Canceled business trips due to volcanic #ash

British Airways, Virgin Atlantic likely to suffer 'most' from business trip cancellations

It's official. My business trip to London has just been canceled due to the dust cloud from Iceland’s Eyjafjallajökull volcano. It's estimated that six million passengers will be affected. I'm one of them. And, for airlines, such as Virgin Atlantic, customers like me, who are traveling for business purposes, are likely to hurt their bottom line even more than leisure travelers.

That's because our purpose for flying is to attend specific meetings that can't be easily rescheduled, like they can be for vacationers. The downside for airlines is that we seek refunds.

I just got off the phone with a customer service representative from Virgin Atlantic, after waiting roughly one hour and 30 minutes on the phone to get my money back for my Monday flight to London's Heathrow Airport, which was just canceled today. Because of the massive backlog, the refund will take a "few weeks," according to the "cheery" representative. Despite the wait, resolving this was relatively painless. I'd give Virgin Atlantic, owned by U.K. billionaire Richard Branson, an A- for handling my trip.

But it won't be painless for the airline, which is estimated to lose "0.25 percent of their annual revenue per day," according to Joe Gill, an analyst at Bloxham securities in Dublin, who was quoted in a recent Business Week article that essentially reported on why carriers that rely on business travelers will be hurt the most.

British Airways, which is the largest carrier for flights between London and New York, "is likely to suffer most from the disruption because of its reliance on passengers making business trips that can’t be rescheduled," according to the article.

Vacation travelers or those flying with discount carriers are more likely to reschedule their trips. From the Business Week article: “Airlines will incur their biggest losses in the trans- Atlantic business-passenger category,” Ashley Steel, Global Chair for Transport and Infrastructure at KPMG, said in an interview. “For an airline like BA, every day of their fleet being grounded is likely to cost tens of millions of pounds. The impact on economy-class revenues is likely to be diluted because people will change their bookings and eventually still fly.”

Here's a cool photo from someone named Niravie on Flickr 

           

And, here's a video from YouTube.