British Airways Q2 Corp. Travel Recovery Stagnates

British Airways' second-quarter business travel volume was about 61 percent of 2019 levels, about the same share as in the first quarter, Luis Gallego, CEO of parent company International Airlines Group, said in a Friday conference call.

"Corporate traffic is recovering more slowly than we thought at the beginning of the year," Gallego said. 

Gallego noted that the pace of business travel recovery is not the same across all IAG airlines. While BA's business travel revenue and booking volume have recovered to a respective 69 percent and 61 percent of 2019 levels, Iberia's recovery has reached 95 percent and 82 percent, respectively. 

As other carriers have noted, Gallego pointed to a correlation between business travel recovery and return-to-office policies. He also noted inconsistent rebound in different types of business travel. "For example, long-haul business trips over two days have been recovering faster than the recovery of so-called day trips," he said.

Noting strength in bookings for September, Gallego projected resumed business travel recovery in the third quarter for British Airways, forecasting volume of 68 percent of 2019 levels, about 7 percentage points higher than the second quarter. 

"It's coming back slowly," Gallego said. "We think we are going to come back to 85 percent [recovered compared with 2019], but it will take more time than we thought originally."

IAG Performance

IAG, which includes Aer Lingus and Vueling in addition to BA and Iberia, reported nearly €7.7 billion in total second-quarter revenue, up about 30 percent year over year. Passenger revenue increased about 36 percent to more than €6.7 billion. IAG reported a second-quarter operating profit of about €1.25 billion, compared with € 301 million in the second quarter of 2022.

For the first half of 2023, capacity was restored to 94 percent of 2019 levels as measured in available seat kilometers, and Gallego in a statement said the company is " aiming to be back to pre-pandemic capacity at the end of this year."

The company in a statement said it also projected transatlantic business to reach 2019 levels by year-end.