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Bmibaby To Get Second Base

BMI British Midland is planning to set up a second UK base for its fledgling...

BMI British Midland is planning to set up a second UK base for its fledgling low cost carrier, Bmibaby, next year.

The no frills unit will also add a further three routes from its East Midlands base to Alicante, Geneva and Munich from next month, expanding its network to a total of eleven destinations.

BMI said it would add a further two aircraft to its Bmibaby fleet of three 737s in October and three next March to coincide with the establishment of the second base.

The decision to grow beyond East Midlands represents a significant shift by BMI chief executive Austin Reid, who only last month played down any plans for expansion beyond its original base.

Bmibaby was set up after Go, Europe's third largest low costcarrier, announced it was planning to launch flights from East Midlands airport, BMI's headquarters and traditional power base.

The company said Bmibaby, which only started flying last month, had had an "exceptional start" and was forecast to carry 500,000 passengers in the first nine months of operations, a third higher than original estimates. Passenger volumes were expected to rise to 1.5m by 2003.

BMI is also shaking up the fare structure on its full service UK routes out of London Heathrow, where it is the second largest operator after British Airways.

The move, which will see it lift Saturday night and minimum stay requirements and offer fares from as low as GBP 29 one-way, mirrors a similar decision by BA earlier this month.

The fare changes is part of a strategic review started by Mr Reid in January. BMI has already simplified the fare structure of its regional UK operations.

Both BMI and BA have seen their traditional two-class model undermined by the success of the low-cost airlines in recent years.