British Airways' parent company, International Airlines Group (IAG), plans to launch a low-cost carrier in the summer of 2022. It will be based at London Gatwick Airport LGW.
IAG's London Gatwick-based low-cost carrier
Although nothing has been finalized, British Airways management sent a memo outlining their plans to create a low-cost carrier. Here's how Head for Points described the concept:
We have not operated short-haul flights from Gatwick since the pandemic. Although this market was once highly competitive, in order to operate a sustainable airline in today's environment, we must have a competitive operating model. We propose a new operating subsidiary that will be run in tandem with our long-haul Gatwick operation. It will serve short haul routes from Gatwick starting in summer 2022. This will allow us to be agile and competitive, which will enable us to establish a sustainable short haul presence in Gatwick.
According to the company, they are in talks with unions regarding the possibility of launching something similar.
British Airways tricky Gatwick situation
Since the outbreak of the pandemic, British Airways has been trying decide what to do about Gatwick Airport.
Slots are restricted at Heathrow and Gatwick. Heathrow slots can be hard to find and expensive.
British Airways understandably has consolidated its operations at Heathrow to reduce demand.
British Airways operated a skeleton schedule from Gatwick during the pandemic. The airline only operated short-haul flights and ceased operating long-haul flights.
Although the requirement to use slots has been temporarily relaxed, it is possible that the requirements will eventually be reinstated. It is anyone's guess when British Airways will return to its pre-coronavirus passenger numbers.
British Airways was considering pulling out completely of Gatwick, but it is understandable that British Airways wants to avoid that.
British Airways' latest plan appears to be to keep operating long-haul mainline British Airways flights out of Gatwick. The airline is aware that it will require short haul traffic but does not believe its current cost structure makes it competitive. Here are some thoughts:
It is hard to find a better experience for passengers than British Airways.
This appears to be a labor play to get lower-paid pilots and flight attendants there. British Airways used this method back in the day but had to change contracts during the pandemic to downsize.
IAG already has Vueling, and LEVEL low-cost carriers; although I am certain the cost structure is correct, British Airways seems to think they are not a good fit for branding.
British Airways founded Go in 1998. It operated low-cost flights from London Stansted to European destinations. EasyJet bought the airline in 2005. However, it seems that the concept British Airways is trying to pursue here is similar.
Bottom line
British Airways is launching a low-cost carrier from Gatwick. British Airways hopes that this will allow them to operate long-haul flights out of Gatwick while offering short haul feed at a lower price.
British Airways has made significant improvements over the last decade in order to reduce costs. However, I suspect British Airways is seeking more labor concessions. This would make IAG the third low-cost carrier. It will be interesting to see how it turns out. At this point, I don't think British Airways labor unions would be very trusting of this company.
What do you think of the British Airways low-cost carrier with a Gatwick base?
