BMI to axe business class in a few months?
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BMI to axe business class in a few months?
According to Travel Trade Gazette (3rd November), a leading airline analyst believes that BMI will axe its falling demand business class service in a few months mainly because of competition from the low-cost airlines.
Join Date: Oct 2003
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I really do think that bmi need to look at the direction they intend to take from now because from the outside the place looks like a mess. They have a motley assortment of a fleet, a route network and a subsidiary.
They need to look at ways to grow their route network and their fleet to be able to compete more head on with the low cost airlines from say Manchester and Heathrow, whilst looking at how baby and regional can grow from the regional airports.
Getting rid of business class leaves little differentiation between baby and mainline. Personally I think a good example to look at is Air Canada ... hear me out.
Have baby to be like zip. Using aircraft and routes bmi cant compete with anymore. Have some routes like the tango product; low cost and all economy but still mainline priviliges, like free snacks and drinks. But otherwise keep the usual Business and Economy classes, but make them more differentiable.
They need to look at ways to grow their route network and their fleet to be able to compete more head on with the low cost airlines from say Manchester and Heathrow, whilst looking at how baby and regional can grow from the regional airports.
Getting rid of business class leaves little differentiation between baby and mainline. Personally I think a good example to look at is Air Canada ... hear me out.
Have baby to be like zip. Using aircraft and routes bmi cant compete with anymore. Have some routes like the tango product; low cost and all economy but still mainline priviliges, like free snacks and drinks. But otherwise keep the usual Business and Economy classes, but make them more differentiable.
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Tiger: It wouldn't be diamond service, because that was a single business class product - albeit at the old economy class prices. This would be a single economy class product at low-cost prices, presumably.
Lite: You are out of date. IMO, the independence of the sections of bmi are now well-marked - Airbus from LHR, 737 for Baby, Emb145 for regional. The only fleet which doesn't fit into this is the F100/F70 - and their days are apparently numbered.
Expansion at LHR - always bmi's preferred option - is constrained by lack of free access to markets and lack of new slots. BA still has far too much of the ear of BAA and the government to allow fair competition. Their product at LHR *is* competing with the low-cost airlines - their press releases for the last four or five months draw attention to the fact that load-factors are rising whilst BA's passenger numbers are falling. On routes that bmi "can't compete on" it comes off - basically, on a level playing field, bmi continues to make more money than the flag carriers on routes, because its cost base is lower.
Also, I don't know if you understand that the cost of a business class product is not simply a couple of quid to stick more food on a tray - it is a lot more structural - the cost of things like lounges and other stuff that you pay for even if you aren't carrying business class passengers. If there aren't enough C passengers and no prospect of them appearing, then having a business class cabin is a substantial financial burden to an airline.
Lite: You are out of date. IMO, the independence of the sections of bmi are now well-marked - Airbus from LHR, 737 for Baby, Emb145 for regional. The only fleet which doesn't fit into this is the F100/F70 - and their days are apparently numbered.
Expansion at LHR - always bmi's preferred option - is constrained by lack of free access to markets and lack of new slots. BA still has far too much of the ear of BAA and the government to allow fair competition. Their product at LHR *is* competing with the low-cost airlines - their press releases for the last four or five months draw attention to the fact that load-factors are rising whilst BA's passenger numbers are falling. On routes that bmi "can't compete on" it comes off - basically, on a level playing field, bmi continues to make more money than the flag carriers on routes, because its cost base is lower.
Also, I don't know if you understand that the cost of a business class product is not simply a couple of quid to stick more food on a tray - it is a lot more structural - the cost of things like lounges and other stuff that you pay for even if you aren't carrying business class passengers. If there aren't enough C passengers and no prospect of them appearing, then having a business class cabin is a substantial financial burden to an airline.
