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BAA has posted a pre-tax loss of £822m, an impressive 154% rise over 2008 figures.
Bosses have blamed a combination of factors for the plunge, including a reduction in passenger numbers at its UK airports, and a £218 million hole in the firm’s pension scheme.
In December, and due in part to the frosty weather, BAA recorded a 1.9% slump in travellers using its airports.
London Heathrow, the firm’s biggest asset, was the only BAA-owned site to see an increase in passenger numbers – a meagre 1.2%. Aberdeen and Glasgow lost 9.4% and 8.8% of their 2008 passengers respectively.
Over the whole year, the figures were equally concerning, with Stansted and Glasgow posting losses in double figures.
The sale of Gatwick at the end of 2009 did little to stem the flow of cash out of BAA’s collective pockets.
Overheads and delivery costs tore £277 million from the £1.5 billion price tag, leaving the firm with just over £1 billion to play with, a figure that has since been earmarked for developments at its UK airports.
BAA executive Colin Matthews was optimistic about the future, claiming that the financial performance "remains resilient, especially at Heathrow", and confirming that they "remain focused on improving our efficiency and the service we offer customers”.
Mr Matthews noted that improved passenger spending had been a boon to the company bank account.
Not all is as rosy as it seems, however. BAA’s lawyers are currently embroiled in a battle to save Stansted from the saleroom, after the Competition Commission ruled to dismantle the firm’s monopoly over British aviation.
Stansted Airport bosses have just unveiled a plan to increase the airport’s contingent of female security guards by 50 positions. Staff fear a hectic summer schedule unless more women can be coaxed to the terminals.
Of the 800 people working beneath Stansted’s glass roof, around 50% of them are already female. So why is the airport so desperate to hire more women?
Under modesty laws, male officers cannot search (or ‘frisk’) female passengers. This poses a problem for under-staffed terminals, and delays can ensue as male security officers contend with a backlog of female passengers.
The issue is not with the number of women employed by Stansted, but rather with their working patterns as an increasing proportion of female guards choose to work part time. The new jobs, which have been advertised on the airport’s website, are also part-time positions.
Bosses are keen to attract ordinary people, rather than muscle-bound brutes. Recruitment boss Cathy Brennan is concerned that some women may associate security positions with violence and ignore the advertisement.
She said “traditionally, women don’t seem to be attracted to security officer roles", and that the bosses were looking for people "who have customer service experience and enjoy meeting and dealing with people". Existing officers have lauded the benefits of the position, which include shopping discounts.
Applicants must have a minimum of five years' work experience in a customer service position, such as a restaurant or shop, and have full-colour 20:20 vision. Interested parties should visit the BAA website, and enter the vacancy number STN381.
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Thomas Cook Airlines have just released a new service whereby travellers can now use an online check-in service rather than checking-in at the airport before their flight. It claims to be the first charter airline in the country to launch the online check-in service from Stansted Airport.
As well as offering the service at Stansted Airport, Thomas Cook Airlines will also provide the option of checking-in online at Gatwick, Bristol, Newport and a few other airports across the country. It is planning on spreading the service to even more airports over the coming months.
The service will allow passengers to check-in online up to seven days before they are due to fly. Following this, they will then be able to go directly to the bag drop location and skip the check-in at the airport altogether. This will lead to shorter queues and less time waiting around at the airport. However, travellers will also be able to choose to check-in normally if they prefer.
If passengers want to choose their seats when they check-in online they will have to pay a fee. Priority Seat Selection is available up to 98 days before the date of travel, and prices start at £6 per passenger. The Seats Together and Your Seat Your Choice options both start from £12 per person for a return flight. Seats with extra legroom are also available from £23.50.
Joanna Wild, the customer services director at Thomas Cook Airlines, said that the aim was to provide their travellers with “more control over their booking”, and that the new service provided them with greater freedom over where they sat as well as making the airport experience “quick and easy”.
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In December, over 150,000 travellers chose to stay at home, rather than run the gauntlet of delays, cancellations, and bad weather at UK airports. The news has aviation bosses braced for another taxing year, even as the global recession begins to abate.
This time last week the whole of the UK was covered in snow but the wintry weather has reasserted its grip on the south of England, which will have a negative effect on airports.
Much of Britain is thawing, albeit slowly, and most airports are back to running at full capacity. There are exceptions, of course – Birmingham and Gatwick were both closed this morning, forcing passengers to endure lengthy delays, but otherwise, the skies and runways are now clear of snow.
The BAA’s traffic figures for December paint a rather worrying picture of British aviation, however, and January’s numbers are set to be even worse, as cancellations start to catch up with airlines.
Adverse weather conditions at the end of last year resulted in a 0.9% fall in festive travellers over the figures for December 2008, and Stansted Airport nosedived by 2.6% in just one month, ironically, its best monthly performance for almost two years.
EasyJet and Ryanair proved to be persistent thorns in the BAA’s side last year, reducing the number of flights available to Stansted customers, and delaying their winter schedules until the very last minute.
As Stansted’s revenue hinges upon holidaymakers, as opposed to rich executives, like Heathrow, the lack of budget flights helped exacerbate the downward trend in passenger numbers.
BAA boss, Colin Matthews, was cautious about the coming year – “2009 was a difficult year for our airline customers. Towards the end of the year, we saw signs of improvements, particularly at Heathrow, but there are more challenging times ahead in 2010.”
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EasyJet has urged Britons to dispense with the winter blues, and start planning a summer holiday.
Despite a spree of cancellations, some as recent as Friday morning, EasyJet continues to put a pleasant spin on the frosty conditions by announcing twenty-one new routes at its European hubs.
Bristol gets three. Liverpool Airport is going to Bodrum, Turkey for its holidays, whilst Stansted gets four new flights out of London, commencing May 2010. EasyJet now boasts 29 routes from Stansted, served by 13 aeroplanes.
Airport boss, David Johnston, hailed the excellent news – “This announcement is a real positive beginning to 2010, and offers our passengers even more choice to increasingly popular destinations.”
The additions are part of the carrier’s sun and sea campaign, which attracts thousands of customers every summer. EasyJet has expanded its Stansted roster three times in the past ten weeks, much to the delight of airport brass.
EasyJet’s new routes travel to Dubrovnik and Split in Croatia, and Dalaman and Bodrum in Turkey. The cost of living is known to be much cheaper in these historic towns, being that Turkey and Croatia are outside the European Union.
On Friday, EasyJet cancelled 30 flights out of London, Belfast and Liverpool as the ubiquitous snow turned into thick ice overnight. The airline then attacked Gatwick Airport for operating far below normal capacity, and forcing delays on customers.
With temperatures falling to as low as -22 in some areas of the UK, passengers and airport personnel are braced for another difficult weekend.
If you are an EasyJet customer who has been affected by the recent delays and cancellations, please visit the airline’s website, where you may be able to claim a refund or arrange a free transfer to another airport.
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Global handling firm, Swissport, is to axe up to ninety jobs at London Stansted, as part of a plan to cull 300 positions throughout the UK. The cuts are likely to be made in the weeks leading up to Christmas.
The Swiss company, whose slogan contains the words, “from landing to takeoff, we care!” has already given thirty-nine people the sack. A further fifty-one employees are at risk of unemployment.
In late October, Swissport failed to reach an agreement with Britain’s General Union (GMB) to prevent the redundancies going ahead. The handling firm also unveiled a controversial change to its shift system, whereby all existing employees could be forced to work six days a week. GMB branded the new system, “unworkable,” warning of extensive disruption over the festive period.
Customer service personnel, as well as baggage handlers and apron staff, are thought to be the worst affected by the cull. Swissport has encouraged its workers to volunteer for redundancy, but so far, only fifteen people have stepped up to the chopping block.
Swissport continues to deny that the advent of robotic and automated airport security has contributed to the company’s financial woes. Online check-in facilities, as operated by budget airline, Ryanair, have streamlined airport operations, removing the need for queuing and bickering inside the terminal, but hundreds of security jobs are being lost as a result.
A spokesperson for the British Airports Authority, the current owners of Stansted Airport, was equally concerned about the welfare of check-in staff:
“The airlines are getting into the situation where there’s no need for check-in agents and they don’t need as many staff. Many passengers just print off their own boarding cards now.”
Stansted will continue to operate as normal throughout the Christmas and New Year period.
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The saying “It is better to travel than to arrive” obviously pre-dates the age of tight security at airports and the resultant queues. Whilst no-one likes waiting in line, how much would you be prepared to pay to jump the immigration queue?
Starting next year, a trial will be carried out at Stansted airport and then at Heathrow Terminal 4, enabling passengers to pay up to £50 to by-pass the immigration queue, which could easily save them 45 minutes.
Those passengers with the new biometric passports will be able to do this free of charge and, for passengers who fly frequently, it may make financial sense to renew their passport early so that they too can avoid having to pay the charge to fast-track immigration.
At the moment, almost 20 million of us have the biometric passports which were introduced in Mar 2006. EU nationals with biometric passports will also be able to use the fast track initiative free of charge.
The technology at the new automated gates will use biometric information (namely, the distance between a person’s eyes, nose, mouth and ears) to decide whether or not a person has the right to enter the UK. Money made from the scheme will be used to pay back the £7 million spent on the new gates.
Currently the only way of jumping the queue is to register free of charge on the IRIS scheme which works using iris recognition.
Whether many travellers will be willing to part with £50 for the privilege of jumping the queue remains to be seen, given that there are so many other hidden costs of flying. This week BA dealt a blow to travellers by introducing a charge for passengers wishing to pre-book their seats.
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Ryanair is continuing to slash its ticket prices to attract increasing numbers of passengers, despite issuing warnings about its projected profits for the year. So far, the profits of the budget airline have been healthy and it recently announced that its net profits were up a whopping 550% for the first three months of the year compared to the same time last year.
However, this can nearly all be put down to the huge 42% drop in the price of fuel over the last few months. Indeed, despite the 11% recorded rise in traffic experienced by the airline, the average fares have fallen by 13%, cancelling this out.
But Ryanair is determined to push ahead with its expansion plans. The whole business model of the company relies upon filling as many seats as it can, but the only way it can currently achieve this is to provide numerous special offers to get more people flying. For example, it regularly provides seats to passengers for as little as £1 or even for free, the aim being that they will then pay for other services when on board. However, this means that the per-seat profit is going steadily down, especially when compared to last year.
Ryanair is now warning that its total profits might be 20% down for the second half of the year compared to the same period last year. It has also warned that its full-year profits are likely to be at the bottom end of the €200 to €300 million.
But the company is not fazed by this. The passenger numbers were up by 11% in the first quarter, with 16.6 million people flying with the airline, meaning the company should reach its target of 67 million passengers by the end of the year. Chief executive Michael O’Leary was also defiant, saying that “we will continue to expand as others fail”.
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Budget airline, Ryanair, announced last week that it would be making sweeping cuts in services out of Stansted this winter. Chief executive, Michael O’Leary, who has become notorious for his cost cutting ideas such as charging passengers to use the aircraft toilets, has announced reductions of 670 flights a week; this will be made up of reductions in frequency on 30 routes and the scrapping of 10 routes.
Although Ryanair has in the past made reductions on certain routes in the winter, this year’s cuts look much more far reaching. The routes most likely to be affected are those to parts of France where, although many Brits have holiday homes, they do not use them between the months of November and February. Spain is likely to come off better since the climate means that it is a year round destination for travellers from the UK, particularly since the Spanish government scrapped tourist taxes. Some Irish routes are likely to be axed altogether.
The reduction in flights is likely to mean that the airline's passenger numbers for the winter will drop by 2.5 million. Mr O’Leary blames BAA charges and government taxes for the cuts. O’Leary has already asked BAA to reduce its charges for the winter months and threatened to switch the aircraft being withdrawn from Stansted to other European countries which “welcome tourists instead of taxing them”.
The only people likely to welcome the cuts are the long suffering residents who are so badly affected by living under the flight path and who have campaigned so vigorously against the planned expansion of the airport.
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Ryanair has been responsible for a few rather strange ideas in relation to getting prices down on its flights. These have recently included charging passengers each time they want to use the toilet on board the flight. But now The Sun has reported that it has come up with a new idea that it claims to be seriously considering, and that is getting people to stand up for the duration of the flight.
When they say stand up, what they really mean is that rather than seating passengers in proper seats, instead they will get them to sit on seats that have more resemblance to bar stools complete with seatbelts. It doesn’t sound comfy, and it doesn’t really sound feasible, but Ryanair is deadly serious and has even announced that it is in talks with Boeing about the possibility of installing such a system.
The idea seems to have come from another airline, the Chinese carrier Spring, which is also said to be considering such plans. With airlines across the world feeling the pinch of the recession, they are looking to cut costs and increase passenger numbers wherever they can, and sometimes this means thinking outside the box.
The head of Ryanair, Michael O’Leary, is apparently now looking for approval from the Irish Aviation Authority before any firm decision is made to check that it would be permitted. A spokesman for the company said that "if they approve it, we'll be doing it". Apparently it could lead to a 20-30% increase in passengers and a 20% decrease in costs, so we could well be seeing it come into force in the near future.





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