AIRLINES LOSE MILLIONS

Chronicle (Levin), 8 January 1948, Page 5

AIRLINES LOSE MILLIONS

(N.Z.P.A.-

—Revzer

State Control In Britain Does NotPay

Comiright)

Reccivcil Wednesday, 7 p.m. LONDON, .Tan. 6. The loss of £8,000,000 l).v the British Overseas Airways 1 orporation and n ea i-l v £2,000,000 by British European Aiiw'avs is oxpeeted to cause a demand t'o v a 'full Government statement soon after the Ilouse oi t oiniuons le asseinbles on .January 20. \nv ( Jovernment romplacency on Ihe score that the loss of £10,000,000 ha'! been allowed for in the Jirst full yeat-T eivil tlying under nationalisation wil. it is stated, l»e met with strong eritieisiri. Alreadv it is rumoured that afte«r the aecouats of the three eorporations have been p resented to Parliament, Lor.l Xathan, M inister of Oivil Aviatiou. roav resiyu, and l>e sueeeeSed by Marslia'l of the Hoval Air Force Hir Sholto Douglas. The third eorporation iBritish South Anteriean Airways, whieh is like.lv to show a small prolb. B.o.A.P.'s report states that the tolal loss for the year was £8,(176,844, o! whieh £7,2.18,100 is in respeet of operatious, and that l/o aireraft oi 2.) .lili'erent Ivpes eariied 129,928 passeng ers and tlew 27,100,000 miles. This Wurks ont ;.il a loss oi £02 for eaeh pas sentier earried. Tliere was ti total staff ot 24,(i4(i, ot 139 to every airertift in flii»ht. Th> revenue totalled £1 1 ,•>-!/,•> 1 3 and the exjienditnre £s,,s()1.7d2. More than £1,0(1(1,000 was spent on aireraft niaii. tennnee tuni overland. ''Airertift standin^ ehtirees" eost over £2,000,000 and flving ojierations tmd cliartering oi jiltines eosl tnore than £3,8Ul,0(l(). . Divi sional and head ofliee adini nist rtit ion aeeounted for £2.932,07 1 , and passengcr ser\ iee for £(i02,. '!()(). Deticits Inevitable The report "ives six reasons for the loss: - -i 1 i Mulliplicity of types of uni'fi noiaietil airertift whieh litid to In used ; (2i delay in deliverv of Tndor.tmd -.mseipient eliunges of plans, wiri, lheir linal repereussions ; ( 2 ) the sea' t "red and iinproxised nitiintentinee, bases whieh the eorporation had to use; (2; delieiene.ies in ronte or^anisation; (1) de\ ch.pinent work earried out during ihe year; (Oi programnte of serviees, in \vhieh eonnneieial considertitions were often snliordinttted to ihe national interesl. * • A II these eanses, " said Sir llarold Hartley, ehtiirnitin of the eorporation, " eont rilnited to the losses, luit tlu out.-t anding faet is that with the present types of aireraft, even with a higli lotul faetor (that is, ratio oi Joad ton-niiles earried to capaeity toniniies offered m the aireraft) the reeeijits liarely eovered the direct operaiing eosts. On many rontes little or no ei.nt ribiition was niade to indireet costs and overhcads, and consequently inereased seiwiees merely ineant in ereased detieit. Tliere is only oue eonelusion. Heavy delieits will inevital.ly eontiiuie until the eorporation has aireraft and faeilities to make itself linaneiallv seli'-supportiiig 'in a liighlv eoinpetiti\e international business. ' ' Keports l'rom Ameriea indieate that the British1 airlines are not the only ones losing nioney. It is estiniated that Ameriean airline eoneerns will show u tolal nperatiug loss of £(i, 2:10, 000 fo 1!'47. Un the othe hand, K.L.M.— the Hoyal Duteii Airlines — niade a protit la^t year and a divideml of 4 per cent. was ] » a i 1 1 1o the shareholders.