British Airways delays T5 long-haul switch

British Airways said on Friday it would delay moving around 120 flights to the airline's new Terminal 5 at Heathrow in an effort to make sure it can handle the extra passengers and baggage involved.

The airline had planned to switch almost all its long-haul flights from Terminal 4 to Terminal 5 on April 30, but BA Chief Executive Willie Walsh told reporters this had now been put back until at least June 5.

By then, passenger volumes are expected to be lighter at Heathrow, the world's busiest international airport, following the late-May school breaks and a public holiday on May 26.

The delay is the latest move by BA to get Terminal 5 running properly after an unmitigated public relations disaster last month when hundreds of flights were cancelled and tens of thousands of bags went missing in disruption caused by baggage handling problems.

This month, BA said T5 disruption had so far cost it around 16 million pounds ($32 million).

Walsh said media speculation about the extent of the costs had been "way off the mark" and that an update would be given in due course.

ABN analyst Andrew Loddenberg told Reuters he did not expect the latest setback to have an impact on costs.

"The 16 million pounds was principally associated with the cancelled flights. This is a deferral. At the margin there would be economies by operating in one less terminal, but it is not going to be material," he said.

BA shares fell 2.5 percent to 221.75 pence by 1238 GMT, valuing the company at 2.5 billion pounds.

LEARNING FROM FIASCO

Harry Bush, director of economic regulation for regulator the Civil Aviation Authority (CAA), said he had written to BA and airports operator BAA demanding they learn lessons from the fiasco of the terminal's opening.

"We've asked them to try very quickly to learn lessons. Once BA moves into Terminal 5, airlines will be moving into other terminals," he said, adding it was likely that both parties were responsible for the disruption.

In a joint statement with BAA, British Airways said that it has been running a normal flight schedule from Terminal 5 since Tuesday.

The two companies said they were working to iron out remaining problems, including the baggage system, and develop a robust timescale to move flights to the new terminal.

"BAA regrets this postponement, and we recognise the impact it has on other airlines, but we believe it is a wise precaution," said BAA Chief Executive Colin Matthews. BAA is owned by Spain's Ferrovial.

The delay in moving to Terminal 5 affects about 60 daily departures and 60 arrivals. Walsh said around three-quarters of the baggage caught up in the terminal disruption had been returned to BA customers.