BMI

[RhysD]

FT.com

FT.com / Companies / UK companies - BMI cuts routes amid rising costs

According to FT.com:

• Heathrow to Leeds and Teesside to be axed
• Heathrow to Dublin to be reduced by one daily flight
• Heathrow to Amsterdam to be reduced by three daily flights
• Heathrow to Aberdeen to continue to be services by Embraers
• Heathrow to Brussels to be served by Embraers
• Four A32S to take on charter work
• Two A32S to be leased (incl. flight and cabin crew) to Lufthansa for new routes from Heathrow to Berlin and Milan Malpensa

Seems that many Ppruners have been right on the culling of domestic routes and also the emergence of several european reductions. Not sure what to make of the last point with Lufthansa having acquired extra A319s to operate from Malpensa.

[ajamieson]

Originally Posted by Max Angle

Rumour is that we will be operating the new LH services to MXP and TXL who knows.

I'm equally puzzled. What is the benefit of wetleasing to a carrier that is not only its deepest codeshare partner but also shortly to be its 100% owner? If bmi has the slots, the aircraft and the crew then why can't bmi operate TXL etc? Strikes me as a pointless complication, and potentially more costly given the need to base in Milan.

Good luck to you all whatever happens...

[Flightrider]

If bmi has been making big losses as reported, the wet-lease is probably a mechanism for its shareholders to avoid putting in huge levels of cash to maintain its financial fitness. New routes at bmi's own risk would need the cash injection; but a guaranteed wet-lease contract with secure income would not. Either way, the money still appears but it's paid slowly over time under the wet-lease rather than in one big lump if bmi flew the new routes in its own right.

[RevMan2]

If bmi has the slots, the aircraft and the crew then why can't bmi operate TXL

Because bmi doesn't have a positive (if any) brand image in those markets.

Simple as that.

[ajamieson]

Flightrider thank you. If RevMan2 is right then I'm puzzled why bmi serves HAJ, NAP, VCE and LIN until last year seemingly without the same brand image problem (I do understand the stupendous losses, though!) If that is the thinking then it all points to the eradication of the bmi brand under LH rather than the strengthening of it. Shame, but that's business I suppose. I don't think Max Angle ever liked the colours anyway

[virginblue]

TXL is a direct replacement of Lufthansa's LCY-TXL service, so Lufthansa probably wants to keep its product in the market.

MXP is part of Lufthansa Italia's massive build up in Italy, centered around the new MXP hub. It certainly does not make sense to dilute a recently established brand ("Lufthansa Italia") by adding bmi services. The target is mainly traffic originating in Italy, whereas bmi's brand recognition is restricted to the UK end.

Anyone done the maths by now? If I have mine right, 13 slot pairs are freed up by the reductions, whereas 10 are needed for MXP/TXL/KBP. Where does the balance go to?

[ajamieson]

To add into your calculation we already have Kiev and the extra rotation to TLV, but there's also the scrapping of JER.

[virginblue]

My calculation is (leaving out such details as LH itself is freeing up some slots as well, e.g. by reducing LHR-DUS by one rotation)

-4 LBA
-2 JER
-3 MME
-3 AMS
-1 DUB

-13 in total


+6 MXP
+3 TXL
+1 KBP
+1 TLV

+11 in total

Anything missing?

[RevMan2]

I'm puzzled why bmi serves HAJ, NAP, VCE and LIN until last year seemingly without the same brand image problem

Because they were established in those markets.

Starting up a new operation is a capital-, manpower- and time-intensive venture and it takes time until your product achieves market acceptance.

bmi has neither time nor capital and it's a no-brainer for a brand leader to use bmi equipment to operate into established markets.

[LKMflyboy]

Route cuts

Why have the route cuts been announced on ft.com, when we have no official memo or press release from the company, yet? Plus all the routes are still bookable on the website.

Any thoughts?

[ajamieson]

Confirmed, sadly, from March 28.

The website is a shocker, so no surprise at all that you can still book

[woofly31]

Does the switch of the Brussels service to Regional require using the Aircraft not required for the LBA,MME or Jersey services? How many 145's will now be based at Heathrow for the future operations?

[MUFC_fan]

Surely it will cost them a fortune to use EMJs on LHR routes with the price of slots?! CO were paying stupid prices for the slots at LHR and BD are putting EMJs on similar, if not more appealing slots!

Amazing...

[RevMan2]

Flightrider's right on the money with this one

Not really - if you look at the operating costs on a sector like that, a high degree of the costs are fixed. Heathrow landing charge, nav fees and parking for 45 minutes for an Embraer 145 is £787 and for an Airbus A319, £858. If you assume an average fare of £75 on those routes, it means you've got to carry 10 passengers on an Embraer just to pay the Heathrow charges which is 20% of your capacity gone before you can pay any other bills. For an A319, it's 11 pax per flight to pay the landing fees but this only equates to 6% of your available seats.

Information about route changes now ticker-taping on the website, LBA services no longer bookable past Mar 28

[mutualswap]

Why have the route cuts been announced on ft.com, when we have no official memo or press release from the company, yet? Plus all the routes are still bookable on the website.

Any thoughts?


wasnt an official press release this info was leaked!!

5 Embraers in LHR for summer

MUFC worst post of the week

[virginblue]

Surely it will cost them a fortune to use EMJs on LHR routes with the price of slots?!

Why? They already own these slots. You could asrgue that they could make better use of them, but otherwise they do not cost them a penny.

[rutankrd]

Actually Hanover is operated for Lufthansa.

Naples was operated for a limited period during the good times when the city folk had their cash bonuses to burn on expensive Tuscan Villas.
With the £-€ rate currently so poor and combined with economic recession demand has collapsed.
Milan –Linate, Paris, Madrid and Swiss Cities were part of the BMI failed strategy of head on competition with BA and the LCCs and all now gone.

Currently only Venice and Palma survive as primarily leisure routes out of LHR and come the autumn I expect these to go too. They add little to the LH/*A alliance.

These may well be replaced by Minsk and Lening… oh sorry St Petersburg for instance

Venice and indeed Naples and several other Italian Cities can be reached via Munich on partner group companies Lufthansa /Air Dolimiti.and soon via the new Milan –MXP LH.it services.

Palma surely is best left the LCC and Leisure airlines such as Monarch/Easy operating out of other London terminals and the slot pairs used for something else more profitably.

The clear vision for bmi (LH,uk) is to be a medium-haul specialist carrier serving Eastern edges of Europe (Moscow/Kiev), Central Asia (Oil and Gas traffic) and Middle East all complementing LH’s own operations in these regions.
Many of these services should be timed to make good connections with Air Canada TALC services (especially for the gas/oil traffic) and to a lesser extent United over Chicago/ Washington Dullas hubs. Beyond this any other *A connections are best served over FRA/MUC hubs and even the CDN/US- Central Asia traffic could just as well go via FRA/MUC if truth be told.

The remaining Heathrow short haulers are primarily domestic feeder flights to GLA/EDI/Aberdeen/MAN plus Dublin Amsterdam and Brussels and these each have merits for their own continuance (Subject to some frequency adjustments)
GLA/EDI/MAN and Dublin provide important feed for bmi’s own services and partner *A operator connections for UAL/ACA/ANZ/SAA/ANA particularly plus Singapore and Thai to a lesser extent.

Amsterdam also feeds into these *A services however many of the services can be just as easily reached over FRA/MUC.
There is however some residual Oil/Gas traffic to attract particularly Anglo-Dutch companies.

Brussels well they now code-share with fellow LH subsidiary SN .SN presence in the BRU-LON market is now just two flights Sun-Fri and one on a Sat morning into Gatwick!

Finally I expect bmi to take over a few of the marginal UK-German routes such as Cologne (Previously operated for LH from STN!), and either Stuttgart or Hamburg from CLH/DLH in addition to the TXL service. These may well utilise bmi--Regional aircraft and free up DLH aircraft for redeployment and/or withdrawal (Particularly of the dedicated Cologne B735 unit)

[Skipness One Echo]

Milan –Linate, Paris, Madrid and Swiss Cities were part of the BMI failed strategy of head on competition with BA and the LCCs and all now gone.

In fairness the world has changed a lot since this strategy was "British Midland - The Airline for Europe" and BA adapted better due to it's greater size and network. BMI cut service and costs and was squeezed by BA on one side and the LCCs on the other.
I can't imagine the choice on LHR-ABZ will be around for long as an ERJ145 versus a full size ( and busy ) Airbus is a no brainer IMHO.

[iwhak]

What is the reliability like on the EMBs now, I heard they were having some problems with them?

[rutankrd]

Skipness.

Don't disagree wth you and that this was a Bishop vision for sure. When bmi were operating as a true standalone business.

I just point out for so many people and especially some of our friends across the pond that bmi are no competition for BA and given their very limited short haul connections we are getting further and further away from LHR being a viable *A hub -Frankly the European Hub for *A is FRA/MUC henceforth.
*LHR will be a *A focus and O&D destination (with minimal domestic UK feed)

I understand your comment re the jungle-jets to Aberdeen however they may want to retain the route if only for Royal Dutch Shell traffic.