NEWS – TRAVEL WEEKLY BUSINESS BREAKFAST
DELTA TIE-UP: THE VIRGIN NAME ‘WILL NOT BE SCRAPPED’
Craig Kreeger said IAG boss Willie Walsh was “crazy” for suggesting the Virgin Atlantic name would be scrapped by its new US partner Delta Air Lines. When news of the partnership between Delta and Virgin Atlantic emerged in 2012, Walsh said he would be happy to wager Sir Richard Branson a “knee in the groin” that Virgin Atlantic wouldn’t exist in its current form in five years’ time. But Kreeger told the Business
Virgin: ‘Cutbacks won’t hit customers’
Virgin Atlantic is in the middle of a “great mode of recovery” but will never lose its “cool, innovative factor”, according to Craig Kreeger. The airline’s chief executive said cutting costs without having an impact on the customer was a priority for him when he joined the business last year. He told the Travel Weekly Business Breakfast: “I took the job 15 months ago with a clear mission statement: to work with our team and improve the financials of the company while retaining the magic of the culture and the brand. “The good news is, I’m very confident that we’re going to do that. I wouldn’t be issuing profit warnings if I was [running] a publicly traded company today.” Kreeger said cost savings had to be made in a way that would not
A380: Order is deferred again
Virgin Atlantic is still undecided about whether it will fly the Airbus A380.
The airline has an option for six A380s and has repeatedly delayed its order. Kreeger said: “When we look at the economics of our business, it hasn’t made sense for us so we have deferred
Virgin has introduced fees for selecting a seat
impact the product or customer services. He said: “I asked a lot of questions about how we do things and if we could do them less expensively. We’re investing in a new fuel management system that allows us to fly our aircraft more efficiently.
“Some of it is about little things that just add up, like becoming
the order. We’re facing another decision this month. It doesn’t look like it makes sense in the current economic environment.” The airline is focusing on its 17 new Boeing 787-9 Dreamliners, the first of which is due to enter service in October. He said: “The 787s’ operating
costs are so much lower – yes, it’s a big investment, but a positive one. The end of October is the target date and everything is on track.”
Artist’s impression of a Boeing 787-9 in Virgin livery
more paperless, and moving to a cloud-based storage system. There are lots of little things away from the customers.” When asked if Virgin plans to bring in more ancillary charges, having announced the introduction of fees for selecting a seat, he said: “That’s the only one we’re talking about. The idea of trying to create fares that have different features is a long-term change that’s happening in the industry and we can play in that space.” In terms of the market, Kreeger said the summer had been softer than expected. “We saw a pretty big pick-up last year on the year before, and a little pick-up this year versus last year. When you look at the summer, it looks strong but maybe not as strong as you might have guessed.”
Breakfast: “Delta and Virgin both desperately need Virgin Atlantic to be Virgin Atlantic. We both need to compete successfully with British Airways and American Airlines, and we need a brand, a product and a service that wins.” Kreeger insisted Delta’s acquisition of a 49% stake in Virgin Atlantic last June would not mean the Americanisation of the Virgin brand. He said: “We have a good history of competing
transatlantically...and any Americanisation or Delta- fication of our brand, which would threaten that capability, is not in Delta’s interest or ours. “Willie’s crazy to say this is going to fundamentally change the Virgin Atlantic brand. “It may change how effective
we are at competing, but it’s not going to change how we compete.”
Kreeger said the aircraft
would offer a “different level” of entertainment system and Wi-Fi connectivity in premium economy.
The airline plans to improve
its premium economy offering in the coming months. Kreeger said: “We’re looking at upgrading food, in particular presentation, which is the one element that most notably doesn’t quite hit the premium mark.”
26 June 2014 —
travelweekly.co.uk • 11
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