving in 2016, BA said.

Forecast capital expenditure has been reduced from £725 million to £580 million for 2009/10 and is likely to remain at that level in 2010/11.

"Market conditions continue to be very challenging with trading at levels well below last year," the airline said.

"However, on an underlying basis, both premium and non-premium volumes and seat factors have now been stable for more than three months."

by Phil Davies