Birmingham Airport

UK carriers rush to snap up bmibaby’s planned route closures

British Airways (BA) is preparing to disband bmibaby, the low-cost unit it unwelcomely acquired from bmi after previous owner Lufthansa failed to find a buyer. But as the saying goes: one man’s meat in another man’s poison and the news of bmibaby’s grounding was welcomed by multiple airlines including Monarch, Flybe and Jet2.com, all of which are swiftly stepping in to backfill capacity.

Anemic-turns-dynamic is not exclusive to bmibaby’s network but a development seen following the recent demise of other small- and medium-sized airlines in Europe such as Spanair, Malev and Cimber Sterling. In those cases, competitors have reacted swiftly and within a couple of days to fill the void.

bmibaby’s closure is indicative of a recent development in Europe: the lavish injection of capital in loss-making carriers is coming to a standstill with public and private shareholders alike halting the operations of these entities, mostly small- and medium sized airlines, a trend long overdue and induced by low or no economic growth in most EU countries implementing stark austerity measures, and high fuel prices.

UK airports cater for LCCs while package vacation demand decreases but supply increases

The expression ‘mixed messages’ is often banded around in the air transport business. There is a clear case of it in the UK right now where many airports are behaving as if there is little future for the traditional package holiday delivered by dedicated charter airlines while at the same time the LCCs, who were supposed to supplant the charter airlines with their FIT-friendly offer, are increasingly turning to the package vacation in order to differentiate themselves from the opposition and to appease growing demand from their customers.

Airport financial reports emphasise differing rates of economic recovery

Recent airport financial results indicate an overall improvement in prospects but are also indicative of the different rates of recovery in the global economy. Airport Investor Monthly has received a variety of three, six-month and annual financial reports from a diverse set of airport operators including Aeroports de Montreal (Canada), Birmingham (UK), Brussels (Belgium), MAHB of Malaysia and the three private airport operators in Mexico.