racko
Posts: 4548
Joined: Tue Nov 06, 2001 12:06 am

Could Lufthansa Buy Bmi?

Sat May 04, 2002 8:04 am

Hi,

i just found this post on pprune, sounds pretty serious:

"Lufthansa could buy BMI?
Hi,

at first: I'm not a pilot, i work as an aircraft engineer for LH Technik in Frankfurt, but i hope you won't kill me for posting here I think you could be interested in this:

There were several rumours about LH and BMI in the past, but now it seems like it's serious.

I have contacts to some executives at LHT, and one told me today, that LH is in serious talks with BMI about buying the whole BMI mainline. BMIBaby would continue to operate independent, but with strong connections to the Star Alliance (so they won't start a pricewar with Star members for example).

With a possible opening of LHR->USA for other than the 4 current airlines, LH wants to expand BMI at LHR.

What do you think about this (any BMI pilots here?), would you like or dislike flying for Lufthansa? (Actually, BMI would continue as a own brand, maybe something like BMI Lufthansa, but my Colleague didn't know anything about possibilities yet)

ByeBye

Jochen"


What's your opinion, is this possible ? I really like that idea  Big grin
 
dutchjet
Posts: 7714
Joined: Sat Oct 14, 2000 6:13 am

RE: Could Lufthansa Buy Bmi?

Sat May 04, 2002 8:27 am

Doesnt LH already own a stake in BMI (20%) which LH purchased from SAS (SAS I think at one time owned 40% of BMI and sold half of that interest to LH)?

I think that a LH/BMI deal would make a lot of sense.....BMI has been having a difficult time lately with many of its new Airbuses on the ground. I am not sure how its new transatlantic services are doing, but they could not have picked a more difficult time to start service accross the Atlantic - certainly not BMI's fault, world events ruined their plans.

BMI has a valuable hub operation at LHR and is a serious competitor to BA.....whether BMI ever gets transatlantic routes out of LHR is another story that gets into the complicated Bermuda 2 issues and open skies agreement that the UK and US cannot seem to work out.

The problem could be competition issues.....many authorities are not 100% happy with the LH/UA and LH/SAS alliances accross the atlantic and within europe; adding a purchase of BMI to LH may cause the governments some concern. If LH adds a strong position, directly or indirectly at LHR to its dominant position at FRA, some may object, especially AA and BA who were told that they could not go forward with their alliance due to competition problems out of LHR.
 
racko
Posts: 4548
Joined: Tue Nov 06, 2001 12:06 am

RE: Could Lufthansa Buy Bmi?

Sat May 04, 2002 7:42 pm

Yes, LH owns 20% of BMI.

But i think the difference between the aa/ba thing and LH is, that AA/BA would have had nearly a monopoly on all northamerican flights (only some virgin and ua flights left), while LH faces more competition at FRA. And every new airline in LHR for transatlantic flights would be good for competition...

 
johnnybgoode
Posts: 2144
Joined: Wed Jan 03, 2001 8:47 pm

RE: Could Lufthansa Buy Bmi?

Sat May 04, 2002 10:39 pm

although i agree that the northatlantic sector is heavily restricted and that they should drop Bermuda II, i don´t think that LH/star faces more competition at FRA than BA/oneW at LHR. i´m not 100% sure, but somewhere on this board i once read that star has more traffic at FRA compared to oneW at LHR.

i don´t think that LH would buy all of bmi. there are too many regulatory issues to be concerned about, and i don´t believe they would take over bmi. however, i could very well imagine LH getting a bigger share in bmi and perhaps even to take over bmi´s management, something similar to ANZ and AN (but hopefully more succesful).

cheers
daniel
If only pure sweetness was offered, why's this bitter taste left in my mouth.
 
747firstclass
Posts: 821
Joined: Tue Mar 28, 2000 2:45 pm

RE: Could Lufthansa Buy Bmi?

Sun May 05, 2002 12:42 am

And dont forget that Germany has an openskies with the US and all US carriers are free to serve FRA, among everywhere else in Germany. LHR is another story, only VS,BA,AA and UA are allowed to fly there. Hence the uproar when AA/BA tried to form an alliance. Thats why there was no uproar in Germany when LH/UA got together. Big, big difference.