British Airways puts Ground Fleet Services up for sale

British Airways has taken another step towards becoming a "virtual" company by putting up for sale its Ground Fleet Services operation, which maintains its fleet of trucks and buses.

The business employs 470 staff at Heathrow and Gatwick, most of which are skilled mechanics who maintain BA's 7,300 ground-based vehicles such as the tractors which tow planes on to the runways. Staff were told of the decision at meetings yesterday.

The sell-off marks the second big announcement in BA's programme to save pounds 1bn by the turn of the century, involving around 5,000 voluntary redundancies. Each division has to come up with cost savings or face the possibility of a sell-off or closure.

In September the airline said it was to close its Contract Handling business at Heathrow, which provides services such as check-in facilities for other operators, with the loss of 750 jobs.

A spokeswoman for BA admitted the Ground Fleet Services division had failed to make the internal cost savings required, but said several companies had expressed an interesting in buying the operation. She said a multi- million pound investment was required to develop it over the coming years.

"We've been looking at Ground Fleet Services for some six months now and it has become clear that while it is geared to do more work than British Airways alone can provide, it requires investment to grow the business and utilise its assets far better than is currently the case," she explained.

Most of the staff involved, the bulk of whom work at Heathrow, were expected to transfer to the new company, though BA said some would have the "opportunity" to take voluntary redundancy or early retirement.

Bob Ayling, BA's chief executive, said in a statement: "We are committed to ensuring that the employees of Ground Fleet Services are treated in the best possible way. The potential buyers are world-class operators in their own right and would therefore, we believe, be good employers."

BA's efficiency drive has already attracted controversy with plans to slash the pay of staff in its regional air division which flies from Birmingham, Manchester and Scotland. The airline has asked for savings of pounds 32m to pay for a new fleet of Boeing 737 aircraft.

Separately, Sir George Young, the Transport Secretary, confirmed last night that the UK would resume the "open-skies" talks with US officials on 4 December for three days.