With a hat-tip to Xander who commented about one of my pictures yesterday Airline Route confirm the launch of a Brussels Airport to New York JFK International operated by Brussels Airlines.

The route is due to commence on 1st June 2012, operating the following legs

SN0501 -  DEPART BRU 10:20       ARRIVE JFK 12:35
SN0502 -  DEPART JFK 17:15       ARRIVE BRU 06:25+1

Operates Daily
Booked Equipment: Airbus A330-300

Economy Returns are pricing in from £486.70 based on a departure from MAN/BHX.

With Brussels Airlines returning to JFK, it marks the return of a Belgium flag carrier serving the Trans-Atlantic Market since the collapse of Sabena in November 2001.

However, there is some major competition into the New York Area, with United (Continental) operating to Newark International and Jet Airways operating to New York-JFK.

It’ll be interesting if Brussels Airlines can tap into the JFK destination market from it’s built network in Africa and let it flow through, as well as marketing the service locally when there are existing Star Alliance (or Jet Airways service).

All Nippon Airlines (ANA) have announced dates when it intends to operate 787 on Japanese Domestic routes.

The routes hubbing from Toyko Haneda Airport will serve the following:

Commencing 23rd January 2012
Tokyo Haneda – Osaka Itami
Tokyo Haneda – Yamaguchi

Commencing 1st March 2012
Tokyo Haneda – Matsuyama

International services are still restricted to the changes made on the 15th December, however the Tokyo Haneda -Frankfurt route is still set to commence on the 21st January 2012. The first aircraft operate between Tokyo Haneda-Okayama and Tokyo Haneda-Hiroshima.

There is a also a livery change with the dramatic scheme that was painted on the first two birds swapped for something a bit more… ANA.

Image – Flight International

GhettoIFE.com will be looking further into the 787 over the next few months as the writer may just be going for a ride in one… and hopefully I’ll answer the question “How is it flying in a plastic plane” and “Is it just a 767 on steroids?”

It’s the 27th of December, and there is a little news out and about, but who cares. Images I’ve promised this week, and images you’ll get.

Today it’s a Brussels Airlines Avro Regional Jet RJ85 parked at London Heathrow

More again tomorrow!

As it’s still quiet in Airline news land, it’s time for some more airplane art – and there’s going to be a fair bit over the week – as well as my end of year review which I’m working on.

Today, it’s an EasyJet’s 100th Airbus A319 at Belfast International Airport.

More airplane art over the week!

It’s Christmas Day, and a Merry Christmas to all.

It’s Sunday still, so it’s time for some airplane art. This week, it’s a present International Consolidated Airlines Group brought for it self from Lufthansa – British Midland Airways Limited.. and with that, a BMI Airbus A319 taxing at George Best International Airport

More airplane art over the week as it’s Christmas week, and news is normally quiet this week…

(Republished as something has gone a bit odd… and I’m at a loss to see what WordPress has done this time)

It’s Saturday again, and it seems this series has legs on it as we continue Aircraft Repaint Saturday (currently I’ve got content to last through March – hopefully more than enough time for some new safety videos to come out… ).

This week, it’s a Virgin Atlantic Boeing 747-400 going into the hanger for a repaint.

More aircraft repainting next week!

In what seems like a turnaround for a low-cost carrier, Air Asia has announced that it will be abolishing the counter check-in fee for all international flights.

The RM10 fee (~$3/£2 or so) will no longer apply for International bookings from 22nd December 2011 onwards, however Domestic flights with Malaysia (which is fairly spread out) will be required to pay the fee – or use a free self check-in option such as using a kiosk at the airport, web check-in or mobile check-in.

What’s really surprising is the fee was introduced in September this year, and in being rescinded quickly after 4 months. Air Asia has refused to give a reason, but with every penny counting these days, you can the money that was paid for check in fees stacked up with a free complaint from each customer.

Either Air Asia is made of less sterner stuff than Ryanair (who will happily charge you £5 to check in online or £40 to use a counter), or Air Asia is actually realises they can’t ding customers for every little thing….

Looking through the slide deck from the IAG  have published on their investors relations site, it is now confirmed that BMI’s membership of Star Alliance will terminate upon completion of the purchase of BMI by IAG.

The transaction is due to be completed by 31st March 2012, subject to regulatory approvals.

The slide deck also reveals a few more features:

• BA will be gaining a fleet comprising 27 aircraft (23 leased and 4 owned)
• The 56 slot number applies to weekdays only
• bmibaby to be wound down and closed if a sale of bmibaby is not executed (or as written “if bmi baby is not sold by May 2012, Lufthansa will provide compensation to cover costs of orderly exit”)
• It looks like mixed terminal running to start with, with the possibility of moving to T5/T3 (“Possibility to co-locate bmi mainline capacity at Heathrow in the Western Campus (T5 / T3) with the rest of IAG, after T2 phase 1 completion in 2013)
• The IAG slot portfolio will increase to around 53% post completion
• BMI used 25% of it slots with regional aircraft (ERJ-145′s) for Summer 2011.

Slide deck is at http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9MTE5NzI3fENoaWxkSUQ9LTF8VHlwZT0z&t=1. Worth a read.

Subject to nothing else breaking out, I’ll be doing an analysis a bit later on this evening.

The press releases for today’s big announcement today of the sale of British Midland Airways to International Consolidated Airlines Group (IAG)

First up, Lufthansa – http://presse.lufthansa.com/en/news-releases/singleview/archive/2011/december/22/article/2054.html

Following the announcement on November 4, 2011, Deutsche Lufthansa AG (Lufthansa) and International Airlines Group (IAG) have signed a binding agreement for the sale of British Midland Limited (bmi) to IAG. The price is GBP 172.5 million (approx. EUR 207 million) in cash for bmi. The price is subject to certain reductions. Both parties aim for a closing of the transaction by the end of the first quarter 2012.

After signing the agreement, Christoph Franz, CEO and Chairman of the Executive Board of Deutsche Lufthansa AG, stated, “bmi’s employees and management team have shown great motivation and unfailing commitment in dealing with the financial challenges of the past years. For this I owe them my thanks and appreciation. It was therefore especially important for us to find the solution that best provides the company and its employees with sustainable prospects for the future. This has been achieved through the sale of bmi to IAG. And as part of Lufthansa’s strategic development the sale means that our customers, shareholders and employees will benefit from a sharpened corporate profile and a stronger financial position of the Group. Both of these are necessary elements to enable sustainable, profitable growth.”

Transaction highlights:

• Sale of bmi for a gross purchase price of GBP 172.5 million (approx. EUR 207 million), subject to certain reductions
• Net of total potential reductions, the net purchase price expected to be clearly negative; however, the transaction is expected to have amortized for Lufthansa after around one year
• As part of the agreement, a British holding company of Lufthansa, is to take on bmi’s defined benefit pension scheme
• Deal remains subject in particular to competition clearance
• bmi will be accounted for as “asset held for sale / discontinued operations” for Financial Year 2011
• Closing of the transaction is aimed for the first quarter of 2012
• Transaction offers sustainable future prospects for bmi
• Lufthansa aligns airline portfolio to strategic fit and benefits from stronger earnings position

Meanwhile over at IAG http://www.iairgroup.com/phoenix.zhtml?c=240949&p=irol-rnsArticle_Print&ID=1642163&highlight=

BINDING AGREEMENT FOR BMI PURCHASE

Following the announcement on November 4, 2011, International Airlines Group (IAG) and Deutsche Lufthansa AG (Lufthansa) have today reached a binding agreement for IAG to acquire British Midland Limited (bmi). The cost is £172.5 million in cash though the price is subject to significant reductions. bmi consists of three distinct business units – bmi mainline, bmi regional and bmibaby.

Transaction highlights:

• Acquisition of bmi for £172.5million in cash
• IAG’s Heathrow slot portfolio to increase by up to 56 additional daily slot pairs
• Lufthansa to take on bmi’s defined benefit pension scheme
• Lufthansa has the option to sell bmi regional and bmibaby before completion
• Significant price reduction if Lufthansa does not opt to sell bmibaby before completion
• Deal subject to competition clearance
• Earnings per share (EPS) accretive by 2014 at the latest
• 2015 operating profit target of €1.5 billion to increase by more than €100 million with consequent increase in EPS
• Underpins goal of 12 per cent return on capital employed by 2015
• Restructuring costs spread over three years and significantly lower in total than bmi’s current annual losses

Willie Walsh, IAG chief executive, said: “Buying bmi’s mainline business gives IAG a unique opportunity to grow at Heathrow, one of our key hub airports. Using the slot portfolio more efficiently provides the option to launch new longhaul routes to key trading nations while supporting our broad domestic and shorthaul network.

“This deal is good news for the UK as we will maintain a comprehensive domestic schedule including Belfast. Our plans to expand our longhaul network would guarantee growth by making Britain better able to compete on a global scale. It will also help maximise Heathrow’s position as a world class hub airport.

“Customers will benefit from access to new destinations, more convenient schedules, enhanced frequent flyer benefits and greater investment than had been possible for loss-making bmi.

“Given the scale of bmi’s losses, there is an urgent need to restructure the business. Unfortunately, this will mean some job losses but we will secure a significant number of high quality jobs here in the UK and create similar new jobs in the future. IAG’s purchase of bmi will protect more British jobs than if the airline had been closed and had its Heathrow slots sold off. There will be restructuring costs spread over three years but these will be significantly lower in total than bmi’s current annual losses.

“bmi regional and bmibaby are not part of our plans and Lufthansa has the option to sell them before completion”.

Financing

IAG intends to finance the purchase from its own funds. £60 million of the purchase price will be paid in four instalments to Lufthansa pre-completion. This amount will be secured by Heathrow slots.

Pensions

Lufthansa has agreed to take on bmi’s defined benefit pension scheme.

Timetable and conditions

It is hoped that the transaction will be completed during Q1 2012 subject to regulatory clearance from the European Commission and other bodies. There is a termination fee of £10 million which is only payable by IAG if phase 1 EU regulatory approval is not achieved by March 31, 2012 and either party elects to terminate the sales purchase agreement.

About bmi

bmi mainline operates Airbus aircraft to destinations in the domestic UK market, Europe, CIS states, Middle East and Africa from London Heathrow. bmi regional operates an Embraer fleet and offers shorthaul flights within the UK and Europe from 7 regional airports. bmibaby operates Boeing aircraft and is a low-cost airline flying primarily out of East Midlands and Birmingham airports.

bmi reported gross assets of £284 million as at December 31, 2010 and a £153 million loss before tax on revenues of £777 million for the year 2010.

So what new things do we learn?

• BMI is loosing money hand over fist still.
• BMI’s pension scheme is still Lufthansa’s problem (operated by a LH controlled UK holding company)
• IAG gets a significant price reduction if Lufthansa fails to sell BMI Baby
• BA Brand gets a chance to launch more long-haul routes out of London Heathrow
• Belfast to retained as a destination from London
• IAG remains “London focused” with it not wanting to deal with BMI Baby – showing what BA’s attitude to the regional areas of the UK
• It’s still all down to the competition authorities.

There will be further coverage of this during the day, including an analysis later on today.

Well it seems Virgin was too late to the party with Deutsch Lufthansa AG deciding to sell it’s British Midland Airways subsidiary to … International Consolidated Airlines Group (IAG).

For IAG, the spoils of war are simple: 56 slots at Heathrow.

The cost has been revealed to be  £172.5m, and IAG/Lufthansa aim to have the deal done in the next 3 months.

The deal of course is subject to competition bodies, which Virgin will bitch about non-stop.

Whilst BMI employ over 3,600 staff, they have managed to loose £153m in 2010, which means – another restructuring of the business. And sadly for some of the staff, it’s job cut time again.

Willie Walsh – IAG Chief Executive said:

“Given the scale of BMI’s losses, there is an urgent need to restructure the business.

“Unfortunately, this will mean some job losses but we will secure a significant number of high quality jobs here in the UK and create similar new jobs in the future.”

IAG will be conducting the changes over a 3 year period.

The sale currently includes BMI Baby, but Lufthansa has the option to dispose of BMI Baby before the sale of British Midland Airways is completed. BMI Regional is already sold in its current state.  Should Lufthansa fail to sell BMI Baby before the deal is completed, IAG said the price it would pay would be subject to a “significant” reduction.

So where does this leave Virgin? Firing off an angry press release it didn’t get what it wanted

Sir Richard Branson states:

“BA is already dominant at Heathrow and their removal of BMI just tightens their stranglehold at the world’s busiest international airport.

“We will fight this monopoly every step of the way as we think it is bad for the consumer, bad for the industry and bad for Britain.”

I can only wish my best for the staff of BMI who are some of the best in the business in the air, and hope the losses that happen are minimal.

I’ll have further analysis on this during the day. But if you have a mileage pile, consider redeeming shortly….