Aging Well?: Virgin Atlantic Turns 25 in the Midst of a Downturn With Network Ambitions and a Cautious Fleet Plan

This article looks at the current state of Virgin Atlantic Airways as it turns 25. It continues to rely on its fundamentals, mainly the exclusively long-haul, point-to-point network, but it is in talks with Lufthansa about acquiring its bmi mainline operation at London Heathrow, which would mean a shift from a stand-alone, brand-based airline into a full network carrier, with a likely membership in Star Alliance. Lufthansa may also be proposing close ties with Virgin in the form of acquiring some of the 49 percent stake in Virgin held by Singapore Airlines Group. Virgin has tried to link with bmi’s mainline and predominantly short-haul network at Heathrow in the past, but negotiations have failed to progress because of opposition from bmi founder Michael Bishop. But he has exercised an option requiring Lufthansa to acquire his 50 percent share plus one, which will increase Lufthansa’s ownership in bmi. Challenges to the arrangement from other carriers on anti-trust grounds include arguments made by British Airways, which has had a problematic relationship with Virgin since Virgin’s launch. While the airline anticipates difficult times in 2009 and 2010, it argues that it has a well-diversified passenger base that balances leisure and business, with about 30 percent of its capacity “premium.” Thanks to a combination of paring down future capacity growth and delays in the 787 program, Virgin won’t be taking delivery on any aircraft until at least 2013, which gives it some financial cushion in the current downturn.

• Availability:
  • Find a library where document is available. Order URL: http://worldcat.org/issn/00022543
• Authors:
  • Buyck, Cathy
• Publication Date: 2009-3

Language

• English

Media Info

• Media Type: Print
• Features: Photos;
• Pagination: pp 52-55
• Serial:
  • ATW: Air Transport World
  • Volume: 46
  • Issue Number: 3
  • Publisher: Penton Media
  • ISSN: 0002-2543

Subject/Index Terms

• TRT Terms: Airlines; Finance; Profitability
• Identifier Terms: BMI (Airline); Virgin Atlantic Airways
• Subject Areas: Administration and Management; Aviation;

Filing Info

• Accession Number: 01125467
• Record Type: Publication
• Source Agency: UC Berkeley Transportation Library
• Files: BTRIS, TRIS
• Created Date: Mar 30 2009 1:36PM