UK-headquartered airline bmi british midland has not taken kindly to attempts by budget operator Go to muscle in on its home territory at East Midlands airport – so much so, in fact, that it has decided to set up its own rival low-cost subsidiary.

Due for launch on March 23, the new budget arm will, says bmi, “serve an extensive range of key leisure destinations from East Midlands airport, including high frequency services to Barcelona, Nice, Palma, Malaga, Faro and Alicante.” Fares will start at £25 each way.

Details bmi could not provide include the no-frills service’s name and corporate identity, due to be unveiled next week.

The move follows Go’s announcement in December that it would commence flights to a number of European destinations from East Midlands by May. Its application to fly to Prague from the airport is being challenged by bmi.

In stark contrast to the hard times experienced by full-service carriers, budget airlines EasyJet and Go posted hefty increases in sales last month.

Only a few months ago, bmi insisted it would not turn into a low-cost operator. However, it is thought that chairman Sir Michael Bishop decided that running traditional and low-cost services side by side was the best way to compete with Go.

News sources: The Times (London); bmi website