Delta Air Lines and Virgin Atlantic Airways took the first step toward confronting the formidable threat of the recent British Airways-American Airlines pairing as regulators approved Delta’s acquisition of Singapore Airlines’ 49-percent stake in the UK carrier last week. The acquisition means that Virgin Atlantic and Delta have cleared a major hurdle in their effort toward forming a full joint venture, an antitrust review of which the U.S. Department of Transportation expects to complete during this year’s third quarter.
Virgin Atlantic Airways
In seeking to consummate its proposed strategic alliance with Delta Air Lines, Virgin Atlantic Airways aims to head off the challenge posed by the formidable pairing of British Airways and American Airlines. So who did Virgin chairman Sir Richard Branson recruit to succeed retiring CEO Steve Ridgway? Why, naturally, a senior American Airlines executive in the shape of senior vice president for customers Craig Kreeger, who assumes his new role from February 1.
Charter operator Gama Aviation says young children will no longer need to sit on their parents’ laps while traveling aboard any of Gama’s Bombardier Challenger fleet thanks to the company’s new infant safety seats. The UK-based business aviation services group made the seats and claims they are the first child seats certified for taxi, takeoff and landing on numerous business jets. The seats are already in use aboard Virgin Atlantic and Cathay Pacific flights.
Virgin Group boss Richard Branson insists that Virgin Atlantic’s brand will remain intact well into the future following Delta Air Lines’ planned purchase of Singapore Airlines’ 49-percent stake in the UK carrier. “First of all, ignore the press speculation, the British Airways speculation,” said Branson via a video feed from his Caribbean retreat on Necker Island during last week’s announcement. “I’m not going anywhere.”
More evidence of capacity constraint among U.S. airlines appeared in a recent quarterly earnings report from one of the fastest-growing carriers in the country. Virgin America, which has seen annual available seat mile (ASM) growth average 28 percent for the past three years, has reconsidered its fleet expansion strategy and said it would move to cut the number of airplanes it plans to add over the rest of the decade.
British competition authorities have dismissed complaints that they did not investigate the British Airways (BA) bid to buy BMI (the former British Midland International) from Germany’s Lufthansa—a deal approved by the European Commission (EC) on March 30.
The scramble for precious slots at London Heathrow Airport has spurred a bidding war for struggling UK carrier BMI. Virgin Atlantic Airways has told Lufthansa, BMI’s owner, that it will be able to close the deal more quickly than the International Airlines Group (IAG), which launched a bid for BMI in November.
The weeks preceding the unforeseen losses caused by Europe's volcanic ash crisis saw improved trading conditions across much of the airline sector and, in its wake, revived momentum for long-anticipated consolidation between carriers on both sides of the Atlantic.
Virgin Atlantic Airways announced today that it signed a $2.1 billion firm contract to buy six Airbus A330-300s and lease another four from Netherlands-based lessor AerCap. The airline said it has financed all 10 deliveries via AerCap.
British Airways (BA) ditched its business jet charter service just six months after launching it with charter broker Air Partner, the result of cost-cutting after September 11. Meanwhile, Virgin Atlantic said it is reconsidering its plans to operate business aircraft through a program dubbed Virgin Jetset.
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