Scottish routes axed as airline Bmibaby faces closure

LOSS-MAKING airline Bmibaby is expected to close in September after new owners failed to find a buyer.

However, there appeared to be more hope for Aberdeen-based BMI Regional, with “progress” made with a potential buyer, believed to be business consortium Granite Aviation.

The signalled shutdown announced yesterday came a day after The Scotsman highlighted the writing was on the wall for Bmibaby, with rival Flybe announcing flights on five routes from its main base at East Midlands airport.

The move also follows owner International Airlines Group (IAG) – British Airways’ parent firm – saying it doubted whether it could sell the no-frills offshoot after buying the BMI group from Lufthansa.

Bmibaby managing director Peter Simpson said the closure would be preceded by axing several routes from 11 June, including its sole Scottish connections, between Edinburgh, Glasgow and East Midlands.

On Wednesday Flybe confirmed it would operate these from September.

Mr Simpson said consultation aimed at grounding all Bmibaby flights from 10 September had started with unions.

He said: “Bmibaby has delivered high levels of operational performance and customer service, but has continued to struggle financially, losing more than £100 million in the last four years.

“Progress has been made with a potential buyer for Bmi Regional, but so far this has not been possible for Bmibaby, despite attempts over many months by both Lufthansa and IAG.

“Bmibaby has, therefore, started consultation to look at future options including, subject to that consultation, a proposal to close in September.

“To help stem losses as quickly as possible and as a preliminary measure, we will be making reductions to Bmibaby’s flying programme from June.”

He added that he “sincerely apologised” to all customers affected, and said full refunds would be provided.

Colin Whyatt, of the GMB union, said: “This is absolutely devastating news which puts 800 jobs at risk, almost half in the East Midlands.

“Bmibaby had been reorganised last year and GMB members hoped it would be sold.

“Two potential bidders have pulled out, and unless a new bidder comes forward in the next 90 days, these jobs will go, on top of 1,200 jobs lost from the reorganisation of BMI.”

IAG has said it does not want to keep Bmibaby or BMI Regional, having bought the group for BMI’s valuable take-off and landing slots at Heathrow.

That has given BA a monopoly on flights to the London hub from Edinburgh and Aberdeen. BMI axed its Glasgow-Heathrow route a year ago.

IAG remains in talks with Aberdeen-based business consortium Granite Aviation over the potential sale of BMI Regional, whose UK and European routes include flights from Edinburgh, Glasgow and Aberdeen.

IAG warned last month the takeover of BMI was likely to lead to up to 1,200 job losses.

Positions facing the axe are at BMI’s head office at Castle Donington in Derbyshire and at airports.

However, IAG said if it had not acquired BMI, all 2,700 jobs at the group could have been lost.

Bmibaby shed 158 jobs in 2009 when its fleet was cut from 17 to 12 aircraft.