ANALYSIS: Airlines in multiple comms challenge - The after-effects of the tragic events two weeks ago in the US are being felt across the economy but the airline sector in particular faces major comms challenges, says Andy Allen

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.

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