Maersk Air Birmingham .... soon to be RIP?

[Capt. Reepicheap]

Heard a rumour the other day that Maersk Air ... the UK operation at Birmingham, not the Danish mother operation, is up for sale with operating losses of £1m/week.

I guess if true much of the problem lies with the way the airline business has tumbled downhill recently, but I strongly suspect that the BA link and the incompetant management which forced so many of us to abandon ship over the last 3 or 4 years must be a factor, after all the mismanagement was clearly visible for years before 1999.

Good luck to the 'workers', lets hope that the rumour is not true, and that your jobs and what's left of the pension are secure. If it is true, what hope is there of finding a buyer?:confused:

[brabazon]

Where've you been in the last fortnight:

Danes seek buyer for Maersk Air UK
David Kaminski-Morrow, London (04Feb03, 17:13 GMT, 168 words)


Denmark’s Maersk Aviation Group has placed its Birmingham-based UK regional division up for sale, saying that the airline is no longer economical to keep.

Maersk Air UK operates as a franchise carrier for British Airways and has a fleet of ten Bombardier regional jets – five CRJ700s and five CRJ200s – which it operates on European routes.

“Maersk Air has decided to sell the Birmingham activities,” says a spokesman for the Danish company, which is part of the transport and shipping firm AP Moller. “This is owing to continuing weak results. It is a recent decision and the employees have been informed.”

The carrier operates to more than 15 international destinations from Birmingham International Airport.

“We are now in the process of finding a buyer,” adds the spokesman but says that no deadline has been fixed for a sale. The company will not disclose whether it is currently in talks with any individual entities.

Maersk Air UK is a sister company to Copenhagen-based Maersk Air and employs around 450 personnel.


Source: Air Transport Intelligence news


See also:

http://www.pprune.org/forums/showthread.php?s=&threadid=80466&highlight=Maersk

[Dom Joly]

I don't know where your source got the £1million per week but I am sure that they are wrong.

With many flights full I'd be staggered if we weren't making a profit!

[HZ123]

We had some of these issues on this subject the other day. You may be right in that it seems to be a large amount of money to be losing. However the logistics of CRJ's can surely not lend themselves to making a healthy profit, hence the reason for the sale. They are to small and there is now surely far too much competition from the LC operators around the midlands and the north. I beleve that the rates of pay are ok which all adds up to a high costs base. I hope they all do well there.

[Capt. Reepicheap]

Dear Brabazon,

Where have I been lately? On leave, and out of the loop until I got back to work and heard the rumour.

Loads are high? Great, but if the results are 'weak' and so the operation is up for sale, there can be no profit being made. To the best of my knowledge Maersk Air Ltd. only ever made a profit one year between 1989 and 2000, which I believe was about 1996 or 1997.

So if the loads are good but the results weak, the problem must lie with management, my original point. Incompetance there leads to losses, low staff moral and high training costs, all of which Maersk has suffered from for many years. Solution? Sack the management who've fiddled about since the days of Birmingham Express [and my lovely G1!] and get some in who actually know how to run an airline and manage people.

Regards,

Capt. Reepicheap

Small and furry, but armed and deadly!

[misterblue]

I'm never sure how the behaviour of management can give the staff low morals.

Now the effect on morale, I could believe...

[Grace Quirrel]

CRJ just isn't a profitable machine to operate. Take for example a 37,000kg CRJ 700 burning 1.5t /hr and a widebody at say 233,000kgs burning 6t hr means:>

233/6 =38.83 tonnes of aircraft lifted per hour per tonne of fuel burnt as opposed to 37/1.5 , therefore you are burning 50% more fuel for less weight carried. And of course that is to say that the CRJ 700 is operating at max weight (ie best loads?).

Thats simple economics before you talk about routes / loads etc etc.

C Ya. :=

[Buster the Bear]

I thought the EMB/CRJ concept was to feed high yield passengers from the remoter areas within the USA, to hub at a major. It also works well as a point to point carrier on low density, but high yield routes. Not so suited to higher density, low fare routes though?

Passengers within the USE demanded jet transportation rather than the prop jet Saab/Jetscream/ATP/ATR/Fokker.

[boredcounter]

Cheers mate, I was gonna ask GQ if he had even seen the new fangled aeroplanes. Does he understand fares, Wt related costs.

HMMMMMM no !

If you flightsim pilots wish to make Airlines work, buy virtual airline sims. Lots of us have jobs on the line, from Aircrew to Grunts.

GQ as you are so sure, advise. You know FA mate.


GQ and I will take the flak from you and your mate's here.


Keep that language outa here Hogg

[Grace Quirrel]

Have I seen them Bored, I've flown them FOR REAL, facts are facts buddy.

Cheers!

[boredcounter]

Soz..
Matter is close to mine, and the bank manager's heart.

[rubber jonny]

So the local paper say's its a "management buyout".
How long will it last without a big backer behind them???

[In trim]

How much longer is the BA franchise deal for? When this expires I presume BA ("let's pull out of the franchises / regions") will not renew it and Maersk would have to "go it alone"?

[MerchantVenturer]

I am not in the airline industry but am an interested amateur member-of-the-public observerof the scene.

I would be grateful if any of you from within would comment on this.

A year or two ago I read that the reason why the likes of BA Citiexpress (as they now are) were converting from turbo props such as the DH8 to similarly-sized passenger equipment such as the ERJ 145 was that the jets were more economical as a resource.

From some of the posts in this thread I come away with the impression that the smaller RJs are not that economical for an airline . Why then, did such as BA Citiexpress ditch the turbos for the RJs? I appreciate the jets are faster but could an extra daily rotation be operated within say the UK by a RJ as opposed to a turbo prop?

Thanks for any replies.

[fokkerjet]

Capt. Reepicheap.

How many crewmembers are still around from the Birmingham Executive days? I used to fly the US GI for BEX in 1987.

[HZ123]

Some of your points are spot on and there are far to many issues to respond to and do it justice.

Turboprops for many of the inter Britain routes were and are to slow in many cases and if operated by or for BA are to expensive. Give a company that is making a healthy profit like Cexpress to BA and watch them turn it into a loss maker.

Smaller twin jets CRJ and EMB145 once again are often in the wrong hands arec as expensive to operate as a B737 / A319 because the Tprops/CRJ & EMB's cannot offer full service cabins, any one who has ever flown on them will tell you that they are not comfortable and internal space is nil. My cabin preference is the EMB as the CRJ windows for anyone over 5' 6'' offer very little view.

Both a/c suffered start up problems and I believe for some time utilisation was not good. Both were developed from executive jet extensions and this formular does not always work, though CRJ enjoy sucess in the exec jet market.

Routes are often too long or too short and many times there are too may unsold seats or the flight is oversold, I appreciate that is a contradiction. Internal UK operations by BA or its franchises made seat prices often far to expensive and that may still be the case, made worst by the low cost operators who have cherry picked some of the best routes anyway.

Historically within the UK and near mainland Europe the public did not consider flying due to cost and very much the culture.

I wish Maersk the very best of luck but I fear that they will not be able to cut costs quick enough in what can only be the worst of all times at present. I believe that there is about 2-3 years to run on the BA franchaisse but BA have enough problems and many of Maersks' routes often carry passengers to mainland Europe for traveling to further destinations by other carriers so that is also a factor.

Finally as BA have found merely cutting seat prices without being able to cut operation costs will only fill the a/c up not the coffers. On a previous thread I posed the question that no-one answered what was Maersks 'ASK' (actual seat cost per kilometer) Easy is 4.5 pence and BA is 13.0p LGW and 15.0p LHR I am sure that Maersk cannot be much under 8.0 p.

I would hazard that this reponse might generate a few replies aiming some flak at my views. Rgds

[In trim]

I agree with HZ123 in most areas, and have worked for a BA Franchisee with a jet/tp mix.

Turboprops are undoubtedly cheaper to operate (in the right hands) than the equivalent sized jet. If you look at the history of Brymon, CityFlyer, Manx, etc., paying turboprop-level salaries, then there is no competition for marginal routes such as channel islands, PLH, IOM, etc. The fuel burn on an ATR or Dash 8 is virtually nil! The yields on these routes may often be low, but the costs are lower!

However, as soon as the likes of BA start operating these types, they start having to pay turboprop pilots the same salaries as jet pilots. I do not mean this to degenerate into a debate of this point, and personally I believe tp's can be harder to operate than jets. However, a TP will never have the same earning power as a jet.

Equally the TP market is (nowadays) limited. There are still some ideal TP routes out there, but increasingly there is jet competition on the same or parallel routes, and people will pay the premium to fly on the jet.

Summary: Put a TP on the right route, with the right (regional) operator, and it can be a winner. Nowadays in the hands of BA (or other mainline airlines), and on routes with competition from jets, and the TP days are numbered.

In trim

[MerchantVenturer]

HZ 123 and In trim,

Thank you both for taking the trouble to explain some of the problems/logistics re small turbo prop versus RJ operations.

Not being in the airline industry, some of the points you raised had not crossed my mind and certainly gave food for thought.

Once again, many thanks.