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BRITISH AIRWAYS CUTS U.K. REGIONAL COSTS, NEW PACT WILL IMPROVE PROFITABILITY

 BRITISH AIRWAYS CUTS U.K. REGIONAL COSTS,
 NEW PACT WILL IMPROVE PROFITABILITY
 NEW YORK, March 4 /PRNewswire/ -- The future of British Airways' (ADS - NYSE: BAB) regional services has been secured with the signing of a new agreement that improves the profitability of the airline's extensive shorthaul network.
 Management and union representatives have agreed to set up a new business, "British Airways Regional," to run the services in Manchester, Birmingham and Scotland. A package of measures to improve profitability and safeguard some 1,000 jobs has also been agreed.
 The announcement centers on an agreement to reduce annual staff costs by 8.25 million pounds sterling ($14.3 million) from April 1. It follows months of negotiation between management and the Association of Professional Executive Clerical and Computer Staff (APEX), the British Airline Pilots Association (BALPA), Cabin Crew '89 and the Transport and General Workers Union (TGWU) representatives under a joint management/trade union steering group.
 The airline's Super Shuttle services linking Heathrow with Belfast, Manchester, Glasgow and Edinburgh; and services between Heathrow, Newcastle and Aberdeen; as well as the trans-Atlantic services operated from Manchester and Glasgow, are not affected by the changes announced today.
 British Airways Regional will operate British Airways' 23 BAe 1-11 aircraft at Birmingham and Manchester; and the airline's 13, 64-seat BAe ATP aircraft, based in Scotland.
 Robert Ayling, director of marketing and operations, British Airways, said: "The launch of British Airways Regional heralds a new phase in the development of the airline's short haul operations and is great news for the regions.
 "It provides a dedicated, profit-accountable unit to meet the special demands of a regional network that will link important business and community centers throughout Britain and Europe.
 "It secures the future profitability of a comprehensive route network and marks another significant step in British Airways' determination to control costs. It also provides the 1,000 staff who currently support our regional services, with future employment as part of the British Airways group.
 Ayling said that a number of factors, not least the continuing recession in the U.K. and rising costs, had placed the airline's regional, short-haul services at a competitive disadvantage and it had been one of his priorities to establish a basis for developing the regional business for the future.
 He added: "We now have a regional cost structure that will ensure the business improves its profitability and can grow."
 At present, 477 staff are employed at Birmingham; 340 at Manchester; 183 in Scotland.
 Discussions to put regional services on a stronger financial footing began last October when union representatives formed four groups comprising -- a business group, flight crew, cabin crew and ground staff -- to study the likely impact of any changes.
 British Airways Regional will operate more than 400 flights a week to 17 cities from Birmingham with a fleet of 13 BAe 1-11s; 270 flights a week to 20 destinations from Manchester with a fleet of 10 BAe 1-11s; and almost 100 services a day on Scottish routes with 13 BAe ATP aircraft.
 -0- 3/4/92
 /CONTACT: Sandy Gardiner of British Airways, 718-397-4725/
 (BAB) CO: British Airways ST: IN: AIR SU:


CK -- NY060 -- 4951 03/04/92 12:18 EST
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Date:Mar 4, 1992
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