The unprecedented slump in travel volume has affected the airline industry globally. The coronavirus pandemic reduced the number of travelers and British Airways has felt the pressure. On July 17, the company confirmed that it will retire its entire Boeing (NYSE: BA) 747s iconic fleet marking the end of an era.
This move means that British Airways will remove all 31 of its 747-400 planes out of its 300-aircraft fleet. The removal will happen four years earlier than originally planned. A company spokesperson stated:
“It is with great sadness that we can confirm we are proposing to retire our entire 747 fleets with immediate effect. It is unlikely our magnificent ‘queen of the skies’ will ever operate commercial services for British Airways again due to the downturn in travel caused by the COVID-19 global pandemic.”
British Airways is owned by IAG (International Airlines Group). It received its first 747-400 plane in July 1989. Today, it is the biggest operator of 747-400s globally. The IAG shares (LSE: IAG) fell by about 3% during the early morning London trading at 10.15 am GMT.
Initially, the airline company planned to retire this fleet by 2024. It would then gradually replace them with more efficient twin-engine jets including the Boeing 787 Dreamliner and Airbus A350.
At its peak, British Airways had 57 747-400s, the second biggest operator of this aircraft worldwide. Japan Airlines had over 100 in its fleet. Originally, the upper deck comprised of a lounge with lounge chair seating. During the time, it was known as the ‘club in the sky.’
The 747-400 has a wingspan of 213 feet and the wings are large enough to accommodate 50 parked cars.it has a tail height of 64ft which is equivalent to a 6-story building.
British Airways said that these planes will be retired immediately. They represent almost 10% of the airline’s total fleet.
Due to intense pressure to cut costs, the company laid off thousands of workers and grounded its fleet aiming to avoid collapse. All that pressure resulted from a major slump in travel due to the current health crisis.
Other major airline companies have also faced the negative consequences of the pandemic. As Finbold.com reported earlier, Virgin Atlantic axed 3,150 employees in the COVID-19 aftermath, Emirates Airline sent staff on leave, Delta Air Lines saw the revenue slip by 88%. Overall, the full airline industry recovery could take two years, the analysts project.
A New Strategy
Willie Walsh, the IAG boss said that British Airways is fighting for its survival. The airline does not expect international travel demand to reach the 2019 levels until 2023.
The restructuring plan which British Airways has adopted includes cutting almost 12,000 jobs which represent 30% of its workforce.
This plan has been criticized heavily for its ‘fire and rehire’ model. It has prompted UK lawmakers to press Prime Minister Boris Johnson to review all of the airline’s prized airport landing slots, including slots at London Heathrow.
British Airways is also auctioning some of its art collection aiming to raise cash. It has sold up to 17 paintings and prints by artists like Damien Hirst, Bridget Riley, and Patrick Heron.