British Airways

:For the 1930s airline of similar name see British Airways Ltd.

History

The airline's origins go back to the birth of civil aviation and the pioneering days after the First World War. On 25 August 1919 its forerunner company, Aircraft Transport and Travel (AT&T), launched the world's first daily international scheduled air service, between London and Paris. On 31 March 1924, Britain's four fledgling airlines - Instone, Handley Page, Daimler Airways (a successor to AT&T) and British Air Marine Navigation - merged to form Imperial Airways, which developed its Empire routes to Australia and Africa.

Related Topics:
25 August - 1919 - London - Paris - 31 March - 1924 - Imperial Airways - Australia - Africa

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Meanwhile a number of smaller UK air transport companies had started flights. These merged in 1935 to form the original privately-owned British Airways Ltd. Following a government review Imperial Airways and British Airways were nationalised in 1939 to form the British Overseas Airways Corporation (BOAC). Post-war, BOAC continued to operate long-haul services, other than routes to South America - these were flown by British South American Airways, which was merged back into BOAC in 1949. Continental European and domestic flights were flown by a new airline, British European Airways (BEA).

Related Topics:
1935 - British Airways Ltd - 1939 - British Overseas Airways Corporation - British South American Airways - 1949 - British European Airways

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The 1950s saw the world enter the passenger jet era - led by BOAC, with the De Havilland Comet flying to Johannesburg in 1952, halving the previous flight time. The birth of the mass package-holiday business meant changes for the airline industry. BEA met this by establishing BEA Airtours, which took off in 1970. In 1972 BOAC and BEA were combined under the newly formed British Airways Board, with the separate airlines coming together as British Airways in 1974. British Airways, simultaneously with Air France, inaugurated the world's first supersonic passenger service with Concorde in January 1976.

Related Topics:
De Havilland Comet - Johannesburg - 1952 - 1970 - 1972 - 1974 - Air France - Concorde - 1976

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Privatisation

Sir John King, later Lord King, was appointed as Chairman in 1981 with the mission of preparing the airline for privatisation. King hired Colin Marshall as CEO in 1983. King was credited with turning around the loss-making giant into one of the most profitable air carriers in the world, boldly claiming to be "The World's Favourite Airline", while many other large airlines struggled. The airline's fleet and route map were overhauled in the early years of King's tenure, with brand and advertising experts being recruited to overhaul the airline's image. Over 23,000 jobs were shed in the early 1980s, though King managed the considerable trick of boosting staff morale and modernise operations at the same time. Lord King also recognised the importance of Concorde to the company's business strategy, and used the supersonic airliner to win business customers by guaranteeing a certain number of Concorde upgrades in return for corporate accounts with BA.

Related Topics:
Sir John King - 1981 - Colin Marshall - 1983

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The flag carrier was privatised and floated on the London Stock Exchange in February 1987 by the Conservative government, with the initial share offering being 11 times oversubscribed. In April 1988 British Airways effected the controversial takeover of Britain's second-force airline British Caledonian, and in 1992 absorbed Gatwick-based carrier Dan-Air.

Related Topics:
London Stock Exchange - 1987 - Conservative - 1988 - British Caledonian - 1992 - Dan-Air

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"Dirty tricks"

Soon after privatisation Richard Branson's Virgin Atlantic, which began with one route and one Boeing 747 in 1984, was beginning to emerge as a serious threat on some of BA's most lucrative routes. Following Virgin's highly publicised mercy mission to Iraq to fly home hostages of Saddam Hussein in 1991, King is reported to have told Marshall and his PA Director David Burnside to "do something about Branson" ¹. This began the campaign of "dirty tricks" that ended in Branson suing King and British Airways for libel in 1992. King countersued Branson and the case went to trial in 1993. British Airways, faced with likely defeat, settled the case, giving £500,000 to Branson and a further £110,000 to his airline; further, BA was to pay the legal fees of up to £3 million. Branson divided his compensation among his staff, the so-called "BA bonus".

Related Topics:
Richard Branson - Virgin Atlantic - Boeing 747 - 1984 - Iraq - Saddam Hussein - 1991 - David Burnside - Libel - 1992 - 1993

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During the 1990s BA became the world's most profitable airline and trumpeted the slogan "The World's Favourite Airline." In 1992 Deutsche BA was established as a subsidiary operating in Germany. By the time it was sold in June 2003 DBA was operating 16 Boeing 737s and was the second-largest German domestic carrier, after Lufthansa.

Related Topics:
1992 - Deutsche BA - Germany - 2003 - Boeing 737 - Lufthansa

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Lord King stepped down as chairman in 1993 and was replaced by former deputy Colin Marshall, who initially combined the roles of CEO and Chairman. Bob Ayling, who would later take on the role of CEO, was appointed Managing Director by Marshall at that time. Lord King was appointed President, a role created specifically for him, and became President Emeritus in 1997, until his death in July 2005.

Related Topics:
1993 - Bob Ayling - Emeritus - 1997 - 2005

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In 1995 BA formed British Asia Airways, a subsidiary based in Taiwan. British Asia Airways was set up due to political sensitivities, the Union Jack tailfin being replaced by Chinese characters. Many airlines followed the same practice, e.g. Qantas flew as "Australia Asia Airways" and KLM's operations became "KLM Asia". British Asia Airways ceased operation in 2001 as the airline suspend operation to Taiwan due to low yield.

Related Topics:
1995 - British Asia Airways - Taiwan - Qantas

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Bob Ayling

In 1996 British Airways, with its newly appointed Chief Executive Bob Ayling, entered a period of turbulence. Increased competition, high oil prices and a strong pound hurt profits. BA management and trade unions clashed and the resulting disruption cost the company hundreds of millions of pounds. In 1997 Ayling dropped BA's traditional Union Flag tailfin livery in favour of world design tailfins, in an effort to change its image from a strictly British and aloof carrier to a more cosmopolitan airline. The move was not a success and Ayling slowed the process, eventually declaring the fleet would sport a dual livery; half a Union Flag design, half the world design tailfins. Ayling devoted a lot of time pursuing a merger with American Airlines, but this was ultimately unsuccessful due to the conditions placed on the deal by regulatory authorities, the most painful of which would have been the sacrificing of landing slots at Heathrow.

Related Topics:
1996 - World design tailfins - American Airlines

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Positive news during Ayling's reign included cost savings of £750m and the establishment of the successful, but highly subsidised, Go in 1998. Go was a low-cost carrier intended to compete in the rapidly emerging "no-frills" segment. After four years of successful operations, the airline was sold off and merged with easyJet. Another efficiency sought by Ayling was the reduction of capacity, cancelling Boeing 747-400 orders in favour of the Boeing 777 and rationalising BA's short-haul fleet with an order for the efficient Airbus A319/A320/A321 family.

Related Topics:
Go - 1998 - Low-cost - EasyJet - Boeing 747-400 - Boeing 777

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Rod Eddington

In 1999 British Airways reported a 50% slump in profits, its worst since privatisation. In March 2000 Bob Ayling was removed from his postion. British Airways announced Rod Eddington as his successor in May. Eddington set about cutting the workforce further, dramatically so after the slump caused by the September 11th attacks in 2001. In May 2001 Eddington announced the return of the Union Flag to the entire fleet, reversing his predecessor's rebranding exercise.

Related Topics:
1999 - 2000 - Rod Eddington - September 11th attacks - 2001

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Marshall, who had been appointed a life peer in 1998, retired as Chairman in July 2004 and was replaced by Martin Broughton, former Chairman of British American Tobacco.

Related Topics:
Life peer - 1998 - 2004 - Martin Broughton - British American Tobacco

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On 8 March 2005, Broughton announced that former Aer Lingus CEO Willie Walsh would take over from Rod Eddington upon his retirement in September 2005.

Related Topics:
8 March - 2005 - Aer Lingus - Willie Walsh

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During the fiscal year ending 2005, BA carried some 35m passengers on revenue exceeding £7.8bn, posting a pre-tax profit of £415m. It employs 51,939 staff.

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Willie Walsh

As soon as the new CEO Willie Walsh took over at the beginning of September 2005 he announced changes to the Leadership Team of British Airways, which will also result to changes in the Board of Directors. Obviously changes to the Leadership Team started another reorganisation through all levels of the airline. In contrary to the many other reorganisations the airline went through since the big crisis following the sep 11th terrorist attacks this time middle management staff have to re-apply for their current jobs which creates uncertaincy amoungst the employees but gives a clear signal of thorough change to the financial markets.

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Industrial action

Over the last 3 years British Airways employees have engaged in substantial strike action there times. Over 600 BA flights were grounded on August 11 2005 - August 12 2005, when baggage handlers, loaders, and cargo staff went on strike in support of laid-off catering workers.

Related Topics:
August 11 - 2005 - August 12 - Baggage handler

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