BA removes first class service on long haul flights

International jet-setters are likely to be distressed by the news that British Airways will be doing away with its first-class service, as the recession has taken a major bite out of demand for premium air travel. 

For decades, flying first class on BA, was the only way that many business moguls and glitterati would think of travelling. 

The carrier has already removed first class accommodation from long-haul aircraft, and is currently reviewing the seating configuration for new planes. 

In the post-millennium boom, well-to-do passengers spent lavishly for access to the airline’s designer cabins, Michelin-class dining, the world’s finest wines and free pyjamas and slippers. When the credit crunch hit last year, however, the demand among air travellers for in-flight opulence took a nosedive. 

Willie Walsh, the BA chief executive, confirmed that luxuries were being stripped. He said: “The long-haul aircraft that we take delivery of this year will not have any first class cabins in them,” adding: “Longer term we will review the configuration of all new aircraft.” 

British Airways needs to find ways to cut costs. Demand for both first and business class has fallen sharply, and it has just reported a 401 million pound ($638 million) loss even though it is still adding routes. British Airways also revealed that its new service from London Heathrow to Las Vegas, to be launched later this year, and which will cater to “high rollers”, will not offer a first-class cabin.

Existing flights will keep their first-class seating at the moment because company officials state that the cost of tearing out the section and replacing it with business class or coach seating would be too expensive. This could have a good effect on the more proletarian passengers–because with more empty seats in the posh section, there would be a greater chance of getting upgraded. The potential bonanza may not last long, however, because BA might follow the lead of other carriers like KLM and Delta and scrap first class on transatlantic routes altogether.

BA-Malaysian in talks for merger???

Speculation is rife that Malaysia Airlines (MAS) is in talks for a possible merger or a strategic alliance with British Airways (BA) and Qantas to form a global airline.  It is learnt that what is being looked at is the creation of a super alliance or a global airline, and could involve other airlines. 

Under pressure from the global economic conditions, the airline industry is now going through a consolidation period with talks of mergers, acquisitions and bankruptcies dominating the business pages.  MAS did not deny the talks, but would only say today that the Malaysian national carrier was pursuing strategic partnerships with a number of airlines. 

“We are in talks with a number of airlines on collaborating and creating synergies for growth. This ranges from joint ventures and code shares to interlining partnerships,” said MAS CEO Datuk Seri Idris Jala today.  ”In our Business Transformation Plan, we have said we will pursue strategic partnerships to create additional value for Malaysia Airlines. This is in line with our vision to transform into The World’s Five Star Value Carrier.” 

The Sydney Morning Herald in Australia reported in this morning’s edition that Qantas had held merger discussions with MAS earlier this year, and is believed to be keeping its options open in case its own proposed merger with BA fails.  This morning’s Sin Chew Daily, Malaysia’s best selling Chinese-language newspaper, splashed a front page report claiming that all three airlines are looking into a merger or alliance. 

Quoting sources, the newspaper said the merger would cut off the possibility of Qantas or BA merging with Singapore Airlines, a scenario which the newspaper described as disastrous for Malaysia and MAS.  Neither Qantas nor BA currently flies to the Kuala Lumpur International Airport (KLIA).  While details of the talks remain sketchy, it is understood that what is on the cards is a business arrangement which is “deeper than a code share, but maybe just short of a merger.” 

This would mean the respective airlines remain in local control with their own identities intact, with the possibility of that a new super-holding company could be formed.  But any deal will still be subject to government approval.

British Airways to reduce Fuel Surcharges

British Airways has announced today that it will further reduce its fuel surcharge on all flights. They reduced the fuel surcharge back in October 2008 but this is a much bigger reduction this time and also affects all cabins.

British Airways will drop its fuel surcharge by as much as a third on longhaul services from Thursday, December 18. 

The move reflects the reduction in the price of oil and the airline’s fuel hedging policy for 2009/10. 

The reduction in fuel surcharge will mean: 
· For World Traveller flights over nine hours a reduction of £30 per sector to £66. On flights of less than nine hours a reduction of £15 per sector to £53. 
· For World Traveller Plus flights over nine hours a reduction of £30 per sector to £85. On flights of less than nine hours a reduction of £20 per sector to £63. 
· For First and Club World flights over nine hours a reduction of £35 per sector to £98 and on shorter flights a reduction of £20 to £78. 

BA Cityflyer adds 5th Daily Glasgow flight

BA Cityflyer is adding 5th Daily flight on the London City – Glasgow route from 27OCT08, offering early morning flight from London and late evening service from Glasgow

The new flight is:

BA8720 LCY0650 – 0815GLA AR1 x67
BA8729 GLA2010 – 2140LCY AR1 x567

Jet Airways to bid for BMI

In late breaking news from sources, Jet Airways is believed to be in advanced stages of a agreement to bid for BMI for as much as USD 400 Million.  Meanwhile rumors are also floating that Etihad is in talks with BMI for a possible merger.

Like almost all airlines, BMI has seen its profits trimmed this year by the continuing high price of aviation fuel.

This has led to a number of carriers seeking closer ties with rivals, such as British Airways plans for a tie-up with American Airlines.

Other carriers have faced financial problems, such as Italy’s Alitalia, which is trying to secure a rescue deal. BMI flew 10.6 million passengers last year, and operated 70 aircraft.

As the owner of 11% of the take-off and landing slots at Heathrow Airport, bmi is seen as a very valuable asset, especially as the value of its 83 slot pairs – the largest portfolio after British Airways – has sky rocketed following last year’s open skies deal between the European Union and the US, which opens up Heathrow to new airlines from April 2008.

For Jet Airways, bmi could prove to be critical as it is finding it difficult to break into the European market from its hub in Brussels as other European airlines are not keen to partner with it.

So, with bmi in its pocket, it could piggy back on its formidable presence across Europe and also use Heathrow as a second international hub.

Keep tuned to here for more updates!!!

British Airways and Iberia to merge

British Airways has announced a €5 billion merger with long-term partner Iberia.

The BA and Iberia brands will be retained as part of a combined group listed on the FTSE 100 Index and the Madrid Stock Exchange.

A final agreement will be finalised in the coming months after the EU gave the move the green light.

British Airways’ chief executive, Willie Walsh, said: “The aviation landscape is changing and airline consolidation is long overdue. The combined balance sheet, anticipated synergies and network fit between the airlines make a merger an attractive proposition, particularly in the current economic environment.”

Anlaysis : This merger could mean potential issues for group pricing issues as flights will be cut and this will lead to an increase of prices on BA and Iberia flights….This is slightly negative for the passengers in terms of ticket prices, but a big positive in terms of new routes and networks.

OpenSkies announces new Premium Service

OpenSkies, the new premium transatlantic airline from British Airways, announced today that it will offer daily service between Amsterdam’s Schiphol International Airport and New York’s John F. Kennedy Airport beginning on October 15, 2008.

Tickets for the Amsterdam-New York route will go on sale in early August.  The daily flight departs from Amsterdam-Schiphol at 1:20pm arriving in New York-JFK at 3:35pm and departs New York-JFK at 8:05pm arriving in Amsterdam-Schiphol at 9:40am the following morning.

 OpenSkies offers guests superior service, competitive fares and exceptional value.  The Amsterdam-New York route will be served by the current OpenSkies’ 757 flying the Paris-New York route.  An additional 757 from the British Airways fleet is now undergoing modification and will join OpenSkies when the Amsterdam route launches this fall.