British Airways mainline scheduled revenue passenger kilometres (RPKs) grew by 10.5 per cent. With mainline available seat kilometres (ASKs) growth of 9.9 per cent, the passenger load factor improved by 0.4 points to 64.9 per cent.
Premium traffic declined by 3.6 per cent whilst non-premium traffic grew by 12.9 per cent. Forward bookings point to a continuing softness in the market, particularly in premium traffic. This is putting heavy pressure on yields. It is too early to comment on bookings for 1999. The outlook supports the very low capacity growth planned by British Airways over the next three years.
On the cargo business, traffic volumes grew by 2.3 per cent in terms of cargo tonne kilometres (CTKs).
For the three months ended December 31, the mainline passenger load factor of 67.8 per cent was up marginally by 0.1 point. This reflected traffic growth of 10.9 per cent with non-premium traffic showing growth of 13.6 per cent but premium traffic declining by 2.9 per cent.
Highlights of the month
British Airways, American Airlines, Canadian Airlines, Cathay Pacific Airways, and Qantas Airways welcomed Finnair as the first new recruit to oneworld?, since they announced the global airline alliance in September. Finnair flies to 60 destinations worldwide, including 21 in Finland and a further 39 elsewhere in Europe. The airline employs 8,570 people and operates a fleet of 58 aircraft. Finnair is presently assessing the time that it will require for training employees in preparation for offering oneworld services and benefits and is planning to participate in the alliance from the second half of 1999.
The uncovered Japanese Yen debt at December 31 stood at Yen 127 billion with the exchange rate at £1=Yen 189 compared with £1=Yen 230 at September 30, 1998. The impact of the stronger Yen on the net interest charge for the third quarter’s accounts will be £117 million. Financing under Japanese Leveraged Lease arrangements offer significant tax benefits and attract low rates of interest. Current cashflow is unaffected : the revalued obligations are payable in 8-12 years.
British Airways announced that its commission rate for the French market will be reduced from 9 per cent to 7 per cent with effect from April 1st, 1999.
British Airways opened its new Concorde Room at New York’s JFK airport for Concorde passengers. CD Partnership, Sir Terence Conran’s architecture and design practice, was commissioned to transform the Concorde Room to create a design classic, like Concorde itself.