BA IT failure to cost company £80m, chief executive Willie Walsh says
British Airways owner IAG has said a major IT failure that caused travel chaos for tens of thousands of passengers last month will cost the company £80 million, as it extended another apology to customers.
Chief executive Willie Walsh gave the estimate during the airline giant's annual general meeting, where the company also apologised to customers and praised its staff for the way they handled the incident.
"On May 27, British Airways suffered a power failure to its primary data centre, which led to severe disruption to its flights at the beginning of the UK half-term school holiday.
"Our initial assessment of the gross cost of the disruption is in the order of £80 million. We will update the market at the appropriate time with more details."
Mr Walsh added that the work to restore operations was "an outstanding achievement by the teams involved" and stressed IAG was "working hard to ensure that affected passengers are compensated as soon as possible".
He explained the company has also launched an independent investigation following the incident and would provide an update once the probe is completed.
"What we do know at this stage, however, is that this failure had absolutely nothing to do with changes to the way we resource our IT systems and services," Mr Walsh said.
The airline cancelled 726 flights due to a power failure over the spring bank holiday weekend at the end of May, sparking a raft of compensation claims for flight costs, train and hotel expenses, replacement clothes and toiletries.
Under EU law, passengers can claim compensation from BA for cancelled or delayed flights, worth up to 600 euro (£528).
They can also claim expenses for items such as hotels, meals and phone calls.
Some 75,000 passengers were stranded by the IT shutdown.
IAG chairman Antonio Vazquez said he wanted to "offer on behalf of the board our sincere apologies to all the customers whose plans were affected by this unwelcome incident".
He assured shareholders that the board was "constantly kept up to date" during the incident and was "providing support to the management teams to resolve the crisis".
Mr Vazquez also congratulated BA for re-establishing operations and for returning delayed baggage to passengers.
"You can be reassured that we will do everything in our powers to avoid similar problems in the future and restore our customers' faith in British Airways," he added.