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flybmi goes into receivership, all flights cancelled – why did it happen?

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flybmi (not to be confused with Flybe) went into administration on Saturday evening.

All flights were cancelled with immediate effect.

This is the official statement published on their website:

British Midland Regional Limited, the East Midlands-based airline which operates as flybmi, has today announced that it has ceased operations and is filing for administration.

flybmi goes into receivership

flybmi operates 17 regional jet aircraft on routes to 25 European cities.

All flights have been cancelled with effect from today. Customers who booked directly with flybmi should contact their payment card issuer to obtain a refund for flights which have not yet taken place. Customers who have booked flybmi flights via a travel agent or one of flybmi’s codeshare partner airlines are recommended to contact their agent or airline for details of options available to them. Customers who have travel insurance should contact their travel insurance provider to find out if they are eligible to claim for cancelled flights and the procedure for doing so.

A spokesperson for flybmi said:

“It is with a heavy heart that we have made this unavoidable announcement today. The airline has faced several difficulties, including recent spikes in fuel and carbon costs, the latter arising from the EU’s recent decision to exclude UK airlines from full participation in the Emissions Trading Scheme. These issues have undermined efforts to move the airline into profit. Current trading and future prospects have also been seriously affected by the uncertainty created by the Brexit process, which has led to our inability to secure valuable flying contracts in Europe and lack of confidence around bmi’s ability to continue flying between destinations in Europe. Additionally, our situation mirrors wider difficulties in the regional airline industry which have been well documented.

“Against this background, it has become impossible for the airline’s shareholders to continue their extensive programme of funding into the business, despite investment totalling over £40m in the last six years. We sincerely regret that this course of action has become the only option open to us, but the challenges, particularly those created by Brexit, have proven to be insurmountable.

“Our employees have worked extremely hard over the last few years and we would like to thank them for their dedication to the company, as well as all our loyal customers who have flown with us over the last 6 years.”

Why did flybmi go bankrupt?

Where was flybmi flying?

flybmi carried just over 500,000 passengers on 29,000 flights last year, using a fleet of 17 Embraer aircraft.

The airline had three main bases, in Aberdeen, Bristol and Munich, with its head office at East Midlands Airport.  flybmi served Aberdeen, Bristol, Brno, City of Derry, Dusseldorf, East Midlands, Esbjerg, Frankfurt, Hamburg, Jonkoping, Karlstad, London Stansted, Lublin, Milan Bergamo, Munich, Newcastle, Norrkoping, Nuremburg, Oslo, Paris Charles de Gaulle, Rostock/Laage, Saarbrucken and Stavanger.

As well as flying under its own brand, it sold tickets under codeshare deals with Lufthansa, Brussels Airlines, Turkish Airlines, Loganair, Air France and Air Dolomiti.

The airline is the final remnant of the old British Midland.  After IAG acquired BMI in 2012, IAG sold the non-core routes which did not fly into London to Sector Aviation.  In 2015 it came under the control of Loganair’s owner Airline Investments.

It is important to note that Loganair is not impacted by this announcement, despite the two airlines having the same parent.

Why did flybmi go into administration?

Whilst flybmi is not related to Flybe, there is no doubt that the two airlines had been facing the same issues in recent months.  This move may give Flybe the opportunity to pick up a few of the better performing routes.

Let’s be clear about one thing though – flying 522,000 passengers on 29,000 flights in 2018 means an average of just 18 passengers per flightAn Embraer E145 can seat 49 people whilst an E135 holds 37, so we are looking at very weak loads.  Whatever factors are being blamed for its closure, the answer may be closer to home than the airline wants to admit.

Comments (104)

This article is closed to new comments. Feel free to ask your question in the HfP forums.

  • Genghis says:

    Small mistake: “a flight of 17 Embraer aircraft” should be “a fleet of…”

    • David says:

      I thought this, but if you can have a “flight” of wines, why can’t you have a “flight” of Embraers? Especially if you consider the pun bonus…

    • Rob says:

      Doh, will fix.

  • Will says:

    The livery on those ERJ’s pictured looks fantastic!

  • Charlieface says:

    Anyone with flights booked by credit card should remind their provider that section 75 means they are equally liable for consequential loss, in this case rebooking under EC261/2004, not just a refund.
    I pity Failing Grayling who just announced 2 days ago the renewal of the Derry-Stansted PSO. He really doesn’t seem to get anything right.

    • Save East Coast Rewards says:

      Let’s not pity Failing Grayling considering the amount of public money he’s wasted with his dodgy decisions in the past. Perhaps Loganair will be able to take over this route if they have the aircraft to do so.

      It’s sad to see the end of the bmi brand. Diamond Club was what gave me my love of loyalty schemes as I could get amazing benefits from the scheme. Although bmi regional never flew anywhere I needed to go and didn’t have Diamond Club it was still nice to see the bmi brand and livery around when flying.

      • Mikeact says:

        It does make me concerned about Loganair as well…..are they financially sound……what are their load factors ? I guess underlying, that they get subsidies to ensure they keep going ?

        • Mr Dee says:

          So Flybmi was run separate to ensure profitability on the routes they took on, makes sense.

  • BJ says:

    To be honest I had forgotten that BMI regional even existed. I cannot recall noticing an ad or promotional material for them anywhere. That may have been part of their problem.

    • Save East Coast Rewards says:

      I guess it depends where you lived. They weren’t much use for those of us in London (except for the Derry flight). I’d have hoped they promoted themselves in the areas where they had a presence.

    • Rob says:

      Agreed.

    • RussellH says:

      Amex had one of their “Spend £xxx, save £yy” offers on flybmi about 12 months ago. It was never mentioned on here, though, in an article, though I mentioned it as an OT.

      I also mentioned flybmi here a few months later when my partner tried to use them for a day trip from NCL-BRU. The plane was supposed to arrive at NCL in the evening, stay the night then leave for BRU at some ungodly hour in the morning. Even though the plane nevver arrived at NCL on the Tuesday, she only found out when she tried to check in in the morning. She was given a piece of paper with instructions to phone an 0845 number (08xx numbers having been banned for CS purposes some months earlier) which just went to voice mail, with an announcement to try after 0800. Flight should have left before 0600.

      • Lady London says:

        Haha Hertz has for some time now removed all the normal 01- 02- 03- numbers for branches on its website, and displays only 0843- numbers. Hertz disabled all the old regular numbers. so even if you know the “real” phone numbers still, which do exist, Hertz seems to have made great efforts to illegally charge their customers so far as I can tell by forcing them to dial these expensive numbers that I believe, it is illegal for them to do.

        These numbers that Hertz is apparently allowing customers to dial as the only way of reaching a branch are charged at at 7p extra per minute, apparently. Customer will pay this as well as potentially huge surcharges on mobile or other phone line if needing to call Hertz on these 0843- numbers. I did mention it as potentially illegal but apparently Hertz doesn’;t seem to think so.

  • hdagz says:

    I had an outstanding EU Regulation 261/2004 (flight delay) claim against them, they hadn’t responded for quite a while, now I know why!

    I have travel insurance and booked on Amex gold, unlikely I know but does anyone know if either will cough up the €250 in bmi’s absence?!

    • Will says:

      Possibly, check the terms of your policy amex plat says £150 for refreshments if 4 hour delay in departure time. Presumably they’d want receipts although perhaps you submitted them to Flybmi and they are now awol.

    • Charlieface says:

      Similar to what I mentioned above, Amex should cover EC261 claim under section 75. It’s also a joint liability.
      Insurance would be separate and usually only cover losses.

      • Shoestring says:

        Amex charge cards don’t come under S75 (which applies to credit cards).

        And don’t forget S75 is for when you paid over £100.

        • Oli says:

          Over £100/person/flight or £100/booking?

        • Shoestring says:

          @Oil pretty sure it would be covered – see www
          financial-ombudsman org
          uk/publications/technical_notes/goods-and-services-bought-with-credit.html
          case study 1
          [Mr McF used his credit card to buy a travel voucher for £220 that was valid for ten single trips. He had made three trips using the voucher when the travel provider went into administration.
          The credit card provider argued that the value of each individual trip under the voucher would be less than £100. It said this meant it could have no potential liability under section 75.
          We disagreed. Mr McF had not purchased ten individual trips costing £22 each – he had purchased a single voucher costing £220. As the item purchased under the contract was above £100, it was covered by the provisions of section 75.]

        • John says:

          Over £100 per transaction according to your card statement, at least. If two pax at £50 each are charged separately (as happens with Amex Travel) they would argue it’s two transactions and would require some escalation.

    • Shoestring says:

      No to EC261 EUR250 compo but you might be able to claim actual losses

      • Charlieface says:

        Joint liability means the credit card is also liable for EC261 in the same way the airline would be. That means they must cover rebooking even if it costs more than the original charge.
        Granted the OP has a charge card so no s75.

    • Rob says:

      Unlikely. You can claim from the administrator but I doubt there is any money in the pot.

      • hdagz says:

        Thanks all. I’ll try travel insurance, Amex and administrator, but not getting my hopes up. Forgot to mention my Gold is (still) a charge card so as suggested no S75 for me 🙁

        • Shoestring says:

          Amex’s chargeback scheme is meant to be just as good for small things so mention that to them

        • John says:

          That will provide a refund but not the compo or a replacement flight though

  • Oli says:

    OT – I have a Transavia flight in April from Marrakech to Nantes which scheduled landing time has been modified from 2pm to 8pm. As we cannot drive the 3 hours to our final destination that evening with small kids, are we entitled to an hotel in Nantes paid by Transavia?

    • Rob says:

      No. Two months out, your only right is the right to cancel and get a refund, I think.

      • Shoestring says:

        I’ll challenge that – depends if you insist on your right to re-ticketing, in which case duty of care come in:
        [What are my options?
        If your cancelled medium-haul flight is covered by EU law, your airline must let you choose between two options:
        1. Receive a refund
        You can get your money back for all parts of the ticket you haven’t used. For instance, if you have booked a return flight and the outbound leg is cancelled, you can get the full cost of the return ticket back from your airline.
        2. Choose an alternative flight
        If you still want to travel, your airline must find you an alternative flight. It’s up to you whether to fly as soon as possible after the cancelled flight, or at a later date that suits you. Airlines often refer to this as being ‘rerouted’.
        Although most airlines will book you onto another of their flights to the same destination, if an alternative airline is flying there significantly sooner then you may have the right to be booked onto that flight instead. You can discuss this with your airline.
        Care and assistance
        If you choose an alternative flight you are also entitle to care and assistance. This usually means food, drink, access to communications (this could be by refunding the reasonable cost of phone calls) and accommodation (if necessary).]

        From CAA. Yes – no compo if over 2 weeks’ notice.

        • Rob says:

          This flight isn’t cancelled though, just moved 6 hours.

        • Shoestring says:

          Should have read that bit. Yep – this one’s clear – they wouldn’t pay for a hotel the other end, no duty of care there.

        • Bill says:

          I had a ryanair flight schedule change by something like 8 hours. They rebooked me on an alternative flight with same destination but a different origin (resulted in the same date of travel and same departure and arrival time). Nothing to pay. That was about 8 months ahead of departure

        • sunguy says:

          It all depends on whether the flight number has stayed the same……as to whether its cancelled or a schedule change.

          Its a nuance – but if the flight number changes, you have been cancelled and rebooked if the number is the same, you have just had a schedule change….

          I had to argue this point with an American Airlines first line agent last year – eventually passed to a manager who whilst reading the booking mentioned the flight had been cancelled (no longer running at the time I had booked).

  • Billy says:

    Loved how they blamed it on Brexit, the media is gonna have a field day with this. The CEO was a remainer no doubt.

    • Chrisasaurus says:

      Or saw that the reduction in forward bookings into the EU, the cost associated with making changes to the legal structure of the airline and the quite obvious uncertainties that surround any business with any exposure whatsoever to the EU all contributed to a situation where the shareholders could no longer guarantee the companies survival?
      Y’know, facts and that?

      • Shoestring says:

        You two must have missed this bit: [which has led to our inability to secure valuable flying contracts in Europe and lack of confidence around bmi’s ability to continue flying between destinations in Europe]

        • Rob says:

          It’s true that they wouldn’t have been able to confirm any EU-EU routes and would probably have had to surrender those they had. Still an under 50% load factor though.

        • Chrisasaurus says:

          That was the legal structure bit – easyJet-esque Austrian setup if wanting to continue within EU

      • hdagz says:

        +1

      • Alan says:

        Shhh, you’re sounding a bit like someone well-informed and reasonable and you know we’ve all had enough of experts… 😉

    • Roger* says:

      No. ‘The airline has faced several difficulties, including recent spikes in fuel and carbon costs, the latter arising from the EU’s recent decision to exclude UK airlines from full participation in the Emissions Trading Scheme. These issues have undermined efforts to move the airline into profit. Current trading and future prospects have also been seriously affected by the uncertainty created by the Brexit process, which has led to our inability to secure valuable flying contracts in Europe and lack of confidence around bmi’s ability to continue flying between destinations in Europe. Additionally, our situation mirrors wider difficulties in the regional airline industry which have been well documented.’

      Your point is? No, let me guess.

  • Nigel the pensioner says:

    Rob – i assume you got my PM re the regional airlines editorial i sent you a couple of days ago?
    There goes number one; whatever Virgin have in mind for Flybe I believe they are safe for now. I would be very aware of the “independents” though on niche routes and also on the “challengers” on competitive routes. Make a note of which airline is giving a profits warnings and which are “delighted” with new financial backing – this simply means greater long term debt in the first instance.
    Oh and finally (and i expect obviously) do distinguish between a credit card and a debit card when booking…..

    • Shoestring says:

      It does help Flybe mgt’s case that it was a case of ‘sh!t or bust” and 1p is generous

    • Rob says:

      Yes, thanks for that. I think the Flybe deal is a done deal and this will simply remind anyone who thought there was an alternative that there really isn’t.

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