Virgin Atlantic has moved out of recovery phase, says chief

Virgin Atlantic has moved out of recovery phase, says chiefVirgin Atlantic chief executive Craig Kreeger says the airline is no longer in recovery mode but is now looking towards building for the future.

He was speaking to Travel Weekly after the airline announced its profitability plans which involved increasing the number of transatlantic flights and dropping other routes including Tokyo, Cape Town, Mumbai and Vancouver.

Kreeger, who is looking to grow profitability and sustain it by 2018, said: “This announcement marks a transition from recovery to a brand building for the future. We are no longer in recovery mode, we have a plan for a bright future.”

Kreeger said was confident the airline would deliver a profit this year.

He said the airline’s £300 million investment in customer experience would include, among other things yet to be revealed, building a Virgin ClubHouse on land in Los Angeles and rolling out onboard Wi-Fi across the entire network, not just the airline’s newest Boeing 787s.

The chief executive, who was speaking ahead of reports that it is to shut its UK domestic airline Little Red, said it was important to be “a connected airline” in this day and age.

He said the decision to pull flights hadn’t been made lightly and that the airline went through a filter of testing profitability on all routes to see whether they were making money now and if there was anything that could be done to ensure they do in the future if they were not.

“Unfortunately, there were four routes we couldn’t get through that filter system successfully,” he said.

The airline is to introduce more than 500 more flights in summer 2015 than last year and is also offering five new daily transatlantic services.

However, Kreeger insisted the airline isn’t intentionally moving capacity towards transatlantic services.

He said it was important for the airline to go where it can be profitable and when asked whether the airline may reinstate the dropped routes in the future he added:

“One never says never in our business because things change very quickly.

“That’s not to say our plan now is not tentative because we think we have built a network plan to last and to be successful.

“We didn’t have a plan to be bigger in one location and not in somewhere else. I hope there will be future growth in locations like China and Latin America.”

Meanwhile, Kreeger said Virgin is still lobbying government to cut in APD for children under 12.

Kreeger revealed his hopes of reducing the rate of air passenger duty for children when he spoke at a Travel Weekly Business Breakfast in June.

He said while he’d like to see significant change in the tax, it wasn’t going to be easily achievement but said he remained committed to lobbying government over

He said: “We are lobbying over the possibility of a reduction (in APD for children).

“At Virgin Atlantic we offer a discount to kids under 12 and given the fact the government is looking to make travel more affordable we are actively in discussion with people in government.

“We don’t have an update as to how those discussions are going.“

Sourced from Travel Weekly

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