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Virgin Atlantic

Virgin Atlantic Airways Limited
IATA ICAO Callsign
VS[1] VIR VIRGIN
Founded 1984
Commenced operations 22 June 1984
AOC # 534
Operating bases
Frequent-flyer program Flying Club
Airport lounge Virgin Atlantic Clubhouse
Fleet size 39
Destinations 31
Parent company Virgin Group
Headquarters Crawley, United Kingdom
Key people
  • Richard Branson, Founder
  • Craig Kreeger, CEO[3]
  • Stephen Murphy, Chairman[4]
Revenue Increase £2.93 billion (2014)
Operating income Increase £14.4 million (2014)
Employees 9,231 (2014)
Website .comvirgin-atlantic

Virgin Atlantic, a trading name of Virgin Atlantic Airways Limited, is a British airline with its head office in Crawley, West Sussex, England. The airline was established in 1984 as British Atlantic Airways, and was originally planned by its co-founders Randolph Fields and Alan Hellary to fly between London and the Falkland Islands. Soon after changing the name to Virgin Atlantic Airways, Fields sold his shares in the company after disagreements with Richard Branson over the management of the company. The maiden flight from Gatwick to Newark Liberty International Airport took place on 22 June 1984. The airline along with Virgin Holidays is controlled by a holding company, Virgin Atlantic Limited, which is 51% owned by the Virgin Group and 49% by Delta Air Lines. It is administratively separate from other Virgin-branded airlines.

Virgin Atlantic uses a mixed fleet of Airbus and Boeing wide-body aircraft and operates to destinations in North America, the Caribbean, Africa, the Middle East and Asia from its main bases at London-Heathrow and London-Gatwick and its secondary base at Manchester. The airline also operates seasonal flights from Glasgow and Belfast.

In 2012, Virgin Atlantic carried 5.4 million passengers,[5] making it the seventh-largest UK airline in terms of passenger volume. In the year to 31 December 2013, it reported a £51 million group pre-tax loss (approximately US$87 million),[6] however, in the year to 31 December 2014 the airline reported a return to pre-tax profit of £14.4 million.[7] Virgin Atlantic holds a Civil Aviation Authority (CAA) Type A Operating Licence, which permits it to carry passengers, cargo, and mail on aircraft with 20 or more seats.[8]

Contents

  • History 1
    • Conception and birth 1.1
    • Formative years 1.2
    • Competition 1.3
    • Recent years 1.4
  • Corporate affairs 2
    • Offices 2.1
    • Ownership 2.2
    • Business trends 2.3
    • Service concept 2.4
    • Little Red 2.5
  • Destinations 3
    • Codeshare agreements 3.1
  • Fleet 4
    • Current fleet 4.1
    • Retired fleet 4.2
    • Livery 4.3
  • Incidents and accidents 5
  • See also 6
  • References 7
    • Citations 7.1
    • Bibliography 7.2
  • External links 8

History

Conception and birth

Alan Hellary, Richard Branson, and Randolph Fields launch Virgin Atlantic at the 1984 press conference

Randolph Fields, an American-born lawyer, and Alan Hellary, a former chief pilot for Laker Airways, set up British Atlantic Airways as a successor to Laker Airways.[9] Fields had the idea for an airline that operates between London and the Falkland Islands in June 1982, when the Falklands War had just finished.[10] Fields needed expertise, and contacted Alan Hellary, who had also been thinking about establishing a regular commercial service to the Falklands. Hellary was in contact with colleagues out of work following the collapse of Laker Airways, and they developed the idea.

However, the short runway at Port Stanley Airport and the time it would take to improve it made the scheme unviable, so the idea of the Falklands service was dropped. Instead, Hellary and Fields tried to secure a licence from Gatwick Airport to John F. Kennedy International Airport in New York City. A three-day inquiry in May 1983 rejected the application after British Airways, British Caledonian, and BAA objected.

Hellary and Fields then applied for a licence between Gatwick and Newark, using a 380-seat McDonnell Douglas DC-10.[9] However, faced with the prospect of direct competition from People Express, a post-deregulation "no frills" discount airline at Newark, they decided to secure more funding before proceeding.

Fields met Richard Branson at a party in London during which he proposed a business partnership. After protracted and testy negotiations, Fields agreed to a reduced stake of 25% in the airline (renamed Virgin Atlantic) and became its first chairman. Following disagreements over operations, Fields agreed to be bought out for an initial sum of £1 million with further payment on Virgin's first dividend. As a result of a High Court action, this additional payment was received shortly before Fields' death in 1997.

Formative years

Maiden Voyager operated the first scheduled Virgin Atlantic service on 22 June 1984.

On 22 June 1984, Virgin Atlantic operated its inaugural scheduled service between Gatwick and Newark using a leased Boeing 747-200 (registration G-VIRG), christened Maiden Voyager,[9] formerly operated by Aerolíneas Argentinas. Part of Richard Branson's approach to business is to succeed within the first year or exit the market. This includes a one-year limit on everything associated with starting up.[11] Virgin Atlantic became profitable within the first 12 months, aided by sister company Virgin Records' ability to finance the lease of a secondhand Boeing 747. The firm timed operations to take advantage of a full summer, from June to September – the most profitable period of the year.

In November 1984 the airline started a service between Gatwick Airport and Maastricht Aachen Airport in the Netherlands using a chartered BAC One-Eleven/[12]

In 1986, the airline added another Boeing 747 and started a scheduled route from Gatwick to Miami. Additional aircraft were acquired and routes launched from Gatwick to New York JFK (1988), Tokyo (1989), Los Angeles (1990), Boston (1991), and Orlando (1992). In 1987, a service was launched between Luton and Dublin using Viscount turboprop aircraft, but this was withdrawn around 1990. In 1988, Club Air operated two Boeing 727 jet aircraft on behalf of Virgin. These served the Luton to Dublin route until about 1990.

Competition

Before its inception, British Airways had been the only airline from the United Kingdom serving long-haul routes to destinations in North America, the Caribbean, and the Far East since the BA-BCal merger in the late 1980s. In 1991, Virgin was given permission to operate from Heathrow following the abolition of the London Air Traffic Distribution Rules (TDRs) which had governed the distribution of traffic between Heathrow and Gatwick airports since 1978, primarily to bolster the profitability of Gatwick. Airlines without an international scheduled service from Heathrow prior to 1 April 1977 were obliged to operate from Gatwick. However, airlines that did not already operate at Heathrow were still able to begin domestic scheduled services there provided BAA, which ran both Heathrow and Gatwick on behalf of the UK Government, and the Secretary of State for Transport granted permission.

Virgin Atlantic aircraft at Heathrow Airport's Terminal 3

The Civil Aviation Authority also transferred two pairs of unused landing slots that British Airways held at Tokyo's Narita Airport to Virgin to let it increase its frequency between Heathrow and Tokyo from four to six weekly round trips, making it easier for Virgin to compete against British Airways. The then-Chairman of BA Lord King called the CAA's decision, which the Government had endorsed, "a confiscation of his company's property".[13]

In the year to October 1993, Virgin Atlantic declared a loss of £9.3m. The decision to abolish the London TDRs and to let Virgin Atlantic operate at Heathrow in competition with British Airways became the trigger for BA's so-called "dirty tricks" campaign against Virgin. In 1993, BA's QC. BA settled out of court when its lawyers discovered the lengths to which the company had gone in trying to kill off Virgin. British Airways had to pay a legal bill of up to £3 million, damages to Branson of £500,000 and a further £110,000 to his airline. Branson reportedly donated the proceeds from the case to Virgin Atlantic staff.[14]

Airbus A340-300 landing at Kai Tak Airport, displaying the "No Way BA/AA" sticker"

In the 1990s, Virgin Atlantic jets were painted with "No Way BA/AA" in opposition to the attempted merger between British Airways and American Airlines.[15] In 1997, following British Airways' announcement that it was to remove the Union Flag from its tailfins in favour of world images, Virgin introduced a Union Flag design on the winglets of its aircraft and changed the red dress on the Scarlet Lady on the nose of aircraft to the union flag with the tag line "Britain's Flag Carrier". This was a tongue-in-cheek challenge to BA's traditional role as the UK's flag carrier.[16]

In June 2006, US and UK competition authorities investigated alleged price fixing between Virgin Atlantic and British Airways over passenger fuel surcharges.[17] In August 2007, BA was fined £271 million by the UK Office of Fair Trading (OFT) and the US Department of Justice.[18] However, the Chief Executive of Virgin Atlantic, Steve Ridgway, was forced to admit that the company had been a party to the agreement, had been aware of the price fixing and had taken no steps whatsoever to stop the price fixing.[19] The company escaped a similar fine to that levied on British Airways only by virtue of the immunity it had earlier negotiated with the regulators.

Recent years

Airbus A340-300 at London Heathrow Airport in 2003, displaying "4 Engines 4 Longhaul" slogan

In April 2010, a tip-off from Cathay Pacific led to the OFT investigating alleged price fixing between Virgin Atlantic and Cathay Pacific on flights to Hong Kong between 2002 and 2006. Cathay Pacific received immunity from prosecution for reporting the alleged offence. A maximum fine, if found guilty, was 10% of turnover which based on the £2.5 billion in sales for the year to February 2009 would have been £250 million.[20] At the time, the OFT stressed that it should not be assumed that the parties involved had broken the law.[21] The OFT cleared both airlines in December 2012, concluding there were "no grounds for action".[22]

In May 2014, Virgin Atlantic ended flights to Sydney. In September 2014, Virgin Atlantic announced plans to scrap flights to Tokyo, Mumbai, Vancouver and Cape Town and to code-share transatlantic flights with Delta Air Lines. The company was also reported to be considering axing its new 'Little Red' domestic airline after suffering heavy losses.[23] On 6 October 2014, Virgin Atlantic confirmed that Little Red services between London and Manchester would end in March 2015, with the Scottish routes closing in September 2015.[24] Passengers used the routes from point to point as opposed to using it as a connection for longer haul Virgin Atlantic flights. The former BMI routes will continue with rival airline British Airways.

In June 2015, Richard Branson admitted that Virgin Atlantic would be in "real trouble" without strategic support from Delta Air Lines. With cumulative losses between 2010 and 2013 amounting to £233 million, the future of the 30-year-old airline was in doubt.[25] In the same month, the airline announced it would cut 500 jobs to establish a more efficient management structure.[26]

Corporate affairs

Offices

The Office, the head office building of Virgin Atlantic and Virgin Holidays in Crawley, West Sussex

Virgin Atlantic's head office, known as The Office, is located on a business park in Crawley, West Sussex, England, near Gatwick Airport[27] and also houses the corporate offices of Virgin Holidays.[28] The company operates several offices and call centres around the world, with a large office in Swansea, Wales, which is a base for reservations and sales; baggage claims and tracing; 'live chat' web support, and a customer relations department.

International offices are located at Norwalk, Johannesburg, Barbados, Shanghai, Hong Kong, Greater Delhi, Lagos, Johannesburg and Dubai.[29]

Ownership

Boeing 747-400 landing at McCarran International Airport

Virgin Group sold a 49% stake in the airline to Singapore Airlines in 1999 for £600 million.[30] On 14 May 2008, the company formally announced an invitation for offers for its Virgin Atlantic stake, and publicly acknowledged that its stake in the airline had "underperformed".[31]

In November 2010 it was reported that Virgin Atlantic had appointed Deutsche Bank to begin a strategic review of options for the airline following the tie-up between British Airways and American Airlines.[32] By February 2011 it was confirmed that SkyTeam members Air France-KLM and Delta Air Lines had appointed Goldman Sachs to advise them on a joint potential approach for Virgin Atlantic. Etihad Airways was also reported to be considering a deal,[33] and Willie Walsh, chief executive of International Airlines Group, stated that they would be interested in the airline, but only for the lucrative take-off and landing slots it holds at London Heathrow Airport.[34]

On 11 December 2012, Delta Air Lines confirmed the purchase of Singapore Airlines' 49% stake in Virgin Atlantic for £224 million, with future plans to develop a transatlantic joint venture. Regulatory approval from the United States and European Union was granted on 20 June 2013,[35] and the purchase was completed on 24 June.[36] In December 2012, International Airlines Group CEO, Willie Walsh, suggested that the loss-making company would be history within five years. "I can't see Delta wanting to operate the Virgin brand because if they do what does that say about the Delta brand? I just don't see that the guy [Branson] has anything that stands out in terms of what he has achieved in the industry."[37]

Business trends

The key trends for Virgin Atlantic over recent years are shown below (figures are for each year ending end February; they exclude Virgin Nigeria 2005–2008):

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Turnover (£m) 1,630 1,912 2,141 2,337 2,579 2,357 2,700 2,740 2,870 2,928
Profits (EBT) (£m) 68.0 77.5 46.8 22.9 68.4 −132.0 18.5 −80.2 −69.9 14.4
Number of employees c.9,000 9,580 9,231
Total flights 17,637 18,960 21,344 22,149 20,735 19,484 20,519
Number of passengers (m) 4.5 4.9 5.7 5.8 5.5 5.5 5.3 5.4 5.5 6.1
- passenger change year-on-year Increase 8.9% Increase 15.4% Increase 1.4% Decrease 5.2% Decrease 2.3% Decrease 0.3% Increase 2.0% Increase 3.5% Increase 10.9%
Passenger load factor (%) 74.3 72.8 76.5 76.9 78.9 82.5 77.5 78.1 79 77.8
Number of aircraft (at year end) 40 40 39
Notes/sources [38][39] [38][39] [38][39] [38][39] [38][39] [38][39] [38][39] [39][40][41][42] [43][44] [45][46]

Service concept

Clubhouse lounge in Heathrow

Virgin Atlantic aircraft operate with a three-class cabin configuration: Economy, Premium Economy, and the Business Class called 'Upper Class'. Premium Economy has a separate check-in area, priority boarding and a wider seat with more legroom. Upper Class features a seat that converts into a fully flat bed and access to chauffeur drive.[47] Virgin Atlantic was the first airline to offer personal entertainment for all passengers in all classes.

The airline's frequent-flyer program is styled 'the Flying Club'.

Virgin Atlantic also maintains ten lounges called 'the Clubhouse' located in London (Heathrow and Gatwick), New York-JFK, Newark, Boston, Washington D. C., San Francisco, Los Angeles, Johannesburg and Hong Kong.[48] They are accessible for passengers travelling in Upper Class and Flying Club Gold Tier members.

Little Red

A Virgin Atlantic Little Red Airbus A320-200 operated by Aer Lingus

British Midland International provided domestic and European feeder traffic into Heathrow Airport in partnership with Virgin[49] until it was purchased by British Airways' parent company International Airlines Group in 2011. The Lufthansa-owned airline had faced heavy annual losses of more than £100 million. Under the terms of the takeover, IAG had to relinquish some former BMI domestic slots at Heathrow. Virgin Atlantic purchased enough slots in 2012 to enable it to launch a domestic service on 31 March 2013, under the "Little Red" brand, operating a total of 12 daily services from London to Aberdeen (3), Edinburgh (6), and Manchester (3).[50] The airline wet-leased four Airbus A320s from Aer Lingus, operating with Virgin Atlantic livery, under a three-year contract.[51][52]

In September 2014, it was reported that Virgin was considering closing its domestic brand after suffering heavy losses,[53] with Civil Aviation Authority figures confirming an average seat occupancy level of just 37.6% in 2013.[23] The 12 daily pairs of take-off and landing slots at Heathrow cannot be sold to be used for long-haul routes.[54]

On 6 October 2014, Virgin confirmed that the Little Red service will be closed, flights to Manchester ended on 28 March 2015 while flights to Edinburgh and Aberdeen ended on 26 September 2015.[55]

Destinations

Codeshare agreements

Virgin Atlantic has codeshare agreements with the following airlines:[56]

Fleet

Virgin Atlantic Airbus A330-300
Virgin Atlantic Airbus A340-600
Virgin Atlantic first Boeing 787-9 named the 'Birthday Girl'

Virgin Atlantic uses a mixed fleet of Airbus and Boeing aircraft. Boeing 747-400s and Airbus A330-300s are used on selected routes from Gatwick, Glasgow, and Manchester, with the A330 being used on other flights as well. Boeing 747s, Airbus A340s and Airbus A330s are used interchangeably on all routes from Heathrow. In August 2002, Virgin became the first airline to operate the Airbus A340-600.[57]

Virgin Atlantic took delivery of its first Boeing 787-9 in October 2014, becoming the first European airline to fly the variant.[58] Virgin's order was first announced on 24 April 2007, and is for a total of 17 aircraft, with options on 5 more. The exercised options will replace the Heathrow-based 747 fleet during 2015 and 2016. Virgin Atlantic also has an order for the Airbus A380-800, with delivery due in 2018. The type was originally projected to enter service in 2006, but a combination of delays in production and Virgin deferring its order has pushed that date back.[59]

The ageing Airbus A340-300 aircraft were withdrawn from service in April 2015, as rising costs had made it less economical to run the type. Virgin had begun to replace the A340-300 on routes with the two-engine A330-300 and 787-9. The final Virgin Atlantic A340-300 flight was made on 9 April, landing at London Heathrow early on 10 April.[60] The A330s, in three-class layout, have been stationed at Heathrow Airport since April 2012.[61]

Current fleet

Virgin Atlantic's fleet consists of the following registered aircraft as of October 2015:[62]

Aircraft In Service Orders[63][64] Options Passengers Notes
J W Y Total
Airbus A330-300 10 33 48 185 266
Airbus A340-600 11 45 38 225 308
Airbus A380-800 6 6 TBA Entry into service delayed to 2018[59]
Boeing 747-400 11 44 62 261 367
14 58 379 451
14 66 375 455
Boeing 787-9 7 10 5[65] 31 35 198 264
Total 39 16 11

On 31 October 2005, Virgin Atlantic operated a humanitarian aid charter flight to Islamabad, Pakistan, with 55 tonnes of aid for the people affected by the 2005 Kashmir earthquake.[66]

On 27 September 2006, Branson announced plans to reduce greenhouse gas emissions by cutting aircraft weight and fuel consumption. There was also an experiment in 2007 in partnership with Boeing to have aircraft towed to the runway to save fuel, as a potential change to future operational procedures.[67] Virgin also volunteered a Boeing 747 for a test of biofuels in February 2008. The aircraft flew without passengers from Heathrow to Amsterdam Airport Schiphol, with 20% of the power for one engine provided by plant-based biofuel. Virgin said that it expected to use algae-based biofuels in the future.[68]

Retired fleet

Boeing 747–123 Spirit of Sir Freddie marked with "No Way BA/AA" protest. Ironically, this aircraft was initially ordered by American Airlines as N9669.
Aircraft Introduced Withdrawn Notes
Airbus A320-200 1995 2000 1 leased for a London to Athens service, replaced by an A321-200 in 2000[69]
1999 2001 3 operated for Virgin Sun
Airbus A321-200 2000 2003 1 named Hellenic Beauty leased for a London to Athens service to replace an A320-200[69][70]
2000 2001 1 operated for Virgin Sun
Airbus A340-300 1993 2015 Last commercial flight 9 April 2015.
Boeing 747-100 1990 2000 G-VMIA named 'Spirit of Sir Freddie' after Sir Freddie Laker
Boeing 747-200 1984 2005 G-VIRG was Virgin Atlantic's first aircraft

Livery

Boeing 747-400 Lady Penelope in Birthday Girl livery in 2014

Virgin's first aircraft were painted with a "Eurowhite" design with a red stripe through the centre of the main deck windows. The engines were metallic silver and the tail red with the Virgin logo in white. In the 1990s, the refreshed design was introduced, removing the centre red stripe through the windows, engines were painted red, the Virgin Atlantic titles in grey were added along the main fuselage, and the 'Flying Lady' was introduced to the nose area. In October 2006, with the delivery of G-VRED, Virgin introduced a new design, with the fuselage painted in metallic silver and a revised tail fin, with red and purple features and the Virgin logo. Near the nose of each aircraft is a pin-up girl, the "Scarlet Lady", carrying a Union flag, which was designed by British artist Ken White, who modelled the motif on the World War II pin-ups of Alberto Vargas – hence the naming one of the fleet Varga Girl.[39]

Each aircraft has a name, usually feminine, such as Ladybird, Island Lady, and Ruby Tuesday, but some are linked to registrations (e.g. G-VFIZ became Bubbles). There are a couple of commemorative names (e.g. G-VEIL—Queen of the Skies—which was named by Queen Elizabeth II on 7 April 2004, in celebration of the centenary of the Entente Cordiale). An exception is Spirit of Sir Freddie. An early Boeing 747, it was named in honour of Freddie Laker of Laker Airways, who helped Virgin Atlantic following the demise of his own airline. G-VFAB—Lady Penelope—gained a special livery to celebrate Virgin Atlantic's 21st birthday. On September 26, 2015, G-VFAB, Lady Penelope, was retired after 21 years of service. [71]

The current livery dates from 2010 and returns to the "Eurowhite" design featuring purple billboard titles on the fuselage, slight changes to the Scarlet Lady, and new red metallic paint for the aircraft's tail and engines. The wingtips are red, with the Virgin logo on the inside facing passengers on board. The Virgin Atlantic logo was also added in purple billboard titles to the underside of the aircraft.[72]

Incidents and accidents

  • On 5 November 1997, after numerous attempts to shake free the jammed main landing gear of an Airbus A340-300 (G-VSKY) failed, the aircraft en route from Los Angeles to Heathrow, made an emergency landing at Heathrow Airport. The aircraft sustained major damage to the undersides of engines 1, 2, and 4, which made contact with the runway surface during landing. The runway surface was also damaged and several runway lights were broken as the right main landing gear wheels broke up during the deceleration. The aircraft was evacuated safely. Two crew members and five passengers sustained minor injuries during the evacuation.[73] The damaged aircraft has been repaired after the incident and was retired from the Virgin Atlantic fleet in 2003.[74]
  • On 8 February 2005, on board an Airbus A340-600 aircraft (G-VATL) en route from Hong Kong to Heathrow, the fuel control computer system caused a loss of automatic fuel transfer between tanks. The left outboard engine lost power, and shortly afterwards the right outboard engine also began to falter until the crew began to crossfeed fuel manually. The crew diverted to Amsterdam and landed safely. The interim accident report made four safety recommendations addressed to the primary certification bodies for large transport category aircraft (EASA and the FAA), advising on the need for a low-fuel warning system for large aircraft.[75]

See also

References

Citations

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  10. ^ West Sussex County Times. 20 January 1984. p. 1.
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  12. ^ David Cross. "Flying Dutchman-Virgin Atlantic style." Times [London, England] 17 Nov. 1984: 1. The Times Digital Archive. Web. 20 Sept. 2014.
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  26. ^ bbc.com - Virgin Atlantic airline to cut 500 jobs 30 June 2015
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Bibliography

  • Gregory, Martyn. Dirty Tricks: British Airways' Secret War Against Virgin Atlantic. New York: Virgin, 2000. ISBN 0-7535-0458-8
  • Bower, Tom. Branson. UK: Fourth Estate, 2001 ISBN 1-84115-400-8
  • Branson, Richard. Losing my Virginity - The Autobiography. London: Virgin Books Ltd, 2006 [2nd reprint] ISBN 0-7535-1020-0

External links

Media related to at Wikimedia Commons

  • Official website
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