Branson ignites war of words with British Airways

Sir Richard Branson has turned up the heat in the ongoing and increasingly acrimonious row between Britain's biggest two long-haul airlines, saying that the Government should not step in to save struggling British Airways.

Warning in interviews over the weekend that a bailout for the UK's flag carrier would not be in the public interest, Sir Richard said that Virgin Atlantic, the airline he founded, would be happy to take some of BA's valuable slots at Heathrow, should it get into more trouble. "We and other are standing by ready to take on their routes and run their slots at Heathrow if they get into serious trouble. I thought the US government's bailout of the car companies was a bad idea and it's the same for BA."

He added that Virgin would not be prepared to bid for BA even at a knock-down price, blaming the company's pension deficit, which analysts believe could be as big as £3bn. "It's not worth much anymore because of the liabilities," he said. "We were thinking that about if the shares went under 100p, but it would be better to wait for its demise."

The comments met fury at BA. "This [Sir Richard's comments] is utter fantasy," said a spokesman. "There have been no talks with the Government and there will be no talks with the Government. BA does not favour government support."

Sir Richard's salvo is the latest in a long-running spat between the two companies. BA's finance director Keith Williams recently said that claims of record profits by Virgin, which is a private company, were down to "Virgin accounting territory".

Last week, BA announced plans to ask staff to work for free for up to a month to save costs. The group has been hit hard by the economic downturn, recording a loss of £401m for the final quarter of last year.