Tuesday 7 July, 2020

British Airways CEO pens letter, open to 'practical' fixes from staff

As many airlines reduce headcount in an effort to stay afloat throughout the COVID-19 pandemic and return to the skies, British Airways is giving staff an opportunity to propose options they think might help the company now.

Chairman and CEO, British Airways, Alex Cruz penned a 'difficult' letter to his employees about the pending job cuts, as part of the efforts to see business continuity.

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With passenger revenues slashed by more than 50 per cent when compared to 2019 year-on-year, he wrote:

"We have informed the Government and the Trade Unions of our proposals to consult over a number of changes, including possible reductions in headcount.

"We will begin a period of consultation, during which we will work with the Trade Unions to protect as many jobs as possible. Your views matter and we will listen to all practical proposals."

Where many are talking about a new normal, Cruz said that British Airways must emerge more competitive, but he admits, there is 'no normal' for the airline currently.

Having already repurposed some of their fleet to transport cargo in the absence of passengers, he thanked the staff who have facilitated this change.

"The scale of this challenge requires substantial change so we are in a competitive and resilient position, not just to address the immediate COVID-19 pandemic . . . However challenging this is, the longer we delay difficult decisions, the fewer options will be open to us. 

"I want to pay tribute to the thousands of British Airways colleagues who are playing a vital role in the global response to the COVID-19 crisis. Whether you are supporting our repatriation flights or the transport of essential cargo; or one of the hundreds of colleagues volunteering with organisations such as the NHS, you have my sincere respect and thanks." 

Since the downturn, unbelievably, British Airways has seen some uptick in this new area though.

In the final week of April, 21 British Airways flights were being operated per week from China to London up from 13 the previous week. The flights transported up to 770 tonnes of cargo for the NHS including PPE (Personal Protection Equipment) and the cargo was shipped in a joint effort between British Airways, IAG Cargo, the UK Government and the British Embassy in Beijing.

However, a reduction in headcount and the repurposing jets are not the only avenues being considered to sure-up the company. Cruz said:

"We are taking every possible action to conserve cash, which will help us to weather the storm in the short-term. We are working closely with partners and suppliers to discuss repayment terms; we are re-negotiating contracts where possible, and we are considering all the options for our current and future aircraft fleet."

 

See the full letter is below:

Letter to colleagues from Alex Cruz, Chairman and CEO at British Airways

Yesterday (April 27, 2020), British Airways flew just a handful of aircraft out of Heathrow. On a normal day we would fly more than 300. What we are facing as an airline, like so many other businesses up and down the country, is that there is no ‘normal’ any longer.

The global aviation body, IATA, has said that the industry has never seen a downturn this deep before, and that full-year industry passenger revenues could plummet 55% compared to 2019, while traffic falls 48%.  Many airlines have grounded all of their planes. Sadly, we will see some airlines go out of business with the resulting job losses. 

Our very limited flying schedule means that revenues are not coming into our business. We are taking every possible action to conserve cash, which will help us to weather the storm in the short-term. We are working closely with partners and suppliers to discuss repayment terms; we are re-negotiating contracts where possible; and we are considering all the options for our current and future aircraft fleet. All of these actions alone are not enough.   

In the last few weeks, the outlook for the aviation industry has worsened further and we must take action now. We are a strong, well-managed business that has faced into, and overcome, many crises in our hundred-year history. We must overcome this crisis ourselves, too.   

There is no Government bailout standing by for BA and we cannot expect the taxpayer to offset salaries indefinitely. Any money we borrow now will only be short-term and will not address the longer-term challenges we will face.  

We do not know when countries will reopen their borders or when the lockdowns will lift, and so we have to reimagine and reshape our airline and create a new future for our people, our customers and the destinations we serve. We have informed the Government and the Trade Unions of our proposals to consult over a number of changes, including possible reductions in headcount. We will begin a period of consultation, during which we will work with the Trade Unions to protect as many jobs as possible. Your views matter and we will listen to all practical proposals. 

The scale of this challenge requires substantial change so we are in a competitive and resilient position, not just to address the immediate COVID-19 pandemic, but also to withstand any longer-term reductions in customer demand, economic shocks or other events that could affect us. However challenging this is, the longer we delay difficult decisions, the fewer options will be open to us. 

I want to pay tribute to the thousands of British Airways colleagues who are playing a vital role in the global response to the COVID-19 crisis. Whether you are supporting our repatriation flights or the transport of essential cargo; or one of the hundreds of colleagues volunteering with organisations such as the NHS, you have my sincere respect and thanks. 

This has been a difficult message to write and one I never thought I would need to send. I know how tight-knit the BA family is, and how concerned you will be, not just for yourself but for your colleagues, too. We must act decisively now to ensure that British Airways has a strong future and continues connecting Britain with the world, and the world with Britain.  

Thank you. 

Alex 

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