IT outage to cost British Airways $135m

A technological failure that stranded tens of thousands of British Airways passengers in May will cost the company around £80 million (A$135 million).

Willie Walsh, chief executive of BA parent International Airlines Group (IAG), told the company's annual shareholders meeting in Madrid the figure was an initial estimate.

In addition to BA, IAG owns Aer Lingus, Vueling and Spain's Iberia.

BA suffered a disruption at London's Heathrow and Gatwick airports when a power surge knocked out its IT system, forcing it to cancel almost two-thirds of all flights on May 27, which fell on a busy bank holiday weekend.

An electrical engineer disconnected the uninterruptible power supply, shutting down the data centre, Walsh previously said.

British Airways has commissioned an independent study into the shutdown.

Heathrow suffered further setbacks this week after a baggage system failure prevented luggage from being checked in at terminals 3 and 5. The problem has been resolved.