14 March 2009

BA Swings A Soft Axe First (Eugene)

BA has swung its first round of cuts by sending out Voluntary Retirement Notices to all its European based staff. Much like Delta did at the end of 2008, BA's program promises little incentive to leave at the moment.

With BA's troubles mounting across the board, they need to reduce headcount even further and probably a lot faster. The drop off of premium traffic affects BA who is more vulnerable with less "cheap" seats in their inventory.

Having just flown in the back of BA and LH round trip in coach both ways - I can assure you that LH has many more cheap seats available - AND is filling them - than BA has and is not necessarily filling them.

They say perception is reality. In the case of the battle for survival, caution wins. BA's aggressive pursuit of profitability at the expense of the gross revenues is now starting to look a little thin.


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