International Airlines Group held its annual Capital Markets Day on Friday 15 November 2013. This is an event where a very large volume of financial and strategic material is presented to institutional investors and analysts. However, there are small items of news (more to follow) of interest to the public at large.
One concerns the London-Singapore-Sydney route. Ever since Qantas jettisoned its partnership with BA in favour of a joint-venture with Emirates there has been speculation as to whether BA would be able to continue to serve Australia directly.
Over the past few years, British Airways has operated summer seasonal weekend flights from its London Heathrow base to European holiday destinations.
Initially, these were charter flights for holiday companies and last year BA launched seasonal weekly flights to Ibiza and Palma de Mallorca. Both of these two destinations are to return to Heathrow next summer.
The use of Heathrow slots for summer seasonal flights ramps up a gear next summer as BA launches twice weekly flights to Faro (also operated from Gatwick), Malaga (also operated from Gatwick and London City), Mykonos, Porto and Santorini.
Flights to Oporto, Faro and Malaga operate from 30 March 2014. Flights to Mykonos operate from 3 May 2014 and flights to Santorini operate from 4 May 2014.
Although it may seem unusual BA is launching these routes from its main hub at Heathrow, instead of Gatwick which has served as BA’s main base for leisure flights over the past years, there is a logic in using Heathrow slots for such flights at weekends when business routes are relatively quiet. No doubt these routes are also supported by bookings from tour operators.
Quite a mixed picture for BA in Africa at the moment. Yesterday, BA announced that its route to Lusaka was being dropped and this followed the suspension of its route to Dar es Salaam earlier this year.
On a more positive note, BA is to increase flights to Accra from daily to 10 weekly from Sunday 27 October 2013. Furthermore, the daily flight will be upgaged from a Boeing 777 to a Boeing 747 from Sunday 30 March 2014. This is no doubt a competitive response to Virgin Atlantic withdrawing from this route.
Just under a year ago, as part of a reshuffle of flights between London Heathrow terminals as British Airways digested its acquisition of bmi, BA decided to move all of its flights to Tel Aviv from Terminal 5 to Terminal 1, with all flights operated by an Airbus A321 aircraft.
This proved to be unpopular with passengers for three main reasons:
1. The switch to Terminal 1 meant no access to BA’s Galleries Club and First lounges in Terminal 5 and a change in terminals for the majority of transfer passengers.
2. The switch from three/four class widebody aircraft to a two class, economy and business class, aircraft.
3. The change in aircraft meant that no premium economy product was available on this route and members of the British Airways Executive Club could not use frequent flyer miles (“Avios”) to upgrade to business class (Club World).
BA has now reversed this decision and from Sunday 30 March 2014 all flights to Tel Aviv will operate from Terminal 5. Flights will operate twice daily, with an Airbus A321 aircraft and a four class Boeing 777 aircraft.
It has not been confirmed whether any routes will move from Terminal 5 to 1 to accommodate the move.
Terminal 1 is due to close in Spring 2016, at which point it is expected that BA’s flights will be consolidated in Terminals 3 and 5.
British Airways has today announced that it is to suspend its thrice weekly route from London Heathrow to Lusaka in Zambia from 25 October 2013.
The final flight, BA255, from London Heathrow Terminal 5 to Lusaka will operate on Friday 25 October 2013, and the return flight from Lusaka to London, BA254, will operate on Saturday 26 October 2013.
No reason has been given for the suspension of the route. However, it is a safe assumption that unsatisfactory commercial performance is the reason.
British Airways has provided rebooking guidelines which include re-routing options via other BA gateways in Africa. Additional options may be added in due course if BA can reach commercial terms with other airlines.
British Airways has today confirmed that it will launch a new direct route from London Heathrow Terminal 5 to Austin, Texas (Austin–Bergstrom International Airport) from Monday 3 March 2014, just in time for the SXSW festival!.
The route will initially operate five times weekly (not Wednesday and Saturday) until 5 May 2014 when it will operate daily. The precise flight times depend on the day of operation until the flight goes daily.
Austin is one of the fastest growing populations in the United States. The announcement is significant in not only providing London with a direct route to Austin, but also this is the first new route to be launched that will be operated with the Boeing 787-8 Dreamliner.
Although BA has made much of how the Boeing 787 Dreamliner will open up new routes to Asia, this announcement does demonstrate how much potential there is in BA’s traditionally strong transatlantic market.
The route announcement also follows a trend of BA launching new transatlantic routes to US cities where it is either the sole operator of the route to London Heathrow, and in some cases, Europe. This may provide some clues as to which new US cities will announced next.
Qantas published its annual results for the year ended 30 June 2013 last week. The airline posted a modest net profit of AUD$6 million after tax, which was a significant improvement over last year’s loss of AUD$206 million.
This was primarily due a reduction in losses at Qantas’ International division, which prompted a significant reduction in capacity to Europe and the jettisoning of Qantas’ partnership with BA in favour of Emirates, by almost half to AUD$246 million.
Whilst the partnership between Emirates and Qantas is still very much in its infancy, it is curious that Qantas seems to have declined to give any clear revenue guidance on the partnership. In its results it gave only vague operational measures such as “2 times increase in codeshare bookings on EK network” and “3 times increase in EK bookings on Qantas Domestic network” compared to the partnership with British Airways and others. It is hard to draw any conclusions from such claims without seeing the detail behind the headlines.
Meanwhile, British Airways has remained upbeat on the performance of its last remaining Australian route, London-Singapore-Sydney.
British Airways has today confirmed that it is, with immediate effect, to offer codeshares with Bangkok Airways on flights from Bangkok to Phuket, Koh Samui, Chiang Mai, and from Singapore to Koh Samui. These are three of the eight destinations in Thailand served by Bangkok Airways.
The move is not surprising. Both Bangkok and Singapore have previously acted as a “scissor hub” for British Airways and Qantas to provide onward connections to numerous cities in Australia. Although these codeshares between British Airways and Qantas are still in place, these are less competitive for passengers arriving from London. This is because Qantas has retimed its Australia bound flights from Bangkok and Singapore after ceasing to fly from London to Bangkok and Singapore.
BA has also downgraded the Bangkok route from a four class Boeing 747 to a three class Boeing 777 from 27 October 2013, indicating under performance on this route.
British Airways has announced it is to upgrade its London Heathrow – Rio de Janeiro route from a three class Boeing 777-200 aircraft to a four class Boeing 777-300 aircraft from Sunday 27 October 2013.