Monday, January 05, 2015

BA's need for a legacy refresh

Mumabi: It was in 1924 that British Airways (BA), then known as Imperial Airways, made its first survey flight to India. Ninety years later, BA counts the country as its second-biggest overseas market after the US.

But growth in India has its own challenges. India is not a high-yield market (as average fare charged is lower than other markets for the same distance). The competition is only getting intensified with the Gulf airlines challenging its dominance. BA, though blessed with a enviable heritage, has its task cut out.

It seems to have put in place a multi-tiered plan to keep its banner flying high. The immediate step to profitable growth is its deployment of the new Boeing 787 aircraft to Chennai and Hyderabad. The change in aircraft reduces seat capacity (BA Boeing 787 has 214 seats, in contrast to the earlier Boeing 777's 247 seats) but is geared for cost-efficiency. Not only are these more fuel-efficient but serve point-to-point traffic out of London better and require the carrier to fill less seats for transfer traffic (whose yield, or revenue per seat per kilometre is more discounted than point-to-point traffic).

BA flies 49 aircraft a week, twice every day to Delhi and Mumbai, and once daily to Chennai, Bangalore and Hyderabad.
04/01/15 Annesh Phadnis/Business Standard
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