BA needs nearly $1 billion to survive
A British Airways plane at Heathrow airport in London
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Stacey Vanek-Smith: Another company scrambling for cash: British Airways. The carrier said today it needs to raise almost a billion dollars. From London, Stephen Beard reports.
Stephen Beard: BA plans to raise the money by issuing bonds and by raiding its pension fund. Drastic measures for a company that is clearly in trouble.
BA lost $650 million last year, and it revealed today it's lost another $160 million in the first quarter. BA's boss is talking about a fight for survival.
Mark Pilling of Airline Business Magazine says BA is not in danger of going bust. But the airline depends on business traffic, especially between Europe and the U.S., and that continues to be the main problem:
Mark Pilling: I mean, transatlantic is something like you know, double-digit, 20 [percent] to 30 percent down on some routes. I mean this is a huge drop in revenue, and therefore it really hits a carrier like BA perhaps disproportionately hard, if you like.
BA faces the additional threat of strike action this summer. BA pilots agreed to a pay cut, but cabin crew and ground staff are resisting further job losses.
In London, this is Stephen Beard for Marketplace.