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Business Comment

Simon Calder: UK passengers owe big debt to this airline


The benefits of competition are easy to take for granted – especially among UK airline pass engers, who benefit from intense rivalry between legacy carriers and low-cost operators. But it's all thanks to BMI.

Just 30 years ago, the notion of a national airline facing competition on a domestic or regional route was absurd: British Midland's first, impertinent challenge to British Airways on the Shuttle routes from Heathrow to Belfast, Edinburgh and Glasgow was rejected by the CAA in 1981. But the Thatcher government overturned the decision, and BA was forced to compete.

Europe was closed to any competition, too, until British Midland fought to connect Heathrow with Amsterdam. That proved the pilot scheme for open skies over Europe.

Yet British Midland was left in the departure lounge. A rebrand did nothing to alter the reality that its value resides in its Heathrow slots. After the deal, as BA regains its old monopoly, expect some slots will be redeployed for more profitable long-haul routes.

Fares will rise and choice decline. But if BA's prices don't appeal, at least you have dozens of easyJet departures to choose from. All thanks to BMI.