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Virgin Atlantic secures $1.5 billion deal, but return of transatlantic travel is ‘imperative to recovery’

Sept. 04, 2020
3 min read
Virgin Atlantic secures $1.5 billion deal, but return of transatlantic travel is ‘imperative to recovery’
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Friday brought major news for the future of Virgin Atlantic, as it completed its $1.5 billion rescue plan. However, the good news in securing funding comes amid the announcement that the airline is making further cuts to operations in order to preserve cash.

The airline said on Friday that while it had completed its rescue deal to secure its future for the next 18 months, it would be cutting 1,150 more jobs. Earlier in the coronavirus pandemic, Virgin cut more than 3,150 jobs.

The airline said that it has been forced to make the cuts in order to survive. As a result of the ongoing coronavirus pandemic and its lasting effects, recovery has taken longer than expected. More specifically, the airline said that the lasting restrictions on travel on the transatlantic market has meant recovery has been slower.

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“The U.S. border closure and U.K. quarantine measures have been in place for far longer than originally anticipated,” the airline said in a press release. “As the airline increases passenger operations, the opening of U.S. borders and removal of quarantine is imperative to recovery.”

Virgin relies heavily on transatlantic travel, with the routes representing 70% of its network. Given the restrictions on entry to the U.S. and required quarantine on entry to the U.K., Virgin doesn’t anticipate transatlantic flying to resume at a large scale until the beginning of 2021.

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Currently, the airline is flying to New York, Los Angeles and Miami in the U.S. It will resume flying to Atlanta on Sept. 15.

“The completion of the private-only, solvent recapitalisation of Virgin Atlantic removes much of the uncertainty we faced and represents a major step forward in our fight for survival,” Virgin CEO Shai Weiss said in a statement.

However, the airline has doubled down on pressuring the U.K. government to rethink its quarantine policy. Since the start of the U.K.’s travel corridor scheme, travelers entering the country from non-exempt countries have had to quarantine for 14 days.

Heathrow Airport and airline executives from around the U.K. have pressured the government to rethink and offer a testing alternative for travelers to bypass the quarantine requirement. The travel industry believes that the testing option would revitalize the tourism industry in the U.K. Since March, the U.S. has restricted non-nationals coming from much of Europe.

“The airline is calling for both U.K. and U.S. governments to introduce robust passenger testing regimes to lift travel restrictions whilst protecting public health,” the airline said in a statement.

In May, Virgin announced its first round of major cost-cutting measures. Among them, the carrier announced the immediate retirement of its Boeing 747s, consolidating London operations exclusively to Heathrow and cutting more than 3,000 jobs.

Earlier this week, Virgin unveiled its plans for a return to service on five additional routes this September. It also announced an enhanced onboard meal experience for passengers across all cabins.

Featured image by PA Images via Getty Images

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TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review

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Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,200 toward travel when you redeem through Chase Ultimate Rewards®

Annual Fee

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Recommended Credit

740-850
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Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

Why We Chose It

If you are looking to take your premium rewards to the highest level, this card is really a no brainer in our eyes. Chase's Ultimate Rewards make points easy to redeem, with a wide range of 10 airline and three hotel transfer partners and a friendly user interface. Despite the high annual fee, Chase is consistently adding new benefits to keep the card competitive in a fierce premium rewards field.

Pros

  • $300 annual travel credit as reimbursement for travel purchases charged to your card each account anniversary year
  • Access to Chase Ultimate Rewards hotel and airline travel partners
  • Unlimited 3x points on the broad category of travel and dining
  • 50% more value when you redeem your points for travel through Chase Ultimate Rewards®
  • Broad definitions for travel and dining bonus categories

Cons

  • Steep $550 annual fee
  • May not make sense for people that don't travel frequently
  • You must spend the $300 travel credit before earning 3x points for travel and dining
  • No automatic hotel elite status
  • Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,200 toward travel when you redeem through Chase Ultimate Rewards®
  • $300 Annual Travel Credit as reimbursement for travel purchases charged to your card each account anniversary year.
  • Earn 5x total points on flights and 10x total points on hotels and car rentals when you purchase travel through Chase Ultimate Rewards® immediately after the first $300 is spent on travel purchases annually. Earn 3x points on other travel and dining & 1 point per $1 spent on all other purchases
  • Get 50% more value when you redeem your points for travel through Chase Ultimate Rewards®. For example, 80,000 points are worth $1,200 toward travel
  • 1:1 point transfer to leading airline and hotel loyalty programs
  • Access to 1,300+ airport lounges worldwide after an easy, one-time enrollment in Priority Pass™ Select and up to $100 application fee credit every four years for Global Entry, NEXUS, or TSA PreCheck®
  • Count on Trip Cancellation/Interruption Insurance, Auto Rental Collision Damage Waiver, Lost Luggage Insurance and more
Best premium travel card for value
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review

Rewards Rate

10xEarn 10x total points on hotels and car rentals when you purchase travel through Chase Ultimate Rewards®.
5xEarn 5x total points on flights through Chase Ultimate Rewards®.
3xEarn 3x points on other travel and dining.
1xEarn 1 point per $1 spent on all other purchases
  • Intro Offer
    Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,200 toward travel when you redeem through Chase Ultimate Rewards®

    80,000 bonus points
  • Annual Fee

    $550
  • Recommended Credit
    Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

    740-850
    Excellent

Why We Chose It

If you are looking to take your premium rewards to the highest level, this card is really a no brainer in our eyes. Chase's Ultimate Rewards make points easy to redeem, with a wide range of 10 airline and three hotel transfer partners and a friendly user interface. Despite the high annual fee, Chase is consistently adding new benefits to keep the card competitive in a fierce premium rewards field.

Pros

  • $300 annual travel credit as reimbursement for travel purchases charged to your card each account anniversary year
  • Access to Chase Ultimate Rewards hotel and airline travel partners
  • Unlimited 3x points on the broad category of travel and dining
  • 50% more value when you redeem your points for travel through Chase Ultimate Rewards®
  • Broad definitions for travel and dining bonus categories

Cons

  • Steep $550 annual fee
  • May not make sense for people that don't travel frequently
  • You must spend the $300 travel credit before earning 3x points for travel and dining
  • No automatic hotel elite status
  • Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,200 toward travel when you redeem through Chase Ultimate Rewards®
  • $300 Annual Travel Credit as reimbursement for travel purchases charged to your card each account anniversary year.
  • Earn 5x total points on flights and 10x total points on hotels and car rentals when you purchase travel through Chase Ultimate Rewards® immediately after the first $300 is spent on travel purchases annually. Earn 3x points on other travel and dining & 1 point per $1 spent on all other purchases
  • Get 50% more value when you redeem your points for travel through Chase Ultimate Rewards®. For example, 80,000 points are worth $1,200 toward travel
  • 1:1 point transfer to leading airline and hotel loyalty programs
  • Access to 1,300+ airport lounges worldwide after an easy, one-time enrollment in Priority Pass™ Select and up to $100 application fee credit every four years for Global Entry, NEXUS, or TSA PreCheck®
  • Count on Trip Cancellation/Interruption Insurance, Auto Rental Collision Damage Waiver, Lost Luggage Insurance and more