BMI
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There has been some bmi advertising. However, it's never quite hit the spot.
There was a frankly bizarre "Heathrow's second favourite airline" press campaign that appeared in The Economist a while back which was a twist on the "We may not be the biggest but we are..." style of campaign that unintentially said we're not Heathrow's biggest airline and we're not Heathrow's favourite either.
There was a frankly bizarre "Heathrow's second favourite airline" press campaign that appeared in The Economist a while back which was a twist on the "We may not be the biggest but we are..." style of campaign that unintentially said we're not Heathrow's biggest airline and we're not Heathrow's favourite either.
Join Date: Sep 2005
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BMI has been active in advertising in the Economist. Also, there was the "BMI Time" adverts on TV, which I thought excellent.
You have to remember that BA and BMI are trying to attract the mass market to major destinations. A large part of BMI's business is to niche markets, such as Freetown, Khartoum, Almaty, Aleppo etc...mainstream advertising in the mass media for these markets would be money ill spent, and specific marketing aimed at businesses and communities with known links to these destinations would be far more prudent.
You have to remember that BA and BMI are trying to attract the mass market to major destinations. A large part of BMI's business is to niche markets, such as Freetown, Khartoum, Almaty, Aleppo etc...mainstream advertising in the mass media for these markets would be money ill spent, and specific marketing aimed at businesses and communities with known links to these destinations would be far more prudent.
I Have Control
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news from the old boss
Heard an interview on Radio 4 news this lunchtime, where Sir Michael discusses the issues around his homosexuality as regards running a big airline. Interesting, and I must say that he surprised me. No scandal here, just a spot of surprising news.
News from the old boss
The programme you were referring to is called 'leading questions' available on BBC iplayer dated Sat 15th Aug.
SMB gave a critical overview of the airline industry as he sees it today and about the prejudices gay people face in business.
A very good interview in my opinion
SMB gave a critical overview of the airline industry as he sees it today and about the prejudices gay people face in business.
A very good interview in my opinion
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Thanks for the post crewmeal just tuned in to the interview and it was very interesting.
SMB said that 'he had no regrets and that he felt that he was very lucky to be one of the few people to spend so long in the business and come out on the right side of the balance sheet'. This certainly is true, and his agreement with Lufthansa 10 years ago was a clever move that in effect safeguarded his investment.
However, when he was asked about whats very important to successful management he said controlling costs. I was surprised that he did not say the importance of building a brand aswell.
All in all food for thought and one can only marvel at what he has achieved in his time in the business.
SMB said that 'he had no regrets and that he felt that he was very lucky to be one of the few people to spend so long in the business and come out on the right side of the balance sheet'. This certainly is true, and his agreement with Lufthansa 10 years ago was a clever move that in effect safeguarded his investment.
However, when he was asked about whats very important to successful management he said controlling costs. I was surprised that he did not say the importance of building a brand aswell.
All in all food for thought and one can only marvel at what he has achieved in his time in the business.
Join Date: Feb 2003
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I found it quite sad, though ultimately not shocking, that there was no mention of the importance of a happy workforce as the way to build a successful company, very different from the answers some top dogs would have given!
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BMI seem to be doing an awful lot of charter flying now at weekends and indeed during the week from various UK airports, is this a profitable or lucrative part of their operation and with the LH takeover, is it something that is likely to continue, as there are very few independant charter airlines left out there to pick up the additional capacity and the work of smaller independant tour operators?
Join Date: Jan 2002
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As long as I can remember, bmi/British Midland have been doing charter work.
In the early-90's there were four dedicated 737's doing charter work, based in EMA,GLA,BFS and LTN, plus the 'nines flying ex-GLA,BFS,DUB on sat night/sun morning to PMI/IBZ etc.
LHR has had a large weekend charter programme for a long while.
Nothing new in this work.
In the early-90's there were four dedicated 737's doing charter work, based in EMA,GLA,BFS and LTN, plus the 'nines flying ex-GLA,BFS,DUB on sat night/sun morning to PMI/IBZ etc.
LHR has had a large weekend charter programme for a long while.
Nothing new in this work.
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I had my annual biz brief recently... Lufthansa did not have the chance to complete due diligence before the takeover, so that has taken time. In addition, they were doing a full study of the company (you may have seen them doing audits) which only completed the information gathering phase last week; their plan will be based on the results of this.
Quick precis: stop the bleeding!
Quick precis: stop the bleeding!
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Lufthansa plots sale of bmi to Virgin
Article found in todays Times.
From The Sunday Times
August 23, 2009
Lufthansa plots sale of BMI British Midland to Virgin Atlantic
German airline may jettison assets after threat of a downgrading by leading credit-rating agencies
Lufthansa took an 80% stake in BMI in June
Dominic O’Connell and Ben Marlow
Lufthansa may try to sell BMI British Midland, the UK airline it took control of in June, as part of a plan to raise funds.
Airline industry and City sources say that the sale of BMI is one of a number of options being considered by the German airline, which has been threatened with a downgrade by Standard & Poor’s and Moody’s, the international credit-rating agencies.
Transport bankers say Lufthansa has held preliminary talks with Sir Richard Branson’s Virgin Atlantic about a sale of BMI or a merger of the two airlines.
A sale to British Airways of some of BMI’s take-off and landing slots at Heathrow, the UK’s largest airport, is also under consideration, while BMI’s regional operations could go to a rival like Flybe, the budget airline that has its headquarters in Exeter. Lufthansa declined to comment.
Stephan Gemkow, Lufthansa’s chief financial officer, confirmed that it was considering a deal in a recent interview with Aviation Week, the trade magazine. “But it takes two to tango. If we find the right partner, we will dare to dance,” he said.
Lufthansa took an 80% stake in BMI in June, buying out Sir Michael Bishop, the airline’s founder. The purchase was the result of a contract struck 10 years ago, when Lufthansa agreed to purchase Bishop’s shares at a prearranged price. As The Sunday Times revealed in May, the German airline tried to reduce the fee by forcing Bishop to take part in a recapitalisation of the company ahead of the sale.
He refused, and began legal proceedings to enforce the contract. The two sides settled on the steps of the courtroom.
Although the exact terms of the deal were not disclosed, it is understood Lufthansa paid £223m for Bishop’s shares, not the £292m required under the contract.
Branson and Bishop frequently discussed combining their airlines to take on British Airways at Heathrow, but were never able to agree terms. Sources at Virgin confirmed that Branson remained interested in a deal, but said Lufthansa had yet to decide what it wanted to do having taken control at BMI.
Industry bankers say the deal could take the form of BMI and Virgin merging — the combined airline would have about 13% of Heathrow’s flights, compared with 41% for British Airways. Such a deal would dilute Singapore Airlines’s influence at Virgin, where it holds a 49% stake.
The merged group would be able to exploit transfer traffic at Heathrow by connecting BMI’s short and medium-haul network with Virgin’s long-haul flights.
However, it is not clear that Lufthansa would want to retain a controlling stake in the merged airline. “I think they want to get their money out, not stay in for the long term,” said one airline source.
This could lead to a break-up of BMI, with some of the airline’s landing slots being sold separately — perhaps to British Airways, which may have to give away some of its Heathrow slots because of competition concerns over a looming tie-up with American Airlines.
Analysts think the Lufthansa board, which meets late next month, has other options at its disposal.
Andrew Lobbenberg, airline analyst at Royal Bank of Scotland, has suggested it could dispose of its holdings in Fraport, the group that owns Frankfurt airport, or Jet Blue, the American budget airline.
Lufthansa shares, which have fallen along with other airline stocks during the recession, have recovered in recent weeks. They closed on Friday at €15Å , up 14% in the past month.
British Airways, which still faces the threat of industrial action later in the year as it tries to negotiate cost-cutting deals with cabin crew, has perked up even more. Its shares closed last week at 188Ëp, up 38% in the past month.
From The Sunday Times
August 23, 2009
Lufthansa plots sale of BMI British Midland to Virgin Atlantic
German airline may jettison assets after threat of a downgrading by leading credit-rating agencies
Lufthansa took an 80% stake in BMI in June
Dominic O’Connell and Ben Marlow
Lufthansa may try to sell BMI British Midland, the UK airline it took control of in June, as part of a plan to raise funds.
Airline industry and City sources say that the sale of BMI is one of a number of options being considered by the German airline, which has been threatened with a downgrade by Standard & Poor’s and Moody’s, the international credit-rating agencies.
Transport bankers say Lufthansa has held preliminary talks with Sir Richard Branson’s Virgin Atlantic about a sale of BMI or a merger of the two airlines.
A sale to British Airways of some of BMI’s take-off and landing slots at Heathrow, the UK’s largest airport, is also under consideration, while BMI’s regional operations could go to a rival like Flybe, the budget airline that has its headquarters in Exeter. Lufthansa declined to comment.
Stephan Gemkow, Lufthansa’s chief financial officer, confirmed that it was considering a deal in a recent interview with Aviation Week, the trade magazine. “But it takes two to tango. If we find the right partner, we will dare to dance,” he said.
Lufthansa took an 80% stake in BMI in June, buying out Sir Michael Bishop, the airline’s founder. The purchase was the result of a contract struck 10 years ago, when Lufthansa agreed to purchase Bishop’s shares at a prearranged price. As The Sunday Times revealed in May, the German airline tried to reduce the fee by forcing Bishop to take part in a recapitalisation of the company ahead of the sale.
He refused, and began legal proceedings to enforce the contract. The two sides settled on the steps of the courtroom.
Although the exact terms of the deal were not disclosed, it is understood Lufthansa paid £223m for Bishop’s shares, not the £292m required under the contract.
Branson and Bishop frequently discussed combining their airlines to take on British Airways at Heathrow, but were never able to agree terms. Sources at Virgin confirmed that Branson remained interested in a deal, but said Lufthansa had yet to decide what it wanted to do having taken control at BMI.
Industry bankers say the deal could take the form of BMI and Virgin merging — the combined airline would have about 13% of Heathrow’s flights, compared with 41% for British Airways. Such a deal would dilute Singapore Airlines’s influence at Virgin, where it holds a 49% stake.
The merged group would be able to exploit transfer traffic at Heathrow by connecting BMI’s short and medium-haul network with Virgin’s long-haul flights.
However, it is not clear that Lufthansa would want to retain a controlling stake in the merged airline. “I think they want to get their money out, not stay in for the long term,” said one airline source.
This could lead to a break-up of BMI, with some of the airline’s landing slots being sold separately — perhaps to British Airways, which may have to give away some of its Heathrow slots because of competition concerns over a looming tie-up with American Airlines.
Analysts think the Lufthansa board, which meets late next month, has other options at its disposal.
Andrew Lobbenberg, airline analyst at Royal Bank of Scotland, has suggested it could dispose of its holdings in Fraport, the group that owns Frankfurt airport, or Jet Blue, the American budget airline.
Lufthansa shares, which have fallen along with other airline stocks during the recession, have recovered in recent weeks. They closed on Friday at €15Å , up 14% in the past month.
British Airways, which still faces the threat of industrial action later in the year as it tries to negotiate cost-cutting deals with cabin crew, has perked up even more. Its shares closed last week at 188Ëp, up 38% in the past month.
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Nothing new in this report!
Much of this report is just re-issued stuff, its no secret that LH (had to) paid too much for bmi at a time when other buying oportunities came along.
Virgin would make alot of sense, most of bmi profitable routes are East bound from LHR and they have nothing that fly's west of DUB under their own name
I think if LH could come out of this with a handful of LHR slots and no nett cash out they might be tempted, however Virgin is far from a strong company at this point either.
LH will by now have cleared the fog of war that SMB laid down over the groups accounts and will have a pretty good idea of whats working and what isn't. Its still far from clear that bmi under German control can retain traffic rights to some non EU countries and guess what, thery are probably the profitable one's
who was it that said "it will be over by Christmas"
Virgin would make alot of sense, most of bmi profitable routes are East bound from LHR and they have nothing that fly's west of DUB under their own name
I think if LH could come out of this with a handful of LHR slots and no nett cash out they might be tempted, however Virgin is far from a strong company at this point either.
LH will by now have cleared the fog of war that SMB laid down over the groups accounts and will have a pretty good idea of whats working and what isn't. Its still far from clear that bmi under German control can retain traffic rights to some non EU countries and guess what, thery are probably the profitable one's
who was it that said "it will be over by Christmas"
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I agree the article looks like a bit of filler. It is August after all.
Richard Branson has sold Virgin Mobile USA, Virgin Mobile Canada and a stake in Virgin Galactic. This may be to hoard cash to buy bmi, or to refinance other Virgin businesses. He has injected cash into Virgin Blue, and I guess may have to do the same for other businesses.
Virgin would be a logical buyer for bmi in theory, but (assuming LH actually do want to sell), the question is whether Richard Branson can raise the cash and support ongoing losses whilst it restructures the business.
The other option is some form of JV between Virgin and LH (based on previous Virgin deals, the likely model would be Virgin contributing VS in return for a share in the JV company). Given that LH's business model is based around feeding traffic into its long-haul networks at FRA etc, I question why LH would want to divert traffic away from that into VS's network when it would only have a minority share of the JV. The other issue is of course Star Alliance and the TATL ATI that LH have with CO and others, and whether Virgin would be prepared to join that.
Richard Branson has sold Virgin Mobile USA, Virgin Mobile Canada and a stake in Virgin Galactic. This may be to hoard cash to buy bmi, or to refinance other Virgin businesses. He has injected cash into Virgin Blue, and I guess may have to do the same for other businesses.
Virgin would be a logical buyer for bmi in theory, but (assuming LH actually do want to sell), the question is whether Richard Branson can raise the cash and support ongoing losses whilst it restructures the business.
The other option is some form of JV between Virgin and LH (based on previous Virgin deals, the likely model would be Virgin contributing VS in return for a share in the JV company). Given that LH's business model is based around feeding traffic into its long-haul networks at FRA etc, I question why LH would want to divert traffic away from that into VS's network when it would only have a minority share of the JV. The other issue is of course Star Alliance and the TATL ATI that LH have with CO and others, and whether Virgin would be prepared to join that.
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I think that Lufthansa selling bmi or selling any slots to BA at this time is short sighted, by the sounds of it a tactical move to stem losses or avoid down grading of rating of the company.
Lufthansa has an opportunity to build something strong and sustainable at Europe's busiest International hub.
If we look at Cityjet (obviously a much smaller airline), overnight losses were turned into break even and soon to profit as AirFrance combined sales and marketing functions and removed much duplication in the respective head offices.
While these are different times I realise, surely there are synergies to be had and an opportunity to turn Bmi's losses around.
However, if there are discussions on whether BA can buy some slots (assuming BA would be able to buy or want to buy?) could this be a prelude to BA moving to Star?
Lufthansa has an opportunity to build something strong and sustainable at Europe's busiest International hub.
If we look at Cityjet (obviously a much smaller airline), overnight losses were turned into break even and soon to profit as AirFrance combined sales and marketing functions and removed much duplication in the respective head offices.
While these are different times I realise, surely there are synergies to be had and an opportunity to turn Bmi's losses around.
However, if there are discussions on whether BA can buy some slots (assuming BA would be able to buy or want to buy?) could this be a prelude to BA moving to Star?
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I agree. This is a once and only chance for LH/*A to gain a substantial presence at LHR. I just can't see them letting go of it.
If LH want to offload some slots, BA is an obvious candidate to buy some of the less lucrative slots because it has such a large operation at LHR it can make use of them. Other buyers are probably only going to be interested in the lucrative slots for long-haul ops that LH would want to keep.
BA joining *A is highly unlikely.
However, if there are discussions on whether BA can buy some slots (assuming BA would be able to buy or want to buy?) could this be a prelude to BA moving to Star?
BA joining *A is highly unlikely.
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I really feel for the VS staff who seem to be hanging on by their fingernails but let us not forget that the legal action re BAs's fuel charges still has yet to come to a head and I for one think it is premature to think about mergers and take overs until this case had time to run its course.
The only people to benefit from this are VS's lawyers and their PR teams who will be burning a lot of midnight oil if this came anywhere near to coming off.
In my view it is simply not an answer for VS & BD to merge; both airlines are in hard times and simply running to a merger would not solve any of the fundamental management weaknesses that VS in particular continues to possess.
The only people to benefit from this are VS's lawyers and their PR teams who will be burning a lot of midnight oil if this came anywhere near to coming off.
In my view it is simply not an answer for VS & BD to merge; both airlines are in hard times and simply running to a merger would not solve any of the fundamental management weaknesses that VS in particular continues to possess.
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I really feel for the VS staff who seem to be hanging on by their fingernails but let us not forget that the legal action re BAs's fuel charges still has yet to come to a head and I for one think it is premature to think about mergers and take overs until this case had time to run its course.
The only people to benefit from this are VS's lawyers and their PR teams who will be burning a lot of midnight oil if this came anywhere near to coming off.
In my view it is simply not an answer for VS & BD to merge; both airlines are in hard times and simply running to a merger would not solve any of the fundamental management weaknesses that VS in particular continues to possess.
The only people to benefit from this are VS's lawyers and their PR teams who will be burning a lot of midnight oil if this came anywhere near to coming off.
In my view it is simply not an answer for VS & BD to merge; both airlines are in hard times and simply running to a merger would not solve any of the fundamental management weaknesses that VS in particular continues to possess.
The VS strategy of being a self-styled "challenger brand" and just moaning about everything BA does is long overdue for a revamp. Richard Branson may think he's positioning himself as a consumer champion in oppposing the AA/BA/IB ATI application, but the extremely hostile response to his article in the Telegraph indicates that there is no groundswell of support for him:
Dinosaurs BA and AA should not be given a free meal ticket to merge - Telegraph