'Low cost' style one way fare strategy brings gains to bmi

bmi has reported strong growth in both passenger volumes and load factors following the scrapping of its conventional fare structure and the introduction of a low cost style, one way fare strategy.

Passenger volumes in September for bmi and bmibaby increased by 18 per cent, with bmi seeing a rise of 12 per cent in the full service sector of the business. Load factors also increased by 8 per cent to 72 per cent.

Domestic services, in particular, benefited dramatically with routes where there is strong competition from low cost carriers performing exceptionally well.

Services between Heathrow and Belfast saw an increase of 67 per cent with services from Heathrow to Manchester increasing by 28 per cent. Scotland also performed well, with flights to Edinburgh showing a 24 per cent increase and Glasgow 14 per cent compared to September last year.

Transatlantic services from Manchester fared well in September with an overall increase of 57 per cent. The number of passengers flying to Washington rose by 38 per cent with Chicago enjoying a massive rise of 72 per cent.

Austin Reid, chief executive officer, bmi said:

“We are now beginning to see the positive benefits of the strategic decisions taken over recent months. In particular, our move to meet the changing demands of travellers, with a far more flexible one way fare policy, is showing very positive results. It is exceptionally rewarding to see that the biggest gains in the domestic market are on routes where we face some of our strongest competition from the no frills sector. We are out performing them in terms of growth on these routes, proving beyond doubt that there is still great demand from the travelling public for a full service style of operation.

“The increase in volumes and load factors have generated greater revenues and at the same time we have capped and, in many cases, reduced the overall cost base of the business. The containment of costs is an area that we continue to focus on and is a key issue at a time when significant pressure on yields still exists. Much of the bmi growth has come from existing services and has not been inflated by the launch of new routes and destinations that can sometimes distort a true picture of performance.

“We continue to be confident in these challenging times and our strong gains clearly show that we are and will continue to be a major competitive force in the UK aviation industry. We are determined to provide much needed competition to a wide range of markets.”