Virgin Atlantic Joining SkyTeam Makes Sense
25th Feb 2013
Joining a global airline alliance, like Sky Team, will possibly make sense for Virgin Atlantic, according to its Chief Commercial Officer, Julie Southern.
The lady CEO thinks that in due time, the airline may join the Sky Team alliance, if they find it necessary for the airline to grow its business. Early this week, she was quoted as saying through The Financial Times that it is vital to them their ability to compete with BA-AA.
In December last year Virgin Atlantic decided to let Delta Air Lines take over a 49% stake in the carrier from Singapore Airlines, enabling it to form its own UK-US connection to rival the joint forces initiated by British Airways and American Airlines. However, the union of a Virgin and Delta doesn't seem to pose a threat to any existing global alliance.
She also clarified that even though other airlines are joining alliances, they don't see it as the end of their business. Instead, it has emboldened them to stay in the business and rise up to the occasion.
Recently, US-based Delta Airlines purchased a 49% stake in Virgin Atlantic, which is owned by Sir Richard Branson. The said purchase spawned some speculations in the industry that there is a high possibility that Virgin Atlantic will enlist itself as a new member of SkyTeam anytime soon.
Richard Branson remains partial to joining any alliance. Recently, however, he has indicated that joining might be a good strategy to stay in the business.
In October last year, he told Bloomberg Television that maybe it's time to make a decision within 3 to 4 months for the airline's future if it wants to survive competition. He added that his airline has been doing good on its own for many years. However, he observes that business is becoming tougher these days and noted that most of their closest rivals are now members of an alliance.
Before the purchase of a 49% by Delta from Singapore Airlines in Virgin, speculations pointed at Star Alliance as the probable grouping Virgin will join, for the reason that Singapore Airlines is its member.
The union of Delta and Virgin will be a boon to customers of both airlines. First and foremost, they will now be able to enjoy reciprocal frequent flyer benefits, regardless which of the two airlines they are flying with. In addition to that, they will also be able to access each others' lounges.
KrisFlyers members during the SQ and Virgin alliance shouldn't despair as they will still enjoy the benefits promised to them by both airlines even after the severance.