Bmi is dropping its long-haul services from Manchester to Chicago, Las Vegas, Barbados and Antigua from next year.
Flights to Chicago will cease on January 14, while those to Las Vegas and the Caribbean will terminate after Easter 2009. The move will Virgin as the only carrier offering direct flights between the UK and Las Vegas (out of London Gatwick). In a memo to Bmi staff (which has been posted on several internet forum sites) CEO Nigel Turner said:
"The Manchester long haul operation began in 2001 due to our inability to access the Heathrow-USA market. The UK Government had indicated in 2000 that they were prepared to agree a deal with the USA to open Heathrow gradually to competition, but lobbying by BA and Virgin at the last minute hoodwinked them into changing their minds, leaving us with only Manchester services to the USA for our aircraft.
"Nevertheless, Chicago has generally been a success up to this year, when a combination of higher fuel prices, increased competition from both American Airlines in Manchester and some impact of additional capacity to the USA as a result of open skies at Heathrow has had a serious negative impact on the results. The reduction in seats due to the introduction of lie-flat beds in business class and a world leading premium economy cabin late last year has regretfully led to no significant increase to overall revenue, and we have been unable to generate an improved price for our much improved premium products in the Manchester market. Unfortunately it does seem that Manchester cannot deliver the levels of premium business that are available from the London market.
"The disappointing revenue performance reflects our best-in-class product being more than offset by people being increasingly careful with money and downtrading. Equally it appears the Manchester long haul market has become significantly more price sensitive in the economy cabin with people buying purely on price.
"The Caribbean and Las Vegas routes have always been difficult to see a long term future for. They are principally leisure routes, are operationally crew hungry and inefficient and have large seasonal fluctuations. Despite significant efforts to boost revenue and volume over the past year we have been unable to make any significant improvements and have insufficient high yielding premium passengers to make the service profitable."
The two Manchester-based A330 aircraft made available by the move will be introduced onto bmi routes from London Heathrow to Cairo and Amman in the new year. They will replace the current A320 and A321 aircraft on these routes, which joined the bmi fleet when the carrier acquired Bmed last year.
What is not clear is whether bmi will stick with the three class cabins on these A330s (economy, premium economy and business class), or re-configure them to two classes (with an extended business class in place of premium economy) as it has done on mid-haul routes to Saudi Arabia. And of course in the midst of all this Lufthansa will complete its takeover of bmi in January.
For more information visit flybmi.com.