BMI
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Beardy quite specifically doesn't mention UK domestic;
eg Heathrow to Phoenix?
Virgin Atlantic, based in Crawley, England, said in the statement that it would use any “remedy slots” that it may acquire from IAG, as part of regulatory clearance, on routes where British Airways would otherwise hold a monopoly.
Virgin did say around the time they asked for an investigation that they would start regional flying if the deal was blocked/remedied. Also I believe it is the EC who will decide which routes will be covered and that I think that any airline taking those slots will have to commit to flying those routes for a certain period of time, I think it 2 years minimum????
I believe they can then use those slots as they wish.
I believe they can then use those slots as they wish.
Last edited by The Cleaner; 29th Mar 2012 at 12:43.
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So, If the EU blocks the deal is bmi expected to continue operating at a loss to prevent BA having a monopoly on certain routes, who exactly will subsidise these routes!?? Or will the company just fold, the slots go back into the pool!! Di^khe£ds! Yeah I'm sure EVERYBODY wants to start up loss making European and Domestic routes at the moment!!
I am curious as to what I am reading about the "remedy" slots.
Is it correct that the remedy slots must be used for their specified purpose for a minimum of two years, after which they can be employed for any purpose ? So in theory they could be redeployed after two years as longhaul slots if the timings were suitable and then could they be sold on the open market, netting a handsome potential profit for the original beneficiary ? It might even make domestic losses bearable for two years .
Or would there be a prohibition on their sale or trade in perpetuity because they were allocated free as remedy slots, i.e. they could only be returned to the airport authority ?
Welcome comment anyone with a good knowledge of the system.
Is it correct that the remedy slots must be used for their specified purpose for a minimum of two years, after which they can be employed for any purpose ? So in theory they could be redeployed after two years as longhaul slots if the timings were suitable and then could they be sold on the open market, netting a handsome potential profit for the original beneficiary ? It might even make domestic losses bearable for two years .
Or would there be a prohibition on their sale or trade in perpetuity because they were allocated free as remedy slots, i.e. they could only be returned to the airport authority ?
Welcome comment anyone with a good knowledge of the system.
Typically how it works is this. The purpose of the slot release is to ensure competition on a given route. Therefore the slots are only usable for that route (let's say LHR-EDI). The bidding airline gets the slots for free, on condition that they are used on the route in question. You can't take the slots and then turn around after a week and say "oh, we want to use them for LHR-JFK instead". The regulator may appoint a "monitoring trustee" (law firm or similar) to ensure the slots are used appropriately.
For a good example, see the EC's judgement on the Lufthansa takeover of Brussels Airlines (PDF). It's a long document (but an example of the level of detail that typically goes into the analysis) but most relevant for your question are pages 118 onward, the commitments (= the proposed remedies). You'll see (section 439, page 120) that a new entrant gets to keep the slots ("grandathering rights") after a certain number of seasons, i.e. after that period, the slots can be used for alternative routes if the original plan isn't working out.
Note also (and this is relevant for IAG/bmi too) page 120 onwards also describes the other commitments, e.g. interlining/SPA provisions for connecting passengers.
I think this is a reasonable template of what we could expect as conditions for approval of the IAG/bmi deal.
Hope this helps
C.
No guarantees on accuracy :-) .
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Do these slots have to go to a UK airline (I've looked, but can't find anything that says that that they must)? Is there anything to stop Lufthansa bidding for LHR-EDI and feeding in to Star Alliance services? It would be rather ironic if LH were to pick up for free what they had just sold to IAG.
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Or they go to Granite feeding Star into LHR or Virgin gets regional to operate into LHR from Scotland or part of regional no doubt supported by the SNP ?
Just have to wait and see the detail tomorrow or Monday
Just have to wait and see the detail tomorrow or Monday
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I don't think Granite are going to be part of any plans, since they don't seem to have actually been able to buy Regional. I would be stunned if Regional wasn't simply part of the deal with IAG now.
The Scottish Government can't really get involved in funding themselves, though they have various entities that might be able to help. However, the idea that Alex Salmond would put his money where is mouth is over this, is I'm afraid unlikely.
The Scottish Government can't really get involved in funding themselves, though they have various entities that might be able to help. However, the idea that Alex Salmond would put his money where is mouth is over this, is I'm afraid unlikely.
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Lotta talk about Virgin Operating short haul to places like Scotland but after BA take over BMI,
Which other airline is there with a lot of slots and a short haul operation?
Which other airline currently serves UK domestic traffic from LHR ?
Can't wait see how the EU carve this up.
Which other airline is there with a lot of slots and a short haul operation?
Which other airline currently serves UK domestic traffic from LHR ?
Aer Lingus !
Can't wait see how the EU carve this up.
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Does it not work that the company with he slots (BA/IAG) have to agree to give up those slots for that particular route to any competitor that wishes to enter the market? Therefore if no airline comes forward the slots are not given up. I believe this is what happened when Lufti took over Brussels airlines. Slots offered on 4 routes, 2 years later no airline had taken up the slots and they went back to lufti. The slots certainly won't be forced onto any airline. Correct me (I am sure someone will) if I am wrong. 
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Quick question
If Virgin was to get 14 slot pairs for domestics/short haul routes out of Heathrow would these slots be spread over the day. Say one arrival and departure every hour through the day, Or would they be in batches of say 3/4 flights arriving and departing at the same a time which would require them to acquire at least maybe 4x or 5x aircraft?
If Virgin was to get 14 slot pairs for domestics/short haul routes out of Heathrow would these slots be spread over the day. Say one arrival and departure every hour through the day, Or would they be in batches of say 3/4 flights arriving and departing at the same a time which would require them to acquire at least maybe 4x or 5x aircraft?
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I don't think Lufthansa have taken over Brussels Airlines. My understanding is that they own 45% and have some kind of option to acquire more at some point.
Why couldn't Lufthansa retain Regional and use it to operate the routes in question to compete with IAG? They have bases at LHR, MAN, EDI and ABZ although would presumably only need a bigger type. Having said that I believe that Aberdeen has been operated exclusively by the Embraer for some time now, maybe to make a smaller loss than if it were to be operated by an Airbus.
Why couldn't Lufthansa retain Regional and use it to operate the routes in question to compete with IAG? They have bases at LHR, MAN, EDI and ABZ although would presumably only need a bigger type. Having said that I believe that Aberdeen has been operated exclusively by the Embraer for some time now, maybe to make a smaller loss than if it were to be operated by an Airbus.
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I hope Virgin get the slots for the Scottish routes, Sir Dickie will be in a right dilemma then. How he ever thought he'd be taken seriously by offering less than a third that IAG did for bmi.
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Ok so the full Lufthansa ownership maybe incorrect but the slot sacrifice was ordered on 4 routes but no airlines entered the routes so they never had to be released and now they have been retined. I hope virgin stick to what they do well being long haul and leave the domestic slots alone. The best outcome would be BA fly the slots and a regulator monitors the prices charged. I think the evidence shows these route into LHR cannot support two carriers.
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Why couldn't Lufthansa retain Regional and use it to operate the routes in question to compete with IAG? They have bases at LHR, MAN, EDI and ABZ although would presumably only need a bigger type. Having said that I believe that Aberdeen has been operated exclusively by the Embraer for some time now, maybe to make a smaller loss than if it were to be operated by an Airbus.
The Scottish Government can't really get involved in funding themselves, though they have various entities that might be able to help. However, the idea that Alex Salmond would put his money where is mouth is over this, is I'm afraid unlikely.
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Why couldn't Lufthansa retain Regional and use it to operate the routes in question to compete with IAG?
All the best to everyone tomorrow.