Thursday, 27 September 2007

British Airways $8.2 billion dollar order

In a major fleet replacement programme in nearly a decade, British Airways placed an $8.2 billion (£4.1 billion) order for 61 new aircraft, including its first order for Airbus's A380 superjumbo that can carry up to 853 passengers. This includes 12 Airbus A380 superjumbo’s and 24 of the new Boeing 787 Dreamliner craft. British Airways has also taken options to buy a further seven Airbus superjumbos and 18 Dreamliners. Although the airline said the new fleet are worth $8.2 billion (£4.1 billion), City analysts believe the price agreed will probably be about £3 billion because of the size of the order. The order fits with the airline's anticipated capital expenditure plans of £900 million per year

The new planes, will be delivered between 2010 and 2014, and will be used to replace 34 existing long haul planes, mostly Boeing 747s. Willie Walsh, BA's chief executive, said “the airline would use the A380 to make the best use of limited take-off slots at London's Heathrow airport. The new order would deliver an extra 4% capacity every year over the medium term.” (source: Timesonline)

Ikea, the Swedish furniture chain, founded by Ingvar Kamprad one of the richest people in the world, posted profits at 8% lower than last year. This is due to investment in revamping stores and developing e-commerce in a tough market. The company spent £33.9 million on building new stores in Ashton, near Manchester, and Coventry, and £27 million on extending and refurbishing stores in the year up to August 2006.

Total sales are up by only 2% to £1.09 billion ($2 billion) in the year to August 2006, indicating flat underlying sales. Peter Högsted, managing director of Ikea in the UK, said the chain was in the process of a £760 million expansion. Ikea has made 350 managers redundant and hired more shopfloor staff as it cut costs and attempted to increase customer service this year. Mr Högsted expects to extend e-commerce to cover the whole of Britain by next spring, up from about two thirds of the country now. By then he expects to be achieving about £80 million of sales online, equivalent to a medium-sized store. Ikea has yet to advertise its online store, which began operating as a trial in January. (source: Metro)

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