British Airways Plc expects to trim its capacity later this year, Chief Executive Willie Walsh said on June 02, due to the effects of soaring oil prices.
"We will take capacity out during the winter so I think for the current year we'll probably be looking at flat capacity versus last year," he told Reuters on the sidelines of an International Air Transport Association (IATA) conference in Istanbul.
Walsh said it was too early to say whether the airline would cut destinations as part of the move to reduce capacity, but said cutting the frequency of flights was more likely in the winter period which starts at the end of October.
He said it was too early to quantify the effect that higher ticket prices would have on demand, but said it was certain airlines would increase prices, echoing comments from other officials at the industry conference.
BA said last month its fuel costs were set to rise 1 billion pounds ($2 billion) this year, but raised hopes it could manage offset this increase by lifting profits 45 percent and paying its first dividend since 2001.
Growth in annual profit was driven by cost-cutting and rising business-class seat sales that led to a 10 percent operating margin. It said it was reviewing its capacity, costs and network against the backdrop of economic pressures and high fuel prices, and forecast revenue growth at the low end of its previous forecast range of between 4 percent and 4.5 percent.
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