Shares in British Airways’ owner IAG tumbled on Monday as investors reacted to the turmoil of flight cancellations caused by its industrial relations crisis with pilots.
IAG’s shares fell 9p to 421.1p, making it one of the FTSE 100’s biggest fallers.
The drop came as British Airways cancelled “nearly 100%” of flights after pilots began a 48-hour strike over pay today. Travellers were contacted last month and warned of the potential industrial action with rearrangement options.
The 4000 striking pilots are members of the Balpa union, which rejected an 11.5% pay offer spread over three years.
The union has demanded that pilots, who earn an average of around £100,000 a year, should participate in a profit share deal.
British Airways chief executive Alex Cruz demanded fresh talks with unions in a Sky News interview. He said: “We want to resolve this dispute as quickly as possible for our customers and, frankly, for everyone that works at British Airways.”
A spokesman for BA said: “After many months of trying to resolve the pay dispute, we are extremely sorry that it has come to this.”
He added: “We remain ready and willing to return to talks with Balpa.”
George Salmon, equity analyst at Hargreaves Lansdown, said: "Disruption of this type is unfortunately part and parcel of investing in airlines and with weather, currency and economic sentiment all influencing demand, and fuel prices feeding through to the cost base, IAG is exposed to several other factors outside its control."
