Owen Coughlan knew there were going to be delays at British Airways Plc’s new terminal at London’s Heathrow airport almost three weeks before the opening.

Coughlan was in a group of about 100 volunteers who acted as transfer passengers during a March 8 dry run at Terminal 5. Only two made their connecting flights.

“They just weren’t ready to deal with the number of passengers,” said the 22-year-old advertising account executive. “It seemed the staff didn’t really know what was going on.”

Delayed baggage forced British Airways to cancel more than 600 flights and stranded thousands of passengers after Terminal 5 opened March 27.

Fixing the facility may cost the airline as much as 150 million pounds ($299 million), according to Chris Reid, an analyst at Deutsche Bank AG. Two British Airways directors in charge of the move to Terminal 5 were ousted this week, and plans to shift more flights to the building have been delayed. The carrier’s shares are down 12 percent since the opening, compared with a 0.2 percent gain in the Bloomberg Europe Airlines Index.

Terminal 5 sprawls over an area the size of London’s Hyde Park and has 17 kilometers (10.6 miles) of baggage conveyors.

It was hailed as a panacea for British Airways and Heathrow, Europe’s busiest airport, which have been criticized for poor customer service. Instead, glitches in the 250 million-pound automated luggage-handling system caused 12 days of lost bags and angry passengers.

‘Silly Things’

Willie Walsh, chief executive officer of British Airways, blamed the debacle on a series of “simple and silly things,” including delays at the staff parking lot and security checkpoints. Each employee had an average of four days training. In hindsight, they needed more, he said.

“Taken together, it in fact overwhelmed capacity available on the day,” Walsh said April 14 at the Foreign Press Association in London.

The roots of the problem stretch back to September, when some workers were introduced to the new terminal, according to two baggage handlers who asked that their names not be used to protect their jobs.

Training on some systems lasted as little as four hours, and familiarization classes sometimes consisted of watching videos and eating cookies, they said.

That lack of experience snowballed on March 27.

One baggage handler said it took him 2 1/2 hours to reach his work station because he couldn’t find a parking space and was held up at security. When he finally got there, the handheld device that connects each employee to the luggage system directed him to the wrong side of the terminal, a 20-minute walk from where he should have been.

‘On Back Foot’

By the end of the day, he’d completed assignments on just two aircraft, about three less than he normally did at Terminal 4, the baggage handler said.

“Airlines and airports are very time-sensitive operations,” said Jamie Bowden, a former customer service manager for British Airways who now works as a media adviser for airlines. “You can’t afford to have huge groups of staff wandering around not knowing where they’re going.”

New equipment magnified the delays, said Andrew Dodgshon, a spokesman for Unite, which represents about 3,000 British Airways ground staff.

The luggage system is designed to shut down when there’s a backlog, Dodgshon said. Stoppages are supposed to last a few minutes so workers have time to manually unload conveyor belts and get caught up. On opening day, the deficit was so big baggage handlers were never able to get back on schedule, he said.

“Staff were immediately starting on the back foot,” Dodgshon said.

Storage Space

The baggage system may have to be partially rebuilt because there isn’t enough storage space to accommodate a backlog, Deutsche Bank analyst Reid said in a March 31 note to investors.

British Airways and airport owner BAA Ltd. staged 70 trials at Terminal 5, including five major tests involving about 2,000 people, said Richard Goodfellow, an airline spokesman.

Coughlan participated in one of the large exercises. Passengers were released into the terminal in smaller groups about 10 minutes apart, he said. Even so, people were stuck at security and had to search for flights with little help from airport workers, Coughlan said.

“The tests they did weren’t for enough people and weren’t realistic enough,” he said.

Goodfellow said passengers were staggered in groups of 200 to simulate how customers actually flow into the terminal.

“We learned a lot,” he said. “A lot of the trials were designed to replicate failure. We were trying to test the building.”

Striving for Margins

The British Air Line Pilots Association on April 7 blamed Terminal 5’s woes on British Airways’ drive to achieve a record 10 percent operating margin for the fiscal year ended March 31.

A “preoccupation” with the bottom line is affecting performance, the union, which represents 3,000 of the airline’s pilots, said in a letter distributed to the media.

Bowden, the former customer service manager, said workers warned British Airways about potential problems at Terminal 5.

“A lot of the staff feel let down by their managers,” he said.

To contact the reporter on this story: Tracy Alloway in London at talloway@bloomberg.net