The deal for DLH to take control of BMI was done more than 10 years ago, and there were no competition issues with a German company buying a UK company. It is slightly different with a UK company buying a UK and the loss of competition on certain routes. The Scottish Government had valid concerns about the number of services from Heathrow to Scotland and the rise of fares where no competitor exists. Virgin's concerns were purely of self interest.

It should be remembered that Lufthansa did all they could to wriggle out of the deal with Bishop and took the case to the High Court, where they managed to reduce the final price from 450million to 340 million. SAS then forced them into buying their shareholding. All in all BMI has been a hugely expensive exercise for Lufthansa costing them over a Billion euros in 3 years. They just wanted out as quickly as possible and there was only one party that had the money and wherewithal to take on Mainline.

The human cost of this is that a very large number of people will be losing their jobs as BMI is integrated into BA. We still have no clear picture as to what is happening with Baby and Regional, maybe next week will bring some concrete information but I wont be holding my breath...

A few years ago - my apologies, I didn't realise that it is now ten years ago since the original deal....

And just to be clear - I'm genuinely glad and happy that BA's intervention will save jobs because like lots of us here, I've been on the receiving end myself in the past, and huge sympathies for those BMI people who don't get lucky....

Those who care to search through my profile will see my own concerns over Lufthansa's monopoly, and obvious lack of EU interest over these particular competition issues, have been regularly stated over the past three years or four years....

Virgin desperately need a short haul feeder so they can then market outside of the London area and into Europe.

If I was RB I would look at setting up a Low Cost(ish) A320 carrier out of LHR to Scotland and European Capital cities.

What are the implications of this now for Baby and BMI Regional?

Sorry fmcg but that's a real contradiction in terms, in fact the route to perdition.

YS

It would make more sense to operated the long haul out of AMS which already has excellent feeder services from regional airports and also has less slot restrictions than LHR.
A short haul feeder into LGW would be possible but expensive to set up and demand may be limited.

Regional & Baby to be brought into the bigger IAG deal (assume the Baby discount applies and that Regional is a freebie), neither to be integrated into BA at all, and then sold off or shut down. I guess that the unions and management will start the 90 consultation period very soon after the 20th of April.

Anyone know if Granite are still looking to buy?

Why? And what I mean by Low Cost I mean as a separate company with lower DOCs.

True but what they really need is a feed into LHR with bags checked in the whole way through.

Setting up in AMS opens up a small market for them, feeding into LHR opens up a massive market for them.

@Granite City Express.
Regarding Baby and Regional, do you know this or just your opinion????

Second hand news, from a management bod who had a briefing this morning.

GCE is correct. Baby and Regional are to be part of the deal with IAG. They will not be integrated into BA and will be sold off if possible.

I very much doubt whether Granite would buy Regional now. They've had virtually an 8 month run at it so far and haven't managed to raise the required capital to buy it and as we all know, buying it is one thing, having the cash to carry it on a completely different matter.

Hopefully there will be some others willing to purchase it.

As for Baby, I'm not sure that this changes anything, just that the seller is now IAG not Lufthansa. Hopefully the interested party is still interested.

OK, if you could explain how to lower the DOCs operating in and out of LHR I am sure that everyone would like to know. I should also be very curious as to why no one has done it already?

YS

LoCo at LHR
 

Also try turning an aircraft around in 25 minutes at LHR. You'd still be waitng for the bus(es) for your arrival pax let alone the departing Pax. What about those taxy times (on another thread). Why not have a stand alone terminal whilst we're about it. To be ready for THIS summer's rush.

I don't think so somehow.

S

Prediction time-

Granite to get funding, as there are some LHR slots needing an airline!

Based on no knowledge, but stranger things have happened.

Operating Emb 145's into LHR is commercial suicide. bmi have already proved that... So the reality of a small business being able to absorb those sort of losses just doesn't make sense to me.

I might be wrong, but unless Granite refleeted with bigger aircraft asap, then I don't see how they'd make it pay. I doubt whether Virgin would cover the cost for them.

Refleeting isn't exactly the cheapest thing in the world.

The accounting system and the way the regional aircraft were contracted in, have absolutely nothing to do with how a stand-alone operation would work in the future.

Those aircraft helped the bmi group to the losses that have been achieved more than they helped regional to a profit.

Operating 50 seat aircraft into Heathrow is a non-starter. You need a minimum of 100 seats and connecting services to make a service viable.

I understand that rumours of Granite's demise may be greatly exaggerated :ok:

What I mean by this is not the same model as EZY or FR. I have not made myself very clear.

For a start the short haul operation I would imagine should be a separate business with different contracts to mainline VS. They will need to operate from the same Terminal so as to be a proper feeder system.

Branson has wanted this for years and I would imagine that he will not give up. Buying the Scotland slots would be a very good start. Then from there expand the operation across Europe.

What other Longhaul based UK operator needs a feeder airline? VS is the only one!

You've got to remember that LHR, just like any other airport, is a shopping center with a few runways attached. The BAA do not want little aeroplanes in LHR. Look at an A380 next to an EMB 145 on the ground and you will see what I mean. They take up roughly the same 'space and time' on the airfield (within reason) but they have massive differences in terms of revenue for the airport operator. They have been trying for years to price small aeroplanes out of the airport. They even charge them all the same landing fees. You can't get enough people on a 'small' aeroplane and get enough from each seat after deduction of charges to make a profit. No one can and Virgin will not be able to either.

Getting BA to hand back slots to protect services to Scotland was a big mistake. A better outcome would have been to get BA to protect all the slots and maintain the same number of seats. As has been pointed out somewhere else if the slots don't get used they will probably go back to BA who will then have no obligation to operate the service. Either way BA are going to win.

Fly puppy - Spill the beans. What have you heard RE granite?

Mainly down to the egos of their founders but VS and Bmi missed a golden opportunity about 10 years ago to join forces to challenge BA. That chance is gone and there won't be another. Branson operating flights to the North is just hot air...there'll be pigs flying over LHR before a VS A320 to EDI...