Airline passenger news and views

Sir Richard Branson’s proposed sale of Virgin Atlantic is really a result of the regulators allowing the  British Airways and American Airlines tie up to go ahead.

Sure, the airline business is tough at the moment and Virgin Atlantic suffered a £130million loss last year. But, all airlines lost money and, on the plus side, Virgin continued to take business passengers from BA.

Virgin’s growth in business travellers, both in Upper Class and Premium Economy may be partly due to last year’s BA strikes but is also likely to be because of the better level of service that Virgin provide. 

It can be difficult to put a finger on why people like travelling with Virgin Atlantic but they just do.  I would suspect that a good percentage of those that transferred because of the BA strikes will remain Virgin customers, that is as long as Virgin can make effective use of Heathrow.

Virgin have 17,000 Heathrow slots per year compared with the 200,000 plus slots that will be controlled by BA/AA.

Consolidation and mergers are re-shaping the market and Virgin must feel vulnerable.  They have, in my view, very sensibly kept outside of the formal alliances.  Singapore Airlines (the 49% joint owner of Virgin Atlantic) is a Star Alliance member but Virgin continue to act independently.

One problem for Virgin is its identity, is it a holiday and leisure airline or is it a business carrier.  The big money, for the moment, is in business travel but Virgin should not be too quick to shift its focus. It has done very well out of, and for, the leisure market. The services that it provides from Gatwick, Manchester etc. are highly regarded but, clearly, Heathrow remains the key business hub for London and the gateway to other European cities.

Too a large extent, Sir Richard has been let down by the regulators. Virgin Atlantic brought much needed competition to the trans-Atlantic routes and have created new competition on other long-haul routes. Virgin and we, the travelling public, deserve protection.