bmi restructures mainline and bmi regional operations
- focus on core network serving key destinations
- frequencies and capacities that match market expectations
bmi has today announced the restructuring of its mainline and regional operations. The move takes place against a background where the airline industry is facing the challenges of a downturn in demand and the worst recession in the UK since records began. In addition to cost saving initiatives the programme also includes a wide range of revenue enhancement initiatives.
The restructuring plan will see bmi focus on the following key areas:
• Suspending loss making routes
• Adjusting capacity to optimise efficiency and profitability
• Strengthening organisational productivity and efficiency in all areas
• Making use of the synergies of Lufthansa and other partner airlines in all areas
• Maximising revenue generating opportunities with codeshare and Star Alliance partners
The airline’s goal is to focus on maintaining within bmi mainline and bmi regional a core network of services in the UK and Ireland, Europe, the CIS, The Middle East and the Kingdom of Saudi Arabia. Through a combination of improved aircraft productivity and efficiency, and from early 2010 the suspension of non-core and unprofitable services, bmi will reduce the number of aircraft in its mainline operation by nine from the current 39. This reduction will include two of five Embraer aircraft operating on mainline routes that will be returned to bmi regional.
Leases will not be extended on aircraft when they expire in the first half of 2010, including two of the three long haul A330 aircraft. bmi will therefore continue to serve mid haul markets with two long-range aircraft and its fleet of A321s.
bmi regional, which through its niche market position and a long term charter agreement with Airbus, is maintaining a viable operation but is feeling the impact of a prolonged downturn in business-type travel. The return of two Embraer aircraft from the mainline operation at Heathrow and one additional spare aircraft will result in these three units being surplus to requirements. The company is in discussion with potential customers with a view to mitigating this situation.
A reduction in the number of aircraft deployed in bmi mainline and bmi regional operations will result in job reductions coming from all areas of the business, operational and corporate functions. The number of full-time equivalent jobs at risk of redundancy is expected to be approximately 600. However further job cuts cannot be ruled out as corporate overheads will also be cut to reflect the reduced flying programme. Management has today commenced consultations with unions and staff representatives with a view to minimising the number of compulsory job losses wherever possible.
The Lufthansa Group took over bmi in July 2009 and shortly after undertook a due diligence exercise which highlighted the need for a restructuring of the business. Lufthansa has given bmi its full support for the actions it is undertaking in this restructuring programme.
Once stabilised, the business can then be grown again in the years ahead when the economic environment improves and market demand justifies it.
Probably better than lingering tinkering, which has been the policy to date.
Losing two A330's really ends any ambition of long-haul returning in the foreseable future. It looks like a policy of cut back, bed in, and seek growth later.
Probably better than lingering tinkering, which has been the policy to date.
Losing two A330's really ends any ambition of long-haul returning in the foreseable future. It looks like a policy of cut back, bed in, and seek growth later.
Why on earth they even bothered moving the 330's, when it's obviously not made a jot of difference to their profitability is anyones guess... not to mention all the increases of cost related to new routes, No1 Heathrow etc...
Maximising revenue generating opportunities with codeshare and Star Alliance partners
I read this as handing over even more routes to other Star brands (following BRU to SN, the use of LH (Italia) on London-Berlin, Swiss on Geneva even with bmi aircraft...) HAJ will follow in short order I daresay.
With so few aircraft and flights left, I see little point in keeping the bmi brand at all in future.
Also, I presume the "other long-range aircraft" means more of the dreaded Astraeus 757s...?
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Quote:
Originally Posted by ajamieson
With so few aircraft and flights left, I see little point in keeping the bmi brand at all in future.
My thoughts exactly - the landing slots at LHR and the infrasturcture to support other *A partners are the key assets - no need for the BMI brand at all.
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So AMS is nolonger part of the core network or a key destination?
When you think back, that's where the LHR international network all started - after the UK domestics, AMS was the first international "Diamond Service" destination established after much arguing and based on British Midland having previously operated a shortlived service from Heathrow to Strasburg (at the time only airlines operating internationally from LHR were allowed to add new international routes from LHR). How sad it has come to this - years of mismanagement of the airline, the product, the network and the fares - now stand as, in some ways, the end of an era.
Feel very much for the staff too - with extremely few exceptions, they don't deserve this.
When you think back, that's where the LHR international network all started - after the UK domestics, AMS was the first international "Diamond Service" destination established after much arguing
Agree. I have in my drawer a document that is three years old, celebrating 20 years since British Midland marked "an important milestone in European aviation" with the launch of competition to AMS. So much for that pioneering spirit!
As for the staff, yes many job losses - but the slots and the capacity and LHR should remain no matter who owns or operates them, so the jobs will follow the flights. Different names, different places...
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Is TLV for sure gone or is this just speculation? If it is really gone where is that information coming from? Would it not be possible that they are just going back to A321 service as it was previously? On a seperate note if TLV is cut how would it effect a TLV-LHR flight I have booked in Feb 2010?
BMI announcement : 600 jobs, LHR-AMS/TLV/KBP/ALP routes, 9 aircraft cut
