[BigDog.]

Openfly – wrt fuel – it will all depend what percentage of their fuel purchases have been hedged. If it is the vast majority, with price previously fixed/ locked in, then BA will not benefit from the drop until after the hedged period.

[openfly]

Hi Bigdog. I am led to believe that the fuel hedging process is a rolling process over the year. It doesn’t just happen in one process.

So, all being well, it will only be a matter of weeks, or even days before we see the considerable benefits of the reduced crude prices appear. But whether BA reduces the “fuel surcharge” gradually remains to be seen. I doubt that the price reduction will be seen. BA will just pocket the profit and hope that we simpletons don’t notice!!

[greyhawkgeoff]

IAG publish their fuel hedging figures at least twice a year. The latest that I can find from August 1, seemingly as at June 30 – their period reporting date – see IAG Investor relations – with a spot price of $965, is Q314 80% hedged, Q4 79%, Q1 15 65% and Q215 52%. So there we are, IAG has some exposure to the spot market but prudently has limited their upside risk, at the expense of not relying upon the vagaries of the market.

Some years ago Ryanair did not hedge and admitted in the circumstances of the time that they got it badly wrong. It seems a prudent piece of management to hedge a substantial part of your fuel price risk, just as much as buying or selling forward your foreign exchange risk if you import or export in a currency other than your accounts are prepared in.

The next IAG earnings presentation is on October 31 and is open to all if you log in with your name + email address. In the meantime the spot price has eased about 12% for US East Coast FOB delivery, but we all know that at times there is a disconnect between the US market which is awash with home produced oil as the US becomes self sufficient , and the rest of the world, at least Europe where the Brent price has been higher for some time.

So IAG seems about half right going forward, but then what happens if Russian oil cannot be delivered sometime soon to the market?

[LuganoPirate]

AnghonyDunn, sorry I missed your post at the end of the last page. I get the impression not many of the regulars here use the LoCo’s but Easyjet and Ryanair certainly seem to be more profitable than BA but at least they are open over what they do and do not provide whereas it seems BA promises the earth but so often delivers less than a full forkful.

[LuganoPirate]

If the oil price jumped greyhawkgeoff we’ll all be saying how clever BA were to hedge. Of course they’ll still add the surcharges even if hedged so it’s really win, win, win for them.

[TimFitzgeraldTC]

Just a quick point but if BA have scheduled changed you by 4 hours then if you are not happy they are obligated to offer an alternative which includes a re route option to Manchester, or a full refund of ticket. Normally LBA does cost more than just LHR to Chicago so I’d be sending a complaint when back and demanding full refund of the ticket you have purchased.

[BigDog.]

MartynSinclair – 18/10/2014 11:31 GMT
…” I would guess BA flights are full due to number UK passengers flying “…

Your view is somewhat confirmed by Perry Cantarutti, the Delta executive who oversees the airline’s joint business with Virgin Atlantic to the extent that (contrary to WW predictions) Delta is preparing to swap some of its existing routes to the Virgin brand, such as Manchester to Atlanta, because travellers prefer to fly with a native airline. Tickets on routes to the US from Manchester are predominantly sold in the UK, Mr Cantarutti said.

“There is a tendency for passengers to gravitate towards carriers of their nationality,” He said. “There should be no question over whether the Virgin brand survives.” …..

http://www.telegraph.co.uk/finance/newsbysector/transport/11170304/Delta-Airlines-will-always-fight-for-space-at-Heathrow-over-Gatwick.html

openfly – 18/10/2014 18:56 GMT – I fully concur, regardless of the hedging tapering off imo BA will maintain their unjustifiable, pernicious fuel surcharge.

I understand the surcharge (and unwavering high level) was being challenged in the US courts. – did anything come of it GHGeoff?

As a previous poster eruditely put – any charge which is unavoidable should be included in the base fare.
Regulators should ensure standard pricing practices.

[TheRealBabushka]

seasonedtraveller,

Your post belies your handle. Did you expect BA to ignore its booking rules just because you’re a Gold member?

First up, did you make a booking with BA on the earlier LBA flight but then realised that BA had cancelled it and rebooked you on the later flight? If that is the case, then I would say you have some grounds to expect being rebooked to an earlier MAN flight.

If however you made a booking with full knowledge of the long stopover at LHR, then surely it’s cheeky of you to be berating BA.

[seasonedtraveller]

The Real Babushka

Nothing as complex as that.
Flight booked by our travel company.

After a while, I realise that layover is 8 hours which is unusual – it’s normally 90 mins

I check BA website to find they have withdrawn a mid morning flight from LHR to LBA prior to the booking being made.

I see on BA website LHR to MAN at £85.

I call Gold line to see what they can do – total time taken is almost 30 mins.
They tell me it’s £110 plus additional costs to route to MAN instead of LBA – I think this is stupid so;

I book the £85 one way tix on website instead – time taken, 4 mins.

At NO time did I suggest DYKWIA just because I have Gold status (nor would I ever) which would have been infantile at the outset.

I am simply pointing out the fact that to me, it seems completely crazy that I can book a new flight segment, cheaper & easier than I can change an existing booking – if you can make sense of that, you are a better man than I. As for berating BA – they couldn’t explain it themselves!

As far as ‘belies my handle’ – I have been travelling the globe on an almost weekly basis since 1988 – I think my ‘seasoning’ is perfect.

[TheRealBabushka]

Thanks seasonedtraveller. The post just comes across as being from someone who’s uninitiated. Having said that you’ve just demonstrated how ineffective travel agents can be. They ought to have informed you prior to booking that the stopover is a lot longer than expected, which would have given you the opportunity to route to MAN instead.

I’m uncertain calling BA after the event and requesting changes and the waiving of fees is appropriate. Especially so, as a seasoned traveller, one would presumably be aware that fares are constructed around fare rules and it’s not just a simple case of chopping and changing.

But I can imagine blaming BA would be quite a cathartic exercise. I should think you’ve given your travel agent a piece of your mind for their sheer incompetence.

[seasonedtraveller]

The real B

I hate using our in-house travel agent. Recently though, we have been given no choice other than to book via them.
You are right, they failed to inform me of the layover in LHR and, 3 weeks ago, they stiffed me with an 8 hour layover in Arlanda.

[MrMichael]

A colleague of mine had to go to San Francisco, our in house travel managers booked him via Dallas with a 7 hour layover. He enquires why, they seemed reluctant to tell him why. He took it up with the manager of the travel service who after some heated debate explained it was actually £5 cheaper. I think the travel manager on finding out this little nugget was actually more angry at what his staff had done than my colleague.

[MartynSinclair]

Why would any in house travel service knowingly schedule an 8 hour layover.. and for a £5 saving…. its incredible…

[TimFitzgeraldTC]

Sounds like an odd process. One of my main clients is in Leeds but always offer flights to Manchester as part of the option process as often connections on BA to Leeds are poor. If booking process means that you can’t vet/view options before deciding then something isn’t right. I think 95% of the time they end up out of Manchester on BA or one of the other carriers such as emirates or united to name but 2.

With regards to change fee, the cheaper BA fares are £100 plus any fare difference. Also looks like MAN and LBA are common rated fares to Chicago. On the basis you advised you could see fare of £86 then this would suggest relevant booking class was available, so my informed opinion is that BA misquoted you and it should have been £100 to change. If on Business class then fare may have attracted higher change fee.

Also if you use a good TMC (not possible online) then on domestic add ons with BA you can book in B class irrelevant of cheaper long or short haul code (O for example) and you’ll get the extra tier points on the domestic. Only 20 extra per return but if you fly a lot to Europe in economy from MAN for example then might help get you to Silver. Barely anyone knows that or does it.

[TheRealBabushka]

Thanks for the tip TimFitzgerald!

[Author]

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