Bmi hits out at GDSs
GBTA Conference special: Bmi launched a scathing attack on global distribution systems, claiming their prices were unrealistic for short-haul carriers.
The airline has to pay 15-20 per cent of its cheapest return fares in charges to GDSs and commercial director Adrian Parkes said it was making the company uncompetitive compared with short-haul carriers such as easyJet and Ryanair, which refuse to work with the technology companies.
bmi operates a full service on 20 routes from Heathrow, but said it was still important to compete with low cost carriers.
“We’ve seen a massive shift from the front cabin to the back and yields are even more horrific,” said Parkes.
“We have a perception problem that we are expensive, when we are often as cheap as low cost market and we have to be.
“We’re not making profits and the GDS’ booking fees have grown disproportionately. They are just too expensive for short-haul carriers.
“It doesn’t add up to sell through them and our biggest growth of bookings is through our own website and online agencies.”
But Parkes said bmi would not pull out of the GDSs.
“We can’t break the cycle, we need to distribute in as many areas as possible.”
Later in the conference, Galileo managing director international markets Gordon Wilson defended his company’s stance (see separate story) and reacted angrily to suggestions that it was ‘stumbling’ through negotiations with airlines.
“I don’t think we’re stumbling at all. I’m not prepared to conduct our discussions with bmi through the press,” said Wilson.
Parkes admitted bmi had huge problems. “We’re not making money anywhere. (Ryanair chairman) Michael O’Leary is predicting a mother and father of all price wars, so that’s another thing to look forward to.
“We’re now the fourth of fifth place airline after being in 2nd or 3rd place. We have a problem with the brand. People know what they’re getting with Virgin and Ryanair, but they don’t know what they’re getting with us.”
Report by Jeremy Skidmore from the GBTA Conference, Shanghai
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