British Airways meltdown fuels outrage
• British Airways’ epic meltdown over a busy holiday weekend further fanned public outrage of an industry infamous for its focus on cost cuts over customer service, leaving the U. K. carrier scrambling to explain how a local computer outage could lead to thousands of stranded passengers.
Amid United Airlines’ dragging fiasco, mass cancellations at Delta Air Lines and U. S. concerns about terrorists using laptops to down planes, the aviation industry hardly needed another blow. But on Saturday morning, a brief power surge knocked out British Airways’ communications systems, grounding the carrier’s ent i re London operations, leading to days of chaos and putting the new chief executive in the hot seat.
With nearly 600 flights cancelled and luggage unable to be dispersed, images and horror stories quickly c oursed t hrough s ocial media. Damages for rebooking and compensating customers is estimated at about 100 million euros ($ 150 million), or about three per cent of the annual operating profit of parent IAG SA.
The image damage could be even greater as British Airways appears to have no idea how it all happened.
“We’re absolutely committed to finding out the root causes of this particular event,” a grim- looking Alex Cruz, the airline’s CEO, said. He did, however, rule out a cyber attack, which suggests the faults are homegrown.
“It is tempting but increasingly questionable to view this as a one- off,” said Damian Brewer with RBC Capital Markets. “Coming after a spate of other issues, the bad PR and potential reputational aftermath will likely hit future revenues beyond the likely material impact.”
The U. K. carrier is still processing thousands of passengers who missed flights or lost their luggage. The airline said about 75,000 people were affected, while analysts said the number was likely closer to 170,000. The crisis puts the spotlight on Cruz, who took charge a year ago after running IAG’s Spanish budget unit Vueling for more than nine years.
His four-year cost-cutting program at BA i ncludes eliminating almost 700 backoffice jobs, outsourcing some technology operations and switching to paid- for food on short- haul flights. The excessive focus on costs is to blame for the latest mess, according to the GMB union.
“They started on t his journey to outsource and offshore this work and there have been a number of inci- dents now that have culminated in what has taken place this weekend,” Mick Rix at GMB, said.
Critics, meanwhile, questioned whether British Airways deserved to claim to be the U. K.’s flag carrier after the perpetual cutbacks.
Cruz and the airline were keen to distance t hemselves from any notion that penny- pinching led to the meltdown, saying instead that the outage was caused by damage at U. K. data centres, where work wasn’t outsourced. “It’s a tragedy,” Cruz said. “We do apologize profusely for the hardship.”
The airline said in a statement. “We do have a backup system, but on this occasion it failed.”