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Virgin Atlantic has just announced that it plans to “reshape and resize” its operations in a bid to survive the current crisis. With the airline struggling to raise desperately needed funds and with the British government still apparently not inclined to offer a lifeline, Virgin Atlantic says that it will be closing down its operations at Gatwick and shedding 3,150 jobs.
In summary, here’s what Virgin Atlantic says it plans to do:
- Move all flights from Gatwick to London Heathrow
- Attempt to retain its Gatwick slot portfolio in the hopes of returning to the airport when customer demand improves.
- Operate only wide-body twin-engined aircraft on its most popular routes.
- Proceed with the planned retirement of 4 Airbus A330-200s in 2022.
- Retire its 7 remaining Boeing 747 aircraft.
- Operate a fleet of just 36 twin-engined aircraft by 2022.
- Reduce the number of jobs across all divisions of the airline by 3,150
- Rename Virgin Holidays, Virgin Atlantic Holidays.
- Close 15% of the Virgin Holidays outlets this year.
Here’s what Shai Weiss CEO of Virgin Atlantic has had to say:
We have weathered many storms since our first flight 36 years ago, but none has been as devastating as Covid-19 and the associated loss of life and livelihood for so many.
However, to safeguard our future and emerge a sustainably profitable business, now is the time for further action to reduce our costs, preserve cash and to protect as many jobs as possible. It is crucial that we return to profitability in 2021. This will mean taking steps to reshape and resize Virgin Atlantic in line with demand, while always keeping our people and customers at the heart of all we do.
I wish it was not the case, but we will have to reduce the number of people we employ. The commitment of our people throughout this crisis has been nothing but amazing, and the embodiment of true Virgin spirit. As we have navigated the Covid-19 crisis, I have been humbled at every step by their solidarity. In times of adversity we must support each other so that ultimately, we can emerge a stronger and better Virgin Atlantic.
After 9/11 and the Global Financial Crisis, we took similar painful measures but fortunately many members of our team were back flying with us within a couple of years. Depending on how long the pandemic lasts and the period of time our planes are grounded for, hopefully the same will happen this time.
Our vision for Virgin Atlantic remains the same – to become the most loved travel company, for our people and our customers. Once the crisis stabilises, Virgin Atlantic has an important role to play in contributing to the UK’s economic recovery, providing essential connectivity and competition.”
My heart goes out to the staff at Virgin Atlantic right now. I’m far from being a frequent flyer with the airline but I’ve had nothing but positive interactions with all the Virgin Atlantic staff I’ve met down the years (from my first Economy Class flights in the late 80s to my last Premium Economy flight a few months ago) so I really wish I wasn’t having to report this news.
I’m not sure if Virgin Atlantic is pursuing these measures because it has failed to persuade the UK government to issue the £500m loan that it says it needs or if this is part of an agreement that the airline has reached with the government to demonstrate that it has genuinely taken all the measure it can to ensure its survival…but ultimately it doesn’t matter which of the two it is. A lot of people are about to lose their jobs and that’s incredibly sad.
It’s interesting to note that while British Airways has done very little to try to retain its workforce (it’s threatening to make up to 12,000 people unemployed while refusing to take a cheap loan from the government), for Virgin Atlantic these measures look like the last throw of the dice. I don’t think the airline’s hierarchy wanted to have to make cuts as deep as these but it has almost certainly been left with no option if it wants to have any chance of surviving into next year. Let’s hope this will be enough.
With no bailout and no funding forthcoming, this news was inevitable…but that doesn’t make it any less saddening. With airlines like Wizz Air getting hundreds of millions of pounds in UK government cash despite having nothing more than tenuous links to the UK, it’s more than a little disgraceful that a UK airline like Virgin Atlantic still hasn’t been given the aid that in needs.
Good luck to all at Virgin Atlantic – I really, really hope that you all come out of this at the other end.