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The BBC's Marcia Hughes
"Most people agree it was time for a change"
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Chairman Sir Michael Bishop
"We have been preparing a significant sales and marketing exercise"
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Chairman Sir Michael Bishop
"We want to operate from Heathrow to the US"
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Chairman Sir Michael Bishop
"I have no complaint about my competitors"
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Thursday, 1 February, 2001, 13:57 GMT
British Midland: Aiming for the US
Sir Michael Bishop, chairman of British Midland
Sir Michael: "Re-branding and relaunching is not inexpensive"
By BBC News Online's Jørn Madslien

It has not been a good past few days for British Midland. Just as the UK's second-largest carrier got ready for a long-awaited relaunch intended to mark the airline's return to the trans-Atlantic flights market, it was bombarded by bad news.

Less than a week before the relaunch, its new name and logo were secretly photographed by a French plane spotter who posted the pictures on the internet.
Lufthansa planes at Frankfurt airport
Sir Michael insists that Lufthansa did not intervene in British Midland's branding decision.

Then, earlier this week, US authorities once again blocked the airline's long-standing push to offer flights from Heathrow to the United States.

And on the day before the launch, British Midland was threatened with a strike.

Not irritated

Despite these developments, the company's charismatic chairman, Sir Michael Bishop, retained his cool.

"I'm not irritated at all," he said, referring to the threats of industrial action that will inevitably rub some gloss off the company's relaunch, regardless of whether or not a strike actually takes place.

And strangely, perhaps, neither did he seem particularly irritated about the plane spotter's photograph of an Airbus aircraft flaunting British Midland's new logo and colours.

The old logo
The old logo
Both the words "British" and "Midland" have been kept as part of the airline's identity. New is the world "International", and the logo - "bmi"

The airline still flies the Union flag and the colours blue, light blue, red and white will decorate the planes.

"Inevitably, the re-branding and the relaunching of a product is not an inexpensive exercise," Sir Michael acknowledged, though he declined to disclose any amounts.

"We've been working for 18 months, not only preparing the launch of the

There are perfectly legitimate commercial reasons why airlines who are already operating these services would want not to be joined by other operators

Sir Michael Bishop
British Midland
long haul flights themselves and ordering aircraft and preparing the product and training our staff, but we've also been preparing a significant sales and marketing exercise to relaunch the company on 1 February," he said.

So it is no wonder that, as an anonymous British Midland source said, "the airline is gutted this has got out early. It was meant to be a surprise".

Lufthansa's decision?

It had been rumoured that the German airline Lufthansa, which owns a 20% stake in British Midland, had intervened to stop a planned shift away from the airline's British identity.

But when questioned about whether Lufthansa had had any influence on its decisions, Sir Michael said: "On the branding issue, none at all. Neither have there been any discussions or consultations about it."

Trans-Atlantic difficulties

British Midland had hoped to be able to offer flights between London Heathrow and the US through a code-sharing agreement with its partner United Airlines.

In effect, it would be selling British Midland tickets for seats on United Airlines flights.

But its plans were scuppered on Monday when the US Trade Department refused to allow the proposed code-sharing to go ahead "given the current state of US-UK aviation relations".

BA planes at Heathrow
Rival British Airways already flies between Heathrow and the US
Sir Michael appeared to believe that the US is using the issue as a bargaining chip in its negotiations with the UK over possible revisions of the Bermuda II aviation agreement of 1977.

"I think that is an issue which is obviously being retained for part of the main talks between the UK and the US governments, so I think that is probably a logical decision by the US government to gather an agenda for the resumption of talks," Sir Michael said.

Governments' fault

The UK-US aviation agreement restricts to four the number of UK and American airlines allowed to fly between Heathrow and the US.

They are British Airways, Virgin Atlantic, American Airlines and United Airlines.

"There are perfectly legitimate commercial reasons why airlines who are already operating these services would want not to be joined by other operators," Sir Michael said.

"That is in the nature of business and commerce, and therefore I have no complaint about my competitors," he said.

"As far as governments are concerned, that's a different matter altogether," he continued.

Sir Michael argued that consumers would benefit from the increased competition if the Bermuda II agreement was replaced by an Open Skies agreement.

British Midland stopped operating transatlantic charter flights in 1982.

In 1999 the airline was granted licences by British aviation authorities to run scheduled services to New York, Washington, Miami and Boston from Heathrow.

It can only operate the services if an open skies deal is reached.

Early last autumn, British Midland said it would launch new services from Manchester to Washington DC and Chicago.

The airline will start offering flights between these cities in April and May.

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See also:

13 Sep 00 | Business
British Midland goes transatlantic
23 Feb 00 | Business
British Midland stretches wings
09 Nov 99 | The Company File
Lufthansa buys stake in British Midland
20 Oct 99 | The Company File
Anger at airline sale
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