BMI cuts jobs and routes in restructuring

AILING airline BMI is slashing 600 jobs and axing five of its Heathrow routes as it strives to cut costs, it said yesterday.<br /><br />The carrier will also start handing back its leased aircraft, it said, blaming the recession and the fall-off in demand for travel.<br /><br />BMI will stop flying to Brussels, Tel Aviv, Kiev and Aleppo in January, and its route to Amsterdam will be scrapped in March next year.<br /><br />&ldquo;Cutting these routes is significant for BMI,&rdquo; Astaire Securities&rsquo; Douglas McNeill said yesterday. &ldquo;The airline has been building itself up as a mid-haul airline, so saying it will no longer fly to Tel Aviv, Kiev and so on is a signal that that&rsquo;s not working,&rdquo; he added.<br /><br />The struggling carrier, which is owned by Germany&rsquo;s Lufthansa, had warned that it could go under unless it raised an extra &pound;190m in funding. <br /><br />Its parent airline, which has failed to find a buyer for BMI, will put up &pound;95m and hopes to raise a further &pound;95m by selling off its coveted Heathrow slots. It is currently the second-largest operator at Heathrow.<br /><br />It lost &pound;155m last year and is facing a further &pound;200m loss this year.<br /><br />BMI, which said its workforce was being cut across the airline, also warned that further job cuts could be necessary as it fights for survival. <br /><br />The carrier&rsquo;s low-cost arm, bmi baby, has announced 158 job-losses.<br /><br />The Unite union said that announcing the cuts just before Christmas was insensitive and cast doubt on other areas of bmi&rsquo;s business.<br /><br />&ldquo;Unite understands the need to cut costs, but job losses seem to be the kneejerk reaction,&rdquo; said Brian Boyd, the union&rsquo;s national officer for civil aviation. <br /><br />Airline pilots&rsquo; union BALPA said it would work with bmi to try to avoid compulsory job cuts.