Walsh's high-flying plan to weather airline's turbulence

In May Walsh told analysts revenues for this financial year would rise 4%.

At the annual meeting in July the message was that with a fuel bill rising from £2 billion to £3 billion this year, the airline was looking at only breaking even this year.

By August, BA had cut revenue forecasts to 3% but was talking of a small profit. At the September traffic statistics we were back to break even. Today we are back up to a forecast 4% rise in revenues and a small profit.

This shows the horrible volatility in the airline industry even if the occasional upward blips are in the context of an unremittingly downward trend which has seen BA shares fall 75% in 18 months.

It makes a monkey also out of analysts' attempting to advise investors on whether BA shares are undervalued or whether it even has a future. Citigroup, which has been a speculative buyer of the stock, was last week talking of last year's £875 million record high profit becoming a loss of more than £100 million.

The turbulence in the forecasts leaves Walsh and the BA share price horribly exposed to any future downward revisions during a winter which is forecast to be the worst since the post-9/11 aviation slump of 2001 and when it is seeing its premium-priced cabins at the front of the aircraft emptying.

Presumably Walsh knows this. And so, with an apparently clear intention to keep BA's fares high in the face of falling passenger numbers, the assumption is that the BA boss not only has a strategy but one that he thinks will be successful.

As it happens it is exactly the opposite of fare-slashing Ryanair, where the budget airline is attempting to increase passenger volumes with attractive prices.

Who wins? Neither in the short term. Airlines don't like recessions and this recession does not look like being over any time soon.