New BMIbaby chief plots cautious growth strategy

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UK budget carrier BMIbaby is developing a five-year plan, laying foundations for cautious growth over the coming years.

After much uncertainty, BMIbaby's future was clarified earlier this month, when Lufthansa Group committed to retaining the business.

BMIbaby's new managing director, Julian Carr, tells ATI: "I am working on a five-year plan; that is the first thing on desk. I will be working on this intensively for the next couple of months."

The new plan will outline BMIbaby's future network and fleet structure, with effect from the start of the 2011 calendar year. But the shorter term is also high on Carr's agenda.

"We need to make sure this year works," he says. "This is a year of stability for the company, after the impact of fuel prices, the recession and uncertainty surrounding our ownership."

Carr's personal priority is to communicate this new-found stability to his staff and develop the airline's internal culture as a 'small and friendly' airline. This should have a knock-on impact on customer service, he says, helping BMIbaby to secure its competitive position.

"We are not trying to be Ryanair or EasyJet," he says. "We will continue competing on core low-cost routes which are working, but our goal is to do well rather than saturate the market. There's a lot competition, so there's no point in adding to it."

Instead he plans to focus on cautiously developing the business. "We want to make sure that we evaluate things properly, so that when we put routes on sale we can be confident that they'll work from the outset.

"We are looking at where we can take the business next. We have supportive owners who are keen to develop the business at a profitable, sensible rate, but we will not grow for the sake of it. We are looking for opportunities that benefit the group as a whole."

In keeping with this aim, BMIbaby is planning to stabilise its simple marketing co-operation with sister carrier Germanwings.

"We are working on ways to integrate with the other [Lufthansa] group companies in a way which is not complex," says Carr. "In the future there may be opportunities to do more [with Germanwings], but whether this will ever translate into a more integrated connection is unknown at this stage."

Carr mentions fleet development as one of the elements of BMIbaby's strategic plan, but he says there are no plans to renew the airline's fleet of 14 older-variant Boeing 737s in the medium term.

"At the moment the 737 'Classic' is working well for us. [Fleet renewal] is not top of the agenda," he says, adding that there is "no pressure" from Lufthansa to replace the jets. "The aircraft which we work with in the future will be the right one for our business," says Carr.