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Aviation History
1949
1949 - 1918.PDF
634 FLIGHT, 24 November 1949 CIVIL AVIATION NEWS... B.E.A.'s RECOVERY Current Economy Measures : Results Already Apparent WHILE progress in. itself is no guarantee of the ultimatesuccess of any large-scale undertaking, the gratifying achievements of British European Airways in the last threemonths have caused speculation as to the nearness of the day when the Corporation may be regarded as a profit-makingairline Messages of congratulation on past achievements and en-couragement for increased future efforts on the part of the staff appear in the current issue of B.E.A.'s house-journal. Lord Douglas, the chairman, says that " the sub- stantial profit recorded for the three months July. August andSeptember reflected the greatest credit on all employees of the Corporation, many of whom had worked themselves toa standstill during the past summer." His message continues, "Unfortunately this does not mean that B.E.A. will operateat a profit over the whole of this financial year. We still have the bad months before us, but it is a great step forward in thedirection of turning B.E.A. into a profitable airline. This, of course, must be the object of all of us and I see no reasonwhy, if we all put our backs into it, this object should not be attained within the next year or two. Stringent economy andhard work must be our watchword." A review of progress is given by Mr. Peter MasefLeld, chiefexecutive, who points out that B.E.A.'s deficit of ^2,763,085 (^810,904 lower than the previous year) was recorded over aperiod when the Corporation was doing 33 per cent more flying. Preliminary figures for the first six months of the financialyear 1949/50—from April 1st to September 30th— show fur- ther encouraging progress; and for the 12 months ended Sep-tember 30th, B.E.A. reduced its deficit from nearly ^2.8 million to less than £1.8 million, a deficit of 4s 6d per £expenditure compared with 6s gd in 1948-49. The most significant point is the fact that productivity has risen by 55per cent. Results of Devaluation The effect of devaluation on B.E.A.'s operating costs andultimate financial results is estimated to mean an increase of £450,000 in operating costs, including a figure of ^183,000which will be added to the present fuel bill of £900,000 a year as a result of the increased cost of aviation fuel. Stations inSwitzerland, France, Turkey and Italy will also incur increased expenditure, so the importance of the drive for dollar trafficis emphasized. In the past 12 months the dollar income has exceeded dollar expenditure by more than $500,000, and therecent booking of 1,250 seats for American passengers on the Paris service for four days during next spring is considered tobe a fine effort, meaning, as it did, an increase of some §27,875 in the form of an "invisible export." Lord Douglas, however, has since stated that it is hopedto offset to some extent the effects of devaluation by the in- creased traffic which may be expected if fares are maintainedat their present level despite opposition from non-devalued countries; he points out that it is essential to provide fareswhich can compare favourably with the rates for surface transport. COMPARATIVE B.E.A. OPERATING STATISTICS FOR SEPTEMBER 1948 AND 1949 Passenger stage flights com- pleted Distance flown (km) ,, „ (miles) Revenue Passengers Revenue Passengers (km) (miles) Excess baggage (kg) (Ib) Mail (kg) „ (Ib) Freight (kg) <lb) Route Distance (km) (miles) ... U.K. Services 1948 1949 5,158 933,939 580,323 50.241 12,116,146 7,528,622 42,179 92,989 100,913 222,475 69,980 154,280 3,191 1.983 4,824 898,731 558,446 53,649 14,607,726 9,076.817 47,874 105,544 105,670 232,962 136,534 301,006 4.677 2,904 Continent 1946 1.662 1,170,747 727,468 25,622 18,706,922 11,623,939 65,803 145,071 141,092 311,055 320,509 706,601 17,704 11,001 al Services 1949 2.588 1,584,109 984,319 37,135 25,018,340 15,545,671 73,659 162,390 184,511 406,777 318,468 702,102 16,654 10,338 Reviewing the proposed move to London Airport in 1951,Mr. Masefield details the advantages which will result from the increased capacity and the improved maintenance facilitiesof London Airport in its developed form, and says that B.E.A.'s new Ambassadors and Viscounts (the first Ambassa-dor is due for delivery on January 15th, 1950) would not fit into the present hangars at Northolt. He also stresses thefurther advantages of the closer connections which will be provided between B.E.A. and the long-range airlines operatingfrom London Airport. Increased revenue and lower operating costs can be expected wh?n the move is completed. B.E.A,has also approached the M.C.A. on the subject of improve- ment of facilities at Gatwick with a view to making this anadequate diversionary airport if London Airport should become too congested, particularly when peak summer traffic occurson days of minimum visibility. Operations with four Ambassadors will, it is hoped, bestarted by May, 1951. Viscounts are expected to be put into service during 1953, and the entire move to London Airportshould be completed by the spring of 1954. The combination of Ambassadors (flying on the shorter routes) and Viscounts(for the longer distances) will, it is thought, give an ideally balanced fleet from an operational point of view. As part of the stringent economy programme which theCorporation is now following, a budget control system has been introduced whereby each department and station must submitestimates of expenditure and income for the year ahead, and the results are checked each month. A clear indication ofthe financial progress, productivity and operating efficiency of each department can be obtained from a system of simplecharts which show graphically any excesses over budget expen- diture or falling-off in productivity so that remedial actioncan be taken immediately. An important feature of the charts is that certain figures have been calculated as a moving annualtotal, thereby enabling a clearer picture of the overall trend of operations to be obtained. Three of the charts calculated on this basis are reproducedhere in a simplified form and indicate effectively the progress which is being made by B.E.A. "Pi4O £ 9O y 8O ^ 7O < 60 3 5O V, 'A •'A // y/> y/ V, y\y/, Y' <'7> '// ?/ y/, y V,Y y?'/>r —* -A - 1947/8 (SEPT - MAR) 1948/9 1949/5O (APR - MAR) (APR - SEPT) Fig. I. "Break even" versus actual revenue load factors (moving annual basis). The point of interest in Fig. 1 is that the revenue loadfactor has been maintained at an almost steady level oi 63 per cent (representing an income of some ^6,000,000; expenditureat present is £7,500,000), while capacity offered has been in- creased by 45 per cent during the past six months. In orderto "break even" the actual revenue load factor required would, at the moment, be in the region of 80 per cent, but, byincreasing capacity and reducing operating costs, it is estimated that the '' break even '' load factor may be reduced to 68 percent. A budgeted revenue figure of ^7,000,000 is the aim by the end of the year. The decreased cost per capacity ton-kilometre (from 60 to30 pence over a period of 21 months), shown in Fig. 2, is 6O ,50 £40 3O MAT- 1947/8 * 1948/9 (APR-MAR), (APR-MAR) Fig. 2. Total cost per capacity ton-kilomet" 1949/5O (APR-SEPT) B IS
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