Walsh slams APD Increases- on behalf of BA

IAG CEO Willie Walsh appeared on the BBC's 6 o'Clock News this evening to lay into the UK Government's insistence on going ahead with the 8% increase in Air Passenger Duty (APD) from April 2012.

What he said about it's effect on the UK's competetive position in international air travel and tourism was entirely correct and more than justifies his announcement of trimmed plans for the year with recruitment cut from 400 to 200 and one less 747-400 being returned to service from its sojourn in the dry American desert.

The Government response that aviation must take its share of the austerity tax raising burden and that it was lucky anyway in not being subject to VAT or fuel tax was entirely predictable from a beaurocratic entity (the Treasury) which is totally blind to the fact that UK Plc is in competition with Europe and the world for tourism and its share of the air traffic business. Ironically the next item on the News was about sluggish retail sales on Britain's high streets. The link between competitive pricing of air travel to encourage tourists to visit and spend money in the nation's shops, hotels, restaurants, cafes, and adding revenue to public transport and a whole host of other(mainly taxed) activities has no traction in Whitehall or amongst most MP's.

Politics apart, another fascinating aspect of Walsh appearing on the box standing in front of a stylish dark blue backdrop complete with BA logo was that it he as CEO of IAG, not Keith Williams as CEO of the BA brand,who was making the statement. We speculated earlier in the year on how the relationship between the owner,IAG, and the brands would develop once everyone had got their feet under the table and how the previously very hands-on Walsh would cope with what he might find the relatively dull hands off stratosphere of his runwayside office a mile or so away from BA's Waterside HQ.

Could it be that we are seeing here the glimmer of an answer which we suspected likely ? Add to that the question of whether Keith Williams' early expression of a new style with his "Peace in our Time" deal with Unite ending the cabin crew dispute without many of the real game changing gains Walsh had originally been going for has meant a clipping of wings. It is difficult to assess at this stage and we will have to wait for more blips to appear on the radar screen to give us a fix. The initial ones are certainly interesting and raise the antennae. Following ones boss into his/her former position while he/she moves up a notch and remains the boss demands a lot of both people. The success rate isn't wonderful.