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British Airways posts record loss as concerns grow

British Airways has today posted a loss of £531 million which is 32% up on the loss last year and the biggest 12 month deficit in the history of the company. It would appear that a general economic downturn, the worst we have seen for over 60 years, together with ongoing strike action from the UK unions has come together to create a nightmare scenario.

While the company is cautiously optimistic regarding the next 12 months there is the problem of further strike activity in the short to medium term. This will impact upon future profitability, the reputation of the company and could have a major impact upon the company's finances. It is difficult to find any positives with regards to British Airways in the short to medium term until the cost-cutting exercises are rubberstamped and the union issue is resolved. Quite when this will be is anybody's guess!

British Airways offers a perfect reflection of the worldwide aviation industry which is struggling to survive in these very difficult economic times. Mergers, acquisitions and the downsizing of many airline companies are already underway and there will be more to follow. How long can the industry survive these difficult times?

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