Taylor on Travel

British Airways' July traffic figures showed a marked improvement on June and, most important, suggest the beginning of a recovery in premium business.

Revenue per passenger kilometre (RPK) actually rose 1% over July 2008, largely due to an improvement in North America, meaning the budget deals on offer have not destroyed BA's underlying profitability - although the carrier has been losing £1 million a day on its operations.

Passenger numbers overall were 1.2% down on a year ago, with premium traffic 11% lower than July 2008 - but that compares to a near 15% premium shortfall year on year in June. And BA flew with more seats full than a year ago.

Willie Walsh will go into talks with Unite union general secretary Tony Woodley over the next few days - in an attempt to fashion a cost-cutting deal with cabin crew and ground staff - in a rather better frame of mind than he might.