I have always been a huge fan of British Midland. Yet, sadly, they are yet another example of “A great airline but a lousy business”. 

Donington Hall, the headquarters of BMI (Photo credit: Wikipedia)

British Midland Airways were born the year I was: 1964. They operated out of Manchester. In 2001 they became BMIBritish Midland and then just BMI in 2003. Ownership of the airline has always been vexed. SAS, BMI Chairman Michael Bishop and Lufthansa have all had involvements. Lufthansa has been full owner since November, 2009 and has lost a chunk of money on BMI (eg 285m euros of  losses and disposal fees in 2011). In January, auditors expressed grave concerns that BMI had any future.  Now sold to IAG (British Airways /Iberia) with a condition that BMI subsidiaries BMI Baby and BMI Regional be sold separately. On 30 March 2012, the sale of BMI was approved, and the deal was completed 19 April with ownership transferring to IAG. BMI has left Star Alliance  but membership benefits for frequent flyers on Star Alliance will continue until 31st May 2012.  Cash those miles in folks! In the meantime, its good bye to an airline who I found to be consistently great in customer service and who used to be an innovator. Skytrax gave them a 3 star rating. I thought they were closer to 4 star -maybe I was lucky!

bmibaby Boeing 737-300 (G-BYZJ) at Cardiff (Rhoose) Airport, Cardiff, Wales. Taken by Adrian Pingstone in September 2004 and released to the public domain. (Photo credit: Wikipedia)

BMI set up BMI Baby in 2002. I always really enjoyed flying  them although I feel they never quite lived up to their potential. No one seemed quite focused on making BMI Baby ever work properly for both passengers and company.  (My rating of them was an average 3.5 out of 5 or 70%).  Bmibaby flew 2.2 million passengers in 2011 at a load factor of just 72.1%. Their fleet utilisation was reportedly 20% less than EasyJet’s.  Some of my flights would have been less than a third full which is of course not sustainable.  No wonder Lufthansa was losing a fortune. Many BMI Baby flights will cease on  Monday 11^th June 2012. It looks like most/all (?) of their Belfast  and East Midland flights finish on that date. This includes one of my favourite handy ones from Belfast to East Midlands airports. Then all BMI Baby flights will cease from Monday. 10^thSeptember 2012. I guess they hope to make some summer cash from holiday destinations. Nice not to have a sudden complete shut down of the airline for passengers. Not sure what will happen to current fleet of 12 737-300s and two 737-500s. Meanwhile Flybe  (14% owned by IAG) announced it will start five new routes from East Midlands and add more flights to Scotland-all  destinations currently served by bmibaby.

BMI regional are based in Aberdeen, Scotland. (This is the city where my brother and sister were born!). They fly to regional destinations across Europe Their 15 49-seat ERJ-145s and four 37-seat ERJ-135s carried 414,000 passengers in 2001 at a load factor of a mere 62.3%. Who was watching that? Again, no wonder Lufthansa was losing a fortune in BMI. So what are the options for BMI Regional? Closure is also on the cards for them unless a buyer can be found. Bmi have said  this week: “Progress has been made with a potential buyer for bmi Regional, but so far this has not been possible for bmibaby, despite attempts over many months by both Lufthansa and IAG,”. The mystery is who? Possible candidates:

• To my mind, FlyBE seems the most logical candidate. Although I suspect, they will continue to focus on setting up their own routes out of airports vacated by the BMI subsidaries. They already own ERJs but I would assume if they became owner, they would phase out the BMI Regional’s small ERJs
• Eastern airlines would come next. They operate out of Aberdeen and their mixed fleet includes a  couple of ERJ 135s and 145s.
• Ryanair and Easyjet may be interested in cherry picking some routes but I suspect would not be willing to buy the whole airline. Cheaper to just start new services with their aircraft, I suspect.
• Loganair, the Glasgow based airline who fly under FlyBE colours are a more unlikely candidate but a possibility