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Flybmi - another one bites the dust.

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Howardh

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What do you mean, “no”?

I said “a main factor”.
I think a major factor is we all expect and demand cheap fares and it's unsustainable for many airlines. Doesn't help the environment either when it's cheaper/faster to fly from Aberdeen to Southampton/Schipol/Paris than it is to take the train.
 

Bletchleyite

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I think a major factor is we all expect and demand cheap fares and it's unsustainable for many airlines. Doesn't help the environment either when it's cheaper/faster to fly from Aberdeen to Southampton/Schipol/Paris than it is to take the train.

Anecdotal evidence suggests that they weren't even filling their planes with cheap fares.
 

AlterEgo

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I think a major factor is we all expect and demand cheap fares and it's unsustainable for many airlines. Doesn't help the environment either when it's cheaper/faster to fly from Aberdeen to Southampton/Schipol/Paris than it is to take the train.

This was not a major factor for flybmi. They had lucrative business contracts and code shares, as well as a PSO route between Derry and London. They don’t face competition from budget airlines.
 

Howardh

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Anecdotal evidence suggests that they weren't even filling their planes with cheap fares.
Even if a flight was £1 if it's not between two places that folks want to go the flight WILL be empty.
Of course the difficulty is people do need to travel between smaller airports up and down the country but simply not enough of them. We need to get the railways up to scratch all over the UK and to connect them by bus/coach where towns aren't served. And the fares reduced to compete with the airlines would be nice.
 

najaB

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This was not a major factor for flybmi. They had lucrative business contracts and code shares, as well as a PSO route between Derry and London. They don’t face competition from budget airlines.
Sounds more and more like the problem wasn't an unsustainable business model but rather a short-term liquidity problem - as if they needed finance to get through the lean winter season, and their summer bookings didn't fill investors with warm fuzzy feelings.
 

Bletchleyite

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Sounds more and more like the problem wasn't an unsustainable business model but rather a short-term liquidity problem - as if they needed finance to get through the lean winter season, and their summer bookings didn't fill investors with warm fuzzy feelings.

I'd say they are one and the same (just in a different way). If you have to go cap in hand for an increased overdraft in the winter rather than being able to amass cash in a busier period, your business model is not sustainable.

It's not like this doesn't apply to every single business that involves any kind of tourism anywhere ever. Tourist businesses are seasonal - all of them. This is not rocket science.

A business that is sustainable for 6 months of the year is simply not a sustainable business model, unless, like some smaller leisure businesses, you are in a position to employ everyone on 6 month/zero hours contracts and simply shut down completely for those lean months.
 

najaB

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I'd say they are one and the same (just in a different way). If you have to go cap in hand for an increased overdraft in the winter rather than being able to amass cash in a busier period, your business model is not sustainable.
Not really. It's not uncommon for cyclical businesses to depend on credit to get through the lean times - which isn't a problem until your line of credit gets revoked. During the summer you repay your investors and make capital investments. Not every business has the luxury of being able to build large cash balances.
 

AlterEgo

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Sounds more and more like the problem wasn't an unsustainable business model but rather a short-term liquidity problem - as if they needed finance to get through the lean winter season, and their summer bookings didn't fill investors with warm fuzzy feelings.

Yes - like many airlines their existence was precarious and fragile. I’m sad to see them go.
 

Ken H

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Not really. It's not uncommon for cyclical businesses to depend on credit to get through the lean times - which isn't a problem until your line of credit gets revoked. During the summer you repay your investors and make capital investments. Not every business has the luxury of being able to build large cash balances.
maybe lenders saw a bigger risk for some reason. That would increase the interest, which may have tipped them over the edge. We have no idea what the lenders actuaries considered an extra risk. Maybe higher employment costs (workplace pensions can be a drain on marginal companies) or maybe a hit on leasing costs as an aircraft came due for renewal.

when Woolworth went bust, industry knew they were on the edge for a couple of months before. Factors were refusing to buy invoices so suppliers would resort to proforma invoices or COD. Firms with a lot of unpaid Woolworth invoices would start aggressive credit control procedures. Just the sniff of a business in trouble will cause problems with suppliers and it all becomes a self fulfilling prophecy.
 

furnessvale

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Doesn't mean it wasn't the main factor for them though.
Had that been the case I'm sure they would have said so. It wasn't and they didn't.

Incidentally, the CAA website lists four such recent failures only one of which is a UK airline.
 
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najaB

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Had that been the case I'm sure they would have said so. It wasn't and they didn't.
They certainly listed it as a major factor:
A Flybmi spokesman said: "It is with a heavy heart that we have made this unavoidable announcement.

"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.

"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."
Of the three factors mentioned, two are at least indirectly Brexit-related (in that the UK has limited power to force the EU to include UK airlines).
 

furnessvale

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They certainly listed it as a major factor:

Of the three factors mentioned, two are at least indirectly Brexit-related (in that the UK has limited power to force the EU to include UK airlines).
So what started out as the MAIN factor, becomes a MAJOR factor and by the end is INDIRECTLY Brexit related.

Fair enough.
 

Shaw S Hunter

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So what started out as the MAIN factor, becomes a MAJOR factor and by the end is INDIRECTLY Brexit related.

Fair enough.

Argue the semantics all you like but it is clear that without Brexit Flybmi would still be operating. What is not clear is whether it would have survived much longer as its business model was not working very well.
 

furnessvale

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Argue the semantics all you like but it is clear that without Brexit Flybmi would still be operating. What is not clear is whether it would have survived much longer as its business model was not working very well.
There is absolutely no evidence this was the case. It has joined three other, non British airlines in the same predicament, all the fault of Brexit I presume?
 

Ianno87

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There is absolutely no evidence this was the case. It has joined three other, non British airlines in the same predicament, all the fault of Brexit I presume?

Other than, oh I don't know, the exact words from the airline, I suppose you're right.
 

Bletchleyite

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Other than, oh I don't know, the exact words from the airline, I suppose you're right.

It's not exactly unusual for those who led a business to failure to make excuses for their own failings, though, so you can't necessarily take that as gospel.

I suspect it was, though, the last straw that broke the camel's back.
 

Shaw S Hunter

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It's not exactly unusual for those who led a business to failure to make excuses for their own failings, though, so you can't necessarily take that as gospel.

I suspect it was, though, the last straw that broke the camel's back.

Which is pretty much what I have said throughout this discussion. Sadly our resident Brexiteers are not prepared to accept that any bad news can ever arise from Brexit simply because... well just because.
 

najaB

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So what started out as the MAIN factor, becomes a MAJOR factor and by the end is INDIRECTLY Brexit related.

Fair enough.
No. Read what was written, rather than what you want to read - the phrase "at least" is there for a reason.

They listed three main factors in the business' failure. They specifically said that one of them was uncertainty caused by Brexit. They said that another was the ETS - in which the UK has a weak negotiating position due to our leaving the EU.

So, of the three factors raised: one was directly Brexit, one was exacerbated by Brexit and the other (high fuel prices) was largely caused by the weak pound (when did the pound fall again...?).
 

AlterEgo

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I'm enjoying the sub-narrative that a business went bust and lied about it for political reasons. Also, the completely irrelevant discussion of holidaymakers' healthcare provision, which is not relevant to flybmi, an airline dependent on business travel and charter contracts.
 

richw

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No. Read what was written, rather than what you want to read - the phrase "at least" is there for a reason.

They listed three main factors in the business' failure. They specifically said that one of them was uncertainty caused by Brexit. They said that another was the ETS - in which the UK has a weak negotiating position due to our leaving the EU.

So, of the three factors raised: one was directly Brexit, one was exacerbated by Brexit and the other (high fuel prices) was largely caused by the weak pound (when did the pound fall again...?).

Leavers are never going to accept the reality and damage leaving is doing to the economy. Rose tinted glasses etc
 
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Blaming this on brexit is complete and utter nonsense and typical fearmongering by the pro EU lobby. If it is really due to brexit then how do all the airlines in non EU countries such as, Russia, Ukraine, Serbia, Turkey, USA, Canada, Australia, New Zealand, etc etc etc, all manage to survive. There are many other reasons that airlines (or any company) can go in to administration and have to shut down other than brexit.
 

najaB

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If it is really due to brexit then how do all the airlines in non EU countries such as, Russia, Ukraine, Serbia, Turkey, USA, Canada, Australia, New Zealand, etc etc etc, all manage to survive.
Because they don't depend largely on UK<->EU business passengers, as FlyBMI did.

Is it really so non-obvious that Air New Zealand isn't going to be carrying many passengers between Aberdeen and Amsterdam?
 

AlterEgo

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Blaming this on brexit is complete and utter nonsense and typical fearmongering by the pro EU lobby. If it is really due to brexit then how do all the airlines in non EU countries such as, Russia, Ukraine, Serbia, Turkey, USA, Canada, Australia, New Zealand, etc etc etc, all manage to survive. There are many other reasons that airlines (or any company) can go in to administration and have to shut down other than brexit.

So the airline lied then by citing Brexit uncertainty as a main cause. Just want to get a feel for the tinfoilery level again in this thread.
 

DarloRich

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Blaming this on brexit is complete and utter nonsense and typical fearmongering by the pro EU lobby. If it is really due to brexit then how do all the airlines in non EU countries such as, Russia, Ukraine, Serbia, Turkey, USA, Canada, Australia, New Zealand, etc etc etc, all manage to survive. There are many other reasons that airlines (or any company) can go in to administration and have to shut down other than brexit.

indeed - however in this case the airline said Brexit ( or at least the uncertainty around Brexit) was a factor. Could all be lies to cover up incompetence mind.....................

So the airline lied then by citing Brexit uncertainty as a main cause. Just want to get a feel for the tinfoilery level again in this thread.

We are at Foilcon 1 people. We are through the looking glass..........
 

Butts

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British Midland, BMI Baby and now BMI Regional all gone.

Incidentally BMI Baby went bust years before any mention of Brexit !!!
 

Howardh

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British Midland, BMI Baby and now BMI Regional all gone.

Incidentally BMI Baby went bust years before any mention of Brexit !!!
Flybe have found a buyer; their name escapes me but I assume they will still fly under the Flybe brand. I also note they are "interested" in the stock, mechanics and pilots from Flybmi. Hopefully they can fly at least some of the lost routes.
 

Bletchleyite

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Flybe have found a buyer; their name escapes me but I assume they will still fly under the Flybe brand. I also note they are "interested" in the stock, mechanics and pilots from Flybmi. Hopefully they can fly at least some of the lost routes.

Given that the buying consortium is led by Virgin Atlantic, I would be VERY surprised if they kept flying as Flybe.
 
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