British Airways, it’s safe to say, will not look back fondly on 2017. The UK flag carrier has hit the headlines for computer crashes, industrial action, scrapping free meals, shrinking legroom, running out of food and flights delayed by a lack of toilet paper.
It is all a far cry from 1989, when BA declared itself ‘The World’s Favourite Airline’. Since 2007, legions of disappointed customers have taken the opportunity to vent their frustration online at the passenger complaints website, britishairwayssucks.org.
So what does Alex Cruz, BA’s CEO since 2016, plan to do about it?
Earlier this month Cruz declared that “glory days are coming back” and that planned investment of £4.5bn would make BA “the airline of choice for everyone”.
The money will be used to acquire 70 new aircraft, refurbish more than 100 of the current fleet, train employees, install power points in all seats, improve long-haul Economy Class catering, provide first class inflight Wi-Fi, lower fares and serve new destinations.
The Challenge Ahead
The difficulty for BA is that it is caught between two very clear product offerings.
Just as Tesco has struggled to define itself since the arrival of Aldi and Lidl has left it offering neither the highest quality food nor the lowest prices, BA currently offers neither the customer experience available from the likes of Singapore Airlines and Qatar Airways, nor the low prices available from EasyJet, Norwegian and Ryanair.
Whilst Cruz was confident about BA’s ability to “shine through any type of Brexit scenario”, he identified a major challenge for the airline in the expansion of low-cost carriers into the long-haul market. Unless BA adapts to this change and becomes more efficient, Cruz warned, it “will shrink and ultimately risk irrelevance”.
In 2018, we will see if British Airways is up to the challenge.
MSB’s roots lie in the turnaround of British Airways in the 1980s, when an inefficient, publicly-owned behemoth was transformed into one of the best airlines in the world.
Thirty years on, we still provide cutting-edge research, consultancy and training services to international airlines in the USA, Europe and Asia.
To learn more about MSB’s work in the aviation sector, visit our website.