Friday July 3, 06:40 PM
British Airways says will slash spending
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LONDON (AFP) - Troubled British Airways said Friday that it would slash capital expenditure by one fifth in the current financial year after posting another sharp drop in monthly passenger numbers.
"Market conditions continue to be very challenging with trading at levels well below last year," the struggling airline said in a trading update.
"In response to the challenging economic conditions British Airways (LSE: BAY.L - news) has reviewed its business plan.
"Forecast capital expenditure has been reduced from 725 million pounds to 580 million pounds for 2009-2010 and is likely to remain at that level in 2010-2011."
The airline also announced it carried 2.93 million passengers last month, 4.9 percent fewer than in June 2008.
And BA repeated that it wanted to slash 3,700 jobs in the current financial year, which runs until March 2010. It has already axed 2,500 jobs worldwide over the past year.
BA also revealed that it would delay the delivery of its fleet of Airbus A380 superjumbos and announced more reductions to its summer 2009 and winter 2009-2010 flight schedules.
"The delivery schedule for the first six Airbus A380 aircraft has been extended by an average of five months with the first delivery still due in 2012," the carrier said.
"The schedule for the remaining six A380s has been extended by an average of two years with the final aircraft arriving in 2016."
In May, BA had reported an annual loss of 375 million pounds, blamed on plummeting demand for tickets as well as high fuel costs.
After diving into a financial loss, BA asked staff to work for free, while promising that chief executive Willie Walsh and finance director Keith Williams would forgo their July salaries.
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