BA announce major cost cutting scheme
04.07.09
In response to the challenging economic conditions British Airways has announced a major cost cutting scheme that will see it ground aircraft and delay the delivery of 12 Airbus A380 superjumbos as it struggles with the global recession and a steep decline in passengers.
Capacity this summer is being reduced by 3.5 percent (previously 2.5 percent), and will be cut by 5 percent (previously 4 percent) in the winter. The airline's three remaining Boeing 757s will be grounded in mid-2010 and three Boeing 747-400s the following winter. Delivery of the first six A380s is being put back by 5 months on average, with the first delivery still planned for 2012. There will be a 2 year delay for the remaining six aircraft.
Forecast capital expenditure has been reduced from £725m to £580m for 2009/10 and is likely to remain at that level in 2010/11. Staff equivalents (MPE) are targeted to be reduced by some 3,700 in 2009/10 - this is in addition to the reduction of around 2,500 achieved between June 2008 and March 2009.
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