British Airways have told the
Caymanian Compass that there will not be an increase in airfares.
The statement came in the light of
a new report forecasting a hike in air travel costs. The survey, conducted by
the Centre for Economics and Business Research and commissioned by Kelkoo, said
that rising oil prices and the disruption caused by the Icelandic volcano could
combine to raise prices by 5.2 per cent in 2010.
The report said that UK
customers could expect to pay an extra $60 for long-haul tickets.
Bruce Fair, managing director of the
European e-commerce site, Kelkoo UK, said that airlines were already
struggling prior to the volcano crisis, which reduced activity in European airspace
to around 18 per cent of its normal activity, costing an estimated $1.61
billion in lost revenue.
“Increasing competition and falling
demand mean that airline operators have struggled to remain profitable. Profit
margins have been under pressure for some time as established carriers had to
adjust their business models following the market entry of low cost airlines in
“Operating profit margins turned
negative in 2009, with losses reaching 3.4 per cent of revenues and exceeding
the slump experienced after 9/11. In 2010, it is expected that profitability
will remain negative giving the industry little headroom to adjust prices
downward,” he said.
The projected rise will reach 11.5
per cent by 2012, he said.
“British Airways has no current
plans to increase fares,” said spokesman Marcia Erskine.
British Airways operates a direct
flight between Grand Cayman and Heathrow through Nassau, Bahamas.