Going it alone

When Go was created in 1998, the UK Office of Fair Trading deemed on competition grounds that the airline should have a completely independent management team from its then parent British Airways. Although a few former BA managers were appointed, such as chief executive Barbara Cassani and chief operating officer Ed Winter, Go was completely standalone, recruiting its own administration and sales teams and flightcrew, while outsourcing many functions such as engineering and aircraft handling.

Go launched services with a fleet of five secondhand Boeing 737-300s on operating lease in mid-1998, operating a network from London Stansted to points in Germany, Italy, Portugal and Spain, as well as some domestic destinations. The airline opened its first base in Bristol in May last year, and started services from its new East Midlands hub last month, but has so far resisted the temptation to set up in continental Europe. This may change.

"We have a shortlist of bases - a large number of which are in continental Europe and there is a high chance that the next one will be," says Winter.

By mid-2002, Go's 737-300 fleet will number 27, by which time around 200 pilots will be working for the carrier. Winter says that Go aims to achieve an annual compound growth of 30%, which will see its fleet expand to around 80 aircraft in four years' time.

"We have been in a lengthy evaluation of the Airbus and Boeing narrowbodies," says Winter, with the aim of concluding an order for 80 aircraft plus additional options by "early summer", to enable deliveries to start next spring.

The firm orders will be delivered up until 2006, with additional positions beyond that date.

The 150-seat Airbus A319 and the Boeing 737-700 are the focus of the evaluation - although Winter says Go has identified some markets where a larger aircraft could be of benefit and is evaluating whether to also order a 180-200 seat A320/737 variant.

Although the airline started with a strong low-cost base, the search for further savings never ends. Outsourcing has obvious cost benefits. Winter ensures suppliers understand there are no "jobs for life" and that contracts are renegotiable. For example, the airline ended its original handling contract with Servisair at Stansted last year, switching to Groundstar. It pays Stansted-based company FLS hourly rates for engineering and maintenance services, while Go's spares holding contains only carpets and seat covers, says Winter.

The airline has also reduced the number of night-stops it makes, resulting in further cost savings. "Scheduling is more operations-focused than is traditional - and less marketing-led," Winter adds.

"For example, allowances are made in scheduling of aircraft and crews to permit pilots to fly whole mornings or whole afternoons, without costly lay-overs or dead-heading."

Source: Flight International