Virgin Atlantic Seeks New Heathrow Slots For Expanded Schedule
(Bloomberg) -- Virgin Atlantic Airways Ltd. is seeking additional operating slots at London's Heathrow Airport as the carrier looks to add more routes to the US and Asia with the arrival of new jets from Airbus SE.
The airline, which narrowly avoided collapse during a funding squeeze at the height of the coronavirus crisis, is seeking takeoff and landing positions at Europe's busiest hub as the fleet expands from 37 aircraft to 46 in 2025, Chief Executive Officer Shai Weiss said in an interview.
A number of new routes are under consideration, focused on locations where Virgin can tap links with partners, Weiss said on the carrier's first flight from London to Tampa Bay, Florida. That could include more cities in the US, which the UK firm serves in a joint venture with part-owner Delta Air Lines Inc.
Virgin is also looking at destinations in Asia, where it recently agreed to a code-share deal with IndiGo, India's largest airline. Virgin already serves Delhi and Mumbai and is looking at how its decision to join the SkyTeam global alliance next year could enhance route options. Flights to Seoul, home base of founding member Korean Air Lines Co., are among those under consideration.
US, Caribbean
The US and Caribbean, which account for about 70% of Virgin's business, will remain the company's primary focus, according to Weiss. The carrier had a more global network before he became CEO in 2019, but it was largely untenable, he said.
Virgin, controlled by billionaire Richard Branson, will continue to have Heathrow as its sole hub for the foreseeable future. Its decision to shutter operations at Gatwick, south of London, helped achieve £300 million ($346 million) in annual savings. Weiss said Virgin will hang on to operating slots there in case it's unable to build up flights at Heathrow, though he ruled out a return to Gatwick before 2024 at the earliest.
Virgin's fleet plans are in place for the next few years as new Airbus A350 and A330neo wide-body planes arrive following the exit of four-engined A340s and Boeing Co. 747s, according to Weiss.
The fleet will be back to pre-pandemic capacity levels by 2025 but with scope for 20% more flights thanks to improved flexibility and the focus on Heathrow, where the company competes with long-standing rival British Airways. Virgin expects capacity to return to pre-Covid levels by the end of next summer.
Virgin's finances remain “sound” following the £1.2 billion bailout from Branson, Delta and other backers, Weiss said. Full-year revenue will exceed 2019 levels despite reduced capacity, and earnings before interest, tax, depreciation and amortization are set to come in ahead of the company's previous projections.
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