British Airways has announced plans to cut its annual spending from £725 to £580 million, as well as axing 3,700 further jobs, in addition to the 2,500 it has cut over the past year.

The British flag carrier also said it was delaying the delivery of five Airbus A380s by two years to 2016. It also said it would ground its remaining three mainline Boeing 757 aircraft next summer and a further three Boeing 747-400s in winter 2010.The move comes in reaction to it cutting capacity from April to October by 3.5 percent, up from the intended 2.5 percent reduction, and that it would cut its winter schedule by 5 percent, instead of the previously intended 4 percent.

The news came as BA, which last week revealed that about 7,000 staff had volunteered to work shorter hours or take unpaid leave in support of its cost-reduction programme, reported that passenger numbers in June were down 3.8 percent compared to June 2008.

Premium traffic numbers were down 14.9 percent. The load factor fell to 79.6 percent, against 81.4 percent in June last year.

The company added: “Market conditions continue to be very challenging, with trading at levels well below last year. However, on an underlying basis, both premium and non-premium volumes and seat factors have now been stable for more than three months.”
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