bmibaby is set to close late this year

Low cost airline bmibaby is set to close later this year, and with it the possibility that hundreds of jobs could be axed.

The carrier transferred to International Airlines Group, the owners of British Airways, last month, but consultations have now started with unions about its closure in September.

The GMB union said it was "devastating" news, especially for the East Midlands, where the airline is based.

The changes mean that all bmibaby flights to and from Belfast will cease from 11 June, although this will not affect bmi mainline's services to London Heathrow.

bmibaby services from East Midlands to Amsterdam, Paris, Geneva, Nice, Edinburgh, Glasgow and Newquay, and from Birmingham to Knock and Amsterdam, will end on the same date.

With bmi Regional, bmibaby transferred to International Airlines Group ownership on completion of the purchase from Lufthansa.

IAG has consistently said that bmibaby and bmi Regional are not part of its long-term plans.

A statement said: "Progress has been made with a potential buyer for bmi Regional, but so far this has not been possible for bmibaby, despite attempts over many months by both Lufthansa and IAG.

"bmibaby has therefore started consultation to look at future options including, subject to that consultation, a proposal to close in September this year."

Peter Simpson, bmi interim managing director, said: "We recognise that these are unsettling times for bmibaby employees, who have worked tirelessly during a long period of uncertainty.

"bmibaby has delivered high levels of operational performance and customer service, but has continued to struggle financially, losing more than £100 million in the last four years. In the consultation process, we will need to be realistic about our options.

"To help stem losses as quickly as possible and as a preliminary measure, we will be making reductions to bmibaby's flying programme from June. We sincerely apologise to all customers affected and will be providing full refunds and doing all we can with other airlines to mitigate the impact of these changes."

Colin Whyatt, of the GMB union, said: "This is absolutely devastating news which puts 800 jobs at risk, almost half in the East Midlands.

"bmibaby had been reorganised last year and GMB members hoped it would be sold. Two potential bidders have pulled out and unless a new bidder comes forward in the next 90 days, these jobs will go, on top of 1,200 jobs lost from the reorganisation of BMI."