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How Is Virgin Nigeria Doing?  
User currently offlineAA1818 From Trinidad and Tobago, joined Feb 2006, 3435 posts, RR: 4
Posted (7 years 5 months 1 day 18 hours ago) and read 3483 times:

Hi, I was curious to find out how VSNigeria was doing? Profitable?

What is their fleet, destinations, domestic market share, main competitors?

Are they bigger than Arik Nigeria which just bought 777s and 787s (or at least was rumoured to have done so as a UFO).

Cheers
AA1818


“The moment you doubt whether you can fly, you cease for ever to be able to do it.” J.M. Barrie (Peter Pan)
13 replies: All unread, jump to last
 
User currently offlineEurostarVA From Bahrain, joined May 2002, 1296 posts, RR: 7
Reply 1, posted (7 years 5 months 1 day 13 hours ago) and read 3401 times:

Quoting AA1818 (Thread starter):
Hi, I was curious to find out how VSNigeria was doing? Profitable?

What is their fleet, destinations, domestic market share, main competitors?

Are they bigger than Arik Nigeria which just bought 777s and 787s (or at least was rumoured to have done so as a UFO).

The carrier was formed in September '2004 and launched services on June 28 2005. Technically VK is still in a launch/consolidation mode. They have recorded some neat strides especially on the domestic front, where they are the leading carrier. Internationally they face more challenges in the form of inconsistent govt. policies (and some would even say betrayal on the govt's part, since Arik, Bellview, and Aero were granted route rights to the UK which contradicts the MOU between Virgin Group and the Nigerian govt.). Network-wide the load factors are slightly above satisfactory. However, they are not yet in profitable water. They made it clear to their shareholders (Nigerian institutional investors 51%, and Virgin Group 49%) that 2007 is cost-cutting and consolidation year as to become profitable before 2008 - when an IPO on the Nigerian Stock Exchange is planned. Moreover all capital investments were put off recently until after the outcome of the elections (May 29) to reduce exposure and othe risks.

The IPO will allow the carrier to raise badly-needed funds to upgrade its product from lounges to acquisition of brand-new planes.

Fleet-wise, as at May 15th this year they will operate:

2 x 767-300ERs damp-leased from LAT Charter
7 x 737-300 all dry-leased from GECAS
1 x Fokker 50 wet-leased from Denim Air

There are immediate plans to add another Fokker-50, possibly to increase Port Harcourt services and open a new route to Warri. I don't know if VK is planning to announce any serious long-term fleet strategy this year. However and in light of Arik Air's agressive progress, I wouldn't be surprised if VK reacted with a tentative plan to lure passengers and keep them faithful. Speaking of faithful, they managed to release details of Eagleflier, their FFP. I expect Eagleflier to be somehow tied to Virgin Atlantic's FFP soon.

Current destinations from Lagos:
Abuja, Port Harcourt (NAF Base), Calabar, Kano, Sokoto, Accra, Dakar, Douala, Johannesburg, London Gatwick.
Stations for opening in 2007:
Abidjan, Monrovia, Libreville
Suspended destinations:
Dubai (suspended in 2006).

The single largest hindrance to addition of destinations is the lack of air crew. In fact, it might be the largest operational challenge for VK. It's only recently that the local flight college in Zaria resumed pilot training, after decades of neglect. Expatriates are reluctant to work in Nigeria, for obvious reasons. We can safely assume that VK will continue to wet-lease at least until 2009!

Having followed VK developments closely since their inception, I think they aren't doing bad at all, in light of the unstable political situation, Nigerian infrastructural challenges, and so on.

Finally, I think it's tempting to compare Arik's progress with that of Virgin Nigeria, since they are both based in LOS and are relatively embryonic carriers. But consider that the a lot of mystery surrounds Arik's equity capital, and the airline recently came under scrutiny by the Nigerian Economic and Financial Crimes Commission, who might soon publish evidence that the real owner of the airline is a corrupt, highly-placed state Governor. I shall same no more.

PS. Something interesting to watch are the events post April 30 - a deadline imposed by the Nigerian CAA for all Nigerian airlines to recapitalize upwardly or else have their AOC revoked. A significant number of "briefcase"domestic airlines in Nigeria will not be able to survive and yes, VK stands to benefit!

[Edited 2007-04-26 06:48:30]

[Edited 2007-04-26 06:48:55]

[Edited 2007-04-26 07:05:38]

[Edited 2007-04-26 07:17:01]


If there is a will, there is a way
User currently offlineNycfly75 From Italy, joined Aug 2005, 759 posts, RR: 9
Reply 2, posted (7 years 5 months 1 day 12 hours ago) and read 3342 times:

Dont forget also NY-JFK via interline/wet lease agreement with North American Airlines coming soon!

User currently offlineMSYtristar From United States of America, joined Aug 2005, 6570 posts, RR: 51
Reply 3, posted (7 years 5 months 1 day 12 hours ago) and read 3334 times:

When did they replace the A343's with B763's?

It might be a good move if they are still in uncertain financial waters since 763's are significnatly cheaper to operate than A343's.


User currently offlineVC10DC10 From United States of America, joined Apr 2006, 1036 posts, RR: 3
Reply 4, posted (7 years 5 months 1 day 12 hours ago) and read 3328 times:

Quoting EurostarVA (Reply 1):

Dubai (suspended in 2006).

Why was Dubai cut? I would have assumed that both loads and yields would have been quite strong because of the petroleum industries in both regions.


User currently offlineChinook747 From Canada, joined Mar 2007, 126 posts, RR: 0
Reply 5, posted (7 years 5 months 1 day 12 hours ago) and read 3315 times:

Forgive me for asking,
but,
what does "damp," "dry," and "wet" leased mean in the comments above in regard to the Aircraft that VK operates.
thanks


User currently offlineEurostarVA From Bahrain, joined May 2002, 1296 posts, RR: 7
Reply 6, posted (7 years 5 months 1 day 12 hours ago) and read 3304 times:

Dry-lease: Aircraft only
Damp-lease: Aircraft+cockpit crew
Wet-lease: Aircraft+cockpit crew+cabin crew (sometimes referred to as "ACMI" lease = Aircraft, Crew, Maintenance, Insurance provided by the lessor company.

Cheers.



If there is a will, there is a way
User currently offlineEurostarVA From Bahrain, joined May 2002, 1296 posts, RR: 7
Reply 7, posted (7 years 5 months 1 day 12 hours ago) and read 3299 times:

Quoting Nycfly75 (Reply 2):
Dont forget also NY-JFK via interline/wet lease agreement with North American Airlines coming soon!

The latest info I have (a newpaper article published 2 days ago and quoting the CEO Conrad Clifford) is that VK got tentative, unwritten approval from FAA and USDoT to operate to the US direct. This development was facilitated by the huge efforts of the Nigerian CAA since last year to bring its regulatory oversight capacities to international standards, as well as improvements in Nigerian airports of late.



If there is a will, there is a way
User currently offlineEurostarVA From Bahrain, joined May 2002, 1296 posts, RR: 7
Reply 8, posted (7 years 5 months 1 day 11 hours ago) and read 3289 times:

Quoting MSYtristar (Reply 3):
When did they replace the A343's with B763's?

They haven't yet, but as per my post the 767-300ERs are being painted in Montreal as we speak and will replace the leased A330 (BMI) and A340 (VS) by May 15th.

Quoting MSYtristar (Reply 3):
It might be a good move if they are still in uncertain financial waters since 763's are significnatly cheaper to operate than A343's.

Agreed, that is their motive, exactly. My only conern is that their onboard product will take a step backward. I've been told that the -300ERs won't have PTVs.

Quoting VC10DC10 (Reply 4):
Why was Dubai cut? I would have assumed that both loads and yields would have been quite strong because of the petroleum industries in both regions.

According to insiders, it was cut due to predatory practices by Emirates, huge costs at Dubai Airport, and lower-than-expected load factors. I've also been told that VK intends to resume DXB soon with the 767-300ERs.



If there is a will, there is a way
User currently offlineVC10DC10 From United States of America, joined Apr 2006, 1036 posts, RR: 3
Reply 9, posted (7 years 5 months 1 day 11 hours ago) and read 3281 times:

Quoting EurostarVA (Reply 8):

According to insiders, it was cut due to predatory practices by Emirates, huge costs at Dubai Airport, and lower-than-expected load factors. I've also been told that VK intends to resume DXB soon with the 767-300ERs.

Ah, good ol' ruthless competition. And good for Virgin Nigeria for giving it another go.


User currently offlineAA1818 From Trinidad and Tobago, joined Feb 2006, 3435 posts, RR: 4
Reply 10, posted (7 years 5 months 1 day 5 hours ago) and read 3073 times:

Thanks for all your replies guys. They have been realy useful and informative!

AA1818



“The moment you doubt whether you can fly, you cease for ever to be able to do it.” J.M. Barrie (Peter Pan)
User currently offline1stfl94 From United Kingdom, joined May 2006, 1455 posts, RR: 0
Reply 11, posted (7 years 5 months 1 day 5 hours ago) and read 3058 times:

Quoting EurostarVA (Reply 8):
Agreed, that is their motive, exactly. My only conern is that their onboard product will take a step backward. I've been told that the -300ERs won't have PTVs.

The PTVs on VK's A340s are about the size of a postage stamp, your probably better off without them.


User currently offlineB742 From United Kingdom, joined Mar 2005, 3768 posts, RR: 19
Reply 12, posted (7 years 5 months 1 day 4 hours ago) and read 3026 times:

VK will recieve ex Air Canada 767-300ER's; C-GGFJ and C-GHPA.

Any idea what is the fate of the A340-300 (G-VSUN), will it return to VS?

Rob!  wave 


User currently offlineLeezyjet From United Kingdom, joined Oct 2001, 4042 posts, RR: 53
Reply 13, posted (7 years 5 months 1 day 4 hours ago) and read 2958 times:

Quoting B742 (Reply 12):
Any idea what is the fate of the A340-300 (G-VSUN), will it return to VS?

 checkmark 

Quoting 1stfl94 (Reply 11):
The PTVs on VK's A340s are about the size of a postage stamp, your probably better off without them.

Any PTV is better than NO PTV !!.

 Smile



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