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bmi’s long-haul move pays off

UK-based carrier bmi believes its 2005 results demonstrate that its strategy of pursuing more long-haul routes, the restructuring of its mainline operation to a one-class product and tight cost control are beginning to boost its performance. The bmi group saw its turnover rise by 4.7% to £869 million ($1,554 million) in 2005 and its pre-tax profits for the year at £10 million were nearly four times the 2004 figure.

Chief executive Nigel Turner says that the carrier’s focus on high-yield passengers and increased long-haul operations, with new services to Mumbai and Saudi Arabian capital Riyadh, explains why traffic overall rose by 6% but passenger numbers remained static at 10.5 million. Passenger numbers at bmi fell by over 6% to 6.46 million in 2005, while those at its low-cost arm bmibaby rose by nearly 7% to 3.49 million. Turner expects passenger numbers to remain flat for 2006, but adds that yields for the first quarter are ahead of the same period in 2005.

The carrier is concentrating its international expansion strategy on the Middle East and India, although Turner says an open skies agreement with the USA could change the picture as bmi would finally be allowed to operate transatlantic services from London Heathrow. In the Gulf bmi is adding services to Jeddah. However, a planned wet-lease of a Qatar Airways aircraft to serve Doha was blocked by the UK government.

The carrier also plans to serve Moscow Domodedovo airport through a joint service with Russian carrier Transaero, following the award of route rights from Heathrow. Turner says the two airlines will offer twice-daily service on the route “as soon as possible”. ■

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