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12/06/2003
BMI British Midland to axe 1,500 jobs
BMI British Midland Airways, one of the UK’s largest airlines, has said that falling demand will mean that the company will shed up to 1,500 jobs within the next four years.
The airline will axe the jobs as part of a cost-cutting exercise under ‘Project Blue Sky’, a restructuring plan introduced to bring the company - which reported a £19.6 million loss last year - back into the black.
These cuts by the Castle Donington-based airline would equate to almost one-third of the total workforce.
The majority stakeholder in the company id BBW, while Deutsche Lufthansa AG holds 30% of the airline and SAS Group owns 20% of the company which has seen revenue per business passenger decline as competition between carriers increases for the lucrative though shrinking business market.
Last year, BMI British Midland set up a low-cost arm, bmi baby in an effort to win a greater share of the budget-traveller market. Set up in March 2002 bmi baby helped increase passenger numbers by around 12%.
Though BMI British Midland declared a pre-tax loss of £19.6 million in 2002, the company is confident of making a small profit in the next financial year. This compared with a profit of £12.4 million profit in the 2000-2001 financial year.
Excluding the bmibaby fleet, BMI British Midland has a fleet of 40 aircraft in service, which last year covered 5303 million passenger kilometres.
As part of Project Blue Sky BMI British Midland will dispose of all but its fleet of Airbus aircraft in a bid to streamline the operation.
Last month BMI strenuously denied speculation of a merger deal with Virgin Altlantic, but said that closer co-operation such as cross-selling of spare seat capacity on shared routes was a possibility.
(SP)
The airline will axe the jobs as part of a cost-cutting exercise under ‘Project Blue Sky’, a restructuring plan introduced to bring the company - which reported a £19.6 million loss last year - back into the black.
These cuts by the Castle Donington-based airline would equate to almost one-third of the total workforce.
The majority stakeholder in the company id BBW, while Deutsche Lufthansa AG holds 30% of the airline and SAS Group owns 20% of the company which has seen revenue per business passenger decline as competition between carriers increases for the lucrative though shrinking business market.
Last year, BMI British Midland set up a low-cost arm, bmi baby in an effort to win a greater share of the budget-traveller market. Set up in March 2002 bmi baby helped increase passenger numbers by around 12%.
Though BMI British Midland declared a pre-tax loss of £19.6 million in 2002, the company is confident of making a small profit in the next financial year. This compared with a profit of £12.4 million profit in the 2000-2001 financial year.
Excluding the bmibaby fleet, BMI British Midland has a fleet of 40 aircraft in service, which last year covered 5303 million passenger kilometres.
As part of Project Blue Sky BMI British Midland will dispose of all but its fleet of Airbus aircraft in a bid to streamline the operation.
Last month BMI strenuously denied speculation of a merger deal with Virgin Altlantic, but said that closer co-operation such as cross-selling of spare seat capacity on shared routes was a possibility.
(SP)
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