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British Airways cabin crew begin five-day strike

Source: Reuters - Mon 24th May 2010

British Airways Plc cabin crew began a five-day strike on Monday after talks broke down in a dispute over wages, jobs and working conditions and BA said no further negotiations were imminent.

The airline said it planned to operate more than 60 percent of long-haul flights and more than 50 percent of short-haul from London's main Heathrow Airport, allowing 70 percent of passengers to reach their destinations.

Flights from London's Gatwick and City airports were not affected by the strike. Two more five-day strikes are planned if the dispute cannot be resolved following stoppages in March.

"There are no more talks on the horizon" a BA spokesman said. "Our operations are going very well so far today."

BA said it would lease up to eight aircraft with pilots and cabin crews from other airlines to keep passengers on the move.

BA Chief Executive Willie Walsh and leaders of the labour union Unite, which represents the cabin crew, blame each other for a breakdown in communication.

"I made an offer to Willie Walsh yesterday to put back our people's travel concessions that he's vindictively and foolishly taken away from them and I would personally call this strike off" Unite co-leader Tony Woodley told BBC Radio.

The issue of travel allowances for cabin crew has become a major sticking point in the conflict, which comes at a difficult time for BA. The airline last week announced a record full-year loss of 531 million pounds.


BA shares had risen a quarter in the last year as an industry-wide recession eased, but some 10 percent of those gains disappeared last week after a court said staff could press ahead with further strike action.

The stock was 0.4 percent down at 187.5 pence by 1:40 p.m. BST, valuing the business at around 2.2 billion pounds.

Analyst Stephen Furlong at Davy Stockbrokers believes the market is more interested in the state of BA's underlying business than the strikes and said trading conditions were improving.

BA on Friday predicted a return to breakeven next year and said its yield - the revenue it makes on each passenger for every mile travelled - rose 3.2 percent between January and April and would likely keep growing in 2010.

Some analysts, however, believe the strikes could put off previously loyal BA customers from flying with it in future.

"Strike action at BA will not in my view succeed except that it risks alienating BA from more of its customers long term, meaning it could seriously weaken the airline," BGC Partners senior strategist Howard Wheeldon said.

Cabin crew strikes in March cost the airline 43 million pounds, a figure included in the loss posted last week. BA has suffered an additional 100 million pound hit due to disruption to flights caused by ash from an Icelandic volcano.

The government urged the two parties to resume talks to settle the dispute.

The latest round of face-to-face talks between managers and union leaders on Saturday came to an ill-tempered halt after protesters from a tiny left-wing group invaded the venue.

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