British Airways losing passengers after Terminal 5 chaos

March saw the opening of Heathrow’s new £4.3 billion terminal 5. However, there was chaos due to a lack of baggage handlers, which resulted in cancelled flights and thousands of passengers without their luggage.

As a result of the T5 debacle and the continued slowdown in the US economy, British Airways flew 7.9% less passengers last month.

Overall, passenger numbers fell from 2.81 million in April 2007 to 2.59 million last month.

Premium passenger numbers increased 3.4% last month, which is where the airline makes the majority of its money, after posting a 4% decline in premium traffic during March.

As a result of the debacle of the new terminal, Gareth Kirkwood, the director of operations and David Noyes, the director of customer services, were forced to leave BA.

According to Brokers Collins Stewart, the problems at new Terminal 5 could cost British Airways up to £50 million.

Compensation payments, flight cancellations and other costs could cost between £20 million and £50 million in the current financial year, said the broker.

There have been concerns about the airline industry after Oasis Hong Kong Airlines announced last month it was to stop flying and applied for a voluntary liquidator.

US carriers including ATA Airlines, Aloha Airgroup and Skybus Airlines all ceased trading in March.

More recently, EOS and Maxjet revealed they would cease flying.

The airline industry appears to be diving into its most serious downturn since the post 9/11 crisis in 2001 and 2002.

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