British Midland International said it is reviewing its domestic network at Heathrow that will include reducing services to Manchester. The Lufthansa-owed subsidiary has also mooted the possibility of closing its loss-making Gatwick route in a move that would gift British Airways a monopoly on domestic routes.

The carrier, the airport’s second largest operator, has blamed BAA’s increased landing fees for the cutbacks for making it uneconomic to run shorter flights.

It will use slots created by domestic cutbacks for more lucrative international routes instead.

Manchester flights are expected to be cut from six daily to four and is considering

BAA insists charges are not to blame, and that domestic routes have been in doubt ever since a third runway was ruled out by the Coalition, limiting future growth.

Green campaigners also argue that domestic flights are unnecessary in the era of high speed rail.

BMI’s Glasgow, which loses millions each year, could also go under review.

BMI’s Austrian CEO, Wolfgang Prock-Schauer, last year announced cuts on some domestic routes, from eight a day down to five as part of £100m in annual cost cuts. He said BAA was “unfairly penalising domestic passengers at Heathrow” and added that he was “outraged” by the increases.

BMI holds one in ten slots at Heathrow, and together with Star Alliance partners such as Swiss, United and Continental, has 33 per cent.

Cutting back on domestic services, which feed into Star Alliance long haul flights at Heathrow, would have been unthinkable only a decade ago, but faster rail links and competition from no-frills rivals such as easyJet have eroded income.

In the past four years BMI has shifted focus at Heathrow, cutting services between Heathrow and Leeds Bradford, Durham Tees Valley, Jersey and Inverness – despite holding a monopoly on all four routes – and dropping flights to Paris and Brussels due to competition from Eurostar.

Over the same period, it has expanded into more profitable medium haul destinations such as Moscow, Cairo and Riyadh. It begins flights to Tripoli, next month and plans to announce more new routes this year.