BA pulls out of Detroit after 50 years

I can honestly admit to being completely surprised by that statement, but “the city” isn’t something I’m particularly across at the best of times. Recent news headlines and business dealings would certainly give the layman like me, the distinct impression that all is not “ideal” shall we say…?

I’d be delighted to hear otherwise.

Renfrew, fair comment and yes I do feel that the press doesn’t always report all facts or correctly. The statement I made was in the Sunday Times business section August, 2007:

http://business.timesonline.co.uk/tol/business/money/investment/article2326736.ece

and also has been stated at least 4 times I can recall in various business sections and publications over the past year.

Is everything ideal, I’d agree no, but feel there is potential in the near future to grow and develop the business.

Yes, not too sure what these alleged difficulties are, BA (by city experts) is seen as one of the most undervalued stocks in the FTSE100, I suspect once T5 is factored in and the costs and service improvements that will bring, can only improve performance. The fact that the business is able to monitor route performance so closely and react quickly I think demonstrates that the airline is on top of its business. You only need to read about the many billions of dollars worth of debt that US car manufactureres are in to understand that those businesses aren’t growing and that they will not be supporting too much travel.

I can honestly admit to being completely surprised by that statement, but “the city” isn’t something I’m particularly across at the best of times. Recent news headlines and business dealings would certainly give the layman like me, the distinct impression that all is not “ideal” shall we say…?

I’d be delighted to hear otherwise.

I think it says more about the state of Detroit. I was looking at a thread on a US website entitled “will the last person out of Detroit please turn out the lights” it directed me to a section entitled Detroit Ruins on Detroityes.com and it showed building after building in a state of ruin – hotels, automotive works (Chrysler/Ford/Studebaker), the YWCA building etc. Other than New Orleans (Which is slowly rebuilding), Detroit is the only major US city to have a declining population. I think BA made their money on this route from premium business passengers connected with the automotive industry which has all but collapsed. I suppose all these places can be regenerated with cash.

Fair enough… I tend to look at announcments like these by BA as a reaction to trading conditions within the business as a whole, particularly given recent events at BA, such as the fuel fixing debacle and the withdrawal from the UK regional business.

Are other airlines retreating from ‘the Motor City’ too ?

Seriously though, to pull out of a route after 50 years says something about the state BA these days. I wonder how much of the stated reasons are ‘smoke and mirrors’ aimed at masking current difficulties within BA’s business ?

I think it says more about the state of Detroit. I was looking at a thread on a US website entitled “will the last person out of Detroit please turn out the lights” it directed me to a section entitled Detroit Ruins on Detroityes.com and it showed building after building in a state of ruin – hotels, automotive works (Chrysler/Ford/Studebaker), the YWCA building etc. Other than New Orleans (Which is slowly rebuilding), Detroit is the only major US city to have a declining population. I think BA made their money on this route from premium business passengers connected with the automotive industry which has all but collapsed. I suppose all these places can be regenerated with cash.

Yes, not too sure what these alleged difficulties are, BA (by city experts) is seen as one of the most undervalued stocks in the FTSE100, I suspect once T5 is factored in and the costs and service improvements that will bring, can only improve performance. The fact that the business is able to monitor route performance so closely and react quickly I think demonstrates that the airline is on top of its business. You only need to read about the many billions of dollars worth of debt that US car manufactureres are in to understand that those businesses aren’t growing and that they will not be supporting too much travel.

Seriously though, to pull out of a route after 50 years says something about the state BA these days. I wonder how much of the stated reasons are ‘smoke and mirrors’ aimed at masking current difficulties within BA’s business ?

Not at all, this route has been in steep decline for many years. The only reason it has survived for the last 2 years is because the flight operated LHR-DTW-IAH, and the IAH leg has been propping it up.

Now that IAH can be run direct from LHR, DTW is very weak. Seeing as the motor industry in Detroit has been in serious decline for some time, and Detroit as a city is definitly not booming, noone is very surprised by this really. Anyone with an aviation interest in DTW has been expecting this for a while.

Difficulties within BA’s business? Aircraft haven’t been this full, or making this much money for many years now. Lots of tough, unpopular decisions have been made recently, but ultimatley these have been for a reason, and continue to improve loads and revenue.

I think this was a BOAC route not a BCAL one, although I’m not much of an aviation historian so don’t quote me on that!

This is already being discussed in another thread.

Seriously though, to pull out of a route after 50 years says something about the state BA these days. I wonder how much of the stated reasons are ‘smoke and mirrors’ aimed at masking current difficulties within BA’s business ?

I disagree to be honest (and not to be awkward LOL). It has always suprised me that BA have operated DTW, which has become a notoriously low yield market, and isn’t even bouyed by a strong underlying leisure component. With NWA having such a prominent hub there, it adds to the difficulties of external airlines because the NWA frequent flyer program probably makes that airline more attractive to premium travellers. I’d say the reasoning is probably quite genuine

Whilst I think your statement of “to pull out of a route after 50 years says something about the state BA these days” is very true, I think we would disgaree on why. The old BA (and we’re talking 80s/early 90s) would have continued many such routes, for the purposes of prestige. The new BA has to be competitive, and aircraft resources are not cheap. The airline has finally cottoned onto the fact that these resources may be better used elsewhere, and routes that do not deliver adequate profit will, and rightly should, suffer.

I’d say the reasoning is probably quite genuine, but even if its not, if the aircraft resource can truly be better used elsewhere then it is a sensible business decision.

Was DTW a former BCal route?

Well… You can’t be ‘Heathrow Airways’ if you keep operating to other places too…:diablo: 😀 :dev2:

Seriously though, to pull out of a route after 50 years says something about the state BA these days. I wonder how much of the stated reasons are ‘smoke and mirrors’ aimed at masking current difficulties within BA’s business ?