British Airways has reported a sharp fall in passenger traffic for February as the downturn and heavy snowfall forced a rise in cancellations.
Total passenger numbers fell by 10.1 percent compared to February last year. Economy passenger numbers were down 5.5 percent, whilst premium was hardest hit, down 20 percent.In total, BA carried 244,000 people fewer last month than the year before. The biggest decline in passenger numbers was to Asia Pacific, which saw a 19 per cent fall.
BA said: “A reduced flying programme was necessary due to airport closures, runway restrictions and enforced diversions.”
The airline also told investors how it plans to cut costs and further reduce jobs, as it attempts to stem losses for the second successive year.
Keith Williams, chief financial officer, has told staff the deficit in its main pension fund is reaching £2.1bn or even higher, despite the company having paid in about £1.5bn in the past three years and the workforce agreeing to reforms.
BA has started talks with its trades unions about pay, productivity and performance.
Mr Williams told the in-house newspaper “our cash balance is too low and falling too fast. It stood at £1.6bn at the end of December, £278m lower than in March , and is likely to fall for some time. . . We’re burning through that cash at a rate of £2.7m a day”.
Chief executive Willie Walsh earlier told staff to be “prepared for a long and protracted recession lasting up to two years . . .  The economic climate is the worst I’ve seen in my 30 years in the industry”.
Last month BA lost its investment grade credit rating from Moody’s, the US rating agency, and was relegated to junk bond status. The previous week Standard & Poors also reduced its status to junk.