BRITISHAirways will start to manage loss-making Olympic Airways next month, as exclusively revealed in Travel Weekly on May 31.
The $10m contract to run the airline was expected to be signed between the Greek government and BA’s consultancy arm Speedwing last week. BA will then try to make the Greek national carrier profitable within three years.
A BA spokeswoman confirmed Speedwing was scheduled to sign the managing contract as Travel Weekly went to press.
BA’s involvement will inevitably mean streamlining Olympic’s workforce and cutting unprofitable routes – as BA did when it was privatised.
Olympic’s own privatisation process is due to start later this year, but is expected to go ahead only when the airline proves to future investors it is turning fortunes around.
Once BA is satisfied Olympic can be profitable and provide network advantages, the Greek carrier will join Oneworld. This potentially offers the group Greek regional and eastern European expansion options.
Olympic’s fortunes have been hit in recent years by strikes and by competition from charter operators and low-cost airlines. If BA’s involvement fails to resurrect Olympic, the Greek government has threatened to close it down.