British Airways (BA) began consultations with trade unions today (April 12) on proposals to integrate bmi mainline into its operations at Heathrow.
The acquisition of bmi by British Airways’ owner, International Airlines Group (IAG), was given regulatory approval from the European Commission in late March. BA says that bmi is losing more than £3m (US$4.7m) a week and that, “without this acquisition, was facing closure with the potential loss of all 2,700 UK-based jobs.”
A company statement added that the consultation proposes the full integration of bmi mainline into BA, “securing approximately 1,500 jobs” but conceded that the integration proposals, “could result in up to 1,200 redundancies.”
Jobs secured under the proposals include the transfer to BA of around 1,100 cabin crew, pilots and engineers based at Heathrow, while up to 400 passenger services jobs would be safe at Heathrow’s Terminal 1.
The proposed UK redundancies consist primarily of roles based at bmi’s head office at Castle Donington and at regional airports. BA says that consultation will seek to, “reduce the number and mitigate the impact of the proposed redundancies,” including the potential to offer vacancies within BA at Heathrow.
BA will explore potential job opportunities with industry partners in the Midlands, such as Rolls-Royce, and states that it will also look to create jobs at its engineering facility in Glasgow from January 2014 when the contract for bmi aircraft heavy maintenance work outside the UK expires.
Keith Williams, BA’s Chief Executive, said: “bmi is heavily loss making and is not a viable business as it stands today. Our proposals would secure around 1,500 jobs that would otherwise have been lost. “As we look to restructure the business and restore profitability, job losses are deeply regrettable but inevitable. We will work with the unions to explore as many options as possible and are already working with industry partners.
“This deal is good news for our customers and will offer new destinations, new routes and new schedules in due course. For customers with bmi bookings to or from Heathrow this summer, it is business as usual, and customers can continue to book with confidence.”
As announced on December 22 last year, Lufthansa is to take on bmi’s defined benefit pension scheme before completion of the transaction, which is expected to take place around April 20. This scheme has been closed and the terms on which pensions will be retained will be agreed between Lufthansa and the bmi pension trustees. After completion, BA intends to maintain the bmi defined contribution pension arrangements for bmi employees with the potential, subject to the outcome of consultation, to transfer some or all of the bmi employees to the BA defined contribution scheme.
The acquisition of bmi mainline would give BA an additional 56 average daily slot pairs at Heathrow, of which up to 14 will be available to other carriers. Retained slots will be used to expand its operations at Heathrow. The proposed integration would also include repainting the bmi mainline aircraft in BA’s livery. The airline says that discussions with potential buyers for bmibaby and bmi Regional are continuing.