Following the terrorist attacks in America, the sector facing the
greatest commercial uncertainty is the airline industry. This
uncertainty has created a series of challenges, to which the solutions
rely - in part - on effective communication.
From an internal communications perspective, airline staff around the
world remain understandably frightened by the possibility of a repeat of
the tragic incidents on 11 September. Yet there are other troubles
facing the sector. A collapse in consumer confidence because of fear of
further attacks threatens revenues. Costs are being hit hard by
insurers' becoming nervous enough about covering the carriers'
liabilities for passenger air safety as to raise the possibility of
grounding the flights altogether.
In the wake of the attacks, almost all the major companies in the sector
announced major restructurings to cope with the crisis. Nearly all UK
airlines have now announced fleet reductions and/or service cuts. BA
plans to cut 7,000 jobs (roughly ten per cent of its total) and Virgin
Atlantic, which has never had to make staff redundant, 1,200. Boeing,the
market leader in manufacturing passenger aircraft, is to shed more than
20,000 staff in the next 12 months.
Out of sensitivity to those affected by the disasters, some carriers
withdrew ads considered inappropriate and shelved proactive PR work.
Virgin Atlantic head of communications Paul Moore says: 'After such a
tragedy it would be wrong to pursue ad or PR campaigns - we'll guage the
mood before resuming that.'
BA senior comms manager Jemma Moore says the firm is now merely puting
out basic factual information and reassurances on security'.
It is clear that problems in the aviation area predate 11 September.
The financial position of BA, for example, was such that its debt
mountain, at more than £6bn, was twice the size of its market
value even in the first days of September.
Airline industry analyst Daniel Solon points out that airlines operate
with slim profit margins and high fixed costs.
'The industry was on thin financial ice on 10 September, but the events
of the 11th crystallised the situation in a tragic way,' he says.
Indeed, some critics have suggested that the terrorist attacks may be
used as a reason to justify staff lay-offs that may have had to be made
And yet however uncertain the situation was for airlines before the
attacks, their effect has been to exacerbate existing doubts in the City
and undermine consumer confidence.
Some have responsed by lobbying for state aid to absorb predicted
Whether these subsidies will only apply to the largest airlines remains
unclear - commentators point to easyJet's ads last weekend imploring the
Chancellor not to single out one or two major carriers for state
Trade secretary Stephen Byers is reported to have already held
preliminary talks on this matter with BA chief executive Rod Eddington.
The US Government has already agreed an initial £10bn aid package
for its troubled airlines which, although falling short of both the
sector's expectations and needs, could set an example the UK Government
finds hard not to follow.
The lobbying has also meant reviving plans for consolidation, normally
hindered by the regulators. The CEOs of the UK's biggest airlines - BA,
Virgin Atlantic and bmi British Midland - all now talk up the need for
more and greater mergers and fewer, larger companies if the industry is
to survive in its current form.
Besides reassuring the City there is a solid future for air travel, and
working on the Government to secure the assistance needed to carry on
working, the airlines face a tough job in winning back consumer
This applies across the sector, but is especially worrying for BA, since
it had invested heavily in its attempt to increase the proportion of
seats taken by business and first class passengers. Empty fully-flat
beds are of more concern for the long-term health of the sector than
empty economy seats. And for the business people who used these
services, it will be easier to justify the use of private aircraft,
previously regarded as too expensive.
Airliner World editor Tony Dixon is not without sympathy for airlines
and as a specialist is critical of what he feels is hysterical coverage
by the mainstream press. And yet Dixon says airlines are wary of
publicly talking about tightened security, mainly because they can never
be sure to have eliminated the chance of future attacks.
Despite the job cuts, airlines still employ millions of staff and
understandably, they are scared. Internal communications expert Bill
Quirke says the task facing airlines in reassuring worried employees is
so important it cannot be solved by an e-mail from the CEO: 'Internal
communications will be operational. Especially in view of what is
thought to have happened to cabin staff in the attacks, team leaders
will have to conduct special briefings and treat staff as a specific
audience to communicate that safety is a priority.'
The tragedy of more than 6,000 dead or missing has led to questions
about the value of PR in such a situation. And yet to avoid compounding
the trauma with staff desertion and collapsing investor or consumer
confidence, the role of communications will be crucial.