Virgin in US to fly with Airbus
SIR RICHARD Branson's Virgin Group has unveiled operational details of its new low-cost domestic airline in the US.
Scheduled for launch in the first quarter of next year, Virgin America will fly up to 105 Airbus A319 and A320 aircraft and create up to 3000 jobs over the next five years in New York and San Francisco, although routes are yet to be determined.
It will be headed by Fred Reid, former president and chief operating officer of Delta Airlines, who has more than 25 years' experience in the industry.
Virgin's entry to the US market will up the ante in the escalating war between the low-cost airlines and their full-fare counterparts.
Despite a $15bn (£8.2bn) bailout by the US government, almost all America's major airlines have continued to bleed red ink since the terrorist attacks in September 2001. They have laid off more than 100,000 employees and mothballed 1200 aircraft.
It also marks another victory for Airbus in its growing ascendancy over Boeing in the civil aviation market. The Virgin deal is a blow to Boeing's attempts to market its single-aisle 737 aircraft to low-cost carriers.
Reid declined to give financial details but said the airline plans to order 33 Airbus A319s and A320s with an option to buy up to 72 more.
The American-controlled and majority-owned and managed airline will effectively be a licensee of Virgin as a US law forbids non-US entities from owning more than 49% of the equity or 24.9% of the voting power of a domestic airline.
