British Airways blames recession for losses

British Airways has announced record annual losses of £401 million after suffering a £3 billion fuel bill in last year's oil price bubble. The carrier's nosedive into the red comes after record profits the previous year and discloses the impact of the fuel hikes and lower demand in the recession. BA warned there would be job losses and confirmed it was now offering staff unpaid leave and the option to go part-time, having already frozen pay and axed more than 2,500 roles since last summer to cut costs. Jim McAuslan, general secretary of pilots' union Balpa, said: "We are extremely concerned about the implications for our members of what we have heard today. "BA is facing an unprecedented downturn in trading and this will make the task of agreeing cost-saving measures even more challenging. "We will nonetheless continue to work with the company to try and find solutions which will mitigate the effects of the economic downturn on our members." Martin Broughton, chairman of BA, said: "In the last twelve months we have gone from a record profit to a record loss due to the current tough economic environment. "That only serves to underline the extremely difficult trading conditions that we are facing, despite our best ever operational performance, and any recovery is likely to take longer than initially envisaged." BA admitted its merger plans with Spanish airline Iberia were being held up by the internal trading issues faced by both groups. Willie Walsh, chief executive of BA, said: "We're still in discussions - clearly those discussions have been ongoing for some time now. "Iberia said they are focused on what needs to be done for the core business, which is exactly what we're doing."

» More on this story... «

ITN | May 22, 2009

Tags:. .nosedive. .broughton. .envisaged. .axed. .underline