Virgin Atlantic wants to challenge the dominance of British Airways and it’s parent company IAG (International Airlines Group) when London Heathrow’s new runway is built. The airline is planning to significantly increase its long-haul operation, as well as launch a comprehensive network of short-haul destinations.
However, Virgin Atlantic has stated that the plan will only work if the UK Government reforms the way new Heathrow slots are allocated, to allow the creation of a ‘second flag carrier’. The airline plans to serve 103 destinations, of which 84 will be new, including:
- 12 new domestic routes
- 37 new European routes
- 35 new global routes
Virgin Atlantic Wants to Become the UK’s Second Flag Carrier
According to Virgin Atlantic, the proposed route network would cover all three of the objectives set out in the Government’s Aviation Strategy Green Paper. These three objectives are:
- The allocation of additional Heathrow capacity to facilitate effective competition between airlines, benefitting consumers through more choice and lower fares.
- Improve domestic connectivity.
- Improve connectivity to international destinations that are currently underserved or unserved.
The government is currently reviewing how new slots will be allocated. Virgin Atlantic has warned that these slots must be allocated in a way that allows the creation of a second flag carrier to compete with IAG.
IAG Currently Dominates the Heathrow Market
Controlling over 50% of capacity at London Heathrow, British Airways’ parent IAG dominates at Heathrow. IAG also holds more than 55% of all take-off and landing slots at the airport, while no other airline holds more than 5% of the remaining slots. Last week, a new report found that 18.5 million passengers flying from the airport – that’s one in four – were forced to fly with IAG.
The report suggests that because of the lack of competition on these routes, customers may be paying up to 10% more in airfares. 77 monopoly routes are operated by IAG or its joint venture partners, meaning that customers are forced to fly on their planes, as no direct rival exists.
Virgin Atlantic plans to compete on 25 of those routes, including Aer Lingus’ home at Dublin Airport and Iberia’s base at Adolfo Suárez Madrid-Barajas Airport.
What Virgin Atlantic Says
Shai Weiss, CEO Virgin Atlantic, stated:
“Heathrow has been dominated by one airline group for far too long. The third runway is a once in a lifetime opportunity to change the status quo and create a second flag carrier. This would lower fares and give real choice to passengers, as well as giving Britain a real opportunity to boost its trade and investment links around the world. Changing the way take-off and landing slots are allocated for this unique and vital increase in capacity at the nation’s hub airport will create the right conditions for competition and innovation to thrive.”
Featured Image Source: Tomás Del Coro on Flickr