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British Airways is a ‘2 out of 10’ airline, says its biggest shareholder

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British Airways is a ‘2 out of 10’ airline, said a senior airline executive in a Sunday Times interview yesterday.

The amusing thing is that the company behind the man behind the comment – Akbar Al Baker, CEO of Qatar Airways – owns 25% of BA’s parent company, IAG. It’s the parenting equivalent of telling your step-children they’re ugly.

I should say, before I go on, that I have met Akbar on a few occasions and like him. He is an interesting character though. Of all the titled people I know, he is the only one that I always feel expects to be called by their title (‘His Excellency’) and would be offended otherwise. I have also visited the Qatar Airways head office in Doha in the past.

You can read Akbar’s full rant on The Times website here (paywall). If you have American Express Business Platinum, register for your free digital subscription on the Amex website here.

The interview covered a range of topics, but I focus on just two areas here. The first is his opinion on British Airways, and the second is his opinion on premium economy seating.

To quote:

“I’m very direct,” he says. “I don’t care what people think. People need to hear frank opinions.”

Akbar Al Baker on British Airways

“BA management “lost focus”, he says. Instead of making it “an airline Britain and the British people would be proud of”, the leadership reduced it “to a low-cost carrier — a level I never expected BA to be”. He explains: “British Airways is the flag carrier of the UK. You remember the motto? ‘To fly, to serve’. That was not any more the motto of the company. It was only on a billboard.” When Qatar Airways decided to invest, “we wanted BA to get the glitter back. We wanted an airline that doesn’t sell food but serves food.”

How many marks out of ten would he give BA in recent years? “Two.”

Al Baker hasn’t given up hope of still being proud of his step-child. Financially, of course, IAG has always delivered a better return for the Qatari Government than Qatar Airways itself, but you can have money without pride.

We go on ….

He praises Cruz’s replacement, Sean Doyle, one of whose first moves was to bring back free food and drink in short-haul economy. “He’s a very good leader. He has my confidence … British Airways will come back to its old glory.”

Akbar Al Baker on premium economy

We recently covered a speech by Tim Clark, the CEO of Emirates, where he admitted that not introducing premium economy earlier had been an expensive mistake. Emirates was seeing strong demand and a big price premium on the routes that have it.

I already knew from speeches by Al Baker in the past (I was at the unveiling of their new economy seat in 2019 – see photo above of Al Baker, second right, with a footballer I believe) that he feels differently:

But one thing he will not be doing is hiring cabin crew to work in a new premium economy cabin — the class between economy and business that Emirates has introduced, joining BA and Virgin Atlantic. He thinks the 25 per cent extra that airlines charge for premium economy is a rip-off. “It’s the most uncomfortable seat. You can’t rest your feet on the floor. And they give you the same meal, the same bottle of wine, or whatever they give in economy.”

Al Baker believes that if you have the best economy seat on the market, you don’t need premium economy.

On this one, I don’t agree. This is partly because there is ample evidence from other airlines that premium economy can be hugely profitable.

It is also, to my mind, simple logic. You could offer me caviar for lunch and Bollinger on boarding, but it still won’t get me to squeeze my 6’2′ frame into an economy seat. It’s worth noting that Al Baker is a very slim man of average height.

You can read more on The Times website here if you can get around the paywall.

PS. Here is a fascinating fact from the article. As we have covered on Head for Points, the ‘blockade’ against Qatar by Saudia Arabia, the UAE and others has recently ended. This means that Qatar Airways aircraft can fly over Saudi airspace again, avoiding a lengthy detour. Al Baker believes that, in a normal flying year, this will save an astonishing $1.2 billion in costs, primarily fuel.


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Comments (100)

  • Martin Louis says:

    “It’s the most uncomfortable seat. You can’t rest your feet on the floor. And they give you the same meal, the same bottle of wine, or whatever they give in economy.”

    I’ve travelled PE a couple of times on BA and QF. QF definitely gives you a different meal experience than Y. Also you get normal cutlery and crockery. I think when I did BA PE it was the same meal tray, but it seems to be upgraded now.

    I think BA treated PE as just a slight step up from WT, hence the WT+ name. Others focused on calling it “Premium” and offered something better, almost J- and some of the seats were akin to the J of old.

    But the fact that BA has upgraded it’s WT+ offering, and Al Baker’s comments on it as having the same food etc, would indicate to me he’s out of touch with the real world.

    • Rhys says:

      Yes, BA and Virgin (and many other airlines) do offer improved catering, so he’s very wrong on that account!

      • Max says:

        More like airlines have further downgraded regular economy catering to make their ‘Premium” Economy one look better.

  • Nick says:

    Premium economy also delivers the highest revenue per floor space of all the cabins, and is therefore responsible for delivering quite a large chunk of the profit he takes from BA. So the demand is definitely there. But he’s never really been known for making much sense.

    • Rhys says:

      This is what I find perplexing. Multiple airlines are on the record in saying premium economy is their most profitable cabin per sq metre, including Lufthansa. Even Tim Clarke was shocked by the (positive) response to Emirates’ recent cabin launch….

      • Paul Pogba says:

        I understand what “his excellency” is saying from a customer perspective but as a business segment it makes sense. If he thinks its over priced money for old rope why not introduce it on Qatar at a more competitive rate?

  • AndyGWP says:

    I’m sure there’s a simple, logical answer (I have a few ideas), but what’s the business strategy for Qatar owning a 25% stake in IAG?

    • kitten says:

      Do they have to launch a full bid at > 25% ? or is it a UK/Eur ownership restriction?

    • Chrisasaurus says:

      Well for Qatar it at least means they get to experience, vicariously, being a Profitable airline

  • Alex Sm says:

    His Excellency could have been a bit more corteous but on the other hand what’s the point to play this “emperor’s new clothes” game if he is absolutely right on all three main points:

    1) BA has lost its focus
    2) BA has become a de facto LCC
    3) the motto ‘To Fly. To Serve’ has gone through the window and had (or soon has to) to be quietly dropped by BA itself

    • marcw says:

      Lost focus, but having record profits?
      LCC but still offering a premium cabin (well, actually THREE), generous FFP, generous loyalty program, multi-frequencies, massive network, connections,…?

      • Alex Sm says:

        What’s the difference between FFP and loyalty program?

        • marcw says:

          Majority put it in the same bag. Technically, FFP is a type of loyalty program. But I like to see and analyse them separately. BA has two unites: Tier points and Avios. Tier Points are from the FFP and Avios are the loyalty program. You can be very Avios loyal, but not a frequent flyer.
          In summary, in my eyes, IAG has 1 loyalty program (Avios) but 4 different FFP (AerClub, Vueling Club, Iberia Plus and BA Executive Club).

    • Lady London says:

      Someone was it here? said the motto was

      “Two flies, to serve”

      🙂

  • Tomas says:

    Perhaps he should check his flagship airline that just ‘enhanced’ away lounge access for the lowest business class tier.

  • AJA says:

    I suspect that His Excellency is trying to drum up support for his airline’s economy offering over BA’s WT+ by bashing the competition. His airline does quite well out of BA though since it not only owns 25% but it also codeshares so gets revenue in its own right on the back of BA operated flights. It does seem a bit of a Gerald Ratner* faux pas though especially as Emirates has now introduced Premium Economy.

    *Gerald Ratner is famous for saying at an IoD conference in 1991 “We also do cut-glass sherry decanters complete with six glasses on a silver-plated tray that your butler can serve you drinks on, all for £4.95. People say, “How can you sell this for such a low price?”, I say, “because it’s total crap.”

    He compounded this by going on to remark that one of the sets of earrings was “cheaper than an M&S prawn sandwich but probably wouldn’t last as long.”

    After that address his company value plummeted by £500m and very nearly collapsed. A textbook example of why CEOs should choose their words carefully.

    • AJA says:

      Is it Emirates or Etihad that has now introduced PE? Either way Qatar is now the odd one out not to have it.

    • N says:

      Gerald Ratner.
      I also thought the comments from His Excellency had all the hallmarks of a Ratner-style speech!

      Still to this date the biggest corporate gaffe in history.

      • AJA says:

        It was hilarious (though not if you worked at Ratners) After that speech whenever there was a similar corporate gaffe the errant CEO would be described as “doing a Ratner” 🙂

    • Alex Sm says:

      Which company was he CEOed at the time? Cant figure out from your comment and too lazy to Google…

      • AJA says:

        He was CEO of Ratner Group which became Signet Group plc before being delisted in 2016. It is the group which owns H Samuel and Ernest Jones, high street jewellers.

        https://en.wikipedia.org/wiki/Signet_Jewelers

        • Alex Sm says:

          Yes, I found it too but the Wiki article also says that he is still a popular motivational speaker and “ currently speaks around the world at corporate and promotional events”, so that episode left him relatively unscathed and he still flies high!

          • N says:

            Yes I think Mr Ratner has made a career out of after dinner speeches, about the very speech that created this new role! Ingenious.

          • AJA says:

            Well with his experience of his expensive mistake if he can’t teach everyone what not to do who can?

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