THE airline may be Britain’s pride of the sky, but BA’s involvement in the recent price-fixing scandal will no doubt have damaged its global image as well as putting a dent in its bank balance.
The company has been hit with a record £121.5million fine by the Office of Fair Trading after admitting to price-fixing fuel charges on its long-haul flights. BA also faces more fines, this time from the US Department of Justice, which could see their total pay-out hitting the £350million mark.
According to the OFT, BA had colluded with Virgin Atlantic on at least six occasions between August 2004 and January 2006, during which time surcharges rose from £5 to £60 per ticket.
Virgin Atlantic, on the other hand, has been given immunity after it reported BA’s activity and is therefore not expected to be hit by a fine.
BA chief executive, Willie Walsh, says: “I want to reassure our passengers that they were not overcharged. Fuel surcharges are a legitimate way of recovering costs. However, this does not in any way excuse the anti competitive conduct by a very limited number of individuals within British Airways.”
A rise in surcharges from £5 to £60 in a year and a half hardly seems “legitimate” to me.
Posted: 1st, August 2007 | In: Money Comments (2) | Follow the Comments on our RSS feed: RSS 2.0 | TrackBack | Permalink
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August 2nd, 2007 at 7:48 pm
Terry I agree with you. it should have been all involved who were fined. One feels Virgin set BA up.
The only thing that surprises me is that anyone is surprised that there is price fixing!
Last year I was looking for a flight to Singapore. I went into a couple of price comparison flights / made some calls and on the dates I wanted all the big airlines (BA, Virgin, Singapore, Kuwait, KLM) were all within about £15 of each other! For Singapore? across the world? Ive always assumed there was a cartel for everything, not just taxes!
August 1st, 2007 at 11:20 am
BA hit with record fines while Virgin (their major competitor) who were just as guilty claim the moral high ground and are apparently “immune” from prosecution having “done their moral duty”.
Hmmmmmm Something smells and I don’t mean Heathrows toilets.