eg777er
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Virgin And British Midland To Merge!?

Thu May 22, 2003 7:05 pm

 
SInGAPORE_AIR
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RE: Virgin And British Midland To Merge!?

Thu May 22, 2003 7:08 pm

Virgin bmi British Atlantic - How nice.

"The secret discussions are said to be at an advanced stage although no deal has yet been agreed, the Evening Standard has learned."

Well they're not secret any more are they my dear.  Laugh out loud

Deutsche Luftahnsa AG has a 30% stake minus one share in bmi British Midland.
Virgin Atlantic Airways Limited is 49% owned by Singapore Airlines Pte Limited.
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Ikarus
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RE: Virgin And British Midland To Merge!?

Thu May 22, 2003 7:13 pm

Sounds more like a takeover of BMI by Virgin Atlantic to me... BMI initiated the talks when they were at their weakest and fearing for their future. I very much doubt anything but a takeover by VS would be accepted by Virgin management. They would not want to share control. But then again, given that neither carrier is financially very buyoant enough to buy the other at the moment, I have strong doubts whether this thing will ever succeed.

Either way, it could be interesting, finally giving Virgin a feeder carrier at Heathrow, with a UK & European network to feed their transatlantic routes, as well as potentially putting them in StarAlliance. But it would also bring them a loss-making, more or less doomed operation. Let's face it, a full price shorthaul airline is about the last thing I'd want to be - shorthaul is starting to be dominated by low cost. If what they want is a feeder, they should buy a much smaller airline with much less capacity.

To be honest, I think they should work out an extensive code share agreement - using BMI to connect various UK & European airports to the LHR hub and feed them transatlantic passengers. But a merger? Not smart, in my (inexperienced armchair manager's) opinion.
 
work4bmi
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Virgin And British Midland To Merge!?

Thu May 22, 2003 8:44 pm

Working for bmi, its been very hush hush here - a take over coud be on the cards it seems, which I think would be great!
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TonyBurr
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RE: Virgin And British Midland To Merge!?

Thu May 22, 2003 8:49 pm

BMI is part of Star Alliance. If this occurs would Virgin join Star or would Star Alliance lose a great member in Europe?
 
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Fly-K
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RE: Virgin And British Midland To Merge!?

Thu May 22, 2003 9:35 pm

I think it would make sense, their networks are complementing each other.

But think of "Virgin Baby"  Big grin How does the virgin get a baby?

Konstantin
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Demoose
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RE: Virgin And British Midland To Merge!?

Thu May 22, 2003 10:18 pm

If the take over goes ahead what about bmibaby being renamed Virgin Baby Blue! (Mmmm a lovely shade of blue)  Nuts

Mark
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airchabum
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RE: Virgin And British Midland To Merge!?

Fri May 23, 2003 12:50 am

I've not heard anything about this at work but it would be good news if it happened. VS needs some feed at LHR and taking over BMI would give VS access to this plus a sack load of slots that could be used for new longhaul services in the future. And it'll find a use for the ex-Virgin Sun A320's that are still parked in Bordeaux or wherever they are now!  Smile/happy/getting dizzy

Whilst VS is not exactly rolling in money at the moment, the Virgin group can always provide cash when it's required, eg the imminent float of Virgin Blue. I get the impression that BMI isn't doing too well at the moment, having to compete with the low-cost carriers on price and BA on service, which is a very tough battle. Maybe BMI could become a second Virgin Express?

Hi Ikarus
I agree with most of your points but you say that '...if VS want a feeder they should buy a smaller airline....' The trouble is that there aren't any smaller independent airlines with a network from LHR. Taking over flybe or Eastern or whoever simply wouldn't give them the benefits that BMI would.

Cheers
Biggidy biggidy bong
 
Skymonster
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RE: Virgin And British Midland To Merge!?

Fri May 23, 2003 2:21 am

Virgin and BM/BMI have been making eyes at each other for years. They've already done code shares, and BMI frequent flyers can rack up points with Virgin (presume the reverse is true too). If BMI is indeed having a hard time (particularly out of LHR), as has been suggested, I fail to see what Virgin could do that would fundamentally change the situation. Whilst the suggestion may be that the justification for a merger would be to improve Virgin's domestic feed, my feeling is that Virgin would gradually pillage the domestic slots to extend its longhaul network.

Andy
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ba319-131
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RE: Virgin And British Midland To Merge!?

Fri May 23, 2003 2:32 am

In principle the idea is a good one.VS take over BMI,thus have a feeder for the longhaul flights,and perhaps expand the longhaul flights.

However,as a general rule many of the 'feeder' flights operate at a loss due to lack of revenue from the connecting passenger - just look at the losses BA has made over they years maintaining a large european network to feel the longhaul network.

Nice idea,the 320 and 321 fleet would look great is VS colours,but i'm not sure it would increase VS revenues,more likely cost them.

Most VS flights perform just fine as they are,do they need a eurpean network?....I doubt it.

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David_itl
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RE: Virgin And British Midland To Merge!?

Fri May 23, 2003 5:51 am


And the 1st casualty of any bmi takoever would be the A330s (remember the Virgin slogan?).

David
 
dc-10 levo
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RE: Virgin And British Midland To Merge!?

Fri May 23, 2003 5:57 am

Just read it on the news. I like the sound of it (but it better not be another of Richard Branson's publicity stunts!)

Remember the Virgin slogan?

Nope, the only one I know is "No way BAA / AA."

DC-10
 
bhxforever
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RE: Virgin And British Midland To Merge!?

Fri May 23, 2003 6:01 am

4 engines 4 long haul...cant see that one on the side of a 330  Yeah sure
 
LFutia
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RE: Virgin And British Midland To Merge!?

Fri May 23, 2003 6:13 am

that would mean that VS would come back to ORD right?

Leo/ORD
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ConcordeBoy
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RE: Virgin And British Midland To Merge!?

Fri May 23, 2003 12:04 pm

And the 1st casualty of any bmi takoever would be the A330s (remember the Virgin slogan?

Which is nothing but a crock of Bransonian crap... considering that VS flew the 763ER over the Atlantic for years, and also showed interest in the proposed Sonic Cruiser twinjet  Insane


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ConcordeBoy
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RE: Virgin And British Midland To Merge!?

Fri May 23, 2003 12:05 pm

How does the virgin get a baby?

Dont know... but remember the stir caused by the last time that happened? Big grin
Faire du ciel le plus bel endroit de la terre c'est impossible sans Concorde!
 
AA717driver
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RE: Virgin And British Midland To Merge!?

Fri May 23, 2003 12:58 pm

Hummm... VS gets a European network. Has Australia. Has Pacific Rim long haul with SQ. Wants a U.S. presence. A low-cost version of "Star" perhaps?TC
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aerokiwi
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RE: Virgin And British Midland To Merge!?

Fri May 23, 2003 2:14 pm

I've thought of this possibility for a long time. I reckon that, in general, it's a good move. If BMI is losing money at the moment, then maybe more of an integrated international feed will support it.

So conceivably, while BMI would probably not add hugely to Virgin's profitability, perhaps Virgin could at least help make the domestic arm profitable. Though if one considers it, then all those BMI pax that transfer onto United, Lufthansa, SAS, Air NZ SQ etc flights, would now use Virgin flights where they can.

I think they need to lose the A321s though, these seem excessively large for BMI's network. Maybe some A319s instead? And perhaps adopting a model akin to Jet Blue. Anyway, I hope Virgin can spice things up again for BMI. They seem to have lost the plot in the last few years.

Lol, that's true ConcordeBoy, there was a bit of a stir. Does that make this the second coming then?
 
ScottB
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RE: Virgin And British Midland To Merge!?

Fri May 23, 2003 3:49 pm

Actually, I'm not sure that the U.S. would give Virgin and United permission to codeshare; after all, they are two of the only four airlines with LHR-U.S. rights and together with bmi hold a significant percentage of the slots at Heathrow, just as AA and BA do together. The current codeshare between bmi and United is permitted in part because bmi cannot operate from LHR to the U.S. Perhaps if a combined VS/BD were willing to relinquish a significant number of slots, along with DL, CO, NW, and US being permitted to operate to LHR, then the VS/BD merged airline would be permitted to codeshare across the Atlantic.

And with the EU now taking a hard line on the existing bilaterals, I don't see any movement happening for several years. The EU wants cabotage, but to be frank, you'd be more likely to see a blizzard on the French Riviera in August. U.S. carriers have little to no interest in operating domestic flights in Europe, given issues of language and competition with well-established carriers, as well as limited slot availability at desirable airports.
 
richcandy
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RE: Virgin And British Midland To Merge!?

Fri May 23, 2003 4:02 pm

Hi

Will this ever happen???

I am not saying that this will not, but a few years ago Virgin were intrested in buying Dan Air and was there not talk of a Virgin Continental based at Brussels.

Lets just say I will believe it when it happens.

Rich

 
SInGAPORE_AIR
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RE: Virgin And British Midland To Merge!?

Fri May 23, 2003 4:21 pm

A very good Times of London article about it...

Virgin's attempt to merge with bmi 'doomed to fail'
By Russell Hotten

SIR RICHARD BRANSON’S latest desperate attempt to merge his Virgin airline with bmi British Midland appeared doomed last night after his larger rival insisted that the talks were dead.

More at the Times website
Anyone can fly, only the best Soar.
 
backfire
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RE: Virgin And British Midland To Merge!?

Fri May 23, 2003 4:53 pm

And the 1st casualty of any bmi takeover would be the A330s

Those A330s have almost been casualties since bmi got hold of them.
 
SInGAPORE_AIR
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RE: Singapore Airlines Supports VS/bmi

Fri May 23, 2003 7:34 pm

Singapore Airlines Pte Limited - a 49% shareholder in Virgin Atlantic Airways Limited - has backed Virgin Atlantic's attempt to merge with bmi British Midland. Singapore Airlines and bmi are members of Star Alliance - The Airline Network For Earth.

Singapore Airlines said, "We support (the bmi merger) exploration."

Deutsche Lufthansa AG - a member of Star Alliance - The Airline Network For Earth - said, "We have read about the deal, or proposed deal, and have no comment at this stage. Bmi was always a long-term investment for Lufthansa. We have a 30% plus one share stake in the airline. As far as we are concerned at the moment these reports are speculation and we don't comment on speculation. Sir Michael Bishop (bmi's founder and chairman) will be the man who will be speaking about it."

More information at the This Is Money website

Information was gathered from the above hyperlinked webpage. Full information can be viewed by clicking the above hyperlinked webpage. Information was rephrased and not copied and pasted with the exception of quotes.
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tristar4ever
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RE: Virgin And British Midland To Merge!?

Fri May 23, 2003 8:25 pm

I dont think virgin merging *take-over* bmi would benefit them as has been stated above, a simple code share would provide them with the benefits without incuring the drain of bmi`s financial woes. Virgin joining star wouldnt happen either, although i think it would provide great strength for the alliance at heathrow, and perhaps help ease the competition for united on the heathrow routes.

i think bmi need a serious review of their core mainline business, AeroKiwi had a great idea for bmi to look at jetBlues model. bmi used to have a great reputation, but thats been shot to pieces with service cuts. if they could perhaps emulate the jetblue idea of service and cost levels, and aply them to the heathrow ops. imagine a fleet of all ecomomy a320/21`s with generous pitch and comfortable seating offering basic service, but with simple uncomplicated fares. this would apeal to the business traveller, while capturing the vff market also. bmi has a potentialy great brand, their identity works well, but it needs to be reflected in the product they offer.

what do people think of those new adverts with that ugly bird creature? i think its terrible, their previous campaign based on `civil aviation` was much slicker, very jetblue!

i hope they can make the changes to surive, it will be an uphill stugle.

mike
 
Leezyjet
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RE: Virgin And British Midland To Merge!?

Fri May 23, 2003 8:43 pm

I knew something like this was on the cards as soon as Bmi launched Bmi Baby. It was just a matter of time, for Bishop to keep baby (as his baby - hence the name) and sell the rest off. Personally I thought it would have been LH buying them out totally rather than another attempted merger with VS.

This is not the first time that VS has attempted to merge with BD. It happened a few years ago, but SMB did not want to loose the British Midland name, ( the Virgin name is more widely recognised - about 98% of the UK population have heard of Virgin). Branson even suggested that SMB be the chaiman and he would just be a member of the board, but still SMB wasn't happy with that and the talks failed, so it would be interesting to see what is on the table this time, although I personally think that it would mean one airline loosing it's name (BD) rather than re-naming the whole lot or merging the two names.

If this merger goes ahead, it will be the best thing for both airlines. It will give VS access to the UK/European market and will give Bmi access to the Transatlantic market from LHR which they have been craving for a long time. It will also make it easier for both airlines to compete with BA, as they are both competing but just in separate areas.

Everyone seems to be talking just of the BD routes feeding onto the VS routes, but this also works in reverse, in that the VS longhaul routes will feed onto the BD routes too and both will supplement each other.

"I think they should work out an extensive code share agreement - using BMI to connect various UK & European airports to the LHR hub and feed them transatlantic passengers"

That used to happen until Bmi joined the Star Alliance, now though because of Star most of Bmi's pax connect onto other Star carriers, although VS do still codeshare on a few of the main routes.

With regards to the aircraft, those A330's could be used to start up LHR-DXB which VS has been planning for sometime and BD already has the rights to operate. The VS A321 (that was used on the ATH route) that is confirgured in a 2 class config could be used on the LGW-PHC service, as it would be comercially viable to bring it back into service then, as there would be all those other A320/321's operating in the fleet rather than just the 1 if they did it now.

The downside of this would be for the staff at grass roots level as it would probably mean some job losses as the 2 airlines merged various departments.

 Smile
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qantas744
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RE: Virgin And British Midland To Merge!?

Fri May 23, 2003 10:19 pm

I guess I shouldn't really plug my own picture but it's kind of relevant since the subject of slogans was mentioned earlier. G-VSKY is one of the most recently painted aircraft in the fleet and is bearing the slogan 'Virgin seeks travelling companion(s)'-which seems somehow appropriate.


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Matt
you can't buy time but you can sell your soul and the closest thing to heaven is to rock'n'roll
 
SInGAPORE_AIR
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RE: Virgin And British Midland To Merge!?

Fri May 23, 2003 11:12 pm

Another good article, this time by the Financial Times

COMPANIES UK: Compelling logic of a BMI and Virgin merger
By Kevin Done
Financial Times; May 23, 2003

While the global airline industry has made far more losses than profits for most of the jet age, Sir Richard Branson and Sir Michael Bishop, the UK's two leading aviation entrepreneurs, have managed to end up in the black most years.

These are tough times, with aviation facing the worst crisis in its history, and according to one leading investment banker, "several airlines in Europe are hitting the panic button".

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airchabum
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RE: Virgin And British Midland To Merge!?

Sat May 24, 2003 1:08 am

Hi Leezyjet

Unfortunately the A321 doesen't have the range to do LGW-PHC but the A330's would be far better suited to Nigeria/Mid East routes than A340s/747s. In which case they might have to be called 'medium-haul' routes or the '4 engines....' slogans would have to be painted out! I'm sure the A320/1s could be used to replace BMIs 737s which I thought they were getting rid of anyway?

The word seems to be that the deal is dead in the water but then companies always say that as soon as a story hits the press. BMIs greatest asset is their LHR slots and I imagine it would be quite difficult to put a value on these. In the long term when VS (and others) start expanding again the value of these slots is likely to rocket (until the new runway is built of course!  Insane)

Cheers
Biggidy biggidy bong
 
aviationmaster
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RE: Virgin And British Midland To Merge!?

Sat May 24, 2003 1:21 am

What would they be called? BMI Virgin (Be Mi Virgin) Big grin
 
SInGAPORE_AIR
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RE: Virgin And British Midland To Merge!?

Sat May 24, 2003 3:01 am

easyJet supports possible Virgin and bmi tie-up
The rumours that Virgin Atlantic and bmi British Midland are considering some kind of alliance, cooperation etc should be welcomed. easyJet has long argued that there are far too many airlines in Europe and the need for the industry to act in a rational way through consolidation is paramount.

The recent ruling by the European Court of Justice that bilateral agreements with third-party countries should be negotiated centrally by Brussels is great news for the consumer. It is plainly absurd that airlines registered in one European country cannot operate international routes from another European and simply serves to protect the interests of a few entrenched airlines.

The consumer will never truly have the best possible choice of airlines until all air routes are truly liberalised.
Anyone can fly, only the best Soar.
 
ctbarnes
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RE: Virgin And British Midland To Merge!?

Sat May 24, 2003 3:21 am

While from a network point of view a BD/VS tie up would make sense, from a corporate culture standpoint it could be very difficult. BD and VS are two very different companies with two very different cultures. When I have flown BMI in the past, they have struck me as buttoned down, very professional and extremely efficient but a little stuffy. Although I've never flown Virgin, they seem have a much "looser" culture that is a bit more flamboyant and free-spirited, This could cause friction and a lot of tension.

Of course this goes without saying that I am talking about corporate culture here, not operational culture which is impeccible in both companies.

Merging two carriers is never easy, and past experiences show that it can prove extremely difficult, and can result in serious disruptions and customer service lapses unless things are handled very carefully.

Charles, SJ
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