13-May-2010 3:37 PM

Vueling load factor falls; British Airways prepares for strike action

The majority of European carriers’ shares gained on Wednesday (12-May-2010), moving with wider markets on improved financial results from businesses including Allianz and ING Groep and news the Spanish Government plans to cut its budget deficit. UK markets also rose after the appointment of a new Coalition Government between the Conservative and Liberal Democrat parties.

In key markets, UK’s FTSE (+0.9%), France’s CAC (+1.1%) and Germany’s DAX (+2.4%) all ended the session higher.

Vueling load factor falls

Vueling (+3.3%) gained after the carrier reported an 86.4% year-on-year rise in passenger numbers for Apr-2010, to 909,000. The strong gain was aided by its merger with clickair in Jul-2009. However, load factor was down 2.1 ppts, to 73.3%. The carrier stated the reduction was due to the Holy Week holidays this year falling partly in Mar-2010, while the whole holiday fell in April last year.

Competitor, Iberia (+1.7%) was also up for a second time in three days.

British Airways preparing for strike action

British Airways (+2.5%) gained despite recent news cabin crew union, Unite, is planning to launch 20 days of industrial action. The strike will be held in four, five-day blocks from 18-May-2010 to 19-Jun-2010.

CEO, Willie Walsh, stated during trading that he would resist attempts to undermine the carrier through strikes. It is estimated that the 20-day strike approved by the union could cost the carrier up to GBP150 million. Seven days of strikes in March resulted in losses of approximately GBP45 million.

Mr Walsh also made an appeal to staff to volunteer to keep BA operating during the strikes. The carrier expects to operate the majority of its long-haul operations from London Heathrow during the strikes and does not expect operations at London Gatwick to be affected. British Airways has reportedly already trained more than 1,000 volunteer cabin crew.

Europe Airline Daily is an efficient morning briefing on European airline developments. Covering fleets, routes, financials, traffic, bilateral agreements, alliances, financing, ownership, along with analysis of all significant developments. Other stories featured in today’s issue:

Ryanair takes delivery of 242nd B737 (NG) aircraft;
Virgin Atlantic not optimistic about recovery;
Cyprus Airways announces fleet plans, to take delivery of an A320 on 15-May-2010;
KLM increases Amsterdam-Liverpool frequency;
Lufthansa to launch A380 to Johannesburg;
Polish Treasury plans to raise USD2.2bn from privatization;
Russia and Turkey sign air and maritime bilateral agreement.

Europe selected airlines daily share price movements (% change): 12-May-2010