Virgin bid for BMI apparently
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A real bid or just muddying the waters ?.
Having thought about it since my first post I can't see it bring a shill bid. There's a cost to bidding even if, after due diligence, you choose not to proceed. No, Virgin has decided they want/need to bid. I suspect they'll make lots of noise if they lose but if that means they have cost BA/IAG money they won't lose sleep over it.
If they win is the interesting speculation. I can see the domestic/UK routes feeding Virgin Atlantic but the Middle East/Africa/'Stan routes? And, would we see the whole thing on the Virgin Atlantic AOC or might they keep BMI separate and rebrand? I'm inclined to rebrand and keep them separate, Doesn't stop cooperation but does allow some separation if they go down a semi-low cost route in Euope.
If they win is the interesting speculation. I can see the domestic/UK routes feeding Virgin Atlantic but the Middle East/Africa/'Stan routes? And, would we see the whole thing on the Virgin Atlantic AOC or might they keep BMI separate and rebrand? I'm inclined to rebrand and keep them separate, Doesn't stop cooperation but does allow some separation if they go down a semi-low cost route in Euope.
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I think they are serious about bidding and they seem to have secured financing for it. It is noticeable that the huffing and puffing about the IAG bid has stopped and they have gone very quiet. Virgin has made it easy to dismiss whatever they do as PR and bluster but I think they are serious this time.
At the least they have made life harder for IAG in negotiations and if the will to invest hundreds of millions to turn around BD is there they might just be successful.
At the least they have made life harder for IAG in negotiations and if the will to invest hundreds of millions to turn around BD is there they might just be successful.
Paxing All Over The World
This is no surprise. VS have wanted BD from the first time that Bishop started to sell and, I think, wanted a part buy in to the carrier before that.
The antipathy of one airline owner to another is common around the world and Bishop never allowed it. To those of us on the outside, the VS/BD link up was sensible and logical and Bishop's behaviour was a surprise.
In my personal view, Bishop, in his desire to avoid working with/selling to Branson, had to wait too long for another partner and was VERY lucky to sell to LH. They, in turn, bought at the wrong time of the market - indicated by the sale now.
Accordingly, this could have be done ten years ago in the boom time but no one said that human beings were rational.
The antipathy of one airline owner to another is common around the world and Bishop never allowed it. To those of us on the outside, the VS/BD link up was sensible and logical and Bishop's behaviour was a surprise.
In my personal view, Bishop, in his desire to avoid working with/selling to Branson, had to wait too long for another partner and was VERY lucky to sell to LH. They, in turn, bought at the wrong time of the market - indicated by the sale now.
Accordingly, this could have be done ten years ago in the boom time but no one said that human beings were rational.
The question is would VS have the resources to turn around BD? BD already codeshares with VS on some routes. I can't see how VS will make BD's domestic services profitable. IAG wants the slots and is far more likely to be able to restructure BD. Would VS have to sell off BD slots to fund to fund its losses?
That said, VS is very likely to be awarded some slots for competition issues and could well make a go of routes such as Cairo & Moscow.
I just hope that we don't get into a National Airlines style bidding war. Lufty would benefit but we all know what happened to NA.
That said, VS is very likely to be awarded some slots for competition issues and could well make a go of routes such as Cairo & Moscow.
I just hope that we don't get into a National Airlines style bidding war. Lufty would benefit but we all know what happened to NA.
10years ago, rumours were rife about a bmi Airbus hidden away in a Dublin hangar with bmi livery on one flank and Virgin on the other, waiting for a flyover to coincide with the press release.
At the time, a VS-BD merger would have been a no brainer - VS feeds into BD's domestic network and BD would have access to an intercont network.
But as Austin Reid once said: "Can you REALLY imagine Sir Michael and Richard Branson in the same business, let alone in the same room?"
At the time, a VS-BD merger would have been a no brainer - VS feeds into BD's domestic network and BD would have access to an intercont network.
But as Austin Reid once said: "Can you REALLY imagine Sir Michael and Richard Branson in the same business, let alone in the same room?"
Paxing All Over The World
Agreed RevMan2, and I will assert - due almost soley to that problem - BD is now in it's endgame.
Had they have merged with VS some 15 years ago, we would have had a real competitor to BA and some of the LCCs. But BD struggled on alone and is now being squeezed out. They cannot compete upwards with the long hauls and they certainly cannot compete downwards with the LCCs. They are a very fine carrier but they have lost and will be subsumed into others.
Even if they are are bought up by one carrier - no one can keep them as they are. As I have been saying this about BD for some time, I will not bore you with all the points again, the key is that we are in a period of global financial contraction that has at least five years to run and probably ten. In the western world, all airlines are seeking mergers to stay afloat, the latest are LAN and TAM in South America. Sorry but, BD cannot possibly survive in any form. BD staff will be lucky to survive with 50% of the jobs and a/c and the brand itself will disappear within a year (two at most) - that is the same whether it's VS or IAG that win. If LH had absorbed the airline - rather than try to maintain it stand alone - then more jobs would survive but it's five years too late for that.
The intransigence of Bishop (whilst understandably protecting his baby) has led to it's premature death. It's called capitalism and I am sorry for those that are about to lose out.
Had they have merged with VS some 15 years ago, we would have had a real competitor to BA and some of the LCCs. But BD struggled on alone and is now being squeezed out. They cannot compete upwards with the long hauls and they certainly cannot compete downwards with the LCCs. They are a very fine carrier but they have lost and will be subsumed into others.
Even if they are are bought up by one carrier - no one can keep them as they are. As I have been saying this about BD for some time, I will not bore you with all the points again, the key is that we are in a period of global financial contraction that has at least five years to run and probably ten. In the western world, all airlines are seeking mergers to stay afloat, the latest are LAN and TAM in South America. Sorry but, BD cannot possibly survive in any form. BD staff will be lucky to survive with 50% of the jobs and a/c and the brand itself will disappear within a year (two at most) - that is the same whether it's VS or IAG that win. If LH had absorbed the airline - rather than try to maintain it stand alone - then more jobs would survive but it's five years too late for that.
The intransigence of Bishop (whilst understandably protecting his baby) has led to it's premature death. It's called capitalism and I am sorry for those that are about to lose out.
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Baby, BMI, British Midland, BMA, BM or BMI International or whatever there are called this week have never been really been successful-they were very lucky in picking up some aircraft at rock bottom prices in the early days and basing themselves at LHR with a captive market. Any other airline would have made a success of it but not BM and they had the same failure at London City. as pax boy said its" Bye Bye Baby Goodbye"
Paxing All Over The World
One of the problems for the staff at BD was being started with the old style of airline. That is to say that they began at a time when the legacy carriers were still making money but it looked like more could get in and take advantage of reducing regulations and the bilaterals.
BUT the world changed too fast and once the LCCs were on the warpath - no one was going to be spared. From all that I have ever read about the operation, it was run in a very old fashioned hierarchical way.
One of the problems for any entrepreneur is to leave the thing they started and do something else. Usually, the people who are good at starting things are not the best at running them. For example, Stelios describes himself as a 'serial entrepreneur' and he left EZY to do other things. But he hasn't. He has been in public diasgreement - which brings doubt in the mind of (still) his customers and now he wants to do it all over again (Which, by the way, will not work in the current climate).
So, sorry BD people but the writing has been on the wall for ten years.
BUT the world changed too fast and once the LCCs were on the warpath - no one was going to be spared. From all that I have ever read about the operation, it was run in a very old fashioned hierarchical way.
One of the problems for any entrepreneur is to leave the thing they started and do something else. Usually, the people who are good at starting things are not the best at running them. For example, Stelios describes himself as a 'serial entrepreneur' and he left EZY to do other things. But he hasn't. He has been in public diasgreement - which brings doubt in the mind of (still) his customers and now he wants to do it all over again (Which, by the way, will not work in the current climate).
So, sorry BD people but the writing has been on the wall for ten years.
From all that I have ever read about the operation, it was run in a very old fashioned hierarchical way.
Loos in Donington Hall with "Directors Only" notices on the door and memos to staff to enforce the rule, speak only if you were spoken to by senior management (who rarely spoke to minions), catering service from the canteen for management
There were exceptions - Austin Reid, for one - but most of the management I had dealings with were so far up themselves that they didn't know whether to f%$t or brush their teeth.
Paxing All Over The World
RevMan2
That is very funny. 
Unfortunately for the staff, that kind of 1950s attitude was not going to help them in the 1990s/2000s. Further, since Lufty failed to grasp the nettle (not that they are hierarchical anything!) then someone else has to do it.
Again, my sympathies for hard working staff who gave a great service. Yet again, one is reminded of one of the companies now in IAG, where staff said (IIRC) that they could deal with anything - other than their mgmt.
... were so far up themselves that they didn't know ...
Unfortunately for the staff, that kind of 1950s attitude was not going to help them in the 1990s/2000s. Further, since Lufty failed to grasp the nettle (not that they are hierarchical anything!) then someone else has to do it.
Again, my sympathies for hard working staff who gave a great service. Yet again, one is reminded of one of the companies now in IAG, where staff said (IIRC) that they could deal with anything - other than their mgmt.
Last edited by PAXboy; 21st Dec 2011 at 16:14. Reason: spelling
