April 15, 2008 / 11:10 AM / 10 years ago

BA says 2 managers to go after T5 fiasco

LONDON (Reuters) - British Airways is parting company with two senior managers following the airline’s chaotic move to a new terminal at Heathrow airport.

The airline said that Gareth Kirkwood, director of operations, and David Noyes, director of customer services, would both be leaving the group and would be replaced by a chief operations officer to combine both roles.

Europe’s third-biggest airline has cancelled hundreds of flights and misplaced tens of thousands of pieces of luggage following the opening of the new 4.3-billion-pound ($8.5 billion) Terminal 5 at Heathrow last month.

A spokesman declined to say whether the pair had chosen to go or been asked to leave, nor when they would stop work.

A source close to the matter said they would not receive any special payments beyond their contracted entitlements.

“The departures follow the airline’s move to Terminal 5,” BA said in a brief statement on Tuesday.

Douglas McNeill, transport analyst at Blue Oar, said the departures may have come following discussions with shareholders. British Airways Chairman Martin Broughton met David Cummings, Standard Life Investments head of UK equities, on Monday.

British Airways passenger planes park on the tarmac at the new Terminal 5 at Heathrow Airport in London on March 28, 2008. BA said on Tuesday its directors in charge of operations and customer service were leaving the company following its chaotic move to a new terminal at London's Heathrow airport. REUTERS/Luke MacGregor

“This could be a reaction to the opinion of shareholders -- as articulated yesterday by SLI. We don’t know what was said, but the two events are not unconnected,” McNeill said.

SLI could not immediately be reached for comment.

Andrew Lobbenberg, an analyst at ABN AMRO, added that the trigger could have come from a number of sources.

“There has been a huge amount of pressure on the company from shareholders, government and the public. It needed some fall guys,” he said.

BA said earlier this month that the disruption at Terminal 5 had so far cost it about 16 million pounds ($31.6 million).

Airports operator BAA, owned by Spain’s Ferrovial, which has also been blamed for the airport opening fiasco, said the matter was one for BA.

At 4:00 p.m. BST (1500 GMT), BA shares were down 3.1 percent at 209 pence, underperforming a 1.5 percent rise on the UK’s benchmark FTSE-100 index. The stock has fallen over 12 percent since the opening of Terminal 5.

Reporting by John Bowker and Mark Potter, Editing by Paul Bolding, Elizabeth Fullerton

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