With travel opening up gradually, airlines worldwide are transforming their operations to increase customer satisfaction while also adopting strategic business models.
We talk to an aviation expert for details on the UK-based carrier Virgin Atlantic and how it is serving its guests currently.
What is the airline doing to reduce costs amidst the ongoing crisis?
Global aviation was one of the first industries impacted by the Covid-19 pandemic and will be one of the last to fully recover.
To emerge from this crisis, against an uncertain backdrop, all airlines, including Virgin Atlantic must radically adapt, so that it can continue to thrive.
From the start, we took the decisive action to reduce costs, preserve cash and to protect as many jobs as possible. We moved our flying programme from London Gatwick to London Heathrow, with the intention of retaining its slot portfolio at London Gatwick, to return in line with customer demand.
We will no longer use all of our seven 747-400s, with four A330-200 aircraft retiring in early 2022 as planned.
How is the airline ensuring maximum passenger comfort onboard?
We have implemented enhanced cleaning and social distancing practices at check-in, boarding gates, and onboard. The use of electrostatic spraying of high-grade disinfectant in all our cabins and lavatories ensures that no surface is left untouched.
We also provide a personal ‘health pack’ to passengers that include medical grade face masks, surface wipes, and hand gel.
To ensure our customers have space on board, where possible, some seats will not be available, and they will be marked with special pillows. On busy flights, this will unfortunately not always be possible.
Elaborate on how the airline is planning to expand its India operations?
We are excited to resume services from Delhi and Mumbai to London Heathrow under the bilateral air travel arrangement between the UK and Indian governments. Flights from Delhi have recommenced from September 2 and Mumbai service will start from September 17, 2020.
We know many of our customers will be excited to reunite with friends and family and we are looking forward to welcoming them onboard.
We are committed to India in the long term and hope that market conditions will allow us to expand service further in the future.
Tell us about the initiatives adopted to restore passenger confidence in air travel.
On August 24, Virgin Atlantic announced complimentary Covid-19 global insurance cover which will apply to all existing and new bookings, travelling up until March 31, 2021.
The insurance policy with Allianz Assistance offers comprehensive cover in the event that a Virgin Atlantic customer or travel companion becomes ill with Covid-19 while on a trip.
Emergency medical costs, associated expenses such as transport and accommodation and repatriation up to £500,000 are included, as well as costs if a customer is denied boarding or held in quarantine.
Click here for more details on the airline’s Covid-19 insurance cover.
How has the airline revamped its inflight dining experience?
We will be offering a simplified hot food service in economy and premium economy, redesigned to limit contact.
Passengers will now receive a new “Fly safe, eat well” meal box, which incorporates a hot meal (choice of three) that our crew simply slide into the side of the pre-built/packed meal box.
Customers will also receive a second service (which on a day-flight ex UK) will be our Eric Lanlard afternoon tea box (in all three cabins).
Upper Class customers will receive a choice of six hot meals, desserts, including cheese and biscuits, a ciabatta roll which will be delivered to their seat on a tray.
In order to minimise contact between customers and crew, we have simplified our onboard offering and temporarily removed some items including Vera, our inflight magazine and our retail therapy service.
Our duty-free products are still available for pre-order and delivery to your seat.
What has been the development in Virgin Atlantic’s £1.2 billion refinancing package?
Virgin Atlantic has announced the completion of the £1.2 billion private-only solvent recapitalisation of the airline and holiday business. Its restructuring plan has now been sanctioned by the English High Court under Part 26A of the UK Companies Act 2006, and formally recognised in the US court.
This final step in the legal process paves the way for the company to continue its efforts to emerge from the Covid-19 crisis as a sustainably profitable airline.
Achieving this significant milestone puts Virgin Atlantic in a position to rebuild its balance sheet, restore customer confidence and welcome passengers back to the skies, safely, as soon as they are ready to travel.
Virgin Atlantic’s restructuring plan is based on a five-year business model, and with the support of shareholders Virgin Group and Delta, new private investors and existing creditors, it paves the way for the airline to successfully rebuild its balance sheet and return to profitability.
The recapitalisation will deliver a refinancing package worth c.£1.2 billion over the next 18 months in addition to the self-help measures already taken, including cost savings of c.£280 million per year and c.£880 million rephasing and financing of aircraft deliveries over the next five years.
- Shareholders are providing c.£600 million in support over the life of the plan including a £200 million investment from Virgin Group, and the deferral of c.£400 million of shareholder deferrals and waivers.
- Virgin Atlantic welcomes new partner Davidson Kempner Capital Management LP, a global institutional investment management firm which is providing £170 million of secured financing.
- Creditors have also supported the airline with over £450 million of deferrals.
- The recapitalisation plan also has the full support of credit card acquirers (Merchant Service Providers) Lloyd’s Cardnet, First Data and American Express.
This is not a Chapter 11 bankruptcy filing. It is a filing which supports and recognises the solvent recapitalisation of the airline in the UK courts.
What is the role of sustainability in the airline’s operations?
Sustainability remains central to the airline and in September 2019, Virgin Atlantic took delivery of its first Airbus A350-1000 aircraft – helping to transform the fleet into one of the quietest and most fuel-efficient in the sky.
By 2022, the simplified, greener fleet will comprise of 36 twin-engine aircraft reducing CO2/RTK emissions by an estimated further 10 per cent, building on the 18 per cent efficiency already achieved between 2007-2019.