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Virgin Atlantic to Join an Alliance Soon

by on September 21, 2011 · 18 comments

in Polls, skyteam, star alliance, Virgin Atlantic

In a recent interview with Forbes magazine , Sir Richard Branson stated that Virgin would be joining an alliance in the near future. As a London based carrier, they’d obviously be competing with British Airways, so Oneworld is out – but that leaves Star Alliance and Skyteam.

On one hand Star Alliance makes a lot of sense – Singapore Airlines currently holds a 49% stake in Virgin Atlantic and Virgin partners with a number of Star Alliance partners like Continental. Virgin has also expressed interest in buying Star Alliance carrier bmi and Star Alliance is the biggest alliance with 27 current members.

On the other hand, Delta and Skyteam partners Air France and KLM do a huge amount of transatlantic traffic and could give a huge amount of connecting traffic to Virgin’s operations, which service:
York (Newark and JFK), Los Angeles, San Francisco, Washington, Boston, Miami, Tokyo, Hong Kong, Johannesburg, Cape Town, Shanghai, Delhi, Mumbai, Lagos, Sydney, Dubai, Chicago, Nairobi and Mauritius. Virgin operates services from Gatwick to Orlando, Barbados, St Lucia, Antigua, Las Vegas, Grenada, Tobago, Cuba and Jamaica (Kingston and Montego Bay). Virgin Atlantic also operates a service from Manchester to Orlando, Barbados and St Lucia.

While I selfishly hope that Virgin joins Skyteam, I think it makes more sense to join Star Alliance. Virgin overlaps with Delta on huge routes like JFK and Miami to London, whereas Star Alliance has huge gaps on those routes (Continental services EWR to LHR, but JFK has no London service). If I had to bet money, I’d say Star Alliance, but something tells me Sir Branson may have a couple tricks up his sleeve – like creating his own alliance of unique carriers.

Hat tip to TPG reader Tanu!

Which Alliance Will Virgin Atlantic Join?

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  • Anonymous

    If they join Skyteam, would Upper Class be considered a business class product? Because then Skymiles could be redeemed at the low level :D

  • Anonymous

    Yes it would be business, but something tells me there would be a catch, like hefty fuel surcharges

  • http://www.euanross.com Euan

    I agree with you in that with the existing SQ connection they will join Star Alliance.

    However, Delta, Air France & KLM may view it as a big coup to get Virgin Atlantic in SkyTeam so who knows… anything is possible.

  • Nick E

    Is Virgin Australia part of Branson’s company portfolio as well? The expanded codeshare just announced with Delta could indicate a willingness to join SkyTeam…

  • Funkhauser

    I hope they join an alliance (a new one or Skyteam) that makes competition for low fares more robust. That’s my primary concern.

  • Mitch

    Didn’t SQ write off their VS stock as worthless? I know they still own 49%, but it seems like AF/KL/DL might take SQ’s stake off their hands to get VS into SkyTeam.

  • http://www.euanross.com Euan

    Yes they have written it down to zero (http://www.telegraph.co.uk/finance/newsbysector/transport/8111295/Sir-Richard-Branson-begins-strategic-review-of-Virgin-Atlantic.html) having bought it for £600m.

    I think AF/KL/DL would look as VS being a good addition to SkyTeam, particularly for their LHR slots.

  • Anonymous

    they are partners with several *A airlines as noted already. So I wouldn’t be surprised at all to see them join up.

    I think Branson would prefer to make his own alliance but I am not sure there are enough unaligned players out there to have it make sense. Certainly they wouldn’t join with Emirates AND Qatar, would they? It would be nice to see the Gulf carriers link up with an alliance at some point though, that’s for sure.

  • Anonymous

    I’m guessing either they’ll be part of the *A or create another alliance – with say Alaska, El Al, and perhaps a South American or other European carrier. This would give them coverage to most parts of the world.

  • http://twitter.com/maccoinnich Iain

    I think they’ll probably wind up in Star Alliance, given their ownership and existing partners. However, Skyteam would make a lot of sense. For the most part, Delta and Virgin don’t compete out of London, and where they do, there’s plenty demand to support both services (ie, London-New York). Indeed, bringing VS into the transatlantic joint venture, along with major codesharing, could really help both Virgin and Delta compete against BA/AA. It was also help Skyteam fill in gaps where they’re lacking, ie, EU-Australia, where KLM and Air France rely on partners outside the Alliance (Malaysia and Qantas, respectively).

  • http://twitter.com/maccoinnich Iain

    I think they’ll probably wind up in Star Alliance, given their ownership and existing partners. However, Skyteam would make a lot of sense. For the most part, Delta and Virgin don’t compete out of London, and where they do, there’s plenty demand to support both services (ie, London-New York). Indeed, bringing VS into the transatlantic joint venture, along with major codesharing, could really help both Virgin and Delta compete against BA/AA. It was also help Skyteam fill in gaps where they’re lacking, ie, EU-Australia, where KLM and Air France rely on partners outside the Alliance (Malaysia and Qantas, respectively).

  • http://twitter.com/maccoinnich Iain

    double post

  • http://twitter.com/maccoinnich Iain

    double post

  • Bdcohen26

    Would this make it any less expensive to redeem reward flights using VA miles with its alliance partners? Or would the same ridiculous fees still apply? As of now, fees are so high there’s almost no purpose in cashing in miles.

  • Jeanette Gamble

    Any more news on this, I am flying with United more and more now with work and I only have Virgin points scheme. What is the best option if I am not star alliance yet, wait for Virgin to join or join another through a credit card or points scheme?

  • MontagueWestminster

    In my opinion, the Virgin group’s best off expanding the Virgin Group and inviting large non-Virgin, non-alliance airlines into it, like Emirates, Air Asia, Southwest Airlines, or Ryanair. Ryanair, Easyjet, or another no-alliance large European operator would be vital to Virgin because of the lack of the Virgin Group’s European network.

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