Fuel, as a proportion of total operating costs, is twice as high at Ryanair as it is at BA, because Ryanair manages to keep its other costs so low. An increase in the price of aviation fuel, therefore, ought to hit low-cost carriers harder.Still, there are at least some advantages in charging more. The same charge of unfairness might be levelled at Ryanair and its infuriating penchant for closing down routes without notice But let's allow that one to pass. It is unfair, says Ryanair's Michael O'Leary, for British Airways passengers who have already bought and paid for their tickets, to find themselves suddenly saddled with a £2.50 surcharge to cover the rising cost of the fuel taking them to their destination. But let's allow that one to pass. BA's knee-jerk reaction to the rise in world oil prices demonstrates once again that, when faced with a rise in costs, the instinct of the flag carrier is to pass it on rather than to absorb it.
It is no accident that all the airlines which have either announced fuel surcharges or are contemplating them are full-service national carriers.BA says this is because they are all long-haul airlines and so spend more of their time in the air guzzling kerosene. But all this is wiped out by the decline in the value of the dollar. In the UK, which accounts for a third of the group, competition is very tough indeed, and this division (which trades as A-Plant) is still loss-making. This has been depressed, although rivals seem to have found enough business to muddle through, thanks to Federal government programmes and residential building.Ashtead sales in the US are accelerating again, up 4 per cent in the year to April, we learnt yesterday, including a 13 per cent rise in the final three months. It speaks volumes about the skittishness of the stock market over the past few days that Spirent shares could jump back up 13 per cent yesterday just on the back of the company saying trading is in line with expectations. The slump, which was spread across manufacturing, took the decline for the first three months of the year to 0.5 per cent - the worst quarter since the end of 2002. The findings contradicted a raft of private surveys from the CBI, EEF, British Chambers of Commerce and Chartered Institute of Purchasing and Supply all pointing to a pronounced rebound.Steve Radley, EEF chief economist said: "While conditions in manufacturing are not buoyant, all the latest evidence suggests the picture is a good deal better than the official figures suggest."The minutes of the April meeting of the Bank's Monetary Policy Committee showed it had discounted February's fall as "rogue" - signalling it would not prevent a rate rise.
Much worse: it defaulted on its debts, incurring crippling penalties.The issue of a £130m junk bond in March earned Ashtead the support of its banks until 2007, which means the group will still be around to benefit from any upturn in the US construction market. The plant hire group rents out diggers, pumps and cranes to the construction industry from 423 depots, mainly in the US and UK. There have been countless profit warnings, with excuses ranging from the weather to the economic climate. Then last year it got worse: accounting irregularities emerged in its US business, Sunbelt, which accounts for two-thirds of turnover. Other threats include yet another competition inquiry into Wiseman's monopoly in Scotland.The shares, at a life-time high, have had a great run since this column advised hanging on to them last year.
