Insights from the UK and beyond
BA horror show should quell talk of “green shoots”
Recent weeks have seen smatterings of good economic news. Sectors that took the full weight of the recession last year said they were staggering to their feet now spring is here.
Retail: John Lewis had its best week of the year so far from 2nd-9th May.
Leisure: Pubs group Greene King said things have ‘generally improved’ since the start of the year.
Then along comes the British Airways CEO to spoil everyone’s fun.
“I see no signs of recovery anywhere,” Willie Walsh told BBC radio’s Today programme following publication of the airline’s full year results. “Globally we see economic conditions continuing to be very weak. We have a global network so we are operating in pretty much every country around the world, and what we see is pretty much the same everywhere.” Cheers Willie.
British Airways’ numbers are an absolute horror show. Having made a record profit in the year to March 2008, it managed to set another record last year – this time for losses. Its fuel bill nearly doubled to three billion pounds. It is losing passengers hand over fist, grounding planes, slashing thousands of jobs – Walsh himself has even waived a year end bonus.
And now he warns of more of the same. So should we listen?
Walsh describes his company as an “excellent barometer of what is happening in the world today” and it is hard not to agree. Air travel is a luxury for the confident consumer, and there are clearly few of those. It is also a sign of a thriving business – sending staff off to New York (usually on BA) to thrash out the latest deal.
BA’s premium (first and business class) traffic is falling by double digit percentages every month. That tells its own story. Shops and pubs may have started to welcome back the punters, but air travel is a far more revealing indicator of what is really happening.
Don’t talk to Walsh about ‘green shoots’.