Is the bmi brand on the way out?

There was a somewhat surprising announcement out of London this morning from regional airline bmi: they’re making some rather significant cuts to their fleet, destinations and staffing levels.  There will be a loss of nine aircraft in total – over 25% of the fleet.  Two of the planes beign removed from the fleet are A330s.  This essentially kills any chance of longhaul service coming back to the bmi fold. 

Destinations being cut include Kiev, Ukraine; Tel Aviv, Israel, Brussels, Belgium and Amsterdam, Netherlands.  The Brussels route will be picked up by Star Alliance and Lufthansa Group partner Brussels Airlines.  There is no indication that the other destinations will see service restored via a partner or other means.  Most of these cuts take effect in the second week of January 2010.

And then there are the job cuts.  The carrier expects to trim about 600 employees from their ranks and did not rule out additional cuts in the future.  Not good at all for those affected by these cuts.

Looking past the cuts there is a rather glaring question out there: What is left of bmi?  Sadly, the answer seems to be not all that much.  They still hold a ton of slots at London’s Heathrow airport but even the value of those is dropping lately.  Still, with the carrier now quickly rolling into the fold of the Lufthansa group (the new CEO either just started or is starting very soon) it makes a decent amount of sense to shift what few viable assets there are around in the organization to places where they make the most sense.  Sure, bmi still offers a reasonably competitive regional network around the British Isles and Ireland, and they also have some decent coverage into the Middle East and former Soviet states.  And they’ve got pretty decent connections from Heathrow to other Star Alliance partners.  But they’re still a small fish in a big pond and having trouble remaining competitive.

Could the carrier remain as a holding company for the slots, slowly doling them out to other airlines in the Lufthansa group (or selling them for real money)?  Few to zero direct operations but most of the routes would still be covered and customers would still have options within the alliance. 

Things aren’t looking particularly great over at Donnington Hall.  They haven’t been for a while now and it doesn’t seem that they’ll be turning a corner anytime soon.  Not good at all. 

I’m not panicking about my stash of points in their program.  Yet.  But I am looking at cashing in a couple redemptions sooner than not just to hedge my bets on their rather advantageous reward chart.  The points won’t just disappear but the Miles+More scheme isn’t as rewarding for me.

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Seth Miller

I'm Seth, also known as the Wandering Aramean. I was bit by the travel bug 30 years ago and there's no sign of a cure. I fly ~200,000 miles annually; these are my stories. You can connect with me on Twitter, Facebook, and LinkedIn.

One Comment

  1. Guess it's time to do something with the 50+K miles I acquired in Diamond Club over the last two years, pretty much exclusively with Hertz rentals and Hilton stays. Never actually set foot on a BMI aircraft…

    Given the financial situation, I don't understand why they bothered to send our fancy new (black) Gold cards. The package looks really nice, especially when compared to the UA 1K "package", but the card expires in 3/2010, just like my previous golden card.

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