British Airways has sold the regional operations of its subsidiary airline BA Connect to Flybe, a move that will lead to about 900 flight cancellations.
The airline said it would offer passengers alternative flights with either BA or Flybe, or a full refund. Airports affected will include Manchester, Glasgow, Edinburgh, Birmingham and Bristol. The deal will create „Europe's largest regional airline”, carrying 10 million passengers on 152 routes, Flybe said. BA - which will take a 15% stake in Flybe - saw its shares fall as much as 10% in mid-morning trade on Monday. The drop came after the US and Europe reached a preliminary „open skies” deal on Friday that could threaten BA's position at Heathrow airport and on the money-making transatlantic routes, analysts said. Flybe chairman Jim French said its acquisition gives the firm „critical mass” across domestic and European city markets, and creates a business with more than £500 million in revenues. Flybe said its immediate focus was to „ensure the transition is managed effectively”. Once that has happened it said it would be looking to list the firm on the stock exchange. BA said it would take an extra £20 million charge on the sale due to losses at BA Connect.
BA had taken a £106 million charge when the deal was first announced in November last year. The airline said that the flights affected will be those that had been scheduled to run between 4 March and 24 March. Flights from Glasgow to Birmingham, and from Edinburgh to Birmingham and Southampton, have been cancelled. Other routes that will cease to run include Birmingham to Barcelona, Madrid and Berlin as well as Manchester to Madrid and Aberdeen. Bristol to Munich and Zurich will also to be cancelled. BA will keep a number of BA Connect's routes, including the Manchester to New York service that it will run as part of its main operations. The airline added that a new subsidiary called BA City flyer will incorporate flights from London City to Edinburgh, Frankfurt, Madrid and Milan. Of the 15,000 passengers affected, some 6,500 will be given an equivalent Flybe flight, while the remaining 8,500 will be offered BA flights via London. „All passengers will be offered alternative flights with Flybe or BA via Heathrow to minimise inconvenience,” BA said. „Alternatively, they will be offered the choice of a full refund.”
BA added that „all the routes being cancelled are substantial loss makers for the current BA Connect business”. „These routes need to be cancelled to protect the ongoing viability of the business,” it explained. Meanwhile BA is in talks to transfer its ground-handling operations at Aberdeen, Edinburgh, Glasgow and Manchester airports to Aviance UK, an independent services firm. The Transport & General Workers Union has reacted angrily to the move, saying members „have suffered real anxieties about their futures” since plans were announced to sell BA Connect in November. (BBC NEWS)