No Accounting for BA

According to a report on Bloomberg today British Airways is maintaining that its new business class only service between LCY and JFK is already profitable. I know Waterside is basking in a good news – and a good share price rise – week but this just stretches credulity.

Even if there is no overhead charge, no charge from marketing, the press office, the sales team, maintenance, etc. Even if there are no airport fees. Even if there are 100% loads and all 32 of those seats are yielding the full published London-New York business class fare, can there really be a profit???? By my maths it might be possible if the only costs were the direct marginal operating costs, eg food, fuel and crew and items such as the lease payments on the two specially configured Airbuses were not considered.

All of us in the industry truly wish BA well on this venture and indeed hope that it is meeting budget (there’s a lot of positive feedback on the quality of the service) but c’mon. Meeting budget is not the same as being profitable within 10 weeks.

Or does someone have a plausible explanation for BA’s claim?

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