British Airways is in trouble not least because it is facing savage competition from both ends of the market. Its prestigious brand image was once boosted by the advertising slogan, ‘The world’s favourite airline’, which was meant to evoke the uniquely high levels of comfort and service on its premium flights. Now Ryanair, the world’s most devotedly cost-cutting, no-frills airline, has started using the very same slogan — what a humiliation.
At the other end of the scale, Virgin Atlantic launched a price war in January 2009, cutting the price of some of its upper-class seats to New York by 40% to £1099. As a result, it has managed to get more people to buy these high-end tickets and its operating profits have doubled to £68 million. To try and remain competitive, BA was forced to retaliate and slashed hundreds of pounds off its ClubWorld seats, offering return tickets from Heathrow to New York for £1100.
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