British Airways To Cut 12000 Jobs

There was a time not that long ago when Branson was widely admired. It was him that threw that away. The UK is nothing but a cash cow to him now, and people have woken up to that fact and said "no more".
Probably rightly. I’ve always considered the guy to be a tool and interestingly, so has much of the industry, he turned it into a circus long before Stelios and O’Really came along. Which is one reason why when the novelty of staff dressed like slappers and in flight massages wore off he was quietly eased out and took on cash cow status with his many publicised stunts and rip off antics in finance, rail, media, soft drinks, you name it, many of which ultimately either failed or became bye words for utter bollocks.

Which is of course great criteria for throwing a company that has a future and now only a tangential connection with the tit through the eternally puerile name to the wolves. And the thousands of people who will be on their arse as a result.

Your post is the perfect illustration of The Branson Effect. Never mind his actual current connection with the business, the man’s a tube, destroy the business regardless.
 
I've said it before, but his close association with both Blair and Remain will have done him no favours whatsoever with the current government.
I refer you to my answer of a few moments ago.
 

Bob65

Old-Salt
Never mind his actual current connection with the business, the man’s a tube, destroy the business regardless.
His current connection with it is that he owns 51% of it! And would continue to do so after being bailed out.

I could get behind an RBS style bailout in which the taxpayer ends up owning a majority stake that can be sold back to the stock markets at the right time. But this isn't it.
 
His current connection with it is that he owns 51% of it! And would continue to do so after being bailed out.

I could get behind an RBS style bailout in which the taxpayer ends up owning a majority stake that can be sold back to the stock markets at the right time. But this isn't it.
I feel exactly the same way about BA.
 
As per the original post, I’m just surprised that all the talk is about BA shedding jobs when the likelihood is that Virgin will be doing the same. I’d agree that Virgin was a shit business that traded on the brand and gimmicks, all shiny on the outside but held together with chewing gum and string behind. Heaven knows, I’ve had to use their “service” often enough and know enough people who work for them to see it. But as a future prospect I believe it has one, not least because of its tie up with Delta and gradual improvement against the backdrop of BA and American in a seemingly terminal downward trend? I suppose what it comes down to is OneWorld -v- Star Alliance with the latter currently in the ascendancy imho.

Maybe it does, but as I said no profit in three years and no overall profit in a decade, why should the government get involved? If it was a decent prospect Branson can sell it to someone with their own money.
As for why the Government should assist, I’m more concerned that the Government is hiding behind Virgin’s past failings and the personalities associated with it to avoid aid to an entire industry which has been hit harder than most and much of which, following the demise of the lame ducks, is highly profitable and a significant contributor to the economy.
Its past failings are quite important, if it doesnt make money the Government certainly shouldnt assist. Beardie might like to play the victim, but the truth is that he running a loss making business. What other airlines are wanting a loan? BA? Maybe when they have run out of their own cash the Government could look at buying some cheap stock.

If you want my honest opinion, the Government is scarred by the banking bail out backlash and doesn’t want to be seen to support industries perceived to be the preserve of high earners and elites. How many jokes do you hear about pilot arrogance and ego, pickets in Porsches etc? They are far more interested in preserving rail jobs despite the fact that virtually all the financial benefits go overseas and most train drivers earn more than junior pilots. They also strike if someone farts out of tune and transport more people on a daily basis which is great right up until you want to fly somewhere and the competition to the shite that BA has to offer Long Haul, or Ryanair and EasyJet Shorthaul has evaporated leaving you with more shite for even more money.
A lot of people use the railways daily, not so many fly. In fact most people will probably only fly once a year on holiday. I dont think competition is actually that important to the majority of people.



I‘m no business guru and certainly no supporter of propping up lame ducks but I’ve enough insight in this sector to see the pitfalls of allowing political posturing and narrow but trendy agendas to cloud sensible moves to protect a generally profitable industry that many won’t miss until it’s gone. Then they’ll wonder wtf happened.
Its not political posturing to let some private businesses suck it up. I dont know why you think its a generally profitable industry, airlines are always going bust. BA was close to it about 10 years ago.
 
His current connection with it is that he owns 51% of it! And would continue to do so after being bailed out.

I could get behind an RBS style bailout in which the taxpayer ends up owning a majority stake that can be sold back to the stock markets at the right time. But this isn't it.
Not quite. Investors own 51% of it. Granted, he may well hold some of that stock but saying he owns it all is not quite the full story.

There never will be a right time to buy in unless it’s now.
 

Bob Upndown

War Hero
Not quite. Investors own 51% of it. Granted, he may well hold some of that stock but saying he owns it all is not quite the full story.

There never will be a right time to buy in unless it’s now.
100% correct re his holdings. Excellent earlier post re chewing gum and string. The product could almost stand up on its own in the early noughties. I got out when it became clear the cash was running out and I could earn twice as much self-employed without the permanent jet lag from 70+ sectors a year. VS’s product, as you rightly say once you past the Vivienne Westwood, is no better than BA/US mainstream airline.

Top tip, keep shtum, next pandemic, don’t buy airline stock, buy Majestic/any wine merchant shares ;)
 

oldfecker

Swinger
Probably rightly. I’ve always considered the guy to be a tool and interestingly, so has much of the industry, he turned it into a circus long before Stelios and O’Really came along. Which is one reason why when the novelty of staff dressed like slappers and in flight massages wore off he was quietly eased out and took on cash cow status with his many publicised stunts and rip off antics in finance, rail, media, soft drinks, you name it, many of which ultimately either failed or became bye words for utter bollocks.

Which is of course great criteria for throwing a company that has a future and now only a tangential connection with the tit through the eternally puerile name to the wolves. And the thousands of people who will be on their arse as a result.

Your post is the perfect illustration of The Branson Effect. Never mind his actual current connection with the business, the man’s a tube, destroy the business regardless.
 

oldfecker

Swinger
Staff dressed like slappers, you say.

Wish I’d known about that. Sounds like a good business strategy. Remind me, how did Branson become so much richer than me?
 
Staff dressed like slappers, you say.

Wish I’d known about that. Sounds like a good business strategy. Remind me, how did Branson become so much richer than me?
saw a market opportunity, got in , built quick, cashed out before everyone else caught up and it crashed.

started if with Virgin Records that way.....his ‘business’ was A phone box and his old Morris Van.
 

Joker62

ADC
Book Reviewer
Staff dressed like slappers, you say.

Wish I’d known about that. Sounds like a good business strategy. Remind me, how did Branson become so much richer than me?
Trust me, you aren't missing much. I used to run a pub across the road from their training centre just outside Crawley. The candidates for jobs used to "pop in" for lunch on interview days, never asked for any more than a glass of water whilst they sat there for an hour taking up valuable paying customer space. They all had an attitude, all caked in make-up for the day. The tears at the end of the recruitment day when they found out they hadn't got a job and came in to get pissed were a joy to behold. One of the biggest hurdles was the uniform, you could ace every test/interview, but if the red uniform didn't suit you, no job.
 
Trust me, you aren't missing much. I used to run a pub across the road from their training centre just outside Crawley. The candidates for jobs used to "pop in" for lunch on interview days, never asked for any more than a glass of water whilst they sat there for an hour taking up valuable paying customer space. They all had an attitude, all caked in make-up for the day. The tears at the end of the recruitment day when they found out they hadn't got a job and came in to get pissed were a joy to behold. One of the biggest hurdles was the uniform, you could ace every test/interview, but if the red uniform didn't suit you, no job.
Fleming Way?
 

Joker62

ADC
Book Reviewer
As per the original post, I’m just surprised that all the talk is about BA shedding jobs when the likelihood is that Virgin will be doing the same. I’d agree that Virgin was a shit business that traded on the brand and gimmicks, all shiny on the outside but held together with chewing gum and string behind. Heaven knows, I’ve had to use their “service” often enough and know enough people who work for them to see it. But as a future prospect I believe it has one, not least because of its tie up with Delta and gradual improvement against the backdrop of BA and American in a seemingly terminal downward trend? I suppose what it comes down to is OneWorld -v- Star Alliance with the latter currently in the ascendancy imho.

As for why the Government should assist, I’m more concerned that the Government is hiding behind Virgin’s past failings and the personalities associated with it to avoid aid to an entire industry which has been hit harder than most and much of which, following the demise of the lame ducks, is highly profitable and a significant contributor to the economy.

If you want my honest opinion, the Government is scarred by the banking bail out backlash and doesn’t want to be seen to support industries perceived to be the preserve of high earners and elites. How many jokes do you hear about pilot arrogance and ego, pickets in Porsches etc? They are far more interested in preserving rail jobs despite the fact that virtually all the financial benefits go overseas and most train drivers earn more than junior pilots. They also strike if someone farts out of tune and transport more people on a daily basis which is great right up until you want to fly somewhere and the competition to the shite that BA has to offer Long Haul, or Ryanair and EasyJet Shorthaul has evaporated leaving you with more shite for even more money.

I‘m no business guru and certainly no supporter of propping up lame ducks but I’ve enough insight in this sector to see the pitfalls of allowing political posturing and narrow but trendy agendas to cloud sensible moves to protect a generally profitable industry that many won’t miss until it’s gone. Then they’ll wonder wtf happened.
I don’t think the government is scarred by the banking bailout, which was, in any event, small scale in comparison with what will come of they start bailing out every viable business that hits a cash crunch.

I think the specific issue for government is how to bail out the industry. The three big British airlines all have very different ownership models which makes it very difficult to deliver a strategy. Also, bail out one and they really have to bail out all.

EasyJet is the easiest to bail; it’s a UK PLC traded on the the LSE. Government could either force a rights issue and acquire stock or provide debt finance supported by some form of convertible note (ie they acquire stock if the debt isn’t repaid).

BA is much more complex as BA PLC is wholly owned by IAG. The government could acquire stock in BA PLC, reducing IAGs holding. But then it would be on the hook for cash on a per share basis. Alternatively, it could acquire stock in IAG, but the how does it guarantee that the rescue money goes to BA. In reality, a bailout of IAG needs Spanish and Irish government involvement.

Virgin is wholly owned by private equity. It has never been traded, so the government would be holding equity privately too. How does it dispose of any share it acquires?

The issue of equanimity between the three is significant too. Bailout one and the other two will have a strong case of unfair competition.

The most important thing the government can do is to get the economy moving; all three will survive if they start generating revenue quickly. The 14 day quarantine is ludicrous; if the science backing it isn’t watertight, I can see it being challenged.
 
I don’t think the government is scarred by the banking bailout, which was, in any event, small scale in comparison with what will come of they start bailing out every viable business that hits a cash crunch.

I think the specific issue for government is how to bail out the industry. The three big British airlines all have very different ownership models which makes it very difficult to deliver a strategy. Also, bail out one and they really have to bail out all.

EasyJet is the easiest to bail; it’s a UK PLC traded on the the LSE. Government could either force a rights issue and acquire stock or provide debt finance supported by some form of convertible note (ie they acquire stock if the debt isn’t repaid).

BA is much more complex as BA PLC is wholly owned by IAG. The government could acquire stock in BA PLC, reducing IAGs holding. But then it would be on the hook for cash on a per share basis. Alternatively, it could acquire stock in IAG, but the how does it guarantee that the rescue money goes to BA. In reality, a bailout of IAG needs Spanish and Irish government involvement.

Virgin is wholly owned by private equity. It has never been traded, so the government would be holding equity privately too. How does it dispose of any share it acquires?

The issue of equanimity between the three is significant too. Bailout one and the other two will have a strong case of unfair competition.

The most important thing the government can do is to get the economy moving; all three will survive if they start generating revenue quickly. The 14 day quarantine is ludicrous; if the science backing it isn’t watertight, I can see it being challenged.
I agree with at least some of this but won’t be going into the detail as frankly I’ve aired my views and the discussion is eternally circular. That’s not a problem, everyone has an opinion they believe is correct, I guess time will tell.

I have other, related matters to deal with but in closing I will make one point. This thread centred on BA redundancies. I introduced Virgin, admittedly a different case but common in that it is making people redundant and their case isn’t being helped by Government for reasons already discussed.

You make an interesting point that underlines my reasons for introducing Virgin to the debate in that I’m surprised BA dominates the thinking of many. Your point that interests me further and illustrates what I’m saying is that you refer to The Big Three. BA and EZY are on your list through merit, Virgin are there through, well, being Virgin.

Jet2 (Dart Group) and TUI UK are both bigger than Virgin by fleet size, crew numbers and pax carried (headcount are probably close because Virgin operate a fleet exclusively made up of larger airframes). Both are U.K. companies although the latter is German owned and both are listed on the LSE (as are RYR) and both have put on about 30% in value in the last month (as have BA and EZY).
 
I agree with at least some of this but won’t be going into the detail as frankly I’ve aired my views and the discussion is eternally circular. That’s not a problem, everyone has an opinion they believe is correct, I guess time will tell.

I have other, related matters to deal with but in closing I will make one point. This thread centred on BA redundancies. I introduced Virgin, admittedly a different case but common in that it is making people redundant and their case isn’t being helped by Government for reasons already discussed.

You make an interesting point that underlines my reasons for introducing Virgin to the debate in that I’m surprised BA dominates the thinking of many. Your point that interests me further and illustrates what I’m saying is that you refer to The Big Three. BA and EZY are on your list through merit, Virgin are there through, well, being Virgin.

Jet2 (Dart Group) and TUI UK are both bigger than Virgin by fleet size, crew numbers and pax carried (headcount are probably close because Virgin operate a fleet exclusively made up of larger airframes). Both are U.K. companies although the latter is German owned and both are listed on the LSE (as are RYR) and both have put on about 30% in value in the last month (as have BA and EZY).
By the logic of some on here, TUI is Russian owned. Mordashov is the biggest single shareholder! But your introduction of Jet2 and TUI illustrates how large and complex this issue is. I think there is a big difference between a charter holiday airline and a scheduled flag carrier; the barriers to entry are very different.

For my part, I don’t think the government should be funding saving jobs for which there is no demand. It should be focused on ensuring that there are businesses left that can are going concerns and sufficiently capitalised to regrow once recovery starts
 
Barriers to entry?
 

Bob65

Old-Salt
By the logic of some on here, TUI is Russian owned. Mordashov is the biggest single shareholder! But your introduction of Jet2 and TUI illustrates how large and complex this issue is. I think there is a big difference between a charter holiday airline and a scheduled flag carrier; the barriers to entry are very different.
But the complexity is entirely artificial, that's the thing. There's nothing inherent in running an airline (or any other sort of business for that matter) that says it has to have some elaborate ownership structure, the only reasons to do it are to evade either taxes or regulations or both. It's not reasonable to dodge paying their fair share during the good times and expect everyone else to dig into their pockets to support them in the bad times.

For my part, I don’t think the government should be funding saving jobs for which there is no demand. It should be focused on ensuring that there are businesses left that can are going concerns and sufficiently capitalised to regrow once recovery starts
Re-capitalisation always wipes out existing shareholders. That's just how it works. How ironic that these businesses have through their own decisions made that politically and financially impossible.

How about Branson sells his 51% stake to the taxpayer for £1 and then the taxpayer props up the business as necessary with an eye to later re-sale. I think that would be politically do-able.
 

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