BMI
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'Virgin Atlantic Monday said it is concerned that British Midland International's sale of landing slots to British Airways would lower the value of bmi for a potential buyer'
Must have took them ages to work that one out.
Must have took them ages to work that one out.
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Atmosphere
Excellent graph, just two points to note with regards to the 3rd quarter of 2011 this is normally the point at which bmi makes the most ( or looses) the least.
The second is that the massive spike in red in 2008 was largely down to bmi exposure to high oil prices as a result of zero hedges. The underlying profitability is of course very weak after the damage done to the brand through chopping and changing routes every few months and a less than clear brand offering
With regards to baby a cabin crew friend of mine was told last week that a number of their leases have been extended for a further year, not sure what that means for the group or baby?
The second is that the massive spike in red in 2008 was largely down to bmi exposure to high oil prices as a result of zero hedges. The underlying profitability is of course very weak after the damage done to the brand through chopping and changing routes every few months and a less than clear brand offering
With regards to baby a cabin crew friend of mine was told last week that a number of their leases have been extended for a further year, not sure what that means for the group or baby?
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RHINO : As MANTHRUST said....it's complicated.
First, none of this will make enjoyable reading for bmi employees looking to their retirement.
Basically if bmi remains a solvent operating company, (which is looking increasingly unlikely, imho) and continues to top-up the funds by £9.5m a year for the next 20yrs, the scheme is currently underfunded to the tune of £190m (a funding level of just 60%).
If (as is looking more likely, imho) the company becomes insolvent, and the scheme 'wound-up', then the funding shortfall is in the region of £400m (a funding level of just 37%).
These figures have been extracted from last years funding statement, are approximate, and fluctuate daily with stock market movements. The latest carnage on world stock markets will not have improved matters.
Moley.
First, none of this will make enjoyable reading for bmi employees looking to their retirement.
Basically if bmi remains a solvent operating company, (which is looking increasingly unlikely, imho) and continues to top-up the funds by £9.5m a year for the next 20yrs, the scheme is currently underfunded to the tune of £190m (a funding level of just 60%).
If (as is looking more likely, imho) the company becomes insolvent, and the scheme 'wound-up', then the funding shortfall is in the region of £400m (a funding level of just 37%).
These figures have been extracted from last years funding statement, are approximate, and fluctuate daily with stock market movements. The latest carnage on world stock markets will not have improved matters.
Moley.
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If those figures are correct, and I've no reason to doubt they are, then this scheme looks to be another candidate for the PPF (pension protection fund).
I would imagine the PPF limits would come nowhere near covering the expected pensions built up by some scheme members. very sad.
Box.
I would imagine the PPF limits would come nowhere near covering the expected pensions built up by some scheme members. very sad.
Box.
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Its not that easy to get into the PPF scheme.The scheme may not pay out much but its not insolvent.
I understand that many in management are already working on their exit plans before they get pushed out and with that amount of pension behind them who can blame them.
I understand that many in management are already working on their exit plans before they get pushed out and with that amount of pension behind them who can blame them.
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Moleslayer it won't go under, Lufthansa won't let it, they'd definitely not recover any of their investment were that to take place. In Stephan Gemkow's (CFO Lufthansa) words, 'insolvency is not an option for us'.
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All the while the company is trading the pension deficit remains a debt to the company ie BMI. If the company is sold the buyer would have to make good the deficit in much the same way as Lufthansa has been doing.
You can't just "dump" a pension on the PPF. This would only happen if the company was insolvent. In the case of insolvency all the companies assets would have to be liquidated in order to pay off it's debts, the pension fund being one of them. It would do Lufthansa no good to allow that to happen as they would get nothing!
If the company's assets were to be sold off piecemeal leaving the pension high and dry the Pension Regulator would have quite a bit to say and I don't think Lufthansa would like to receive all the bad press that would incur.
Lufthansa's first choice would be to sell the lot in one go (most unlikely) so IMHO I think the break-up option is the most likely outcome so as to be able to move mainline on as still trading and get something back for the slots. Willie says he didn't want Lingus because of the £400m pension deficit so I would guess he may feel the same about our pension situation. So who else would be interested I really don't know. A seriously difficult situation for Lufty hence Morgan Stanley and the new Chairman.
You can't just "dump" a pension on the PPF. This would only happen if the company was insolvent. In the case of insolvency all the companies assets would have to be liquidated in order to pay off it's debts, the pension fund being one of them. It would do Lufthansa no good to allow that to happen as they would get nothing!
If the company's assets were to be sold off piecemeal leaving the pension high and dry the Pension Regulator would have quite a bit to say and I don't think Lufthansa would like to receive all the bad press that would incur.
Lufthansa's first choice would be to sell the lot in one go (most unlikely) so IMHO I think the break-up option is the most likely outcome so as to be able to move mainline on as still trading and get something back for the slots. Willie says he didn't want Lingus because of the £400m pension deficit so I would guess he may feel the same about our pension situation. So who else would be interested I really don't know. A seriously difficult situation for Lufty hence Morgan Stanley and the new Chairman.
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This is all very simple.
Mainline is a basket case, with overheads through the roof. It will never recover unless it is rebuilt from the ground up a la Swiss. I think it will be sold.
Baby is poised to be a great loco, but needs investment badly. I think someone will come alomg and buy it and turn it into something great. The people involved are just too good to let go.
Regional is the jewel, a rare thing at the moment, an airline that makes money despite under investment and suffering from neglect. The people involved are resilient and resourceful. I think LH know this and will keep regional in the group.
BTW. yesterday (29th) LH board approved the purchase of extra planes for the 'group' my bet is that the 5 E195s are for regional. They will operate from the end of next year into FRA from the major Uk cities.
Chin up baby and regional, the future is bright, mainline.......not so much!
Mainline is a basket case, with overheads through the roof. It will never recover unless it is rebuilt from the ground up a la Swiss. I think it will be sold.
Baby is poised to be a great loco, but needs investment badly. I think someone will come alomg and buy it and turn it into something great. The people involved are just too good to let go.
Regional is the jewel, a rare thing at the moment, an airline that makes money despite under investment and suffering from neglect. The people involved are resilient and resourceful. I think LH know this and will keep regional in the group.
BTW. yesterday (29th) LH board approved the purchase of extra planes for the 'group' my bet is that the 5 E195s are for regional. They will operate from the end of next year into FRA from the major Uk cities.
Chin up baby and regional, the future is bright, mainline.......not so much!
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Hmmm, something leads me to believe that Kittiwake works for regional then, lol. I'd like to question your assessment of mainline as a 'basket case' with 'overheads throught the roof' well actually, our overall crew costs and operating budget are pretty low when compared to e.g. BA, it has been regularly cited recently that the problem with mainline isn't high operating costs but poor yields and revenue, quite simply there are not enough bums on seats and they're not paying enough.
In reference to the new aircraft for Regional, I sincerely hope they are for you as the existing fleet is aged and although expected and tolerated by Regional passengers, when presented to LHR passengers is a total embarassment and sure to kill off a route. There is a perception of the ERJ's coming to the company's rescue at LHR and holding up routes that can't sustain an airbus, however this ONLY works for a very limited period as presented with a knackered and claustrophobic ERJ passengers run straight to the oposition the next time they fly that route. E170/190/195 would be perfect for some of our routes from LHR at the moment, just a shame we can't have some yesterday, Regional deserve new aircraft!
In reference to the new aircraft for Regional, I sincerely hope they are for you as the existing fleet is aged and although expected and tolerated by Regional passengers, when presented to LHR passengers is a total embarassment and sure to kill off a route. There is a perception of the ERJ's coming to the company's rescue at LHR and holding up routes that can't sustain an airbus, however this ONLY works for a very limited period as presented with a knackered and claustrophobic ERJ passengers run straight to the oposition the next time they fly that route. E170/190/195 would be perfect for some of our routes from LHR at the moment, just a shame we can't have some yesterday, Regional deserve new aircraft!
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Kittiwake
Interesting first post!!
When you say approved for the Group, do you mean the Lufthansa Group or bmi group?
Was it just 5 E-jets purchased or was this an element of a larger mixed order?
Given all that has been said on here these past weeks are you really suggesting that DLH is purchasing aircraft for the bmi group or bits of it?
The ERJ is ok for very thin long routes, but many business passenger baulk at having their normal sized cabin package taken off them and placed in the hold and waiting at the other end to have the ground staff bring it to the foot of the stairs, air-bridges are preferable in winter, the ERJ is a route killer if the cutomer has a choice of airlines, they will opt for something bigger given the choice.
When you say approved for the Group, do you mean the Lufthansa Group or bmi group?
Was it just 5 E-jets purchased or was this an element of a larger mixed order?
Given all that has been said on here these past weeks are you really suggesting that DLH is purchasing aircraft for the bmi group or bits of it?
The ERJ is ok for very thin long routes, but many business passenger baulk at having their normal sized cabin package taken off them and placed in the hold and waiting at the other end to have the ground staff bring it to the foot of the stairs, air-bridges are preferable in winter, the ERJ is a route killer if the cutomer has a choice of airlines, they will opt for something bigger given the choice.
Re comment by ayebmi on not enough bums on seats and not paying enough!
Have you really checked the prices of BMI recently?
There are plenty of alternatives at lower competitive cost on the limited routes of BMI (well within Europe) and they are their own worst enemies in terms of route selection or indeed route reduction.....is Bergen really making money or a lower loss than that of Glasgow prior to being pulled?
BMI Mainstream just causes problems I think...(as a former fairly regular user and still an extant silver card holder).
No recognition in flight of status - still have pull out the wallet for a coffee. Confusion if lounge can or cannot be used at european airports when flying BD metal and specifically I refer to LH Lounge access (as owners or indeed on code share with BD/LH). The dragons at the lounge make the rules.
Have you really checked the prices of BMI recently?
There are plenty of alternatives at lower competitive cost on the limited routes of BMI (well within Europe) and they are their own worst enemies in terms of route selection or indeed route reduction.....is Bergen really making money or a lower loss than that of Glasgow prior to being pulled?
BMI Mainstream just causes problems I think...(as a former fairly regular user and still an extant silver card holder).
No recognition in flight of status - still have pull out the wallet for a coffee. Confusion if lounge can or cannot be used at european airports when flying BD metal and specifically I refer to LH Lounge access (as owners or indeed on code share with BD/LH). The dragons at the lounge make the rules.
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Regional does it's thing very well, but it is a very different "thing" from Mainline.
I like the guys and gals up in ABZ. They are generally straight talking and pretty efficient in what they do, but there are times when you do detect a large bit of "Mainline should do it our way" mentality. Which is silly. They are totally different animals and the way that Mainline do things doesn;t work for small aeroplanes and a small company, but equally the techniques that work for a small company and with small aircraft would be disasterous if applied to Mainline.
Though all the companies in the group could learn something from eachother from what I've seen.
I've heard nothing about new aeroplanes, but that doesn't mean it's not true, though bringing in a new type seems odd. Are you sure it's not just the Baby leases that was signed off?
I like the guys and gals up in ABZ. They are generally straight talking and pretty efficient in what they do, but there are times when you do detect a large bit of "Mainline should do it our way" mentality. Which is silly. They are totally different animals and the way that Mainline do things doesn;t work for small aeroplanes and a small company, but equally the techniques that work for a small company and with small aircraft would be disasterous if applied to Mainline.
Though all the companies in the group could learn something from eachother from what I've seen.
I've heard nothing about new aeroplanes, but that doesn't mean it's not true, though bringing in a new type seems odd. Are you sure it's not just the Baby leases that was signed off?
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195's
Facelookbovvered
The 195 order was made by Lufthansa as part of a wider order which included two more A380's.
Lufthansa - Lufthansa Supervisory Board approves order for twelve aircraft for the Group
It just says "will augment the Lufthansa Regional fleet" rather than will
be operated by Cityline or Eurowings etc.
They have been going to Cityline to replace the RJ85.
One fleet list shows no more 190/195'd to come but still quite a few
RJ85's in the fleet. At a guess and it is only a guess I would have thought
they were for Cityline - delivery 2012 and 2013 I believe.
Pete
The 195 order was made by Lufthansa as part of a wider order which included two more A380's.
Lufthansa - Lufthansa Supervisory Board approves order for twelve aircraft for the Group
It just says "will augment the Lufthansa Regional fleet" rather than will
be operated by Cityline or Eurowings etc.
They have been going to Cityline to replace the RJ85.
One fleet list shows no more 190/195'd to come but still quite a few
RJ85's in the fleet. At a guess and it is only a guess I would have thought
they were for Cityline - delivery 2012 and 2013 I believe.
Pete
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Thanks Pete
That makes more sense, just could not see them ordering any new kit for any bmi company until they make up their mind about a way forward, having followed the it'll be Jet2/Monarch/Flybe/IAG/Stellios/Bishop/Virgin saga, it wouldn't surprise me if they kept it! After all they couldn't find a buyer two years ago what has changed?
That makes more sense, just could not see them ordering any new kit for any bmi company until they make up their mind about a way forward, having followed the it'll be Jet2/Monarch/Flybe/IAG/Stellios/Bishop/Virgin saga, it wouldn't surprise me if they kept it! After all they couldn't find a buyer two years ago what has changed?
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Faceookbovvered,
All you say sounds reasonable except the pax hating the emb. Did you know that they actually provide 2" more seat pitch than the bus? It's only downfall is the "valet service".
Also as far as killing a route, how do explain the Hanover? The word is that it's one of the best performing routes on the network, very high yields. Didn't work for a long time on a bus.
Rev management certainly appear to drop the ball sometimes. Most people seem to have a horror story about fares/availability.
All you say sounds reasonable except the pax hating the emb. Did you know that they actually provide 2" more seat pitch than the bus? It's only downfall is the "valet service".
Also as far as killing a route, how do explain the Hanover? The word is that it's one of the best performing routes on the network, very high yields. Didn't work for a long time on a bus.
Rev management certainly appear to drop the ball sometimes. Most people seem to have a horror story about fares/availability.