Virgin domestic “Little Red” flights a ‘disaster’ at only 33% full, (probably less than that) as passengers stick with no-frills rivals
Date added: October 11, 2013
Virgin Atlantic’s venture into domestic aviation, with its “Little Red” airline, has proved financially disastrous. During the first 6 months flying from Heathrow to Aberdeen, Edinburgh and Manchester, the average flight has been only one-third full, [probably in fact much lower, as Virgin figures appear to be wrong] even though the Virgin plane is cheaper than a Virgin train (on the day fare £64, cf £76). “Little Red” flights from Heathrow to Manchester started in late March, and Heathrow to Scotland began early in April. Few passengers have been tempted so far. The load factor of 33% contrasts to the industry standard of close to 80%, while low-cost carriers such as easyJet and Ryanair achieve around 90%. Virgin is prepared to sustain some losses on this route, as it feeds traffic to lucrative intercontinental flights. With so few seats filled, each passenger contributes disproportionately to noise and pollution. John Stewart of HACAN, said: “This confirms what many have suspected – that a big problem at Heathrow is that so many planes are far from full. Full planes may lessen the pressure for a third runway.”
Virgin Atlantic’s venture into domestic aviation has proved financially disastrous. During the first six months flying from Heathrow to Aberdeen, Edinburgh and Manchester, the average flight has been only one-third full. For every occupied seat, two have gone empty – even though the Virgin plane is cheaper than a Virgin train.
Flights from Heathrow to Manchester, branded as “Little Red”, started in late March. Links to Scotland began early in April. At the time, Sir Richard Branson promised Little Red would “deliver Virgin Atlantic’s rock and roll spirit as well as real value for money”.
Few passengers have been tempted so far. The Independent calculates that 825,000 seats were available during the first six months. Virgin initially told us that 250,000 passengers had flown on Little Red, but late today said the number was “closer to 300,000”.
If the true figure is midway between the two, the “load factor” was 33 per cent – in contrast to the industry standard of close to 80 per cent, while low-cost carriers such as easyJet and Ryanair achieve around 90 per cent.
[Another analysis – by an AirportWatch member said:
“More than 250,000 passengers have flown Virgin Atlantic’s Manchester-London, Edinburgh and Aberdeen service in the first six months since its launch.”
The aircraft holds 174 passengers x 8 flights (4 return) means it can carry 1,392 passengers a day to and from Manchester.
And 3132 passengers on the Aberdeen and Edinburgh routes, (with 6 and 3 return flights per day).
3,132 + 1,392 = 4,524 passengers per day maximum for the 3 routes
x 180 days = 814,320 is the max amount of passengers they can carry in a 6 month period.
If 250,000 passengers were carried, that is around 30% – which is a very low load factor.
The aviation analyst John Strickland said: “The poor loads indicate that the majority of point-to-point traffic on domestic flights now uses low-cost services from other London airports.
The Independent’s journey aboard this afternoon’s Virgin Atlantic flights 3047 and 3048 from Heathrow to Manchester and back appeared to confirm the low sales. The service is operated by Airbus A320 jets fitted with 174 seats. The northbound leg carried 46 passengers, including two infants. Going south, I was one of only 38 passengers – meaning the plane was less than a quarter full. I bought a ticket on the day for £64, £12 less than Virgin Trains’ lowest same-day rail fare between Manchester and Euston.
While the aircraft are in Virgin Atlantic colours, they belong to Aer Lingus. The Irish airline “wet-leases” the jets and crew to Virgin, and gets paid regardless of how well or badly the route is performing.
One man enjoying the acres of elbow room was Robert Meizel, an American businessman connecting to a New York flight. “If they cut the fares they might fill a few more seats,” he said.
Industry insiders estimate that direct losses on the network have been running at between £2m and £3m per week. Calculations are complicated, however, because – like BA – Virgin is prepared to sustain some losses on domestic operations that feed traffic to lucrative intercontinental flights.
Douglas McNeill of Charles Stanley Securities said: “These are routes which British Midland struggled to make work… Virgin Atlantic must make sure it doesn’t just carry on where British Midland left off.
With so few seats filled, each passenger contributes disproportionately to noise and pollution. John Stewart of the anti-expansion pressure group HACAN Clearskies, said: “This confirms what many have suspected – that a big problem at Heathrow is that so many planes are far from full. Full planes may lessen the pressure for a third runway.”
A spokeswoman for Virgin Atlantic said: “As with any new route it takes time for customers to become fully aware of our service. It is normal to have comparatively low load factors in the first six months… Our business plan allowed for this. Bookings for future travel continue to grow steadily.”
Curiously there is an article, put out by Virgin, saying what a huge success the Little Red flights are:
Virgin’s Little Red is a big success at airport
More than 250,000 passengers have flown Virgin Atlantic’s new domestic service service in the first six months since its launch.
More than 250,000 passengers have flown Virgin Atlantic’s new domestic service in the first six months since its launch.
Joe Thompson, the man charged with starting and running the service, says the airline’s first foray into short haul travel has exceeded expectations.
Virgin Atlantic launched Little Red in March, with the service also running from Aberdeen and Edinburgh to Heathrow (Aberdeen flights) – connecting passengers to popular destinations like Shanghai, San Francisco and Las Vegas.
Mr Thompson told the M.E.N that Virgin Atlantic also planned to increase capacity on its long haul flights from Manchester.
And, in line with airport bosses’ own ambitions, he did not rule out setting up a direct flight to China in the future.
Mr Thompson, who became director of short haul and new venture performance in March, admits it was a big step for the company to launch Little Red.
He said: “When we launched it it was something new and different for Virgin Atlantic, for us to go into the domestic routes after 30 years of long haul.
“There was a certain amount of nervousness.
“What I’m really excited about is that we have managed to find a new way of flying in short haul.”
Virgin Atlantic uses 174-passenger A320s to take four round trips from Manchester to Heathrow every day.
And 75 per cent per cent of all passengers catch connecting international flights.
The route has provided 49 jobs at Manchester Airport.
Mr Thompson added: “This flight takes you direct to London and connects with our global network.
“We expected the service to be successful. Manchester is a thriving city from a travel perspective both inbound and outbound and demand is growing all the time. Outside London, it is the biggest operation we have so it was an obvious choice.”
What makes Little Red unique, he said, is its touch of ‘glamour and style’.
He added: “You don’t see much of that in the travel arena these days.
“We really think about what the customer wants. The basics are there – we operate on time, with good connections, but there are also the twists and quirks that really surprise people.
“These include handing out Love Heart sweets, an extra piece of free hold luggage, and a free sports gear allowance too.”
Mr Thompson, who was previously in charge of the global airport operation, added: “I’m proud of Little Red. Look at what we’ve achieved over the last six months, building a new branch of our business that customers say they are loving, that’s operating brilliantly, and seeing passenger numbers growing.”
Mr Thompson said the passenger profile varies throughout the year, with student travel peaking in September, holiday passengers increasing during the summer and business travel the focus in October and November.
And as Manchester Airport sets its sights on China, Mr Thompson does not rule out more expansion in Manchester.
He said: “Manchester is a growing market and we are always looking at future opportunities.
“There are a wealth of possible destinations and we are not ruling out direct routes to China.”
Virgin Atlantic started operating out of Manchester in May 1996, when it launched direct services to Orlando. It also flies to Barbados and Las Vegas.
Virgin starts its domestic services from Heathrow, to Manchester, Edinburgh and Aberdeen
At the end of March, Virgin Atlantic has started its first UK domestic services with 4 flights per day between Manchester and Heathrow. The routes in the UK are being known as Little Red. Starting on 8th April there will also be 6 return flights daily from Edinburgh to Heathrow, and 3 from Aberdeen. Branson says Little Red will compete with BA, which also runs several domestic services. However, Virgin has losses that are expected to exceed £125m this year, which is worse than last year’s £80m deficit. Its new domestic routes are designed to feed more connecting British passengers into its long-haul network from Heathrow. Seat sales for the first week of Manchester flights were said to be low but in line with expectations. Virgin is now hoping to form a deal with Delta, which will build on code-sharing and reciprocal customer loyalty programmes, to try and get more of the profitable passengers between New York and London, that BA currently has. Virgin and Delta need to wait for approval from the European competition authorities and the US department of justice.
Virgin Atlantic has unveiled details of its UK domestic service, which is being called, Little Red. It will launch on 31st March in Manchester, 5th April in Edinburgh and 9th April in Aberdeen, with a total of 26 daily services to Heathrow. Little Red will be Virgin’s first ever domestic flights in the UK. Virgin won key Heathrow take-off and landing slots after Bmi was taken over by IAG last year. Virgin hopes these domestic flights will feed traffic onto its international service. Virgin says Little Red will compete with BA on domestic air routes. BA operates around 52 daily flights between Heathrow and Aberdeen, Edinburgh and Glasgow. BA also runs services to Scotland from Gatwick and London City airports.Apparently Virgin has partnered with a number of brands “to offer exclusive products on board including Irn Bru on Scottish flights, plane shaped Tyrells crisps and Bacardi Martini miniatures. It will later offer Krispy Kreme doughnuts, yoghurts from The Collective Dairy and Rude Health granola” ! Why ?!