British Airlines

Press, Volume LXXXV, Issue 25935, 15 October 1949, Page 6

British Airlines

Although a substantial deficit is again recorded, last year’s accounts of the three British State-owned airlines show improvement. The aggregate loss has been reduced by £1,346,947—fr0m £11,086,909 to £9,740,862 —for the financial year ended March 31, and the causes of this reduction promise better things to come. Air services operated by the corp-orations have not been curtailed to meet a reduction in overhead and* operating costs: on the contrary, they have expanded materially. Despite handicaps, better management is achieving results. The three State corporations established by the British Government’s first nationalising measures to run internal and overseas services have made heavy losses, each year exceeding the subsidy provided under the Civil Aviation Act; and the total loss since nationalisation now exceeds £30,000,000. As British airlines are still passing through an expensive reconstruction period some of -the corporations’ losses have been unavoidable for various reasons. One of the latest of these reasons is that the, British Overseas Airways Corporation and the British South American Airways Corporation are suffering from the withdrawal of Tudor aircraft and delay in the introduction of new types of airliners. When all allowances have been made, however, the corporations must still accept responsibility for a large part of the losses. Staff has been inflated, expenditure too free, and organisation too elaborate. A loss of £11,086,909 in 1947-48 spurred the Ministry of Civil Aviation into a campaign to reduce expenditure and improve efficiency. Miles Thomas, head of the Nuffield organisation, was appointed chairman of the British Overseas Airways Corporation, the largest airline and the heaviest loser; and under his direction the corporation was placed on a footing similar to that of a business concern. He reduced operating costs by 20 per cent, and increased revenue by almost the same amount. The corporations’ staffs, which had grown to about 35,000, have been cut by at least one-third; and fur-

ther economies have been made by amalgamating British South American Airways with 8.0.A.C. The year’s figures show that over the whole air transport services capacity ton-miles increased by 32 per cent., and the passenger miles increased by 20 per cent. The Ministry of Civil Aviation looks for a further reduction of costs and an improvement in output during the current year. Better management will help; but the British airlines will not have much hope of balancing their budgets until they have economic fleets of aircraft. Their few American machines are their best profit-earners; aqd the delivery of comparable long-range British types is still in the uncertain future.