BA going 10-abreast on B777’s, Club Europe on domestics & other IAG Capital Markets Day revelations

Yesterday was the annual International Airlines Group Capital Markets Day, where IAG gives a public presentation for its bondholders on the performance of BA, Iberia, Vueling and now Aer Lingus.

The slides are made available to all. You can download the entire 118 pages here.

IAG Report Accounts 2016

On the off-chance that you have something better to do on a Saturday than read 118 slides, here are a few key points.

I have ignored news which is already in the public domain and which we have already covered on HFP previously.

“Radical improvement in quality and presentation” of food in Club World on the way

New Club World seat “in development”

Club Europe to be launched on domestic flights

More aggressive tailoring of short-haul network to reduce flights to business cities in the summer and replace with flights to leisure destinations (a 3-route trial increased load factor from 43% to 86%)

Out of London, BA short-haul flights are more punctual than Ryanair and easyJet

72 self-service bag-check desks to be introduced at Heathrow and Gatwick next year

Substantial seat densification – 25 aircraft in the Boeing 777 fleet – including the full Gatwick fleet – to move to 10-across in World Traveller compared to the current 9-across; Gatwick 777 fleet to also lose eight seats in Club World whilst gaining 24 in World Traveller Plus; Heathrow A320 fleet to gain another 12 seats, Heathrow A321 fleet to gain another 13 seats  This means that BA A320 aircraft will have the same number of seats as easyJet.

Waterside head office to be “streamlined”

Iberia – now the 2nd most punctual network carrier in the world; Premium Economy launching in 2017

Aer Lingus – positioning as the leading “value carrier” across the North Atlantic; Aer Club now pencilled in for Q4 2016 launch

Vueling – will convert its loyalty programme into Avios in Q1 2017

Avios – BAEC, Iberia Plus and Meridiana Club to move onto the Avios IT platform during 2017

Slide 65 appears to show – although it could easily mean something else entirely – that attempts will be made to encourage members not to redeem Avios on partner airlines but to focus on BA, Iberia and Aer Lingus

Slide 68 implies that the number of Avios issued in 2016 could fall marginally over 2015, presumably due to the British Airways earning changes

More, lots more, in the slides if you want it.

IAG shares closed down 3.6% yesterday at 434p.

(PS.  The image above is taken from the presentation although it has been removed from the version available for download.)

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Comments

  1. Guys chill it’s just locker room banter 🙂

  2. How is there room to go 10 across without making seats *even narrower*?

  3. I am struggling to work out how they can fit another 12 seats into the A320…they surely cant squeeze in any more rows!?!

    I think I’ll be standing from then on, except there isn’t anywhere to stand up in!

    • the_real_a says:

      Remove the galley and lavatory – no need for the former since its buy on board.

  4. Odd decision on cramming extra seats into the 777s. The presentation says 25 aircraft and Gatwick, but BA have 58 777s. So is it just the Gatwick fleet that is going ultra high density?

    Sadly, most people don’t check this level of detail before booking a flight. I used to fly economy on AA when they offered “more room throughout coach” (34″ seat pitch in a 2-5-2 config). I would have happily paid substantially more for this level of comfort, but the business model failed. All most people care about is price. So while people are so stupid, its inevitable that most airlines will cram in as many seats as possible.

    It’s frustrating that in order to get a reasonable level of comfort in premium economy, you have to pay an extra £73 APD (the same level of tax as J or F).

    I don’t often fly Y anymore, but if I have to sit in a cramped seat I may as well fly Norwegian instead of BA.

    To Squash, to Squeeze.

    • Amazing isn’t it? Ryanair, woeful legroom for years… Now Europe’s largest airline by passengers. Emirates, 10-across 777 for years… World’s largest long-haul carrier. Price is simply paramount for economy passengers. Their lower costs allow lower fares and keep attracting the passengers.

      • Don’t touch Ryanair but my last Emirates Y 777 long-haul was on a spotless plane, with hot towels, printed menus, decent IFE and plentiful food. Compare that to the regular FT BA complaints about filthy aircraft, catering mismanagement, mini Mars bars and being treated like cattle.

        • Don’t get me wrong, I wasn’t knocking Emirates, nor defending BA. Just pointing out how commoditised air travel has become. Personally I find service factors secondary if I am highly uncomfortable for x hours.

    • All Gatwick plus the 3-class Heathrow fleet.

  5. To be fair to them, any decent presentation is designed for its audience and this wasn’t aimed at passengers. If this was aimed at bondholders (who want to be paid), you can understand them needing to sound obsessed with costs and… being shown the money…

  6. So they’re densifying 25 777s.
    Anyone any idea how many are in the LGW fleet already? If any might be shuffling around the M25 from LHR to join the game, or if it’s to help better manage the fleet by being able to flick between the 2 depending on demand etc?

  7. Andrew Tucker says:

    I am beginning to wonder whether I should have a rethink over my Avios collecting priorities. Avios appear wanting to keep moving the goal posts. I wonder whether hotel point collecting is now a more effective points choice.

    Hotel points are a lot more versatile in many ways I suppose. Hmmm….

    And come to think of it, my Amex nectar bonus has made me rethink their possibilities through flying with easyjet etc

    Hmmmm…

  8. …way to go, Brutish Airways. 😐

  9. Thinking big picture STUFF perhaps this is a step towards leveraging first and business pax out of scheduled flights and onto their private charters? If so I will look forward to reading Rob’s article on how we are finally going to be getting the same sign up CC bonuses as those in the USA.

  10. One of the slides states “Ambition to create an experience that exceeds that of our key competitors” The question is, who do BA see as their key competitors i.e. What is their target market?

    • Judging by the current cuts all over, they are probably trying to compete with Southern Railways…

  11. +1

  12. BA are obsessed with Norwegian, utterly obsessed.

    What they will achieve is to have no differentiation and no reason to choose on anything other than price. I certainly won’t be flying in the back of a 10 abreast 777 when I can avoid it.

  13. Lostantipod says:

    I read this article sitting in the QR business lounge in Doha and had to laugh. I had just been perusing the buffet and one of the staff asked me what I would like to eat. I said I was feeling like some cheese and biscuits and the response was “we don’t have that here, but I can ask the chef to make you a cheese platter if you like?”. Meanwhile, BA are huffing and puffing with “show me the @&£#ing money” . Show me some customer centric behaviour, IAG….then you’ll see my money.

    • TGLoyalty says:

      IAG might be seeing some of your money now 🙁

      • Lostantipod says:

        I normally fly EY in this direction, but this trip was a one-off so I could try QR and a 787, both new to me. Itch scratched.

  14. Aeronaut says:

    “(PS. The image above is taken from the presentation although it has been removed from the version available for download.)”

    Nevertheless, it’s still pretty puerile.

    • Off the cuff indiscretions are one thing, but that this made it through to a presumably carefully crafter & internally reviewed public presentation speaks volumes about the direction BA is being driven.

    • Off the cuff indiscretions are one thing, but that this made it through to a presumably carefully crafted & internally reviewed public presentation speaks volumes about the direction in which BA is being driven.

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