Choppy Seas
March 5, 2009 – 9:22 amYesterday British Airways announced ,"lucrative premium traffic fell further in February, but, due to capacity cuts, proportionately it filled more seats." Nice try BA. The press release carried more details, "BA’s premium traffic dropped 20.2% on the year, with non-premium traffic off 5.5%. Premium traffic in January fell 13.7% year-on-year. BA generates a significant amount of its profits from premium travelers, particularly on transatlantic routes."
The last line in the CNN article nails the issue. Premium traffic represents BA’s profit. Without the premium traffic there is no money. These numbers also highlight BA’s perlious position with its investments in Openskies and the A318s from London City to JFK. With premium traffic continuing to fall, BA is going to have make some difficult decisions about the future of these ventures.
