Richard Branson says Virgin Atlantic will collapse without government support
Virgin Atlantic founder Richard Branson said on Monday that the airline would not survive the coronavirus crisis if it didn't get financial support from the government.
"We will do everything we can to keep the airline going – but we will need government support to achieve that in the face of the severe uncertainty surrounding travel today and not knowing how long the planes will be grounded for," Branson said in an open letter to Virgin employees. "This would be in the form of a commercial loan — it wouldn't be free money and the airline would pay it back."
Last month, Virgin Atlantic asked for a £500 million bailout, which was rejected by the government. On Friday, the Financial Times reported that the airline's first bid had been rejected by the government and was told it needed to explore other ways to raise money before seeking a bailout.
Virgin Atlantic, which is based in the U.K., is 51% owned by Branson's own Virgin Group. The other 49% is owned by Delta Air Lines.
In his letter, Branson dismissed the argument that he should be paying from his personal wealth to save the airline, rather than relying on government funding.
"I’ve seen lots of comments about my net worth – but that is calculated on the value of Virgin businesses around the world before this crisis, not sitting as cash in a bank account ready to withdraw," Branson wrote.
Branson offered his famed Necker Island as collateral in an attempt to secure funding from the government. In his note, Branson said he would "raise as much money against the island as possible to save as many jobs as possible around the Group".
According to The Guardian, Branson pledged to inject $250 million into the Virgin Group. Of that money, $100 million is thought to be for Virgin Atlantic.
"Today, the cash we have in the Virgin Group and my personal wealth is being invested across many companies around the world to protect as many jobs as possible, with a big part of that going to Virgin Atlantic."
Prior to Branson's plea, the airline had taken a number of cost-cutting measures, including employees taking a wage reduction for eight weeks.
On Monday, another member of the Virgin Group, Virgin Australia, was reported to have entered voluntary administration.
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- Earn 60,000 Membership Rewards® points after you spend $4,000 on eligible purchases with your new Card within the first 6 months of Card Membership.
- Earn 4X Membership Rewards® Points at Restaurants, plus takeout and delivery in the U.S., and earn 4X Membership Rewards® points at U.S. supermarkets (on up to $25,000 per calendar year in purchases, then 1X).
- Earn 3X Membership Rewards® points on flights booked directly with airlines or on amextravel.com.
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| 4X | Earn 4X Membership Rewards® Points at Restaurants, plus takeout and delivery in the U.S. |
| 4X | Earn 4X Membership Rewards® points at U.S. supermarkets (on up to $25,000 per calendar year in purchases, then 1X). |
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Earn 60,000 Membership Rewards® points after you spend $4,000 on eligible purchases with your new Card within the first 6 months of Card Membership.60,000 bonus pointsAnnual Fee
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Why We Chose It
There's a lot to love about the Amex Gold card. It's been a fan favorite during the pandemic because of its fantastic rewards rate on restaurants (that includes takeout and delivery in the U.S.!) and U.S. supermarkets. If you're hitting the skies soon, you'll also earn bonus points on travel. Paired with up to $120 in Uber Cash (for U.S. Uber rides or Uber Eats orders) and up to $120 in annual dining statement credits at eligible partners, there's no reason that the foodie shouldn't add this card to their wallet. Enrollment required.Pros
- 4x on dining at restaurants and U.S. supermarkets (on the first $25,000 in purchases per calendar year; then 1x)
- 3x on flights booked directly with the airline or with Amex Travel
- Welcome bonus of 60,000 points after spending $4,000 in the first six months
Cons
- Weak on travel outside of flights and everyday spending bonus categories
- Not as useful for those living outside the U.S.
- Some may have trouble using Uber/food credits
- Few travel perks and protections
- Earn 60,000 Membership Rewards® points after you spend $4,000 on eligible purchases with your new Card within the first 6 months of Card Membership.
- Earn 4X Membership Rewards® Points at Restaurants, plus takeout and delivery in the U.S., and earn 4X Membership Rewards® points at U.S. supermarkets (on up to $25,000 per calendar year in purchases, then 1X).
- Earn 3X Membership Rewards® points on flights booked directly with airlines or on amextravel.com.
- $120 Uber Cash on Gold: Add your Gold Card to your Uber account and each month automatically get $10 in Uber Cash for Uber Eats orders or Uber rides in the U.S., totaling up to $120 per year.
- $120 Dining Credit: Satisfy your cravings and earn up to $10 in statement credits monthly when you pay with the American Express® Gold Card at Grubhub, The Cheesecake Factory, Goldbelly, Wine.com, Milk Bar and select Shake Shack locations. Enrollment required.
- Choose the color that suits your style. Gold or Rose Gold.
- No Foreign Transaction Fees.
- Annual Fee is $250.
- Terms Apply.
- See Rates & Fees