FlightGlobal.com
Home
Premium
Archive
Video
Images
Forum
Atlas
Blogs
Jobs
Shop
RSS
Email Newsletters
You are in:
Home
Aviation History
1971
1971 - 0005.PDF
FLIGHT International, 7 January 1971 First fimiancial details AMAJOR CONTRIBUTION to public knowledge about Britain's airlines was made last week when the Department of Trade and Industry announced the issue of financial statistics relating to the industry, and the first airline-by- airline figures—balance sheets and profit-and-loss accounts —for the independent sector. Publication of individual data is still a voluntary matter for the airline concerned (except in the case of the two public corporations, which publish their accounts annually as a matter of course). Six privately owned airlines—Britannia, BUA, Caledonian, Dan-Air, Laker and Monarch—have consented to publication, as has the BEA-controlled British Air Services. A further five— British Air Ferries, Channel, Court Line, Loganair and Skyways Coach Air—have co-operated in the DTI survey, but have not consented to publication of their figures. The remaining airlines, it must be assumed, declined to take part; they apparently include British Midland. Donaldson, Invicta Air Cargo, Lloyd International, Tradewinds and Transmeridian Air Cargo. Some financial information on the airlines has of course always been available on public file at the Registrar of Companies (latest information from this source was tabulated in Flight for October 22, page 636). Tt is supplied in accordance with the Companies Acts and is similar to that demanded from all limited companies. It is not in any standard form, is not specifically related to the air transport industry, and is often filed only after some delay. 'Its usefulness for statistical purposes has always therefore been limited. The new statistics from the DTI, which are published in the Business Monitor series,* relate to 1968, but a further edition covering 1969 is expected to appear within a month or two, and those for 1970 before the end of the year. The airlines which have co-operated in the present survey represent 91 per cent of the ton-mile output of the industry in 1968. A further 6 per cent was produced by British Eagle and Transglobe, both of which ceased operation during the year, and which have not been included. Financial data for the airlines producing the remaining 3 per cent have been estimated, using where possible accounts filed with the Registrar of Companies. The paucity of information on British independent airlines has been a matter of adverse comment for some years, although the amount published officially has increased recently (with, for example, the publication from 1968 of route-by-route pessenger-traffic data). The Air Transport Licensing Board has also accumulated a large body of statistical and financial information, but has published little of it. In its report for 1966-67 the ATLB said: "We have maintained in the past, and we understand that the Board of Trade [now Department of Trade and Industry] concurs in this view, that it is not the function of the ATI.B to publish regular statistics on the traffic and operations of British airlines. . . . We doubt also whether we in fact possess the powers to undertake such publication; and even if we did, we are not equipped to do it. ... We have also given some thought to the advantages that might result if some publication were made of the financial results and resources of United Kingdom airlines apart from the two national airways corporations. . .. We have drawn the attention of the Board of Trade to the obligations assumed by the UK Government in relation to UK international airlines under Article 67 of the Chicago * Business Monitor, Civil Aviation Scries, CAii. HMSO, price 5s per year. Convention. . . ." (Article 67 requires the submission of traffic and financial information; Britain for many years conformed only in respect of the corporations.) The Edwards Committee which inquired into British air transport said in its report in 1969 that "the collection and publication of statistical and financial data . . . need to be greatly improved." In a more specific context, that of domestic fares, the report said: "We have only one criticism to make of the procedures by which domestic fares have been regulated. This criticism concerns the paucity of statistical and financial data by which a public judgement can be made of the appropriateness of the fare levels applied for and those approved by the ATLB.... It is our opinion that material of this kind must be made public in order to ensure that arguments for fare increases can be fully tested." The ATLB has stated that it agrees with the Edwards Committee's view. The board is to be replaced eventually by the new Civil Aviation Authority, and it is assumed (although the Government has not yet detailed the CAA's functions) that it will be charged with the collation of statistical information about the industry. So far the Government, which itself has no powers to publish financial information, has relied on the voluntary co-operation of the airlines, and has indicated that it would be reluctant to take compulsory powers relating to one sector of the country's commercial life in excess of those generally conferred by existing legislation. Whether or not the CAA will be expected to continue to assemble financial infor mation on a voluntary basis remains to be seen. But if it is, then one must hope that the airlines who are reluctant to join in at present will be persuaded to do so in course of time. UNITED MANAGEMENT CHANGE THE new president and chief executive officer of United Air Lines and of its holding company, UAL Inc, is to be Mr Edward E. Carlson. The appointment follows the sur prise resignation just before Christmas of Mr George E. Keck, who is to continue as a director of both companies. He has been with United since 1946, becoming executive vice-president and general manager in 1962. Mr Carlson is at present chairman and chief executive of Western International Hotels Inc, another subsidiary of UAL Inc. In common with other major US airlines (and United is the biggest of them), the carrier's fortunes have slipped during 1970; the airline was expected to finish 1970 with a net loss of more than $30 million (£12.5 million), com pared with a net profit of $44.7 million (£18.6 million) in 1969. Mr Carlson said only that the change in management resulted from a feeling among the airline's directors that a change of "operating philosophy" was needed. Mr Keek's resignation should not be taken as signifying the start of a round of top management changes in US airlines, according to Mr John Shaffer, the FAA Adminis trator, who sought to allay rumours to this effect (there has also been a management change at Eastern Airlines recently). In a colourfully worded statement he said (as reported by Aviation Daily): "In an era of escalating labour costs, coincident with a sharp curtailment of business travel in a framework of absurd route structure (attributable to federal and, most recently, state regulatory actions), I don't find airline management culpable. Continued cost-cutting isn't the panacea either, but this can slow the flow of red.
Sign up to
Flight Digital Magazine
Flight Print Magazine
Airline Business Magazine
E-newsletters
RSS
Events
