British Midland returns to the skies but British Airways keeps the Union Jack

One of Britain's biggest airlines, which has been known simply as three letters for the best part of a decade, will be renamed British Midland by its German owners Lufthansa.

Bmi was called British Midland until 2001 when the name was dropped because the airline wanted to develop a more international image and to shed the perception that it was mainly a domestic and European airline.

Lufthansa, which bought the airline last year, said it was bringing back the British Midland name because passengers associate being British with good quality. However, passengers will have fewer flights to choose from as the airline has axed almost 25 per cent of its capacity to save money.

Since its acquisition by Lufthansa, Bmi has also ditched its business class cabin on UK and Ireland routes and reverted to a one-class operation, but passengers buying the more expensive flexible economy tickets are offered an enhanced service.

Dumping the business class cabin means the airline no longer has to charge passengers the higher rate Air Passenger Duty but it is still able to offer those buying the more expensive tickets an inflight meal and access to VIP lounges at airports.

Meanwhile British Airways has confirmed that it will continue to fly the Union Jack following its merger with Spanish carrier Iberia later this year. The merged company will be renamed International Consolidated Airlines, but it is believed both the British Airways and Iberia brands will be retained.

The merged airline will fly more than 58 million passengers a year to 200 destinations worldwide.

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