bmi halves losses and rules out airline merger with Virgin
Britain's second biggest full-service airline, bmi, is expected to report tomorrow a halving in losses for last year to about £9m and to rule out a merger with Sir Richard Branson's Virgin Atlantic.
The group, which also owns a regional carrier and the latest entrant into the no-frills market, bmi baby, will also outline the progress made so far in its £100m cost-cutting programme.
The airline lost £19.8m in 2002 after the attacks of 11 September 2001 plunged the industry into a steep recession. Increased price competition from budget carriers such as Ryanair and easyJet also hurt bmi, which is predominantly a domestic and European carrier save for a handful of routes from Manchester to America.
Sir Richard Branson's long-haul airline Virgin Atlantic, which recorded a slight increase in profits for the year just ended compared with the £15.7m it made in 2002, has been courting bmi for some time with a view to a merger.
However, Sir Michael Bishop, who controls 50 per cent of bmi plus one share, has so far held out against a deal. Lufthansa holds 30 per cent less one share and the Scandinavian airline SAS the remainder.
Whereas Virgin is in expansion mode with plans to take on 1,400 staff, operate three new routes and place a $3bn order for 30 new aircraft, bmi is in the process of slimming its workforce. The Blue Sky initiative, launched in the middle of last year, involves some 1,500 job cuts at bmi - equivalent to nearly one-third of the workforce. As part of the plan to cut operating costs by some 18-20 per cent, bmi is also aiming to increase the proportion of tickets sold on the internet to 50 per cent and expand e-ticketing.
In a bid to fight back against the likes of Ryanair, bmi baby has grown in size from just two aircraft operating eight routes at its launch two years ago to a fleet now of 14 aircraft serving 40 destinations. Last year, bmi baby carried 1.7 million passengers.
The group is also expanding its long-haul network and starts services from Manchester to Toronto next month and to the Caribbean islands of Barbados, Antigua and St Lucia in November.
- 1 Which country would be hardest to invade?
- 2 The man who filmed the Freddie Gray video has been arrested at gunpoint
- 3 Royal baby girl born: Duchess of Cambridge's second child will be a princess thanks to Queen
- 4 Uploading pictures to find out how old you are gives Microsoft the right to post them wherever they want
- 5 Royal baby born: Unsuspecting parents walk out of the Lindo Wing to be greeted by media circus
Which country would be hardest to invade?
The Rothschild Libel: Why has it taken 200 years for an anti-Semitic slur that emerged from the Battle of Waterloo to be dismissed?
The man who filmed the Freddie Gray video has been arrested at gunpoint
Nepal earthquake: Many survivors receiving no help despite relief effort
Royal baby girl born: Duchess of Cambridge's second child will be a princess thanks to Queen
Over 50,000 families shipped out of London boroughs in the past three years due to welfare cuts and soaring rents
EU asylum policy is 'a direct threat to our civilisation', says Nigel Farage
Indonesia executions live: 'Hysterical' families heard prisoners being shot dead by firing squad
General Election 2015: SNP and its activists 'openly racist' towards the English, Farage says
EU exit would hit UK economy much harder than neighbouring countries, study finds
General Election 2015: UK will be 'run for the wealthy and powerful' if Tories retain power, Labour warns
iJobs Money & Business
£16000 - £18500 per annum: Recruitment Genius: This is an excellent opportunit...
£24000 - £28000 per annum: Recruitment Genius: A Senior SEO Executive is requi...
£16000 - £18000 per annum: Recruitment Genius: An Online customer Service Admi...
£18000 - £22000 per annum: Recruitment Genius: This global, industry leading, ...