LIFE AFTER SQ006 - Orient Aviation

e x e c u t i v e i n t e r v i e wThe turnaround at British Airways (BA) since former CathayPacific Airways and Ansett Australia boss Rod Eddingtonbecame chief executive in May last year has been dramatic.Modestly, he refuses to take all the plaudits for BA’s improvedperformance and credits his predecessor, RobertAyling, with contributing to the success of recent months.But, Eddington told TOM BALLANTYNE in London, thereis still much hard work ahead.There were a few raised eyebrows inBritish Airways’ (BA) Waterside headquartersnear London’s Heathrow Airportwhen it was announced in April last yearthat an Australian was to take over one of thegreat British institutions.But many of those who knew Rod Eddingtonin his successful days as managingdirector of one of the most profitable and mostrespected airlines in the world, Cathay PacificAirways, and, latterly, executive chairman ofAnsett Australia, believed BA chairman, LordMarshall, had pulled off a master stroke.The sceptics might have said there wasnothing to lose, it could not get any worse atBA. His predecessor, Robert Ayling, had beensacked as the bottom line headed into thered. The carrier that calls itself “the world’sfavourite airline” was under investor siegeas it reeled from high fuel costs and expensesas well as tough competition from low-costEuropean rivals.In the last year of Ayling’s BA leadershipafter-tax profits had plummeted fromUS$833.3 million in 1997 to $677.3 million in1998 and $313.6 million in 1999. In May lastyear, a few days after Eddington had steppedinto his chief executive’s office for the firsttime, the carrier reported its first full year lossof $16.7 million.At the time shareholders were far fromhappy after earnings per share plummettedfrom around 77 cents in 1997 to minus 24 centsin the year to March 31, 2000.And the staff was unhappy, too. Ayling’smanagement style had not made many friendsamong BA’s employees. Eddington errs onthe side of gross understatement when hereflected on his early weeks at Waterside.“Morale [of the workforce] was bruised,”he said diplomatically. “But people were stillcommitted to the company. That as muchas anything has enabled BA to get throughthe last couple of years, because they haveobviously been difficult years.”“Eddo” the saviour? Well, it was not longbefore he knew his talents would be testedto the full – and more! The documentedfinancial woes were just the beginning. Hewas soon thrown into the complex and soonto-failnegotiations with Dutch flag carrierKLM about a proposed merger. And in June,Eddingtonputs accenton success...and it’s working; but no moreinvestment in Asia-Pacific carriersBA chief executive Rod Eddington: the Australian is comfortableat the helm of one of the great British institutions24 | Orient Aviation | March 01