Rivals Capitalise

By Reuters -  |  Posted 2008-03-28 Print this article Print

British Airways has a long way to go to with pleasing customers in its new opening of Heathrow airport's Terminal 5 amid chaotic service and cancelled flights.


BA shares fell more than 3 percent on Friday, hit by the T5 chaos and jitters ahead of Sunday's start of the "open skies" deal to create greater competition on trans-Atlantic routes.

"I don't think it will be material, but it's certainly bad for sentiment and not good for the BA brand," BlueOar Securities analyst Douglas McNeill said. "You'd need several days of severe disruption to really impinge on BA's financial performance."

Adebayo Oniwinde, 52, a missionary from Lagos, was one of those caught up in the chaos.

"I made a booking on a BA flight to Oslo," he said. "I was going to travel at 1 o'clock. Now I'll have to wait eight hours."

BA's rivals, which resent Spanish-owned airport operator BAA

gifting BA its own dedicated terminal, were quick to capitalize.

Richard Branson's Virgin Atlantic said 200 BA passengers had already switched across to longhaul Virgin flights because of the problems.

Bmi said Terminal 1 had 40 percent less passengers after BA moved out and it was "running like clockwork".

And private jet firm NetJets Europe said it had seen an 88 percent upsurge in traffic in and out of the London region in the past 24 hours.


The open-plan T5 is Britain's largest enclosed space, equivalent to the size of about 50 soccer pitches. It was touted as the answer to regular delays at the airport.

British Airways spent months promoting the gleaming Richard Rogers-designed terminal, packed with high-end shops and restaurants, bringing photographers and journalists from all over the world to show off the complex.

Budget airline Ryanair accused BAA of having "gold plated" the terminal when it should have been focusing on basic efficiency. It used the opportunity to call for the break-up of BAA, which also runs London's Gatwick and Stansted airports.

"If the BAA London airport monopoly was split up, competition would deliver better services and efficient terminals which actually work, as opposed to complicated Taj Mahals like Heathrow's T5," said Ryanair Chief Executive Michael O'Leary.

(Additional reporting by David Clarke, George Kiley, Luke Baker and Tim Castle; Editing by Jodie Ginsberg, Quentin Webb and Mike Elliott)


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