BRITISH Airways chief Willie Walsh has hailed the early success of the new Manchester-based BA Connect airline, and believes it will restore the fortunes of the loss-making regional business.

In an exclusive interview with the MEN, the former pilot said the early response to the low-cost Connect, which replaced the CitiExpress brand last month, had been "excellent".

He said he accepted that BA may have been slow to embrace passenger demands for a low cost, no frills, flexible service: "I take on board any criticism, but we are looking forward now. We have been really pleased with the response of our customers to Connect, we are delighted with it."

He said that the regional business had "struggled" to make money in the last five years, and revealed that he has set a two year target for Connect to make a profit.

Struggle

"We are not in the business to lose money, all parts of the business must contribute - not necessarily equally - and the regional business has struggled to be profitable in the last five years. We work on a two year cycle, and we want to see the business be in profit in 2007/2008.

"It it is not profitable it is not going to have long-term viability. It's not in anyone's interests to operate a business that is not profitable. It has got to be good value for customers and make a financial return, which will allow us to continue to invest in it.

"I am confident the plan for Connect will work."

Mr Walsh, who led the turnaround at loss-making Irish airline Aer Lingus before moving to BA, has a strong track record for delivering at the bottom line.

The current burning issue is BA's é1bn-plus pensions deficit. BA management have pledged to inject é500m into the fund provided staff agree to postpone their retirement by five years.

Mr Walsh is confident agreement can be reached with unions to avoid industrial action. WILLIE Walsh profile: Page 3