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Bmi: Not Risking Trans-Atlantic Bloodbath  
User currently offlineJamesontheroad From United Kingdom, joined Jul 2005, 555 posts, RR: 1
Posted (7 years 1 month 1 week 2 days 10 hours ago) and read 10037 times:

Some nice spin from bmi, from an article in yesterday's Independent. The 12 month delay on launching LHR - US services obviously has nothing to do with the lack of available A330s...

Quote:
Next stop for long haul: airlines set a course to the East
Source: http://news.independent.co.uk/busine...is_and_features/article3149923.ece

By Rupert Steiner
Published: 11 November 2007

The entourage, including Egypt's first lady, that rocks into town this week with Tutankhamun will not only have walked like an Egyptian, but flown like one.

The exhibition on the life of the boy king at London's O2 Arena is the latest example of new links between the two countries, which include the recent expansion of UK airlines' capacity in the region.

Forget the "open skies" agreement set to unlock transatlantic travel next April – airlines are shunning the US to go East, drawn by the promise of strong market growth, a relative lack of competition and bigger margins.

.....

"Our niche is in the Middle East," says Mr Turner. "We would love to do trans-atlantic, but quite frankly we have been waiting 10 years, so another year ain't going to make a difference.

"I would rather watch what happens and see how competition develops, and if there is a blood bath it can happen while we are not there. The global economy is changing and there is a greater emphasis on developing economies and large populations where there is a huge latent demand."



35 replies: All unread, showing first 25:
 
User currently offlineMariner From New Zealand, joined Nov 2001, 25691 posts, RR: 85
Reply 1, posted (7 years 1 month 1 week 2 days 10 hours ago) and read 9972 times:
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Quoting Jamesontheroad (Thread starter):
Some nice spin from bmi, from an article in yesterday's Independent.

I wonder why you think this is "spin"?

I thought it was a pretty good article. There's likely to be a bloodbath on the trans-Atlantic routes, it will be tough for some of the smaller airlines.

I know BMI have had some problems, but the strategy stated here makes sense to me.

mariner



aeternum nauta
User currently offlineCainanuk From United Kingdom, joined Apr 2002, 551 posts, RR: 0
Reply 2, posted (7 years 1 month 1 week 2 days 8 hours ago) and read 9705 times:

Cracks me up though that nobody whinged and moaned louder about not having Open Skies than bmi. Now that they have it they don't want it??!! I really wish somebody would just come in and buy bmi and either run it right or get rid all together. They are a joke!


Cainan Cornelius
User currently offlineVV701 From United Kingdom, joined Aug 2005, 7737 posts, RR: 17
Reply 3, posted (7 years 1 month 1 week 2 days 7 hours ago) and read 9504 times:

Quoting Mariner (Reply 1):
I wonder why you think this is "spin"?

The spin is that what Mr Turner is really saying is explaining the claimed advanages of dropping the until now consistent BD long term long haul westerly focus and substituting a medium haul easterly focus. This about turn in future strategy has been brought about by the opportunity for BD to buy BMED.

KJ's operations are, of course, almost 100 per cent to the east. They have no trans-Atlantic presence. So to maximise the value of BD's purchase of KJ, the new, larger BD needs to focus on integrating KJ's operations and also further develop the synergies from the existing BD presence on medium haul routes to the east that started when BD took over the UK-Saudi routes from BA.

The integration of KJ into existing BD operations and the development of the synergistic opportunities that BD and KJ together create will take significant resources. BD are therefore turning their back on what the airline has been clamouring for for ten years, namely Open Skies on the north-Atlantic and access to the USA from its main hub at LHR.

Of course this total about turn in long term strategy was forced upon BD as, on the calendar, the opportunity to purchase KJ almost totally coincided with the new North Atlantic Open Skies agreements (UK/Canada as well as EU/USA). But this is could be a temporary situation. Be sure that BD will return to refocus on opportunities to the west soon / sometime / never (delete as appropriate).

In other words it is an explanation of a total change in future focus for the airline. Oh! And by the way, it means that BD will not be part of the inevitable Noirth Atlantic blood bath that until recently they had been so anxious to be part of. If that is not spin, what is? Turner certainly was not going to stand up and say that BD had got it all wrong for the last ten years but that at last they have got it right.


User currently offlineOB1504 From United States of America, joined Jul 2004, 3447 posts, RR: 6
Reply 4, posted (7 years 1 month 1 week 2 days 4 hours ago) and read 9084 times:

Speaking of which, why hasn't BD tried to develop MAN into the next Heathrow?

User currently offlineManchesterMAN From United Kingdom, joined Sep 2003, 1234 posts, RR: 1
Reply 5, posted (7 years 1 month 1 week 2 days 4 hours ago) and read 8950 times:

Quoting Cainanuk (Reply 2):
Cracks me up though that nobody whinged and moaned louder about not having Open Skies than bmi. Now that they have it they don't want it??!! I really wish somebody would just come in and buy bmi and either run it right or get rid all together. They are a joke!

BD are actually going to make very good use of open skies as it had opened the door for their comprehensive codeshare agreement with UA whereby BD codes will be placed on all of UAs flights from LHR to the USA starting in March.

I actually think this more considered approach from BD is sensible. Yes it does have something to do with aircraft availability but they will have 2x A330s delivered next year so this is no reason to delay until 2009.



Flown: A300,A319,A320,A321,A330,A340.A380,717,727,737,747,757,767,777,DC9,DC10,MD11,MD80,F100,F50,ERJ,E190,CRJ,BAe146,Da
User currently offlineHUYfan From United Kingdom, joined Oct 2001, 1413 posts, RR: 3
Reply 6, posted (7 years 1 month 1 week 2 days 4 hours ago) and read 8660 times:

The A330s have been deferred until 2009.

Regards

Mike


User currently offlineORDagent From United States of America, joined Dec 2003, 823 posts, RR: 1
Reply 7, posted (7 years 1 month 1 week 2 days 3 hours ago) and read 8023 times:

BD is doing what a well run company needs to do. Constantly look at the market as it develops and respond appropriately. BD was vocal about open skies before the became a *A member. Now that they aren't going it alone refocusing ops is appropriate. BD has made some really incredibly stupid missteps. This time though they are being a bit more realistic. That is what a well run airline or any company needs to do.

User currently offlineLHRBlueSkies From United Kingdom, joined Jan 2007, 493 posts, RR: 2
Reply 8, posted (7 years 1 month 1 week 2 days 3 hours ago) and read 7898 times:

Quoting OB1504 (Reply 4):
why hasn't BD tried to develop MAN into the next Heathrow?

A question that's been asked many times???!!!

And with CO, NW, DL arriving in the foreseeable future, I'm not surprised BD are running scared...!!



flying is the safest form of transport - until humans get involved!
User currently offlineMariner From New Zealand, joined Nov 2001, 25691 posts, RR: 85
Reply 9, posted (7 years 1 month 1 week 2 days 2 hours ago) and read 7805 times:
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Quoting VV701 (Reply 3):
The spin is that what Mr Turner is really saying is explaining the claimed advanages of dropping the until now consistent BD long term long haul westerly focus and substituting a medium haul easterly focus.

Thanks for that. Put it this way - if it is "spin" it seems sensible to me.

Times are changing in airline land. Routes that may be profitable with oil at, say, $70 may be dodgy with oil at $95. The smaller US airlines are all revising strategy. At least one major airline - United - is talking about grounding 100 aircraft its fleet.

It seems fairly clear there is going to be blood over the Atlantic, so add into that an opportunity for BMI to buy an airline "with an easterly focus" and I'm not surprised there has been a change of thinking.

I hope it works for them. I first flew BMI back in 1990 (and several times since) and very much enjoyed the experience.

mariner



aeternum nauta
User currently offlineBCALBOY From United Kingdom, joined Mar 2007, 102 posts, RR: 0
Reply 10, posted (7 years 1 month 1 week 2 days 2 hours ago) and read 7767 times:

Quoting OB1504 (Reply 4):
why hasn't BD tried to develop MAN into the next Heathrow?

For the same reason that BA hasn-t .

There are very few longhaul services out of MAN that have sufficient profitable point to point traffic to
support a service.

JFK , MCO ( profitable ? ) are already served.

Of the Star hubs , BMI already serve IAD ( UA ) , they-re tried IAD and it didn-t work.
US serve MAN themselves so probably don-t want any help from BMI.
SQ serve SIN themselves.
LH/SK/LX are sending traffic on to their networks over FRA,MUC,CPH,ZRH .


Where,s the gap for BMI ?


User currently offlineHumberside From United Kingdom, joined Dec 2005, 4927 posts, RR: 4
Reply 11, posted (7 years 1 month 1 week 2 days 2 hours ago) and read 7738 times:

When bmi do eventually do LHR-US service, how likely is IAH - it would enable them to tap into the oil market between Houston and the Middle East/Central Asia


Visit the Air Humberside Website and Forum
User currently offlineAndyEastMids From United Kingdom, joined Jan 2001, 1026 posts, RR: 2
Reply 12, posted (7 years 1 month 1 week 2 days 2 hours ago) and read 7686 times:

bmi has banged on and on about going across the Pond from LHR for years, and now they've finally got the opportunity to do what they wanted they're ducking out. Sad, because it didn't need a rocket scientist (not that Turner comes anywhere close to that) to foresee that the trans-Atlantic market would be a challenging market in which to establish operations once the bilatteral was squashed. What did they expect - to enter the market unhindered by new entrant US/European carriers or by BA and VS looking to protect their position? Don't make me laugh bmi. I hoped that they'd have the courage of their convictions and go for trans-Atlantic, based on an expectation they should have had when they were doing all the shouting that they'd have to work hard for their market share. Clearly their bleating on about being allowed into the market wasn't substantiated by an understanding of what they were really asking for.

A


User currently offlineORDagent From United States of America, joined Dec 2003, 823 posts, RR: 1
Reply 13, posted (7 years 1 month 1 week 2 days 2 hours ago) and read 7652 times:

BD is doing what a well run company needs to do. Constantly look at the market as it develops and respond appropriately. BD was vocal about open skies before the became a *A member. Now that they aren't going it alone refocusing ops is appropriate. BD has made some really incredibly stupid missteps. This time though they are being a bit more realistic. That is what a well run airline or any company needs to do.

User currently offlineLHRBlueSkies From United Kingdom, joined Jan 2007, 493 posts, RR: 2
Reply 14, posted (7 years 1 month 1 week 2 days 2 hours ago) and read 7568 times:

Quoting AndyEastMids (Reply 12):
Clearly their bleating on about being allowed into the market wasn't substantiated by an understanding of what they were really asking for.

I agree to a degree - but times have changed since their campaign started and they realise that - would you enter the race across the pond given the oncoming slaughter?

Quoting ORDagent (Reply 13):
BD has made some really incredibly stupid missteps. This time though they are being a bit more realistic.

They certainly have, and it's a nice surprise to see them being thoughtful for once, although it would be nice to fly them over the pond from my local airport!



flying is the safest form of transport - until humans get involved!
User currently offlineFlight209 From United States of America, joined May 2006, 78 posts, RR: 0
Reply 15, posted (7 years 1 month 1 week 2 days 1 hour ago) and read 7043 times:

Quoting ManchesterMAN (Reply 5):
BD are actually going to make very good use of open skies as it had opened the door for their comprehensive codeshare agreement with UA whereby BD codes will be placed on all of UAs flights from LHR to the USA starting in March.

I actually think this more considered approach from BD is sensible.

Even with "this more considered approach" to the U.S. market, might BD still be passing up a few good opportunities to fly its own craft to the States? I'm thinking specifically of:

1. LHR-JFK and/or LHR-EWR -- UA, a weakling in the NYC market, seems to be in no hurry to restart service between that area and LHR. Thus, even with the upsurge in LHR-NYC competition, wouldn't BD do well to reestablish a *A presence between London and the Big Apple, not to mention attract whatever travelers are craving an alternative to BA, VS, and U.S.-based airlines for that city pair?

2. Service to US Airways hubs PHL and CLT -- Right now, the only BD route to any major station for US is MAN-LAS. That route, particularly given LAS's summer heat and relatively high altitude, is probably pushing the limits of the A332, so BD flights to PHX (from either LHR or MAN), or even LHR-LAS on BD, might be out of the question in the near future. However, PHL and CLT and definitely close enough, and potentially lucrative enough, for BD to serve from LHR with its A332s. True, BA already flies LHR-PHL, but that route may nonetheless have enough O&D traffic for BD to be an effective competitor to BA, and especially to complement US's PHL-LGW route well. LHR-CLT would have to depend more on connecting traffic on US than would LHR-PHL, but again, such a route could be an ample complement to US's CLT-LGW service (much the same way that LH flies MUC-CLT while US operates CLT-FRA).

[Edited 2007-11-12 11:35:04]


I may question your opinion, but I'll never question your right to it.
User currently offlineBmiexpat From United Kingdom, joined Sep 2005, 175 posts, RR: 0
Reply 16, posted (7 years 1 month 1 week 2 days ago) and read 6601 times:

I love it when bmi comes up on this board, as they are clearly damned if they do and damned if they don't!

Obviously bmi have campaigned for transatlantic open skies for almost 10 years, however when it finally happened they faced some very clear difficulties that would not necessarily have been there had it happened 5 years ago! With oil at record prices and a free for all on LHR now that not only US carriers but also European carriers can launch flights from LHR to the US surely it makes sense to concentrate on the intergration of BMED and the strengthening of their position in the new markets to the East, whilst at the same time sourcing bmi fleet common A330s ready to launch US flights in 2009 when the LHR-US market has settled somewhat.

Even then, bmi may decide that the US market is no longer what they want to do if they decide to pursue other opportunities elsewhere, as they have done with the BMED opportunity at present.

I can imagine how much of a slating bmi would get if they attempted to launch LHR-US flights whilst still trying to integrate BMED and it all went t*ts up!!!!


User currently offline9252fly From Canada, joined Sep 2005, 1403 posts, RR: 0
Reply 17, posted (7 years 1 month 1 week 2 days ago) and read 6340 times:

I have to give BD credit for showing prudence. As stated,they've wanted access for many years to fly from LHR to various USA destinations. Now that they have it,so does every other European and US carrier. That's not what they anticipated years ago,rather,I suspect they expected Bermuda II to disappear and that they would have the ability to fly to any destination of their choosing in the USA from LHR. The reality is that yields on the trans Atlantic are down now(Just wait and see what happens when open skies starts). There are better yields to be found elsewhere.

User currently offlineJamesontheroad From United Kingdom, joined Jul 2005, 555 posts, RR: 1
Reply 18, posted (7 years 1 month 1 week 2 days ago) and read 6281 times:

Don't forget that bmi were all set to start

Quoting 9252fly (Reply 17):
I have to give BD credit for showing prudence.

I'm just wondering whether they would be showing the same prudence if they had managed to get hold of the A330s that they had originally wanted to have for next March... I can quite imagine BD getting slaughtered in this predicted bloodbath if the necessary frames had been available.


User currently offlineUAL777UK From United Kingdom, joined Nov 2005, 3356 posts, RR: 1
Reply 19, posted (7 years 1 month 1 week 1 day 23 hours ago) and read 5712 times:

Quoting LHRBlueSkies (Reply 8):
And with CO, NW, DL arriving in the foreseeable future, I'm not surprised BD are running scared...!!

Nope..wrong, I dont believe they are running scared, far from it..makes sense to me, with the recent aquisition, they need to concentrate on all the new routes they now have and develop those, meantime, they can enter into a broad co-operative code share with UA and share revenues over the Atlantic. Let the others come to the party and let the dust settle. When they do go for it BD will be more than able to hold their own what with their feed at LHR. Of course they need to choose their routes carefully when they do start ops, but JFK is a sreaming whole in the *A on this route so IMHO BD will gor for that, althouth of course we have AI possibly joining the *A who will also operate on that route as well.
Either way, BD I think have got it right this time, time will tell.


User currently offlineJGPH1A From , joined Dec 1969, posts, RR:
Reply 20, posted (7 years 1 month 1 week 1 day 22 hours ago) and read 5648 times:

Quoting Jamesontheroad (Thread starter):
"Our niche is in the Middle East," says Mr Turner.

This week, anyway. Next week it's back to LBA-LIL. Or LSY-MSQ. Or wherever the darts lands on the map up at Castle Donington.  Smile


User currently offlineZuluTime From United Kingdom, joined May 2006, 172 posts, RR: 0
Reply 21, posted (7 years 1 month 1 week 1 day 22 hours ago) and read 5499 times:

"Our niche is in the Middle East" says Mr Turner.

Or did he mean the East Middlands? How good is his geography?


User currently offlineConcordeBoy From , joined Dec 1969, posts, RR:
Reply 22, posted (7 years 1 month 1 week 1 day 21 hours ago) and read 4961 times:

Quoting Flight209 (Reply 15):
to complement US's PHL-LGW route well.



Quoting Flight209 (Reply 15):
such a route could be an ample complement to US's CLT-LGW service

...both of these assume that US continues to serve LGW from either destination, and seemingly to the exclusion of LHR.


User currently offlineDaron4000 From United States of America, joined Mar 2005, 712 posts, RR: 1
Reply 23, posted (7 years 1 month 1 week 1 day 21 hours ago) and read 4948 times:

You guys need to give BMI a break here. For one, when they began clammoring for open skies, oil was not at $100 a barrel. Trust me, it is a lot easier to open up a new network when oil costs 1/5 of what it does now because it means that you need to fill far less seats than you would have to in the current environment. On top of that, the US dollar is very weak so it makes the US more expensive since BMI operate on the British Pound and then there is going to be a recession in the US too. Finally, had BMI started service to LHR, how many of you who are claiming this is such a dumb move would actually transfer from your current transatlantic carrier to fly on BMI?

User currently offlineDavid_itl From United Kingdom, joined Jun 2001, 7437 posts, RR: 13
Reply 24, posted (7 years 1 month 1 week 1 day 21 hours ago) and read 4914 times:
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Quoting BCALBOY (Reply 10):
There are very few longhaul services out of MAN that have sufficient profitable point to point traffic to
support a service.

Now why does MAN have to rely on point to point traffic to make it work? BA relies on feed from the regions to make LHR routes work so why couldn't BD decide to do a radical thing for all these alliances and focus away from the "major" hub and develop a network encompassing their own domestic routes plus those routes of LX, LH and SK and become the proverbial big fish in a little pond. Or are we just happy to see LH walk away with 10% of thier MAN passengers (i.e. over 40,000 a year) going business class long-haul out of FRA/MUC instead of seeing BD try to get a portion of them to do it from MAN non-stop?


25 Bmiexpat : Surely if it was that easy it would have been done by now? The fact that bmi have tried to make an effort with long haul out of MAN, currently flying
26 David_itl : Like IAD - let's stop the service for 6 months, bring it back but make it 2 weekly and then decide to cripple the route by going from the "5 star win
27 Bmiexpat : I completely agree that bmi made a mess of IAD, I should know as I was there right in the middle of it, but do you honestly think they would have sto
28 Miami1 : Maybe BMI should do LONDON to Fort Lauderdale / Hartford / Providence / San Jose, CA / Portland, OR / San Diego / St Louis , non of those cities have
29 StarGoldLHR : MAN has to accept it's not London. It never will be. MAN is not glamourous, it doesnt feature on anybody's "must visit" cities. Therefore unless MAN
30 David_itl : Which is why they keep getting awarded prizes for lowering charges? That comes down to the London err... BritishTourist Authority not bothering to ad
31 Bmiexpat : When exactly did bmi go public on wanting to serve MAN-JNB and MAN-India and try to gain authority to fly these routes? And again, bmi seem to be get
32 Post contains links David_itl : Try looking at this Flight article The current strategy would be right if, and only if, they do not enter LHR-US and lose face over losses sustained
33 Bmiexpat : So bmi were considering/negotiating for different routes out of MAN. Well they are an airline and isn't that what airlines do? They obviously decided
34 Cornish : Bmi were close to launching JNB from MAN - I saw the plans and knew of what was due to happen. Then India came up and Bmi jumped into that thinking i
35 Post contains images Jacobin777 : .....BD's MAN-ORD is one of their most profitable, if not most profitable routes in their entire system...certainly on a per/seat basis... ......Lond
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