BA increases fuel surcharge on longhaul flights

British Airways have increased the fuel price surcharge on longhaul flights to £12 for a return ticket as a result of the continuing increase in the price of oil, the company has announced.

Effective from Wednesday, the surcharge will rise from £2.50 per sector to £6 per sector (£12 return trip) on all new bookings made in the UK. The shorthaul fuel surcharge of £2.50 per flight remains unchanged.

BA's fuel costs are expected to be £225 million higher than last year as fuel prices have risen by 45% in the last 12 months, the company said. The surcharge will soften the blow as it will add £70 million to BA coffers.

The news came on the day that BA posted a pre-tax profit of £115 million for the first quarter to June 30 – a turnaround on last year's mark which saw a £45 million loss which the company blamed on the war in Iraq and Sars.

Operating profit for the quarter topped £150 million, up £110 million on last year, and revenue also rose by 5.1% to £1.9 billion.

However, fuel costs were up 12.7% to £258 million due to increases in fuel price net of hedging, and employee costs rose 4.4%. Net debt now stands at £3.8 billion – down £334 million since the start of the financial year – and total costs were down by 0.9%.

Rod Eddington, British Airways’ chief executive, said that the results were "reasonable", but fuel prices and higher pension contributions of £133 million a year continue to cause concern.

He added: "We continue to improve our products for customers. More than 100,000 customers a month now check-in on ba.com and many can also print their own boarding passes at home. We have installed new wireless technology in our airport lounges at Heathrow and Gatwick.”

Martin Broughton, British Airways’ chairman, said: “Market conditions remain unchanged since our last report. Longhaul premium volumes are recovering steadily, while short-haul premium travel remains at lower levels. The non-premium markets are very price sensitive."

(gmcg)