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

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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.

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 (107)

This article is closed to new comments. Feel free to ask your question in the HfP forums.

  • Kevin says:

    Isn’t the slide a reference to the film Jerry Maguire? It’s quite a funny joke but I see how it looks bad out of context. I expect the papers will end up covering it in one of their breaks from stirring up racial hatred.

    • Tony says:

      I don’t recall the expletive in Jerry Maguire so not even funny in my books, but distatsteful and shows contempt for its customers…

  • Billy Buzzjet says:

    No mention of when they’ll start selling a BA scratch card on-board then.

  • SteveMc says:

    ‘Show me the f*cking money’?!? That’s a real low. Of course it’s important for British Airways to operate a robust, competitive and profitable operation but not to the detriment of the brand’s values, history and integrity. As a staunch and loyal fan of the airline, I’ve struggled recently to advocate them to friends and colleagues. Every piece of news tends to diminish the brand further and does make me question my loyalty. On the plus side, enhancements to Club World are long overdue and quite exciting. Although who knows when we will see them. Club Europe on domestic flights is a nice touch too and gives consumers choice. Extra seating is less of an issue for me with short legs (luckily) although it gives even less reason to choose the airline over a low-cost carrier. But I’m sure all these changes have been driven by BA’s extensive customer feedback and customer service programmes (some of which they scrapped this year). They do continue to remind us that they listen to their customers and this is what we want! Wonder how the staff feel about this…

    • Lee says:

      Its not about short legs , as ive flown 777 with 10 accross before . Never again im a small person but the seats are super narrow and you find yourself squeezed against the person next to you and if you have an isle seat the trolley bashes past you for most of the flight as there is not enough clearence for it . Be warned stay well away from 777 with this seating plan.

      • SteveMc says:

        Yes, you’re quite right Lee. And that’s without the people either side eating into whatever space you might have. I hadn’t really considered that.

    • Temp says:

      I really doubt any customer feedback has pointed to passengers wanting less space, fewer amenities and poorer service standards (couldn’t tell if there was a dose of sarcasm). This is purely about top-driven cost cutting and revenue maximisation. BA is not alone, it is the overriding trend in the whole market and is now moving into long haul… Note AF-KLM announced a new long haul low-cost/hybrid carrier plan yday to better compete with ‘lower-cost Gulf carriers’. BA seems to be adopting the same strategy, but in the mainline carrier! The issue is if all the airlines do it, people will still fly, so where’s the downside for them?…

      • SteveMc says:

        There was a huge dose of sarcasm! On writing to BA recently to ask about the new charges for food and drink on board, they responded to my issues on paying £6 for a spirit and mixer by telling me that this is what their customers had told them they wanted. I can’t imagine anyone said they’d prefer to swap a complimentary bar for a paid for one! But you’re quite right, this is a bit of a trend… it’s just disappointing when it happens to the airline you prefer!

        • Will says:

          Even more annoying when they have a monopoly on the landing slots and the government can’t get any capacity increase of any kind.

          • Temp says:

            Agreed. It is disappointing. And moreso given the London market, unlike the rest of Europe, actually had local network carrier competition (bmi, virgin) which couldn’t really make it work either.

  • Dave R says:

    I hope the Avios IT platform changes won’t mean the end of the BA companion voucher. It’s the only way I can still make BA avios work for me following the devaluation.

    • Lee says:

      If they stop it i for one would cancel my amex and just start using Virgin atlantic even though its flights are mainly Usa etc.

    • CV3V says:

      My own hope, which i have thought for a while, is that they could extend the companion voucher across the IAG network.

      • xcalx says:

        That would make me apply for my first ever BA Avios card so I could use one on IB. I only redeem on NON BA longhaul flights. I have a phobia regarding BA taxes.

  • Leo says:

    I think once you get the feeling that a company is treating you with this level of contempt you should really make alternative plans. The strap-line is obviously a reference to “Jerry Maguire” but it’s still a laughably poor choice. I am struggling to see the real benefit of avios collecting these days with long-haul J flights elsewhere so (relatively) cheap anyway. I can cope with short haul economy with my priority pass – even as a tall(ish) person, and anyway it’s easier to get extra legroom on EZ by paying £12 or so. Will retain silver into 2018 due to other OW flights booked in 2017 but after that I think that’s probably it for me. Not saying I’ll avoid BA totally but I won’t seek them out and choice will be based on cash/convenience alone.

  • Hidehi says:

    That slide you posted does not seem especially professional.. I’d expert it from Ryanair, not BA

  • Jeff says:

    Thank you for flagging this. I couldn’t open the slides from that link – do you have a PDF of them as you did last year.

    • Rob says:

      No, there is no direct link. If someone has a public Dropbox folder and wants to copy it in and post the link, that would work.

      • DV says:

        It’s not just a one-off slide. It’s the BA management ethos. From p. 13:

        “And show me the money is a very common internal phrase we use. It dates from an iconic evening with Willie in a tapas bar in Madrid in 2012. Many of the senior IAG managers in the room were there. We usually use an adjective before the word money, but we’ll share that with you in drinks afterwards.”

        • Raj says:

          That is a quote from the transcript of the 2015 Capital Markets Day which the slide from last week’s presentation seems to refer to. I think the mistake that was made was that someone at IAG mistakenly uploaded onto the live webcast of this year’s CMD a version of the presentation that was meant for consumption only by those physically in the room (as it followed on from the usual household type slides ie on emergency exits etc). Nonetheless, it’s an insight into the WW view of business which is totally contemptuous of the customer.

          I have the whole of the presentation including the incriminating slide on my office laptop which I’ll upload to Dropbox on Monday for those interested. I’ll send a link then.
          RB

    • the_real_a says:

      It opens for me. Its 9,1mb just ensure its all downloaded.

  • Olly1714 says:

    Having read the recent stories on HFP of the new approach BA appears to be taking to its business model I think it will not be long before it is recognised internationally as a budget airline along the lines of Easyjet and RyanAir as opposed to a national carrier renowned for its high level of customer service, A change of motto will once again be required. Formally “The world’s favourite airline”, to “To fly, to serve” and shortly to be replaced with “Show me the money” So sad.

This article is closed to new comments. Feel free to ask your question in the HfP forums.

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