In a somewhat unprecedented move, British Airways (BA) first and business class passengers will soon have to part with more cash for higher fuel surcharges.
Just about two weeks ago, BA implemented its third general hike in fuel surchages this year, and has decided to restructure the levy to effectively make its premium passengers pay more, reflecting the higher amount of fuel burned per passenger in the premium cabins.
Chief executive Willie Walsh advised the airline's travel agents and corporate customers of the structural change in the fuel surcharge levy, though British Airways is yet to make a public announcement and inform the stock exchange.
On 3 June, BA had hiked the surcharge for a one-way, long-haul flight of over nine hours, from the £58 applicable at the start of the year, to £109. That made it around £218 for a return flight. However, from 19 June, the surcharge for first and business class passengers has been hiked by another £24 to £133 for a one-way flight, effectively £266 for a return-flight of over nine hours.
Premium economy passengers have not been spared the pain either, as the applicable surcharge in premium economy has gone up from £109 to £121 for a one-way flight, or £242 for a return trip.
Sparing the commons, the surcharge on economy class passengers stays for now at £109 for a one-way flight.
BA had introduced fuel surcharges in 2004 at £2.50 for long-haul and short-haul flights. Fuel is now the single biggest cost for the group, accounting for over a third of BA's total cost, and having overtaken labour costs in the overall airline cost tally. BA has followed the lead of Virgin Atlantic, who earlier this month changed its surcharge structure. BA has mimicked the move to the exact same level as set by Virgin.
CEO Walsh informed travel agents that the fuel surcharge was being restructured to recover some of the airline's fuel bill from ''those passengers travelling in cabins with fewer seats, using more space and benefiting from larger baggage allowances, as we burn more fuel per passenger to fly them".
Walsh said that the rise in oil prices during the year have been "unprecedented". Worldwide, the aviation industry is predicted to fall back into losses this year. BA had earlier warned investors that its fuel bill could mushroom during the current financial year by £1billion, to around £3 billion. Last year's fuel bill for BA was just over £2 billion.