London Air Travel

London Air Travel’s Monday Briefing – 2 November 2020

Welcome to London Air Travel’s weekly briefing on air travel around the world, as published every Monday at 06:00 GMT.

easyJet aircraft landing at Berlin Brandenburg Airport, Saturday 31 October 2020 (Image Credit: Berlin Brandenburg Airport)

Welcome to London Air Travel’s Monday Briefing for the week beginning 2 November 2020.

No Visibility

When IAG published its third quarter results on Friday, it was telling that the airline group gave nothing away about its plans for 2021.

Whatever plans there were for BA, these probably now lay in tatters. On Saturday evening, the UK government effectively banned all outbound international leisure travel.

When the guidance was first published, the only exception was for “work”. Yesterday, this was extended to include “education and other legally permitted reasons.”

This officially applies until 2 December. Few expect the government, which has proven extremely reticent at managing expectations and giving bad news, to lift restrictions in four weeks.

There is the question of how this will be enforced. If the experience of existing rules on face masks is anything to go by, airlines will only enforce the rule if mandated to do by the government.

It has however clearly shaken confidence in the sector. Based on broadcast interviews given by Michael Gove yesterday, there are no indications that the government is contemplating sector specific support for aviation.

Virgin Atlantic yesterday alluded to the fact it is likely to cancel flights. easyJet and IAG may well release updates to the stock exchange today. Michael O’Leary will appear on Ian King Live on Sky News at 10.30 this morning, and will no doubt have plenty to say.

The summer 2021 season is not that far away. A lack of confidence in flying will put off many passengers from booking trips for next summer in the New Year, which provides a vital source of cash flow to airlines in the winter months.

BA Merges Heathrow Cabin Crew Fleets

BA’s combined Heathrow cabin crew fleet officially came into effect on Sunday.

The three fleets, Euro Fleet, Mixed Fleet and Worldwide have combined into one who work across BA’s Heathrow short-haul and long-haul networks.

BA first introduced “mixed” flying on a permanent basis at Gatwick, often a test bed for changes at the airline, in 2006.

The main aim is that due to the annual legal maximum of flight time hours (which long-haul cabin crew can easily reach) and duty hours (which short-haul cabin crew can easily reach), combined short-haul and long-haul flying is intended to smooth these limits. The annual savings for Gatwick were quoted as £16m per annum, so across Heathrow these will be substantial.

Euro Fleet and Worldwide previously operated exclusively short and long-haul routes respectively. Mixed Fleet, who operated both short and long-haul routes, was introduced as a separate fleet in 2010.

Mixed Fleet also had radically different working practices, particularly around rostering, disruption and the responsibilities of senior crew members.

Although BA frequent flyers are familiar with the different fleets, one of the much lesser commented aspects was that, unlike on Euro Fleet and Worldwide, the senior cabin crew grade on Mixed Fleet was a BA manager grade. This was intended to encourage senior crew members to move on to other roles in the airline. This was much less the case with Euro Fleet and Worldwide.

It was inevitable that the three Heathrow fleets would merge at some point and this has been accelerated by COVID-19. Whilst this is less so when the in-flight service is limited, it will take crews doing either short or long-haul flights for the first time to get used to working with different aircraft and service routines.

Berlin Brandenburg Airport Opens

Berlin Brandenburg Airport finally opened to scheduled passenger flights on Saturday.

This follows no less than nine years of delays and countless defects. easyJet positioned an aircraft from Berlin Tegel to Brandenburg on Saturday and operated its first flight to London Gatwick on Sunday morning.

Assuming BA is still flying to Berlin this weekend, it will transfer flights from Berlin Tegel to Brandenburg this Sunday, 8 November.

UK Government Restricts International Travel

New restrictions on international travel from England will be introduced by the UK government from Thursday 5 November.

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London Heathrow Terminal 5 (Image Credit: Heathrow)

UK Prime Minister Boris Johnson has today, Saturday 31 October, announced a series of measures intended to suppress the spread of COVID-19 that will apply to England until early December.

These measures are expected to take effect from 00:01 GMT Thursday 5 November and will last until Wednesday 2 December at the earliest.

As has been widely reported they are wide ranging and are, in effect, a return to the lockdown of earlier this year in all but name.

Although Boris Johnson did not mention it during his statement at the press conference, ITV Political Editor Robert Peston was briefed beforehand, that international travel out of England will be banned, except for work. Travel within the UK is also discouraged. This has also been included on a list of restrictions published by Sky News. How this will be policed is a complete unknown.

Guidance is available on the UK government website: This has been updated twice since it was first published and is likely to be subject to further updates.

If you live in England, you cannot travel overseas or within the UK, unless for work, education or other legally permitted reasons, and you should look to reduce the number of journeys you make. However you can and should still travel for a number of reasons, including:

travelling to work where this cannot be done from home
travelling to education and for caring responsibilities
to visit those in your support bubble – or your childcare bubble for childcare
hospital, GP and other medical appointments or visits where you have had an accident or are concerned about your health
to buy goods or services from premises that are open, including essential retail
to spend time or exercise outdoors – this should be done locally wherever possible, but you can travel to do so if necessary (for example, to access an open space)
attending the care and exercise of a pet, or veterinary services

If you need to travel we encourage you to walk or cycle where possible, and to plan ahead and avoid busy times and routes on public transport. This will allow you to practise social distancing while you travel.

You must not travel if you are experiencing any coronavirus symptoms, are self-isolating as a result of coronavirus symptoms, are sharing a household or support bubble with somebody with symptoms, or have been told to self-isolate after being contacted by NHS Test and Trace. The fine for breaching self isolation rules start at £1,000. This could increase to up to £10,000 for repeat offences and the most serious breaches, including for those preventing others from self-isolating.

If you need to use public transport – to travel to work for example – you should follow the safer travel guidance. This includes the rules on wearing face coverings and advice on car sharing.

For those planning to travel into England, you should check the current travel corridor list to see whether you need to isolate for 14 days. You will still be required to abide by the restrictions set out here even if you do not need to isolate. If you do need to travel overseas from England before 2 December (and are legally permitted to do so, for example, because it is for work), even if you are returning to a place you’ve visited before, you should look at the rules in place at your destination and the Foreign, Commonwealth and Development Office (FCDO) travel advice.

UK residents currently abroad do not need to return home immediately. However, you should check with your airline or travel operator on arrangements for returning.

The regulations implementing these measures will be subject to a vote in Parliament on Wednesday.

It goes without saying this will have a hugely detrimental effect on travel and tourism. Those who are imminently due to travel will be concerned as to whether they will be able to return home. Anyone who hadn’t already given up on the prospect of a winter ski trip or an escape to sunnier climes, will now do so. It will also have a detrimental effect on people wanting to return home to their families.

The manner by which both the public and business have learned of this, first through leaks to newspapers and lobby journalists and a hastily arranged, and then delayed, press conference, is particularly shabby.

BA Ends Wide Body Short-Haul Flights

BA no longer operates wide body aircraft on selected flights from London Heathrow to Amsterdam, Athens, Larnaca and Zurich.

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British Airways Boeing 787-8 Dreamliner (Image Credit: Heathrow)

Over the past few months BA has operated selected short-haul flights in Europe with wide body long-haul aircraft.

This originated when BA was operating a skeleton schedule in Europe, with wide body aircraft used for its cargo capacity.

The following short-haul services from London Heathrow are no longer operated with Boeing 787 aircraft from this week. They revert to Airbus A320 series short-haul aircraft:

Amsterdam on Wednesday & Thursday under flight numbers BA430 & BA431 ended on 29 October.

Athens on Friday under flight numbers BA632 & BA633 ended on 30 October.

Larnaca on Thursday under flight numbers BA662 & BA663 ended on 29 October.

Zurich on Saturday under flight numbers BA712 & BA713 will end today, 31 October.

BA will, from Sunday 1 November, operate a wide body Boeing aircraft between London Heathrow and Madrid every day under flight numbers BA458 and BA459.

SUN-AIR Suspends Flights Until August 2021

British Airways’ franchise partner SUN-AIR has suspended all scheduled flights until August 2021.

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SUN-AIR Dornier 328 Jet in British Airways livery (Image Credit: SUN-AIR of Scandinavia A/S)

British Airways’ franchise partner SUN-AIR of Scandinavia A/S has decided to suspend all scheduled flights until August 2021.

SUN-AIR, which operated routes from London City and Manchester to Billund, had been progressively delaying the resumption of scheduled flights.

It has now decided to suspend all scheduled flights until August 2021. These may restart earlier, but this will depend on a significant improvement on market conditions. This is likely to be only achieved by an easing of travel restrictions in Europe which in turn requires a widely available vaccine against COVID-19.

BA has recently reinstated scheduled flights from London Heathrow to Billund. Its schedules are of course subject to change in the coming weeks as countries in Europe reintroduce lockdowns and travel restrictions.

SUN-AIR also operates a shuttle between Manchester, Cambridge and Gothenburg on behalf of AstraZeneca which it will reinstate at its request.

International Airlines Group Third Quarter Results

IAG has reported an operating loss of €1.3 billion for the third quarter of 2020.

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International Airlines Group, the parent company of Aer Lingus, British Airways, Iberia, LEVEL and Vueling released its third quarter results today, Friday 30 October 2020.

The results themselves revealed few surprises. IAG had already announced last week an operating loss of €1.3 billion. Air France KLM also reported an operating loss of €1.05 billion today.

IAG’s loss was not broken down by airline but at BA passenger numbers fell year-on-year by 85.2% from 13,042,000 to 1,927,000. Load factor fell by 43.4 percentage points from 86.3% to 42.9%.

IAG’s liquidity currently stands at €9.3 billion. The group is also looking at additional measures to raise cash such as the sale and leaseback of aircraft and new sources of debt.

This will also the first results announcement presented by new IAG CEO Luis Gallego, with new BA CEO Sean Doyle also present. Unlike Willie Walsh, Luis seems to prefer to keep his views on rival airlines to himself.

Overall, it was more interesting for what wasn’t said rather than what was said. IAG did not give any indications as to what capacity or the size of its fleet may be beyond this year. The group is clearly waiting for progress a COVID-19 testing regime to lift quarantine restrictions and open up travel corridors on key routes.

IAG did illustrate what happens to passenger demand as soon as quarantine restrictions are lifted. Here you can see a surge in demand for BA flights to the Canary Islands as soon as quarantine restrictions are lifted:

British Airways Bookings To Canary Islands, October 2020 (Image Credit: International Airlines Group)

BA Restructuring

The restructuring of BA is largely complete.

9,620 employees will have left the airline by the end of October. This is primarily through voluntary redundancy. A further 180 employees will leave by the end of the year.

This is expected to achieve employee cost savings of 30% in 2021. In addition, 19,800 out of 28,000 employees now have lay-off and short-term working clauses. This is good for the airline, but not so good for employees.

London Air Travel’s Monday Briefing – 26 October 2020

Welcome to London Air Travel’s weekly briefing on air travel around the world, as published every Monday at 06:00 GMT.

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Luis Gallego, Chief Executive Designate, International Airlines Group — Luis Gallego, Chief Executive, International Airlines Group (Image Credit: Iberia)

Welcome to London Air Travel’s Monday Briefing for the week beginning 26 October 2020.

Luis Gallego Unveils His First Results As IAG CEO

This Friday, 30 October 2020, Luis Gallego will present his first set of quarterly results as CEO of IAG.

Sean Doyle will also address investors for the first time in his capacity as CEO of BA.

We have a preview of what to expect. Last week, IAG announced a preliminary operating loss of €1.3 billion for the quarter to 30 September.

Revenue declined 83% to €1.2 billion, with revenue passenger kilometres falling by 88%. Average load factors fell by 38.8 percentage points to 48.9%. None of these numbers were broken down by airline.

Capacity for the 4th quarter will be no less than 30% of last year’s levels. BA has pulled at short notice some long-haul routes that were due to resume next month including Denver, Las Vegas and Seoul. IAG has also abandoned any hope of breaking even on a cash flow basis by the end of this year.

On a more positive note, IAG’s cash balance remains strong with €6.6 billion of cash at the end of September, plus €2.74 billion from its recent rights issue.

However, some debt has to be repaid in the first half of next year. With IAG’s three European markets, Ireland, Spain and the UK, facing tighter restrictions, traffic is likely to be severely depressed well into 2021.

Air France-KLM and Lufthansa will also announce their third quarter results on 30 October and 5 November respectively. Ordinarily at this time of year, IAG also holds its annual Capital Markets Day, but no event has been scheduled yet.

Back to Sean Doyle, he will be a panellist at a Royal Aeronautical Society event on climate change next month.

Heathrow’s £17 Billion Debt Mountain

Heathrow is also due to report its third quarter results this week, on Wednesday 28 October at 15:00.

Yesterday’s Sunday Telegraph reported Heathrow has warned its shareholders they may have to provide financial support to the heavily indebted airport. Heathrow owes, through a horrifically complicated structure, a large number of banks and bondholders no less than £17 billion with an annual interest bill of £500m.

Airlines and regulators have understandably balked at the suggestion that Heathrow’s lost income should be compensated for through higher passenger charges.

Heathrow clearly expects to benefit from airlines consolidating London operations at the airport and available slots being filled by new entrants, but it will be expected to take its share of the pain of COVID-19.

Quarantine To Be Waived For The “Jet Set”?

Somebody briefed yesterday’s Sunday Times, possibly not with the intention of encouraging support for the government, that the mandatory quarantine regime may be waived for the “jet set”.

This is said to include those most loved professionals “senior bankers, hedge fund managers and executives involved in high-value deals” who “come in private jets and have a chauffeur-driven car”.

Given the way the UK government has been harangued in recent days for its inability to “read the room” this could well have been leaked to torpedo these plans.

London Air Travel’s Monday Briefing – 19 October 2020

Welcome to London Air Travel’s weekly briefing on air travel around the world, as published every Monday at 06:00 BST.

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Sean Doyle, Chief Executive, British Airways (Image Credit: Aer Lingus)

Welcome to London Air Travel’s Monday Briefing for the week beginning 19 October 2020.

Sean Doyle Replaces Alex Cruz

When Keith Williams was promoted from Chief Financial Officer to become BA’s first CEO after the formation of IAG in 2011, Willie Walsh left BA with a not particularly subtle message about who was really in charge.

He was reported to have quipped to reporters that Keith had been promoted from the 2nd most important job in BA to the 2nd most important job in BA.

Last week, Sean Doyle was promoted to the 2nd most important job in BA after Alex Cruz departed the airline. This was the first major management reshuffle by IAG CEO Luis Gallego. For a group that likes to make much of the fact that it can move executives around the group, no alternative role in IAG was found for Alex.

Although Sean has a relatively low profile, his appointment has been welcomed. Colleagues praise his attention to detail and knowledge of the industry. This is clearly not seen as the time to bring in an outsider. One former colleague told the Financial Times:

“He will make the decisions that will need to be made, but will be able to bring people with him. There really are not that many people with the depth and breadth of experience of the company,”

Before becoming CEO of Aer Lingus, Sean was responsible for fleet and network planning at BA, as well as its joint-business with American Airlines. All of these will be a focus in the coming years.

As for Alex Cruz, there’s been no shortage of comment on his departure. The most balanced comes from John Strickland for Forbes who rightly points out that some of things BA has been criticised for during Alex’s leadership were not of his making.

It was, after all, Willie Walsh’s insistence a few years ago that BA did not need to change the layout of its Club World cabin. Decisions on aircraft density, as well as many other matters like new aircraft orders and capital expenditure, sit with IAG not BA.

That said, a lot of unnecessary negative publicity could have been avoided with a little foresight. Saying BA might withdraw free meals in long-haul economy when there was nothing close to a plan to do so, caused a lot of unnecessary negative headlines. Many negative headlines about the introduction of buy-on-board in short-haul economy could have been avoided if it was properly tested on a smaller scale at Gatwick first, before being rolled out at Heathrow.

Few who have followed BA’s approach to industrial relations over decades would have believed it would have ever gone ahead with a threat, no doubt the work of lawyers, to “fire and rehire” staff. But it was clearly wrong-footed by how this was seized upon by staff and trade unions. Hence what felt like an overly rehearsed performance by Alex before the Transport Select Committee last month.

Back to Sean Doyle, he is due to speak at the Airlines 2050 virtual conference at 10:15 BST today. Luis Gallego will also present his first IAG quarterly results next Friday, 30 October.

Winter Timetable

The clocks go back one hour in the UK on Sunday 25 October. This also marks the start of the winter timetable.

Ordinarily, we should be able to present a long list of schedule changes for the winter season. Not this year.

At London Heathrow, BA will resume short-haul flights to Basel, Billund, Gran Canaria, Malta, Vienna and Zagreb. Flights also resume to Amman which, along with Moscow Domodedovo, switches to short-haul configured aircraft.

Next month, BA will also resume scheduled long-haul flights from London Heathrow to Bangkok, Denver, Las Vegas, Phoenix, Santiago and Seoul. Many other routes benefit from frequency increases, including Boston which switches to twice daily. BA will also return to Orlando and Mauritius at Gatwick.

British Airways Introduces Modified First Class Cabin

British Airways has introduced a modified First Class cabin with a sliding door on its latest Boeing 777-300ER aircraft.

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British Airways First Class Seat With Sliding Door, Boeing 777-300ER Aircraft (Image Credit: British Airways)

British Airways has introduced a modified First Class cabin on its latest Boeing 777-300ER aircraft.

BA was due to take delivery of four new Boeing 777-300ER aircraft this year. It has recently received the first of these aircraft, which bears the registration G-STBM.

As expected, this aircraft features a smaller eight seat First Class cabin. The First Class seat is largely based on the First Class cabin on Boeing 787-9 aircraft, but with the addition of sliding door for complete privacy. This follows the decision to add a door to BA’s new Club Suite on all aircraft.

The new Boeing 777-300ER aircraft is currently operating selected flights between London Heathrow and New York JFK (BA113 & BA114).

In total, the aircraft has 8 seats in First Class, 76 seats in Club World, 40 in World Traveller Plus and 136 in World Traveller.

Clearly, passengers will have their own views on the benefit of complete privacy versus being able to keep an eye on movements in the cabin, and not being out of sight of cabin crew.

BA had planned to refurbish its 12 other Boeing 777-300ER aircraft this year which were delivered to the airline between 2010 and 2014. This is to not only reduce the size of the First Class cabin from 14 to 8 seats, but also retrofit the Club Suite and “densify” World Traveller from 9 seats to 10 seats abreast.

More broadly, given the retirement of the entire Boeing 747 fleet and possible conversion of some four class Boeing 777-200 aircraft to three class, it is inevitable that First Class will be withdrawn from many routes in the medium term. The seating configuration of future deliveries of Airbus A350-1000 and Boeing 777-9 aircraft is also likely to be reviewed.

Alaska Airlines To Join Oneworld On 31 March 2021

Alaska Airlines will become a full member of the Oneworld alliance from 31 March 2021.

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Alaska Airlines, Palm Springs Airport (Image Credit: London Air Travel)

Alaska Airlines will become a full member of the Oneworld alliance from Wednesday 31 March 2021.

The airline had planned to join the alliance from late 2020, but this has been postponed.

This means that members of Oneworld alliance frequent flyer programmes will benefit from full frequent flyer recognition when flying on Alaska Airlines and vice versa.

This includes additional baggage allowances, access to priority check-in facilities, departure lounges, priority boarding (where it is now offered!) and earning of Avios/miles and tier points/status credits. Though, it will be some time before Oneworld frequent flyers in Europe can benefit from this in practice as it is unlikely that travel restrictions to the US will be fully lifted before March 2021.

British Airways already has a codeshare partnership with Alaska Airlines and places its code on a number of Alaska Airlines routes from the US West Coast to Hawaii and other destinations in North America.

It currently possible for members of the BA Executive Club to earn and redeem Avios on Alaska Airlines. Alaska joining Oneworld should lead to further co-operation between Alaska Airlines and BA and other IAG member airlines.

Alaska Airlines has expanded significantly in recent years following its purchase of Virgin America. The Alaska Airlines website has a full route map as well as details of recent and forthcoming new routes.

The latest on Alaska Airlines’ plans to join Oneworld are also available on its website.

Sean Doyle Appointed Chief Executive Of British Airways

Sean Doyle has replaced Alex Cruz as Chief Executive Of British Airways with immediate effect.

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Sean Doyle, Chief Executive, Aer Lingus — Sean Doyle, Chief Executive, British Airways (Image Credit: Aer Lingus)

Sean Doyle has replaced Alex Cruz as Chief Executive of British Airways with immediate effect.

Sean was Chief Executive of BA’s fellow IAG subsidiary Aer Lingus. He knows BA very well, having previously held a number of senior management roles at the airline, including director, network, fleet and alliances.

Alex will remain non-Executive Chairman of BA for an interim period. These changes were announced today, Monday 12 October 2020, by new IAG CEO Luis Gallego who recently replaced founding IAG CEO Willie Walsh.

Alex has held the role of Chief Executive and Chairman of BA since April 2016, having previously been CEO of fellow IAG subsidiary Vueling.

There have been turbulent times during Alex’s tenure (though you could say that of almost every BA Chief Executive), notably the high profile IT power failure of 2017, the theft of customer data from ba.com in 2018 and an an industrial dispute with BA pilots which overshadowed the airline’s centenary celebrations in 2019 and public criticism over the planned restructuring of the airline post COVID-19.

British Airways CEO Alex Cruz Media Appearances Friday 7 September 2018 (Image Credit: BBC, CNN, ITV News)

On a more positive note, Alex oversaw the introduction of BA’s new “Club Suite” long-haul business class cabin, pre COVID-19 improvements to catering in premium cabins and the roll-out of a new lounge concept around the world. There is often a misguided view that when BA CEOs make unpopular decisions, any other CEO would act differently.

Many will speculate as to the reasons for Alex’s departure. It’s not unusual for a new CEO to make management charges. IAG do also like to move executives around the group. The fact that Alex is leaving immediately and has not moved to an alternative role in IAG suggests it was not voluntary. It was clear from Alex’s very well rehearsed recent appearance before the Transport Select Committee that it had been stung by criticism by MPs over the airline’s restructuring.

Sean Doyle has a full in-tray. In the coming months he will make decisions around BA’s fleet plans, route network and airline partnerships that will shape the future of the airline for the rest of the decade as it seeks to recover from COVID-19. Like his predecessors, Sean will have to make unpopular decisions that will put him under considerable public scrutiny.

The next major update from IAG is likely when it presents its third quarter results on Friday 30 October 2020.