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Will BmiBaby Survive The Winter?  
User currently offlineBestWestern From Hong Kong, joined Sep 2000, 6956 posts, RR: 57
Posted (9 years 5 months 4 weeks 10 hours ago) and read 4072 times:

The future of BMI baby is bleak. Running away from competition, they have spread themselves thinly around the United Kingdom, and everywhere they go gets a reaction from the competition. Unlike other Low cost carriers who dominate a City they fly to, (think EZY at LPL, LTN, BRS, NCL and LGW), (FR at STN or PIK) (even BE at SOU, EXT and BHX). The biggest problem with this is that it allows the door to remain open for other carriers to enter a market and succeed.


But Baby doesn’t dominate anywhere, dancing around the corners of airports, with one and two aircraft based here and there. Cardiff, Gatwick and Teesside are good examples of a failed base launches. MME has just three flights today, LGW has two, CWL has seven. Manchester has only eleven flights. Small bases are expensive to advertise per seat if you want to penetrate the market successfully. Thats why EZY dedicated at least three aircraft to a base from day one.... not three flights!

On top of FR and EZY taking their toll on WW traffic at EMA, WW’s only main hub, (with twenty-one daily departures) It is even coming under attack from WW – by starting a base in Birmingham. Low fares from Birmingham will result in EMA losing traffic…


This winter BHX will have eight destinations, Most of which are not served Daily. GVA – Weekly, PMI - twice weekly NOC and PRG six weekly. Business routes (AMS, BHD and EDI) will only be served twice daily – far below the minimum six frequencies daily offered by KL, BA or BE. EasyJet and Ryanair succeed at operating high frequency domestic routes, even on regional routes such as BRS NCL (Three daily). Again, expensive to advertise a hub with such low frequencies.

This winter and next summer will be even more difficult for Baby, with even more competition from FR, EZY, BA, BE, Monarch and Jet2. All bases, with the exception of Cardiff will see more low cost competition fighting for more passengers. CWL with only seven daily flights this summer season is proving itself to be impossible to make money in.

A BD staff member recently stated that WW only managed a Gross Profit break even this summer (Gross profit doesn’t include any fixed overheads involved in running a company, including non sector related wages). With fuel prices rising, competition increasing and passenger numbers diminishing this winter they wont even cover operating costs. Will they survive?

Answers on a postcard….



The world is really getting smaller these days
37 replies: All unread, showing first 25:
 
User currently offlineRichardw From United Kingdom, joined May 2001, 3744 posts, RR: 0
Reply 1, posted (9 years 5 months 4 weeks 10 hours ago) and read 3991 times:

Probably, they have a loyal customer base around EMA and some of those customers will travel to BHX. Customer loyalty is worth a lot, it saves buckets on advertising.
Will the LGW flights be operated next summer?


User currently offline7LBAC111 From United Kingdom, joined Jul 2004, 2566 posts, RR: 36
Reply 2, posted (9 years 5 months 4 weeks 10 hours ago) and read 3966 times:

Funny - this is the second posting on whether BMIBaby survive in as many days!

And everything you say is true Best Western. WW have a good product but they have poor frequencies and timings. MAN is a prime example of where the door has been left open. Jet2 are starting a base with (i think) 3 aircraft from December offering loads of new routes. Easyjet are strongly rumoured to be considering operating from MAN to compliment their operation at LPL (perhaps even replace in time)

BD in general have no idea where they are. They operate to prime business routes, low yield leisure routes, operate a lowcost carrier and have poor advertising and trade relationships. The LCY-LBA route is an example - they have never served LCY before and introduced a new type (ATR42) to the fleet for the route.

7LBAC111

PS - (see also http://www.airliners.net/discussions/general_aviation/read.main/1793983/),




Debate is what you put on de hook when you want to catch de fish.
User currently offlineBestWestern From Hong Kong, joined Sep 2000, 6956 posts, RR: 57
Reply 3, posted (9 years 5 months 4 weeks 9 hours ago) and read 3931 times:

Probably, they have a loyal customer base around EMA

Low cost passengers are loyal to price only - hence FR killing WW's success on DUB overnight.




The world is really getting smaller these days
User currently offlineEGNM-LBA From United Kingdom, joined Mar 2002, 156 posts, RR: 0
Reply 4, posted (9 years 5 months 4 weeks 9 hours ago) and read 3926 times:

The Atr42 is only leased pending delivery of the Embraer 135 ADV early next year which will take over LBA-LCY.

From Jet2's initial route structure out of MAN, i don't see much duplication with Baby other than Malaga - and all of the low-cost operators are ripping the charter business to pieces on that route.


User currently offlineDC-10 Levo From United Kingdom, joined Nov 2001, 3432 posts, RR: 5
Reply 5, posted (9 years 5 months 4 weeks 9 hours ago) and read 3911 times:

They can survive but they need to consider bringing their fares down! There are too many low cost airlines now, all offering much cheaper fares than BmiBaby.

DC-10


User currently offline7LBAC111 From United Kingdom, joined Jul 2004, 2566 posts, RR: 36
Reply 6, posted (9 years 5 months 4 weeks 9 hours ago) and read 3907 times:

I don't think duplication is the problem for Baby at MAN. It's the fact that there is room for Jet2 and any other airline to move in so easily and establish so many new destinations - instead of grabbing it by the balls and doing it properly.



Debate is what you put on de hook when you want to catch de fish.
User currently offlineSevenair From United Kingdom, joined Feb 2001, 1728 posts, RR: 0
Reply 7, posted (9 years 5 months 4 weeks 9 hours ago) and read 3895 times:

i hope they do, perhaps they should come to NCL-and do some routes which are not already covered: but most are already covered! perhaps stockholm or somewhere. but i wish them all the best, and i really hope they survive- i know they have wuite a heavy marketing campaign on NCL's underground system, only thing is, they fly from MME, which is miles away! so perhaps they are chasing the wrong costoemrs, as we can go to most places from NCL, that WW fly from MME-and our airport is only 20mins from city

User currently offlineUk_dispatcher From United Arab Emirates, joined Dec 2001, 2582 posts, RR: 30
Reply 8, posted (9 years 5 months 4 weeks 9 hours ago) and read 3849 times:

I think WW will definately survive the winter. They do need a good expansion plan though. From what I can gather, they are generally very pleased with the performance of their routes out of EMA, MAN & MME. I was very dubious about the launch of flights out of MME, but the flights, maybe with the exception of MME-BFS, are all performing excellently. I checked the loads on all of their flight out of MAN on monday, and every flight except one was booked full (I think one of the BFS flights had about 15 spare seats) - thats got to be good! The only overlap which will be created by LS at MAN will be the AGP route, and I do think there is still room for another carrier on this route without any huge impact on WW.

Does anyone know how the CWL base is performing? Am sure it will be fine, but I do not have that information.

Also, the rumours of the WW / BE merger rumours are still doing the rounds, and with BE now choosing Boeing 737-300s, it shows a potential fleet commonality for the future.

I guess we will have to wait & see....

[Edited 2004-10-26 13:27:58]

[Edited 2004-10-26 13:30:19]

User currently offlinePe@rson From United Kingdom, joined Jan 2001, 19097 posts, RR: 53
Reply 9, posted (9 years 5 months 4 weeks 8 hours ago) and read 3821 times:

I agree with BW on this - they are, for one, too thiny spread. Why didn't they concentrate on expanding at one airport, say MAN, than start flights from others? U2 did this (LTN), FR did this (DUB, but also from places like Waterford, which is why it wasn't that successful at the beginning), WN did this (DAL), Jet2 (LBA) did this. Just think - it costs virtually the same to advertise 1 route from an airport as it does for 100. This is one reason why low-cost airlines create hubs.

"FR at STN or PIK"

Can add LTN to that, for by next March they'll base 4 738s at the airport.



"Everyone writing for the Telegraph knows that the way to grab eyeballs is with Ryanair and/or sex."
User currently offlineDiesel1 From UK - Wales, joined Mar 2001, 1635 posts, RR: 11
Reply 10, posted (9 years 5 months 4 weeks 8 hours ago) and read 3791 times:

Will they survive?

Surely as a wholly owned subsiduary of bmi, their future lies in the hands of Sir Michael Bishop (through BBW Holdings) and the other shareholders (Lufthansa / SAS)?

Also , we need to define 'survive'. The owners could take the decision to wind the operation up, but it is unlikely they would allow it to simply 'fail' and cease operations.


By the way Best Western, you said . CWL .... is proving itself to be impossible to make money in What is the source of this information?




[Edited 2004-10-26 14:04:32]


I don't like signatures...
User currently offlineJGPH1A From , joined Dec 1969, posts, RR:
Reply 11, posted (9 years 5 months 4 weeks 8 hours ago) and read 3781 times:

I think that the lack of frequencies on the routes WW serve is a big handicap (in addition to their destinations and multiple mini-hubs). Serving a route 3 or 4 times weekly with one flight a day isn't going to attract business flyers. U2 and FR attract business travellers (U2 more than FR, I'd say) by having multiple daily returns on many of their routes, making day returns possible. This is going to attract high-end spenders (OK for LCC's, high-end spenders may spend GBP80-100 for a round trip, so it's all relative), but that's who you want. WW would be better off picking one hub (MAN would be best), and betting the farm on that, rather than having 3 or 4 pointless mini hubs pinpointing the odd route here and there.

User currently offlinePe@rson From United Kingdom, joined Jan 2001, 19097 posts, RR: 53
Reply 12, posted (9 years 5 months 4 weeks 8 hours ago) and read 3762 times:

"U2 and FR attract business travellers (U2 more than FR, I'd say)"

On flights within the mainland and UK-mainland Europe probably, but on UK-DUB-UK, a number of businesspeople fly the routes, especially from the major cities. Furthermore, its DUB-UK routes create a lot of cash indeed: in fact, about 35% or so of its total revenue last year came from its DUB-UK routes alone.

But this thread isn't about this, so let's get back to discussing WW.



"Everyone writing for the Telegraph knows that the way to grab eyeballs is with Ryanair and/or sex."
User currently offlineChrista From , joined Dec 1969, posts, RR:
Reply 13, posted (9 years 5 months 4 weeks 8 hours ago) and read 3698 times:

Does anyone know how the CWL base is performing? Am sure it will be fine, but I do not have that information.

I know that in May 2004, whilst I was on work experience, BMIbaby passengers loads were averaging around 80% on domestic and 95% on international...

Not bad numbers I guess..

Regards,

Christa


User currently offlineBestWestern From Hong Kong, joined Sep 2000, 6956 posts, RR: 57
Reply 14, posted (9 years 5 months 4 weeks 7 hours ago) and read 3664 times:

i know they have wuite a heavy marketing campaign on NCL's underground system

How can they afford a heavy marketing campaign in NCL when they have three flights a day from Teesside. They probably have to spend the same as EZY to get their name noticed in the market.




The world is really getting smaller these days
User currently offlineGKirk From UK - Scotland, joined Jun 2000, 24815 posts, RR: 56
Reply 15, posted (9 years 5 months 4 weeks 7 hours ago) and read 3624 times:

Pe@rson, easyJet will still be the #1 carrier in LTN  Smile/happy/getting dizzy


When you hear the noise of the Tartan Army Boys, we'll be coming down the road!
User currently offlineBestWestern From Hong Kong, joined Sep 2000, 6956 posts, RR: 57
Reply 16, posted (9 years 5 months 4 weeks 7 hours ago) and read 3622 times:

Uk_dispatcher - This is a school mid term week. Any flight would be full this week. You state that MME - BHD isnt working... Without the BHD service MME would have two flights daily.... whats the point in that? With Jet2, GB airways and Monarch arriving in Manchester WW can no longer grow there with any hope of profits. This summer they should have focused all their growth there, ignoring Gatwick and Teesside. This would have made MAN less attractive for Jet2 and GBair.

Diesel1 - WW is on its own AOC, so the company could simply cease to exist in the morning. Most probably BD would like a orderly wind-down of the operation as it could seriously harm their network carrier brand.

Christa - you simply cannot get the per seat marketing costs low enough with seven departures a day to make CWL work profitably. CWL currently gets lots of sponsorship from the Welsh Development board... when this goes, expect WW to seriously question the future of CWL.

Pearson - correct about FR attracting business passengers - they do this by offering a high-frequency alternative to BA and EI on the UK - Ireland routes, and on thin routes where there is no alternative. People on business choose the airline that matches their schedule, and not vice versa. BE have survived at Amsterdam by also offering high frequency services against BA, but with smaller aircraft. WW simply dont offer high frequency services.



The world is really getting smaller these days
User currently offlinePe@rson From United Kingdom, joined Jan 2001, 19097 posts, RR: 53
Reply 17, posted (9 years 5 months 4 weeks 6 hours ago) and read 3577 times:

'Correct about FR attracting business passengers - they do this by offering a high-frequency alternative to BA and EI on the UK - Ireland routes, and on thin routes where there is no alternative.People on business choose the airline that matches their schedule, and not vice versa.'

Yep! An example of the "high-frequency" of which you speak is its DUB-LON flights: 6 daily to LGW (including the weekends); 4 daily to LTN (3 on the weekends); and 14 daily to STN (15 on Saturdays; 13 on Sundays). That's a maximum total Mon-Fri of 24; Saturday 24; and Sunday 22. A very "high-frequency" indeed!

"WW simply dont offer high frequency services."

Yep! In my opinion, WW should have concentrated on one hub, like MAN, and built up its destinations and frequencies. It'd make much more sense than trying to be everything to everyone and creating 'hubs' throughout the UK.



"Everyone writing for the Telegraph knows that the way to grab eyeballs is with Ryanair and/or sex."
User currently offlineDaddad525 From United Kingdom, joined Sep 2004, 83 posts, RR: 0
Reply 18, posted (9 years 5 months 4 weeks 6 hours ago) and read 3574 times:

I would guess that BMI wanted some prescence at BHX. Baby has long sponsered our weather forecasts; but with little services.

With the fall-out between Ryanair and BHX, they must have seen a gap in the market. But they are competing with BE and My Travel lite. With the backing that BM have, you can only suggest a winner.

Then-BMI,; Why are Virgin Radio promoting BMI flights to Las Vegas? That appears to be a very unlikely threesome.


User currently offlinePe@rson From United Kingdom, joined Jan 2001, 19097 posts, RR: 53
Reply 19, posted (9 years 5 months 4 weeks 6 hours ago) and read 3567 times:

"With the fall-out between Ryanair and BHX, they must have seen a gap in the market."

Only GRO and MJV. FR did reduce its DUB service to twice-daily, but it'll be increased to thrice-daily (2x on Saturdays and 3x on Sundays). I suspect that the BHX-DUB route could happily sustain 4 or 5 weekday FR flights, so I imagine that the airline will increase its flights to BHX when it can (i.e. when it has the available aircraft) to compete with EI. We'll have to wait and see.



"Everyone writing for the Telegraph knows that the way to grab eyeballs is with Ryanair and/or sex."
User currently offlineDiesel1 From UK - Wales, joined Mar 2001, 1635 posts, RR: 11
Reply 20, posted (9 years 5 months 4 weeks 6 hours ago) and read 3558 times:

Best Western

1) Quite right about the AoC, and also how bmi might want to walk away from bmiBaby

2) Did you mean bmiBaby getting losts of sponsorship from the Welsh Development Board (Welsh Development Agency actually, but I'm not one to split hairs...) - you said CWL, and AFAIK TBI plc have never had aid from the WDA.

3) Again, what is the source of your info on bmiBaby not being profitable at CWL - need the facts not your suppositions...

4) Finally, what are the facts around bmiBaby's finances in terms of profit and loss. Not hearsay, not vague quotes, not guesses or suppositions, what are the actual figures?



I don't like signatures...
User currently offlineBestWestern From Hong Kong, joined Sep 2000, 6956 posts, RR: 57
Reply 21, posted (9 years 5 months 4 weeks 6 hours ago) and read 3551 times:

With the backing that BM have, you can only suggest a winner

Yes, I can, and it isnt WW... Its WW eventually becoming BD, with many 'hubs' routes and cities being dropped, focused 100% on Manchester.



The world is really getting smaller these days
User currently offlinePe@rson From United Kingdom, joined Jan 2001, 19097 posts, RR: 53
Reply 22, posted (9 years 5 months 4 weeks 6 hours ago) and read 3550 times:

WW doesn't post its financial situation on its website (well, at least not that I can find), so we must ask: is it hiding something? If you're making a healthy profit, you might want to share it with others to inspire confidence and for them to think 'wow, it must be doing well.' But if you're not doing well and, indeed, performing poorly or unhealthly, then you obviously wouldn't want to share on your website. FR and U2, for example, publish their financial stats on their websites.


"Everyone writing for the Telegraph knows that the way to grab eyeballs is with Ryanair and/or sex."
User currently offlineDiesel1 From UK - Wales, joined Mar 2001, 1635 posts, RR: 11
Reply 23, posted (9 years 5 months 4 weeks 6 hours ago) and read 3536 times:

Pearson

bmiBaby aren't necessarily 'hiding' anything

FR/U2 are public companies so have to publish their details - good or bad

WW is part of the bmi 'thing' so doesn't have to, but the figures must be wrapped up somewhere in the figures that bmi produce

Question is, is that information available anywhere?



I don't like signatures...
User currently offlineBestWestern From Hong Kong, joined Sep 2000, 6956 posts, RR: 57
Reply 24, posted (9 years 5 months 4 weeks 6 hours ago) and read 3517 times:


1) Quite right about the AoC, and also how bmi might want to walk away from bmiBaby

Thanks.

2) Did you mean bmiBaby getting losts of sponsorship from the Welsh Development Board (Welsh Development Agency actually, but I'm not one to split hairs...) - you said CWL, and AFAIK TBI plc have never had aid from the WDA.

Yes - TBI havent got any aid from the WDA

3) Again, what is the source of your info on bmiBaby not being profitable at CWL - need the facts not your suppositions...

sorry, only suppositions... If CWL were profitable, WW would be much bigger there, and not risk codesharing domestic services with Air Wales, their biggest competitor in Wales

4) Finally, what are the facts around bmiBaby's finances in terms of profit and loss. Not hearsay, not vague quotes, not guesses or suppositions, what are the actual figures?

No Data is published from BD, so I can only go on CEO interviews, where he states that he hopes WW will break even in 2005, and saying that WW isnt suffering from yield erosion. Since then we have seen more competition at EMA, MME and MAN.

BmiBaby isnt reported as a separate company in companies house.


Go used to publish profitability by quarter.

[Edited 2004-10-26 16:24:49]


The world is really getting smaller these days
25 Pe@rson : Pearson bmiBaby aren't necessarily 'hiding' anything FR/U2 are public companies so have to publish their details - good or bad WW is part of the bmi '
26 Richardw : This is a bargain flight that I have found from Wed, 27 Oct 04 Flight WW6155 17:25 Depart London Gatwick (south terminal) (LGW) 20:25 Arrive Prague (P
27 Diesel1 : Pe@rson Bit of a double edged sword bmi publishing the figures for bmiBaby... We know that bmi are turning in a loss - if the bmiBaby figures were pub
28 Jmc757 : They're in for a scrap at their new BHX base bext year. Going head to head with MyTravelLite and now flyBe, with Thomson just down the road. MyTravelL
29 STARCREW : There is no doubt Baby will survive the winter. Bmi is putting lots of money into it (there goes my profit share AGAIN). Think the idea behing having
30 AirWales : Need to bring thier fares down and increase frequencies. They fly Cardiff to Tolouse and Geneva (they do fly others as well). They only fly one day a
31 Richardw : Perhaps the one flight per week to TLS and GVA is aimed at the lucrative Skiing holiday market.
32 BestWestern : RichardW, The PRG LGW route is being dropped on the 29th of October, leaving Babies London hub with one daily service! Starcrew - if this is the criti
33 Btblue : Of course it will survive the winter but probably not the winter at all of its current bases. It seems to be a popular carrier here in the East Midlan
34 Richardw : Will the ORK-LGW route be dropped, considering easyJet are starting this route soon and it will be twice daily, which is good for business travellers?
35 Post contains images STARCREW : BestWestern Yeah I know what you mean. Baby seems a law unto itself, its definately true this go for broke expansion has really stretched resources. T
36 BDSTAFF : CWL is very profitable indeed, however three aircraft have been tried there and didn't do great. Two seems to be the optimum and does nicely. MAN and
37 Post contains images Whitehatter : This is pure rumour but one of those persistent rumours.... Expect BMIBaby to be slightly rebranded (possibly to Baby) and then sold off as a separate
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