Saturday 16 December 2017

Virgin's Little Red service struggling to fill flights

Sir Richard Branson poses alongside staff members
Sir Richard Branson poses alongside staff members
John Mulligan

John Mulligan

Virgin's domestic UK airline service, which is operated for the carrier by Aer Lingus, flew with over 60pc of its seats empty last year, according to data from the British Civil Aviation Authority.

The dismal figures confirm industry speculation that the service Virgin dubs 'Little Red' struggled following its launch last year.

It also highlights what might have been a lucky escape for Aer Lingus.

In 2012, the airline vied with Virgin, which is 49pc-owned by US carrier Delta, to secure a licence to operate domestic British services between London Heathrow and Edinburgh.

The Heathrow slots were being surrendered by British Airways as part of a deal with the competition watchdog to permit it to buy BMI. Had Aer Lingus successfully bid for them, it would have marked its first domestic service in Britain. It already flies between Belfast and London.

But Virgin won, and its Little Red operation also launched routes from London to Manchester and Aberdeen.

But just weeks after Virgin won rights for the Edinburgh route, it announced that it had signed a three-year agreement with Aer Lingus that would see the Irish carrier operate the 'Little Red' service on a so-called wet lease basis, where the Irish carrier provides the aircraft and crew.

Aer Lingus, which repainted four of its Airbus aircraft in Little Red livery, gets paid under the terms of its contract with Virgin regardless of how many people fly on the routes. It's up to Virgin to market the services and make it pay. It's using the service to help feed passengers to its long-haul operations.

British Airways boss Willie Walsh recently claimed the Little Red service is costing Virgin "a fortune".

In its latest annual report, Aer Lingus noted that it broke even last year on its contract with Virgin, while the Irish airline expects to make a profit this year from the service it provides.

Virgin has insisted Little Red is performing well, gaining market share and that its load factor – the percentage of available seats on the service – has risen above that experienced in 2013.

Irish Independent

Promoted Links

Business Newsletter

Read the leading stories from the world of Business.

Promoted Links

Also in Business