[Anonymous]

[sparkyflier]

Since a similar discussion which I commenced around a year ago, there have been a few changes to their fleet, network and products. There have also been changes to their alliances, for example Qantas and the JSA, closer cooperation with JAL & American, and new Oneworld partners TAM, Qatar and very shortly, Sri Lankan. The UK Chancellor (Finance/Economy Minister) has announced a lower APD rate on longer flights and regarding economics and geopolitics – generally growth is returning to most markets, some faster than others, but issues with Russia/Ukraine etc will cast a shadow on stability, international relations and trade.

But what will be the consequences of these? What do you think BA will do next to maximise on opportunities or reduce their risks?

Where will the next 787s go? Until now they have been allocated to mainly previously 767 routes, and some 777-200 routes, but what about the next 787-800s and of course the forthcoming 900 series, some of which will have First? Will these actually go on ANY new routes, or be used on existing routes but to lower the jetfuel consumption, for example Seoul, Bangkok & Buenos Aires?

The 777-300ERs (77W) have gone down well as I understand, enabling slight product improvements, bigger capacity but lower fuel bills. Where will the next batch be heading? I am not sure how many are still left so maybe others can advise.

A380s have also gone down well (although some feel the F& J cabins have disappointed due to the lack of very new inflight products), but after LAX, HK, Joburg and Washington DC where will be next? I suspect MIA, San Francisco & . . .India. I did think GRU/Sao Paulo but as BA are going from 7 to 10 x 744 I think this is now unlikely, although I think they should have done, and used the 3 extra slots for another Latin American offering, such as Santiago, Brasilia or Bogota/Lima.
With the changing economics of the world, China is not growing quite as fast as before, and so I think we will not see new routes there. Vietnam has long been rumoured as a new route but still no developments there – same re Jakarta. But how about Yangon & Manila, or Phuket as a tag (it cannot do Europe onstop due to runway length). Could West Africa get some more attention due to their booming economies and ability to offer high aircraft utilization? Abidjan, Dakar & Port Harcourt/Douala anyone? South America is mostly (not Venezuela or Argentina though) doing very well. Iberia is recovering and returning to some markets (Santo Domingo & Montevideo), but will BA Mngt realise the demand there is for direct Uk flights?

And after Austin (which I predicted ha ha), will the 787s that perhaps were China bound, be now allocated to other USA routes – Portland, St Louis, Hartford or Fort Lauderdale?

The lower APD will help drive demand for a number of markets, especially Caribbean – but what do you think will be the other consequences of this?

Re the Qantas alliance, this has been well covered in other threads, but it seems there will be lots of cooperation with Qatar, but how do you think BA can best use partners Lan, TAM, JAL & SriLankan. And do you think they will look to the big gaping hole in Oneworld – there are no African members. I think Rwandair could be an effective solution to that.

And re Russian issues, an you see the premium offering on Moscow flights being continued, especially if sanctions escalate – will they still use 747/767 etc or downsize to A320/21.

And on new aircraft, could they look to get A321neo, to enable thin but premium routes to be operated, or to lower costs?

BA have been very, very conservative in recent years, and seem to be very afraid indeed of innovation and trying new markets, but with growing economies, growing confidence and greater economies offered by new aircraft, do you think this attitude can change?

I look forward to your views, predictions, insight, advice to BA mngt (please be balanced!) and any inside knowledge!

[canucklad]

Hmmmm sparkflyer, an interesting subject indeed, and your name I fear is going to prove very apt

I’m going to start by suggesting that BA management has now very little influence on long term strategy,those decisions now ceded to Willie Walsh and IAG

So on that basis I believe that IAG have secretly told BA that short haul has no future and to short term manage its downfall,albeit by stealth. Thus making the ultimate transition to Vueling BA more palatable to both employees and loyal customers

Obviously I’ve no proof apart from BA themselves,and their current actions driving their Euro product down market

As I’ve said elsewhere on the forum,BA have become followers rather than leaders. Have the current board been influenced by LH?

[Tirana1]

From my perspective (extensive travel to emerging/third world markets) BA need an aircraft that enable the development of long/thin routes eg Africa and Central Asia whilost still giving scope for a decent business class offering. This might encourage the incremental development of routes which can bear decent premium loads from mining/energy sector customer bases. TK (whom I loathe but have to fly) use the 737-900 for such routes. BA should give thought as to how such routes can be developed where there are currently too few 787/767 aircraft available and even those are too large for early operations on such routes. Overall, my impression is that BA’s service to developing economies (save S Asia) is worse than it has been for decades but these markets will represent future growth opportunities in a way that eg Florida will not.

[canucklad]

I’m afraid Tirana1 the routes you hope for are ,in BA’s world view the equivalent of me betting on Sunderland winning the champions league next year

Fort Lauderdale on the other hand is a no Brainer to BAs decision makers (accountants) ,due to the deal they have with AA. The equivalent of a spread bet on Bayern,Real ,Barca,AC ,Man City ,& Chelsea if you get my drift.

[Tirana1]

But I am a Canaries’ supporter so have no choice but to think of the longer term….

[JohnHarper]

Remember Lufthansa operate a lot of point to point traffic that goes no where near their hubs e.g. LHR-TXL and this is the business that has been moved to Germanwings.

Does BA operate any services that do not start or terminate in London?

The same opportunity is not there.

I agree though innovation has been absent but that’s what you get when you have managers who have only one skill which is cost cutting. To develop the airline that generation needs to move on.

[canucklad]

Didn’t forget JH, wasn’t thinking about specific route management per say,more about transforming their European operation to a LCC cost model rather than working harder to compete with their quality offering

As I’ve said before all to reminiscent of BDs final years

[GreenScot]

Re: “Does BA operate any services that do not start or terminate in London?”

Well apart from their subsidiaries, I believe BA are about to start a service for the summer from Edinburgh to Ibiza, so the answer is yes shortly, albeit temporarily.

[KarlMarx]

What next?

Shorthaul services to transfer to Vueling (possibly branded as BA, possibly differentiated product at Heathrow), to reduce costs and an expansion of Gatwick and possibly a return to other key airports to tap into the very large point to point routes where a low cost base division could operate happily and pofitably.

Long haul, updated business class product and evolved first class in A350, as well as retro fitting programme of business class for A380/777-300, to regain parity with AA and other TATL carriers.

More selective targeting of US regional routes, such as Austin, but less expansion in China, than anticipated and in general, avoidance of the middle eastern carrier heavy routes in Africa, as EK in particular will wipe the floor with western European airlines on cost and will to succeed, using the tremendous numbers of 777-300 and A380s on order to dominate.

In summary, a continued retrenching to a niche player status, with smart targeting of profitable routes and probably a slight contraction in fleet size over the longer term, but combined with ‘rightsizing’ of the fleet for the new world, to maximise the slot constraints at Heathrow and up operational efficiency.

[LondonViking]

There are still big cities in the US that aren’t served directly from London on AA or BA. Minneapolis comes to mind. A metropolitan area of 3.5 million people and home to more Fortune 500 companies per capita then any other city in the US.

[KarlMarx]

LondonViking – 25/04/2014 09:09 GMT

Excellent example of the type of city that might provide a profitable niche market to a company with frugal long range aircraft.

[superchris]

2 points I massively agree with in this thread.

1) BA need to do what AF (hop) and Lufthansa (Germanwings) have done and develop a lower cost offering for routes not going near their hubs and UK domestic.

2) the long thin routes – Tirana1 is right, there are plenty of routes out there which are simply not manageable on current aircraft types. Yes the poster boy of the 787 can do Honolulu et al but what about the routes not justifying this size of aircraft. Savvy carriers like TK and even QR with their mid haul A320’s are doing well and it allows them to get a foot in the market and speculate somewhat without going full on for a huge aircraft with all the costs and risks attached to that.

Oh and Rwandair would be a superb addition to any alliance. Small country with some fantastic ideas and people.

[Panda01]

The way is going, is that they want to replace aircraft for lower fill bill and maybe size too. BA could put 787-9 to Australia and maybe open up some new routes, or just add some more capacity to Sydney. BA ordering A321NEO and other members of the NEO family makes sense, since they could replace bigger aircraft with a321NEO’s(ie, replace 767).

Or BA may just put off ordering new aircraft and expend the codeshare and other means of using an other airline to serve the places that they dont want to have to buy new more aircraft to make the route profitable.

[sparkyflier]

Thank you for your contributions and thoughts so far.

Tirana1 can I ask which specific cities you had in mind in Africa & Central Asia. I agree with you that there are a number of routes which could be served,perhaps with a smaller aircraft than a 767-300, such as an A321neo, which has greater range than the current model. But whether this has enough range for the cities we have in mind I do not know. I do however think that the refurbished 767s should not leave the fleet so soon, and could be an ideal way to measure such markets.

Also offering triangle routes or having a stop (with the crew not necessarily resting and having the change en-route) help keep costs down. An example of this is the LHR-Freetown-Monrovia and vice versa, where the crew work all the way to and from Monrovia, where they rest. This route uses 767 and frequency has increased from 3 to 4 flights a week due to increased demand.

I agree with you that the BA network into developing nations now is pretty poor, almost pathetic, and not timely as it is these economies that have been growing robustly in recent years, at 4-10% per annum and they want direct connections to London, a truly world super-city.. It is my opinion that BA is to some extent selling UK PLC short, and also its shareholders. . .

You cannot plough the same old fields in the hope of a bumber harvest.

Canucklad you always provide great analogies (!), and you use the term no brainer, but that has not stopped them before. They do seem to have a total aversion to any risk and a while ago I met a person from “network development” and his/her geography and knowledge the BA network history was astonishing and not in a good way.

LondonViking MSP is an interesting idea, and your statistics are interesting, but I suspect that will be a tough one to enter as Delta is so strong there, has a very good product, and local companies and individuals will be Skyteam focused for earning miles.

Superchris further to your comment about Rwandair, it is a well-operated carrier with a growing network into central, western, eastern and southern Africa, using modern 737, which BA or other Oneworld carriers could not get to directly. It is very well located to access these markets and vice versa and the airport is hardly congested.

[Author]

Posts