May 2008 Archives

People get very possessive about their local airlines. They love them for helping connect them with the big wide world and often give them money.

So when they fall apart, or disappear without even a sorry, they get very cross.

Witness then the fury of the Isle of Man government over the collapse of its local carrier Euromanx.

It has publically laid out its views about the management of Euromanx and how it handled its affairs in the work up to its eventual closure on the 9th of May.

This open letter on the Isle of Man government's website sets out its position. It's pretty long, but worth scanning, and here are some of the juiciest bits.

After a hellacious couple of months British Airways chief executive Willie Walsh was back to his old chirpy self today, despite voluntarily turning down a £700,000 bonus.

In an interview with BBC Radio 4's Today programme this morning , Walsh said that he "felt it wouldn't be appropriate" to accept his chunky bonus in the wake of the catastophe that was the opening of London Heathrow's Terminal 5.

But Walsh has good reason to be chirpy, despite missing out on what to most of us is a sum of money that can only be dreamed about. Under his leadership BA has hit its much sought-after 10% operating margin target.

The airline today unveiled full-year pre-tax profits of £883 million, a 45% year-on-year increase, on revenues that rose 3.1% to £8.8 billion. Not bad for an airline that has barely been out of the headlines for all the wrong reasons.

Walsh also swept aside persistent press rumours that he is about to be given the boot, telling the Today programme that "I'll be here for another 10 years".

By my calculation, this would put him just beyond the age of his planned retirement, which he told me about during Airline Business' March cover interview. You can never quite believe everything you're told!

As for the admirably relinquished £700,000 bonus, if BA is at a loose end with what to do with it and wants to both score some much-needed good PR and help some people in true and desperate need, may I suggest a donation to help the victims of the recent natural disasters in Burma and China? Just a thought.  

As a journalist I know how something is phrased can be critical. So, take a look at the opening line of this release from AirAsia X today: "AirAsia X, the pioneer Malaysian based long-haul low cost airline proves that it is here to stay and it is all set to spearhead Kuala Lumpur to greater heights as a global low cost hub."

The key phrase I've put in italics.

My interpretation of this is that AirAsia X is feeling the heat, at least in a public relations sense.

Here is a shot of AirAsia's Tony Fernandes (centre just in case you  didn't know) at the announcement of the third AirAsia X route from KL to Perth.

There seems to be a new sport in the UK consumer press - Willie bashing. That's not as rude or painful as it sounds, it refers to what seems to be a competition to publish as many stories as possible slagging off British Airways and its chief executive Willie Walsh.

Now don't get me wrong - after the disastrous opening of London Heathrow's Terminal 5 and the problems and embarrassment that followed, BA and Willie should rightly be coming under some scutiny and criticism in the UK newspapers.

But the story the papers have all jumped on today makes you wonder if they're trying as hard as they can to spin any tiny nugget into another excuse to lay into the beleaguered carrier. Take this story in The Guardian which, from its headline, you would assume means job interviews are underway for a new CEO to replace Walsh.

In fact, if you read further down it transpires that the carrier has hired a headhunter to find a new chief operating officer and it just so happens that the ideal candidate is required to have the skills to act as a possible successor to Walsh "in five years plus". Hardly the same as seeking a new CEO, is it? But don't let that get in the way of a good headline.

In any ultra-competitive market, and Europe's airline one is no exception, casting doubt on your rival's fortunes is a good sport. And Ryanair chief whipper - the Indiana Jones of the airline business - Michael O'Leary took a crack at the survival prospects of German hybrid carrier Air Berlin this weekend.

According to reports, he told a German paper Air Berlin would be one of the victims in this vicious market and that Germany would one day be dominated by Lufthansa and yes, you guessed it, Ryanair.

The route by which we’ve got this story has surprised even us, but we’ve been told – on good authority – that the news will break this weekend that BAA’s refinancing battle will get even tougher with major backer Citibank pulling out.

The bank, which was being lined up to provide the largest chunk of money to BAA in this financing round, is believed to have reversed an earlier decision to extend further credit to the UK airports operator.

If this plays out it will be a major blow to BAA, and could influence other banks mulling a role in BAA’s refinancing.