British Air to Sharpen Premium-Class Focus Amid Drop in Travel

British Airways Plc, Europe’s third- largest airline, plans to sharpen its focus on business fliers as the recession saps travel demand, the carrier’s U.S. chief said.

All-business-class flights between London’s City Airport and New York start in September, and a promotion begins today offering U.S. executives free travel to Europe to promote their companies, said Simon Talling-Smith, British Airways’ executive vice president for the Americas.

“We will continue to position ourselves as a premium airline, that is absolutely core to our business model,” he said in an interview yesterday. “There is an ongoing demand for business travel, and that isn’t going to go away.”

The London-based airline is slashing jobs and grounding flights to help survive a slump that will cause $9 billion in worldwide industry losses this year, according to a June 8 forecast by the International Air Transport Association.

A return to pre-recession traffic levels like those seen in 2007 probably will take five years, Talling-Smith said. British Airways is mired in 10 straight months of declines in premium traffic, which measures kilometers flown by paying passengers in the first- and business-class cabins.

While British Airways hasn’t sold out its initial flights between London City and New York’s John F. Kennedy International Airport, the carrier is “pretty confident” demand will rise as the Sept. 29 start date nears, Talling-Smith said.

‘Good Return’

“Our biggest customers are telling us that they are very interested,” said Talling-Smith, who has worked for the carrier for 18 years. “We’re still confident we will make a good return on that flight.”

British Airways, working to promote its premium-class service to U.S. business passengers, will use some of its excess capacity for the “Face-to-Face” competition for free European trips on three special flights carrying 1,000 people.

“One of the only benefits of the economic climate is that we have quite a lot of empty seats, and a few spare aircraft so the cost of the promotion is pretty small,” Talling-Smith said.

British Airways said an advisory panel would help assess the free-flight requests, which require entrants to complete an online form that includes a 500-word essay on the value they would reap from an overseas trip.

British Airways has tumbled 30 percent this year in London trading, closing at 126.6 pence yesterday.

Source: bloomberg.com