Virgin Atlantic Facing Record Losses

It seems VS's forthcoming results aren't looking good. I hope they can get back on track. Although not the airline they once were IMHO I wouldn't like to think of them disappearing.

http://www.telegraph.co.uk/finance/newsbysector/transport/9920468/Bransons-Virgin-Atlantic-faces-record-loss.html

I suppose the obvious question is what would you do to improve things?

Doors4

Member for

8 years 2 months

Posts: 124

Thinking about it I should answer my own question:

Ditch Little Red (stupid name) and stick with code sharing for domestics, BA for LHR and BE for LGW.

Ditch the 747's, no point carting hoards of people around at break-even prices, using the smaller aircraft should push yield up.

Ditch the orders for 380 and 787 for now. Get things turned round then have another look at new aircraft.

Standardise on the 340-600 for high yield routes from LHR.

Get the right 330, I believe the series they have acquired has payload and range issues for the VS route network. Then standardise on this for the leisure routes from LGW and MAN*.

*I'm inclined to say ditch the MAN operation but I am mindful of the MAN contigient on the forums and don't know much about the MAN operation and it's profitability. I would see more sense in perhaps offering MCO from MAN and several other UK regional airports with frequency from each set to match demand.

Cherry pick the right business routes from LHR so that they are all profitable in their own right.

Develop a bigger Caribbean (and other leisure route) network from LGW (to rival BA) and make them all direct to give the edge over BA on certain routes.

Stop carrying Virgin Holidays punters at break-even prices. Let holidays do their own thing and if they want to use VS let them do it at a profitable price.

Continue to invest in the product while cutting costs elsewhere.

Introduce a LGW ground product to match that at LHR but with an emphasis on leisure travel.

MOST IMPORTANTLY STOP DOING THINGS TO STROKE SRB's EGO AND PUBLICITY SEEKING STREAK AND FRETTING ABOUT WHAT BA ARE UP TO AND GET ON WITH SENSIBLE BUSINESS.
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Matt-100

Member for

7 years 2 months

Posts: 569

I agree on the most part with your suggestions, Little Red never will be profitable even with the lucrative connections it may bring... The sooner VS realise that, the better. But code-sharing with BA? Let's get real Doors, this is SRB we're talking about :D

I too would ditch the 747s and A340-300s, cancel the A380s and defer delivery on 787s until things start to pick up.

But most importantly, the route network needs a major shake up. Ditch all non-profitable routes (I'm guessing these include Tokyo, Sydney, Lagos, Accra and the new Vancouver) and replace them with new routes to emerging markets. China, for example, is very under-served at LHR with practically no direct competition on secondary cities in the country. Also, they don't fly to Latin America... why? Surely Sao Paulo or Rio is higher up the priority list when it comes to new routes than YVR (as nice as the city is)?

Doors4

Member for

8 years 2 months

Posts: 124

But code-sharing with BA? Let's get real Doors, this is SRB we're talking about :D

Fair comment, I didn't actually mean codeshare, what I meant was booking passengers on BA flights, or interlining, as already happens to quite some considerable extent.

Cking

Member for

14 years 11 months

Posts: 997

First of all I'd start blaming British Airways for EVERYTHING. He hasn't had a good whinge about British Airways for almost ten minutes. I think he is slipping.
He had better cancel the A380 quick or Airbus will deliver them. He only ordered them as a publicity stunt, like the sonic cruiser, the 787 and the Rutan spaceship thingy.

Rgds Cking

ThreeSpool

Member for

9 years 6 months

Posts: 949

I think they should be looking to join an Alliance. I think SkyTeam would seem the most likely candidate. They days of big airlines operating alone are sadly going.
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Matt-100

Member for

7 years 2 months

Posts: 569

I didn't mention it earlier but, staff cuts??
VS has roughly 9000 employees, BA has roughly 38,000. So Virgin have roughly 1/4 the staff, but are they really 1/4 the size? I would expect to see a pay freeze at the very least.
Also, could they not outsource heavy maintenance? I'm not sure how efficient an operation the VS engineering team is but management should at least analyse the alternatives.

I don't think Virgin has any clear direction any more. What's their ambition, where do they want to go, where do they see themselves in 10 years time? This, unfortunately, is where the airline has lost its way. When it was founded in 1985 it was a real groundbreaker and culture shock for the established mainstream. Now it seems all they do is shadow BA's moves, which wouldn't be so bad if they could actually offer a better product. They can't. It's about time management (SRB) stops peering over the fence to see what BA's doing and come up with their own ideas.

Whilst not my airline of choice, I certainly wouldn't want them to go. Who'll be there to keep BA in check? :diablo: and it always brings a smile to my face when I see the brightly coloured air hostesses at the terminal (they really do stand out just like how they're portrayed in the television ads)

cockerhoop

Member for

10 years 2 months

Posts: 308

we used Virgina excellent service last summer LGW TO Vegas and back to HRW from LA, i struggle to see without holiday makers on a lot of routes how they would make money at all
like how many passengers on the Antugua run are on business or just visiting family? my guess is 80% are holidaymakers