In the third quarter of 2009, Aer Lingus’ profits fell 9.7%, while the number of passengers rose 7% and the load factor increasing on short and long routes. Fares dropped 17.6% in the three months to September 30. This decline had a positive outcome for the company, which noticed an 8.5% increase per passenger on extra fees, such as seat booking or extra luggage.

In an effort to reduce costs, Aer Lingus hired Christoph Mueller as their new CEO and implemented a series of cost-reducing measures to cut €97m off their anual cost. As a result, 676 members of the company’s staff are being let go and pension arrangements are set to be changed after talks with the Union.

“Cost increases in the form of higher fuel prices, airport and navigation charges together with further expected gross domestic declines and unemployment increases in our major markets, will mean that we must continue to reduce any costs within our control so that we can cope with continued falling fares, compete and maintain balance sheet strength. [...] actions taken to remove capacity on underperforming parts of the network has had a positive impact on stabilising load factors and yields while reducing operating costs” said Aer Lingus.

Aer Lingus is in a tight competition with Ryanair to gain passengers, both being affected by rising fuel costs. The first reported €93m losses for the first half of 2009, almost four time than last year.

Since the summer of 2008, 2,500 jobs have gone and more are likely to follow, according to Willie Walsh, BA’s chief executive. Apart from this, management is also offering their employees the chance to work part-time or to take unpaid leaves.

“BA should see some benefit from lower fuel costs in 2010 but unfortunately the global recession has hit BA hard,” said Tony Shephard, an analyst at Charles Stanley. He added that a “17.7pc decline in premium traffic in April does not bode well for the start of the new financial year.”

As we’re writing this piece of news, Unite, a representation for 14,000 of BA’s cabin crew, are planning a strike in order to prevent the company from changing their salaries and working conditions. The airline announced at the beginning of last month that they’re planning some changes for their staff, including 1,000 voluntary redundancies.

British Airways has also been negotiating a partnership with American Airlines and the Spanish carrier Iberia, which could mean a stronger grasp for the tree on routes across the Atlantic.