[Anonymous]

[LeTigre]

I found today’s article regarding the results of little red quite interesting. By my dodgy calculations half full little red planes with 27% transfer loads would increase VS load factors by 3-4%. Unrealiable but interesting! But the points is, I don’t think they’ll give up.

Anyway the rules say that even after 3 years, the slots must be used in the EU. So, what could you do, if you started from scratch?

My idea was 1x daily A330 flights to 12 of the biggest EU cities, great for transfers, product familiarisation and of course, cargo. A bit like what BA do with the 767s.

Any ideas?

[AMcWhirter]

Hello Le Tigre

It is still early days and hopefully Little Red will increase the number of transfer passengers it feeds to Virgin Atlantic.

And, of course, much depends on the type of transfer passenger it carries, for example are they travelling on discounted economy class promo fares or have they booked Upper Class ?

Clearly the higher the fare, the more the contribution to Virgin’s bottom line.

But the spokeswoman’s comment that “we carry a lot of leisure passengers from Manchester” doesn’t augur well for yields.

As for the slot rules … as far as I know the London-Manchester slots can be used for other routes as and when Virgin sees fit.

But the London to Aberdeen and Edinburgh slots are restricted.

Is it true that if Little Red is closed down within three years then the above slots (for London to Aberdeen/Edinburgh only) will revert to BA ?

[VintageKrug]

Sadly, they can’t really compete on price as they’re already rock bottom (sometimes as low as £1 in actual fare with the rest as taxes and fees).

They have to compete with BA offering free bar, snacks and breakfast – and they simply don’t have BA’s purchasing power to keep costs low.

I *thought* the MAN slots only had to be operated for two years, at which time they can be re-allocated to longhaul, which was the ultimate purpose of making such a song and dance about BA purchasing bmi.

[SimonS1]

The whole thing is a complete exercise in futility. Half full flights going backwards and forwards bringing people to Heathrow where they can look forward to a change of terminal and onward transfer to VS limited network.

Together with BA flying virtually empty planes to and from Leeds Bradford show what a sham the ‘Heathrow full to capacity’ line really is.

I can’t see Little Red lasting much more than a year.

[AMcWhirter]

Hello VK – I’m sure you are correct in that the Manchester slots have to be reallocated only for long-haul routes.

Hello SimonS1 – I hear what you say. But on the other hand Virgin has wet-leased these four Little Red A320s for three years from Aer Lingus. Maybe there’s a penalty to pay if the contract is broken before then.

http://corporate.aerlingus.com/investorrelations/regulatorynews/2012pressreleases/RNS_re_wet_lease_Final_Draft_071212.pdf

[Shearer]

The last flights I was on saw some quite healthy loads.

Remember Little Red is literally weeks old, without a summer season under its belt.

[LeTigre]

Alex McWhirter, I only know what is public about the slots and the EU document is a little opaque.

Well, this is all I know:
-The 4x daily MAN slots are nothing to do with bmi, they are under no rules, and I believe VS owns at least 3 of them, though not sure, cause the fourth was a late addition. These could be reallocated to long haul or other routes as desired.
-The other 9x daily Scotland slots come from the bmi deal. I believe VS gets full ownership of these after 3 years, however, these can only be used for routes connecting London with Europe, according to the EC. The time period for these further terms is not public.
-Virgin could still apply for the last 3x daily bmi slots. The initial plan was to use two of those for Moscow, but the bilateral didn’t permit this. This route may still come off in the future, with Russia hinting at open skies, but the politics are very messy.
-The agreement with EI was indeed announced as 3 years, as per every contract, there would be penalties if terminated I guess.
-Virgin could still use the remaining bmi slots to start service to Nice, Cairo or Riyadh, though none of these are traditional VS territory, though it would be exciting! What would VHols do with Riyadh? No bikinis!

I hope you can see the rationale behind my thread now!

So, if you have 12 slots, only for Europe, what could you do…

[rferguson]

Tbh I think you just have to look where BMI ended up in it’s role as a Star feeder at LHR. Little Red has basically just filled the BMI void on those routes.

I think maybe during the bidding process VS should have sat down with Aer Lingus and come to some sort of arrangement. VS withdraw from the bid for the slots and support EI. Virgin to have a percentage of the seats on each/certain flights to sell for onward traffic leaving EI to sell the rest to the low cost point-point market.

[Shearer]

I disagree.

EI mainline are too closely allied with OneWorld. Virgin and Star need the control and the wet lease arrangement is I think the best option.

[SimonS1]

Interesting point there rferguson.

BMI had some decent feeder routes into their own rag bag of mid haul routes and the Star Alliance. Look where they ended up (taken over).

I can’t see the situation is much different with VS. Their long haul network cannot compete with EK (Dubai), BA (US) etc and with their recently published financial results I can’t see it is sustainable.

Interesting as well LeTigre about the slots, I suppose it’s inevitable these days there would be some firm of EU interference on what they could be used for.

[LeTigre]

Writing off the operation at this early stafe is premature, plus VS announced a while back, that they expected the services to be loss making, but the revenue contribution to long haul ops would be more significant.

Anyway, does anyone think widebody EU service could work?

[SimonS1]

No reason why it shouldn’t work – demand on some of the routes is there. Maybe linked to a return of ‘proper’ business class. That might attract some traffic, even premium paying ones.

[canucklad]

I flew on a KLM DC10 tto AMs, and saw BA L1011’s going to Paris and AF/LH A300’s …….

Adopting Asdanomics could make flying widebodies to Europe not only economically viable but also proftable….

[NameRemoved-18/12/14]

What about returning to Athens? I was also thinking about Milan Malpensa and Barcelona.

[Author]

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