Ben Webster, Transport Correspondent and Miles Costello
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Willie Walsh, the chief executive of British Airways, came under mounting pressure from staff and the City yesterday as he tries to extricate the airline from the chaos surrounding the botched opening of Heathrow's Terminal 5.
The union representing 3,000 British Airways pilots is seeking to oust Mr Walsh, the public face of BA, by blaming him directly for mismanaging the opening of the terminal.
The British Air Line Pilots' Association (Balpa) is preparing a statement condemning Mr Walsh and calling for better leadership of BA as it faces the twin challenges of moving to a new terminal and greater competition on its lucrative transatlantic routes.
At the same time time, one leading shareholder in the airline, whose shares have halved in value over the past year, called for Mr Walsh to provide details about how much the fiasco would cost.
Richard Marwood, a UK equities fund manager at Axa Investment Managers, said: “Priority No1 must be to get this mess sorted out. We are probably broadly supportive of Willie Walsh, but this is a rather high-profile case.
“As yet, they have not been in touch with the investment community to talk about how much this is going to cost. I've read that it could reach £50 million. A one-off cost we can live with, but if it drags on it risks damaging BA's reputation,” Mr Marwood said. Axa owns roughly six million BA shares.
Shareholders rarely go public with their opinions but the public expression of frustration by a long-term owner of BA shares could mark a deterioration in the City's relationship with Mr Walsh, whose moves to cut costs at the airline have won plaudits among investors, until now.
Balpa is furious that Mr Walsh is blocking its plans to hold strikes over BA's planned launch of OpenSkies, a new subsidiary due to operate between airports on the Continent and the United States.
In February, 86 per cent of BA pilots in Balpa voted for strike action over concerns that BA would use OpenSkies to erode pay and conditions at the main carrier.
Mr Walsh said that the strikes would breach European law, forcing Balpa to cancel plans to announce strike dates and to go to the High Court for a ruling.
A senior Balpa member said: “We are very concerned that the future of BA is being threatened by poor management of a whole string of events, not just T5. There is also the mishandling of attempts to take over Iberia, which has resulted in us losing out to Lufthansa-Swiss and Air France-KLM. Willie Walsh's lack of management skills and leadership has left us at crisis point.
“Another 30 per cent of BA flights are due to move to T5 at the end of the month, but we can't even cope with those already there.”
BA's shares fell 1p yesterday to close at 247p. The City, therefore, values the airline at just under £2.9 billion.
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