Willie Walsh

IT IS a testament to the skills of the British Airways legal team that the airline has just about managed to avoid the longest strike by its workers in a quarter of a century this weekend. However, for Willie Walsh, the Dublin-born chief executive of BA, it may only be a brief reprieve. The London High Court injunction preventing cabin crew from striking was overturned last Thursday and workers are now free to walk off the job from tomorrow.


A prolonged walkout could prove the tipping point for Walsh's career at BA. His five years in charge of the self-titled "world's favourite airline" have been far more eventful than his time as CEO of Aer Lingus ? an airline prone to crisis ? when he was accused by former taoiseach Bertie Ahern of attempting to steal the airline. The shambles of the opening of Terminal 5 at Heathrow, a tie-up with American Airlines, the proposed merger with Iberia, a slump in demand for travel, price-fixing allegations and the disruption caused by volcanic ash have overshadowed his attempts to end BA's outdated work practices and cut its monster cost base.


Unite, the union representing cabin crew, is planning four rounds of five-day strikes over the next month. A 20-day strike would be the longest in UK aviation for more than 25 years, crippling the airline at the start of the hugely important summer travel season. Earlier and shorter stoppages in March cost the company £45m (€51m). It is also still counting the cost of ash chaos in April, which it estimates at £20m a day.


In the London Times last week, Walsh argued that a small fraction of union "hardliners" believed that the airline hadn't changed from the 1970s when BA was state-owned, "facing little competition and ever ready to do a cosy deal with the unions knowing the taxpayer will pick up the tab". He said the company must cut costs to compete against nimbler rivals. BA pilots and other workers have voted in favour of the changes.


While Unite said overturning the injunction preventing its members from striking offered a "pause for peace" to allow negotiations to resume, analysts said any sign that the company is backing off won't be tolerated by BA investors.


"The City will take a dim view if Walsh gives any ground," the influential aviation analyst Howard Wheeldon of BGC Partners told Bloomberg last week.


Those that know him and worked with him in his Aer Lingus days say he is unlikely to give in to the unions.


"There is a steely determination about him and he is somebody who has complete and utter conviction in his views," said a former colleague.


"He is cold. He is ruthless," says one admirer who believes Walsh is the right man to tackle problems facing BA. The former pilot had been with Aer Lingus for more than 20 years when he was thrust into the CEO role of the then state-owned carrier in 2001 after Michael Foley's unexpected departure following allegations of harassing a female staff member. Losing the CEO couldn't have come at a worse time as the industry was plunged into another crisis following the terrorist attacks on the US. Immediately Walsh seized the initiative and set about taking a knife to its costs.


"When I met him you had to feel this guy has something special," said a person who worked closely with him in 2001. "I wasn't at all surprised when the moment came and he became chief executive [of Aer Lingus]. He was the right man to turn around the company."


During his time with the airline more than 2,000 jobs went, along with many of the perks that customers expected from Aer Lingus such as free meals on short-haul flights and also any excess at the airline's head office, like its collection of art including works by Louis Le Brocquy. The former pilots' union representative was more than capable of taking on the powerful trade unions at Dublin Airport in 2001.


"He knows the airline business. It is a business that is quite complex and quite magnetic. Willie is acutely aware of where there's fat and your challenge is to slim it down."


Walsh certainly managed to reverse Aer Lingus' fortunes. From a loss of almost €140m in 2001 when he took over, the company made a profit of €72.4m in 2005. That was the year that saw his exit along with close colleagues Brian Dunne and Seamus Kearney.


It was clear by that stage that the government was never going to allow the airline to list on the stock market. All three departed, with Walsh being parachuted into BA to succeed Australian Rod Eddington.


If running Aer Lingus raised his profile, running BA has taken it to a much higher level. It may be smaller than Ryanair or the big European carriers such as Air France-KLM or Lufthansa but being chief executive of BA remains arguably the most prestigious job in aviation this side of the Atlantic.


Walsh has taken to cutting costs at BA with the same zeal as he did at Aer Lingus. But some believe there are limits to a policy of merely slashing costs, and that Walsh lacks strategic vision.


"I think there is one trick. And this [cutting costs] is his. It is looking at opportunities to do things with less people and less costs. I am not sure what other tricks there are," said one former senior Aer Lingus executive who worked with him.


Those that know him personally say he works extremely hard and is a very good communicator. He took a leading role when the ash crisis hit last month by taking to the air in a test flight on a Boeing 747 to determine the impact of ash on engines, arguing that the closures were proving unnecessary.


He is media-friendly and aware that, because of the high profile associated with BA, his comments will always be listened to.


Despite the union's claims that his "slash and burn" strategy will cause long-term damage to BA, it is clear from the airline's finances that it needs radical surgery, losing £531m in the current financial year.


The response from Walsh was a 10.5% cut in costs over that period.


With a crippling strike imminent, Walsh's actions may determine how much longer he remains as CEO. According to sources he is unlikely to back down, so it will come down to just how much pain the airline can suffer in the meantime. So far he has the support of the BA board and his job is safe.


While the strike will be debilitating for the company, former associates say he will relish the crisis.


"The trappings of success are not the things that drive him. He is not going to win any popularity contests. I am not sure he is the guy I would use to build the brand or the business, but he has proven himself to be very good at stabilising a business. I think he likes playing the tough guy. He enjoys that role. It is essential. You need someone who is willing to play to that script."