Travel: BA launches spartan airline for rock-bottom flight prices

British Airways is to jettison champagne and caviar in favour of fizzy drinks and little else in its controversial assault on the discount airline market. The new no-frills carrier unveiled yesterday will be called "Go", but as Chris Godsmark, Business Correspondent reports, it faces stiff opposition from rivals such as Luton-based easyJet.

British Airways is launching a new airline, which will give it its first base at Stansted airport in Essex and represents a complete break with the group's mainstream business by unashamedly copying pioneers such as Ryanair and easyJet. Go will offer a similarly spartan turn-up-and- go service to European short-haul destinations, plying its passengers with nothing more potent than a free glass of lemonade to cut costs to the bone.

Launching the Go brand yesterday, BA pledged to have eight Boeing 737 aircraft operating to so far un-named destinations across Europe by the end of the year. The first services, will be launched in two months, by which time the company will have recruited around 150 staff.

"We don't have caviar and champagne to give away. We believe the name symbolises the simplicity and straightforwardness of the company. There are no pretentions about us," said Barbara Cassani, BA's former head of United States operations and now the boss of Go.

BA was criticised last year by Baroness Thatcher for ditching the Union flag design on its tail fins and used a different brand agency, Wolff Olins, for the discount operation. However, Ms Cassani refused to disclose how much BA had paid to Wolff Olins to come up with a name as simple as "Go".

BA also remained guarded about ticket prices yesterday, although they are certain to at least match the cut throat levels of easyJet, Ryanair and other budget carriers. This means a return trip to Paris for around pounds 59 could be on the cards, or fares of well under pounds 100 to more exotic destinations such as the south of France.

BA's decision to wade into the budget airline business has incensed rivals, despite the claim from "the world's favourite airline" that Go will be run as a totally separate operation. EasyJet chairman, Stelios Haji-Ioannou, has already lodged a formal complaint against BA to the European Commission and yesterday said he hoped to "kill the airline at birth".

Yesterday easyJet threatened to step up its campaign, promising to monitor any attempt by BA to abuse its market muscle and alleging that Go would be subsidised by BA to the tune of pounds 50m. "They could put other airlines out of business. They are enjoying the benefits of being part of British Airways and I don't believe this is a separate operation at all."

The claims were rubbished by Ms Cassani, who insisted "every bill" for the airline would fall on her desk. "We've made it very clear that the BA board wants us to break into profit in our third year of operations. No way will we be throwing money into the market just to gain a foothold."