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British Airways is to make huge cuts to its £15 million

advertising spend in the wake of the terrorist attacks in the US.

The airline said that it is reviewing its advertising spend but has yet

to decide how much it is likely to cut from its budget. The move is a

blow to M&C Saatchi, which is already facing the possibility of having

to make redundancies, having put its staff on notice last week.

BA has also culled its direct marketing and design roster, terminating

its contracts with Carlson and Claydon Heeley Jones Mason. Tullo

Marshall Warren, the third direct marketing agency on the BA roster,

will stay in place as lead agency and will be supported by Black

Sun.

Insiders estimate that BA spends £25 million below the line.

Carlson handled most of BA's customer loyalty work, including its

Executive Club, and Claydon Heeley Jones Mason worked across BA areas

including Club World and Business.

It is likely that BA will put a hold on all brand advertising in the

short term with some promotional press advertising continuing to

run.

The majority of its direct marketing will be moved in-house over the

coming months, with one source suggesting that below-the-line spend will

be cut to between £4 million and £5 million.

A BA spokeswoman said: "We are in the process of reviewing all our

agencies.

We have terminated contracts with Carlson and Claydon Heeley and will

have one lead direct marketing agency supported by Black Sun while we

build our in-house capabilities.

"We are reviewing the work we do with M&C Saatchi but there is not

likely to be a repitch," she added.

BA recently announced 7,000 job losses and withdrew 20 aircraft from its

fleet as it announced its intention to cut flights by 10 per cent in the

wake of the events in the US. BA is also facing a review of its night

flights at Heathrow by the European Court of Human Rights.