BMI to axe 600 jobs and London to Europe routes as demand falls

Published on Wednesday 25 November 2009 20:13

STRUGGLING airline BMI is to cut 600 jobs as it suspends a number of routes between London and the continent.

The move is the latest cost-cutting measure among carriers, which have been hit by falling demand and increased fuel costs.

BMI – currently the second-largest operator at Heathrow, the world's busiest airport – said it was suspending its flights between Heathrow and four European cities, as well as flights to Tel Aviv in Israel.

The airline is also cancelling summer services it runs from Heathrow to Palma and Venice.

Like rival BA, BMI has suffered from falling passenger numbers, in particular from high-margin business-class passengers.

"The move takes place against a background where the airline industry is facing the challenges of a downturn in demand and the worst recession in the UK since records began," it said yesterday.

A spokesman said the plans would not see the airline's flights between London and Scotland reduced but it had not ruled out changes to its domestic schedule in the future.

The changes put the jobs of about 600 of BMI's 4,500 strong workforce at risk, with losses expected across the business.

In a statement, the airline, which is now owned by Lufthansa of Germany, said more cuts might be necessary.

It said: "Further job cuts cannot be ruled out as corporate overheads will also be cut to reflect the reduced flying programme.

"Management has today commenced consultations with unions and staff representatives with a view to minimising the number of compulsory job losses wherever possible."

Trade union Unite attacked the move which comes just months after Sir Michael Bishop sold his remaining stake in the business. Brian Boyd, Unite's national officer for civil aviation, said that, while there was need for changes in the airline industry, the announcement was "kneejerk" and the airline was "insensitive" to make cuts so close to Christmas.

"The fact that another 600 jobs are being lost confirms our belief that far too many employers are treating people's livelihoods with disregard," he added.

The union said it met BMI officials, urging them to minimise compulsory redundancies.

BMI said it needed to improve its efficiency.

The airline, which recently put a number of its prized Heathrow landing slots up for sale, said it was giving up leases on a number of its larger planes, reducing its fleet to about 30.

BMI is trying to maximise the synergies offered by Lufthansa, as well as being part of the Star Alliance network. Its service between London and Brussels, which struggles to compete against the Eurostar service, is being taken over by Brussels Airlines.

Lufthansa took over BMI in July, concluding soon after that there was a need for a significant restructure. BMI said the German airline had given its full support for the changes.