Unions fear engineering sell-off at BA

Airline accused of 'hidden agenda' as opposition grows to pounds 1bn cost-cutting programme

British Airways faces a summer of mounting staff discontent over its pounds 1bn cost-cutting programme and widespread fears of a "hidden agenda" to hive off its huge engineering division.

Following the resolution of the pilots' dispute last week, unions are now pressing BA's chief executive, Robert Ayling, for a meeting as soon as possible over the cuts, which were announced in May alongside record profits of pounds 585m.

Tomorrow BA will also face a fresh onslaught on its planned transatlantic alliance with American Airlines. US rivals Delta, United, Continental and TWA will follow Richard Branson's Virgin in opposing the link-up before the House of Commons' transport select committee.

The pilots' strike threat was just the tip of the iceberg of discontent among BA's 55,000 employees, as morale hits rock bottom amid a lack of communication by Mr Ayling over the flagship carrier's future strategy.

Disaffection is highest among the 9,000 staff of BA's engineering arm, as a future sell-off is widely perceived as an open secret among senior executives.

"You won't see it written down on paper, but if you ask senior management privately, they say that's the way things are going," one senior union source said.

"The big issue for the next 12 months is strategy. It still affects the pilots as much as anyone. Their dispute's not the end of it," he added.

The division carries out engineering and maintenance work for 100 other airlines as well as on BA's 300-strong fleet of aircraft. It has a total turnover of around pounds 1bn a year.

In April last year, it became a profit centre in it own right, and analysts estimate it could fetch up to pounds 500m if sold or floated off on to the stock market. A disposal would not be unique: four years ago, BA sold its engine overhaul business to General Electric of the US. Cargo, another new profit centre with pounds 540m of sales, may also be a candidate, analysts say.

Around 200 engineering shop stewards gathered for an angry meeting on 28 May at Heathrow's Ramada hotel to voice opposition to the cuts and changes in contracts, pay and conditions that BA is already forcing through. All the main unions were represented - the TGWU, GMB, Manufacturing, Science and Finance Union and the Amalagamated Engineering & Electrical Union. A subsequent request to meet Mr Ayling has yet to receive a response.

But with the pilots' strike now cancelled, national negotiators are to press their demands following completion of a paper by George Ryde, the TGWU's National Secretary for Civil Aviation Employees.

"There is an underlying concern with employees generally when the company makes a statement about a level of cost-cutting but does not explain how it is going to be achieved," said Graham Fowler, the secretary of BA's Joint Trades Unions Committee and assistant general secretary of Balpa, the pilots' union.

BA averted an indefinite strike by pilots starting from Tuesday through marathon talks into the early hours of last Thursday.

Mr Ayling had threatened to cancel bonuses, defer pounds 10bn of capital spending and to sell off the Euro-Gatwick operation before the pilots accepted a company-wide 3.6 per cent pay increase. "It was not just bluff. We were forced to face some unpalatable truths," a senior BA source said this weekend.

Officially, BA has yet to reveal how it intends to make the pounds 1bn cuts by the year 2000 and has denied talk of an engineering sell-off. Working parties, however, are now reviewing the group's structure, from ticketing, sales and catering to engineering and cargo, with the American Airlines link-up just part of the picture.

"We're investigating the whole way we do business. We're looking at every aspect of the business," a BA spokesman said.

With relentless pressure on prices, analysts believe further franchising of flight operations is also on the agenda, which may bring fresh conflict with BA's 3,000 pilots. "In fact, they don't really need to run an airline at all. They're more and more a scheduling and marketing operation," one City analyst said.

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
News
ebooksNow available in paperback
Life and Style
tech
News
The 67P/CG comet as seen from the Philae lander
scienceThe most important scientific breakthroughs of 2014
Arts and Entertainment
Ian McKellen as Gandalf in The Hobbit: The Battle Of The Five Armies
film
Arts and Entertainment
Sarah Koenig, creator of popular podcast Serial, which is to be broadcast by the BBC
tvReview: The secret to the programme's success is that it allows its audience to play detective
News
Ruby Wax has previously written about her mental health problems in her book Sane New World
people
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Ashdown Group: Marketing Services Manager - (communications, testing, DM)

£32000 - £35000 per annum + benefits: Ashdown Group: Marketing Services Manage...

Guru Careers: Finance Account Manager

£Neg. (DOE) + Excellent Benefits: Guru Careers: A Finance Account Manager with...

Ashdown Group: Java Developer - Hertfordshire - £47,000 + bonus + benefits

£40000 - £470000 per annum + bonus: Ashdown Group: Java Developer / J2EE Devel...

Ashdown Group: Direct Marketing Manager - B2C, Financial Services - Slough

£45000 - £55000 per annum + Benefits: Ashdown Group: An exciting opportunity h...

Day In a Page

Homeless Veterans appeal: 'You look for someone who's an inspiration and try to be like them'

Homeless Veterans appeal

In 2010, Sgt Gary Jamieson stepped on an IED in Afghanistan and lost his legs and an arm. He reveals what, and who, helped him to make a remarkable recovery
Could cannabis oil reverse the effects of cancer?

Could cannabis oil reverse effects of cancer?

As a film following six patients receiving the controversial treatment is released, Kate Hilpern uncovers a very slippery issue
The Interview movie review: You can't see Seth Rogen and James Franco's Kim Jong Un assassination film, but you can read about it here

The Interview movie review

You can't see Seth Rogen and James Franco's Kim Jong Un assassination film, but you can read about it here
Serial mania has propelled podcasts into the cultural mainstream

How podcasts became mainstream

People have consumed gripping armchair investigation Serial with a relish typically reserved for box-set binges
Jesus Christ has become an unlikely pin-up for hipster marketing companies

Jesus Christ has become an unlikely pin-up

Kevin Lee Light, aka "Jesus", is the newest client of creative agency Mother while rival agency Anomaly has launched Sexy Jesus, depicting the Messiah in a series of Athena-style poses
Rosetta space mission voted most important scientific breakthrough of 2014

A memorable year for science – if not for mice

The most important scientific breakthroughs of 2014
Christmas cocktails to make you merry: From eggnog to Brown Betty and Rum Bumpo

Christmas cocktails to make you merry

Mulled wine is an essential seasonal treat. But now drinkers are rediscovering other traditional festive tipples. Angela Clutton raises a glass to Christmas cocktails
5 best activity trackers

Fitness technology: 5 best activity trackers

Up the ante in your regimen and change the habits of a lifetime with this wearable tech
Paul Scholes column: It's a little-known fact, but I have played one of the seven dwarves

Paul Scholes column

It's a little-known fact, but I have played one of the seven dwarves
Fifa's travelling circus once again steals limelight from real stars

Fifa's travelling circus once again steals limelight from real stars

Club World Cup kicked into the long grass by the continued farce surrounding Blatter, Garcia, Russia and Qatar
Frank Warren column: 2014 – boxing is back and winning new fans

Frank Warren: Boxing is back and winning new fans

2014 proves it's now one of sport's biggest hitters again
Jeb Bush vs Hillary Clinton: The power dynamics of the two first families

Jeb Bush vs Hillary Clinton

Karen Tumulty explores the power dynamics of the two first families
Stockholm is rivalling Silicon Valley with a hotbed of technology start-ups

Stockholm is rivalling Silicon Valley

The Swedish capital is home to two of the most popular video games in the world, as well as thousands of technology start-ups worth hundreds of millions of pounds – and it's all happened since 2009
Did Japanese workers really get their symbols mixed up and display Santa on a crucifix?

Crucified Santa: Urban myth refuses to die

The story goes that Japanese store workers created a life-size effigy of a smiling "Father Kurisumasu" attached to a facsimile of Our Lord's final instrument of torture
Jennifer Saunders and Kate Moss join David Walliams on set for TV adaptation of The Boy in the Dress

The Boy in the Dress: On set with the stars

Walliams' story about a boy who goes to school in a dress will be shown this Christmas