BA vs FR and EZ - can this be true?! BA looks cheap ...

Walsh to staff: British Airways future at risk

Willie
Walsh has given his gloomiest assessment yet of the future of British
Airways, effectively telling staff that the flag carrier is on the
brink of bankruptcy.

In a startling internal email sent to employees, the chief executive confirmed that BA is "definitely at risk" if its call for voluntary pay cuts is rejected by trade unions.

He warned that the £401 million loss BA made last year left it in a perilous situation, saying the downturn was "beyond anything that we can save from our costs".

Britain's flag carrier has faced a torrent of criticism in recent weeks – much of it centred on an
audacious appeal by Mr Walsh's for staff to work for free.

The BA boss made the plea earlier this month after himself agreeing to forgo one month's salary. Unions were given a deadline of midnight yesterday to respond, but early reports indicate that as few as 200 employees signed up to the scheme.

If confirmed, the snubbing of his request means that BA must stake its hopes for survival on plans to make ten per cent of its work force, some 4,000 people, redundant.

"There is no immediate threat to our business if we act with speed," Mr Walsh began in the ominous email. "However, the drop in revenue we witnessed in the fourth quarter of last year goes well beyond anything that we can save from our costs.

"Central to our plan for survival is a fundamental and structural change to our employee cost base. If we do
not change, then the future of our business is definitely at risk."

BA struck a deal with the British Airline Pilots Association earlier this month in which 3,200 pilots accepted a small pay cut, in addition to 78 voluntary redundancies.

But the agreement fell well short of lifting the flag carrier out of its current predicament. Shares in the
airline plunged eight per cent on Tuesday (June 23) after Sir Richard Branson, chairman of Virgin Atlantic, said its rival was "not worth much anymore".

On top of the disappointing profit report, BA is saddled with a £1.5 billion pension fund deficit and is also
considering axing its much-trumpeted subsidiary, OpenSkies.

http://news.cheapflights.co.uk/2009/06/wal...-the-brink.html