SInGAPORE_AIR
Posts: 11619
Joined: Mon Nov 13, 2000 4:06 am

Branson To Spend $100 Mil On US Low Cost Airline

Mon May 06, 2002 4:38 pm

Richard Branson, plans to start a US no frills airline with $100 million.

The airline, Virgin Red (hmmm), will start if US and €uropean revive open skies talks succesfully to allow foreign groups to control American airlines.

Branson also said that he does not plan to derail EZY's £400 million bid for Go.

Virgin Red is hoping to have a base on the north-east coast of the US, operating 10 planes, expanding to four hubs and 40 planes later.

More information at The Herald website
Anyone can fly, only the best Soar.
 
hkgspotter1
Posts: 5750
Joined: Fri Nov 04, 2005 12:43 pm

RE: Branson To Spend $100 Mil On US Low Cost Airline

Mon May 06, 2002 4:51 pm

You have a big interest in Virgin these days, I wonder why  Big grin
 
hawkeye2
Posts: 227
Joined: Thu Mar 14, 2002 5:24 pm

RE: Branson To Spend $100 Mil On US Low Cost Airline

Mon May 06, 2002 4:59 pm

Assuming the foreign-ownership rules are relaxed in the first place, Branson should just buy a stake in JetBlue and be done with it. B9 is the closest US equivalent to a low-cost airline with a hip "Virgin-like" flavor.
 
airnewzealand
Posts: 2310
Joined: Sat Oct 21, 2000 6:00 pm

RE: Branson To Spend $100 Mil On US Low Cost Airline

Mon May 06, 2002 4:59 pm

LOL Hkgspotter,

Anyways, he expanding all over the world isnt he!! Man i wonder where he will go next?? Middle East?

Mike
 
SInGAPORE_AIR
Posts: 11619
Joined: Mon Nov 13, 2000 4:06 am

RE: Branson To Spend $100 Mil On US Low Cost Airline

Mon May 06, 2002 5:05 pm

HKGSpotter: You have a habit of trying to spoil my posts. I wonder why.

The article indicates that Branson wants to expand into the markets of Japan and South Africa. China would also be a good place for him since it's going to grow the biggest in the near - medium term future.
Anyone can fly, only the best Soar.
 
backfire
Posts: 3467
Joined: Fri Oct 06, 2006 8:01 am

RE: Branson To Spend $100 Mil On US Low Cost Airline

Mon May 06, 2002 5:35 pm

This is hardly news. It's been known for ages that Dickie would set up a US airline if the ownership rules changed.

Any chance of something more up-to-date?
 
Guest

RE: Branson To Spend $100 Mil On US Low Cost Airline

Mon May 06, 2002 6:28 pm

Considering that he's currently limited to just 24.9% ownership, I really doubt that this story is true - of course, there is nothing stopping him entering into a franchise deal with a US carrier! Big grin
 
N863DA
Posts: 1140
Joined: Sat Sep 04, 2004 6:36 am

RE: Branson To Spend $100 Mil On US Low Cost Airline

Mon May 06, 2002 9:20 pm

LOL!!! Y'all make me laugh.

Call up JetBlue HQ and ask why all the guys are British.... got any ideas? Because in everything but name, JetBlue is Virgin America.

(JetBlue = Virgin Blue, America).

Obviously with current rules nothing can be written down in stone, but there is no doubt that they will write it down as soon as the rules lax up (which they should not do).

 
VirginFlyer
Posts: 3888
Joined: Sun Sep 10, 2000 12:27 pm

RE: Branson To Spend $100 Mil On US Low Cost Airli

Mon May 06, 2002 9:23 pm

Hawkeye2 - funnily enough, I was going to suggest the same. They could even rename it, wait for it, Virgin Blue USA... Seriously, a Virgin JetBlue partnership seems like a great idea in my opinion - Lets hope good old Sir Richard doesnt show the world's media an cheque to buy JetBlue, then tear it up saying its a joke...

AirNewZealand - Japan I believe is the next place he wants to set one up, according to an article I was reading the other day.

V/F
"So powerful is the light of unity that it can illuminate the whole earth." - Bahá'u'lláh
 
b757300
Posts: 3914
Joined: Fri Dec 15, 2000 10:27 pm

RE: Branson To Spend $100 Mil On US Low Cost Airli

Mon May 06, 2002 9:52 pm

Not likely it will happen. The U.S. hasn't been very willing to change the foreign ownership rules.
"There is no victory at bargain basement prices."
 
TNboy
Posts: 1115
Joined: Mon Mar 04, 2002 8:12 pm

RE: Branson To Spend $100 Mil On US Low Cost Airline

Mon May 06, 2002 9:58 pm

Branson grandstanding again. Oh well, Singapore_Air, makes a change from your SQ press releases. Whose money does Dicky plan to spend, and who will he eventually sell to, and to subsidise what new "venture".
Everything changes, yet everything remains the same.
Cheers
Bill
"...every aircraft is subtly different.."
 
DCA-ROCguy
Posts: 3890
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RE: Branson To Spend $100 Mil On US Low Cost Airline

Tue May 07, 2002 1:09 am

Foreign ownership rules should be relaxed in the US, just like most industries in the US have free trade and real competition. The US high-cost network-airline Cartel needs all the well-managed low-fare competition it can get. Consumers deserve no less.

The most likely scenario for allowing foreign-owned domestic US carriers would be if the Cartel carriers tried to consolidate again. I've argued at this forum for a long time that superconsolidation among the US network carriers--from 6 down to 3--would be disastrous for consumers....unless, Uncle Richard et. al. were allowed to come in and offer competition.

Southwest and other US low-fare carriers are very well managed, but the concentrated market power of the high-cost cartel in 3 supercarriers is NOT a risk the Justice Department will allow. That is why the pro-business current US administration killed UA-US last year. Then Sept. 11 happened, and nobody wants to consolidate....right now.

But the whining continues. Leo Mullin of Delta has been whining for years about how the Cartel 6 barracudas must be allowed to consolidate for alleged "economic reasons." It's possible that the Cartel "Six Families" Dons and Congress could work out a deal where they are allowed to consolidate, and Uncle Richard and WestJet, et. al., are allowed to come in and offer an even broader base of competition. US Superconsolidation should *not* be allowed otherwise.

Jim
Need a new airline paint scheme? Better call Saul! (Bass that is)
 
srbmod
Posts: 15446
Joined: Tue Mar 20, 2001 1:32 pm

RE: Branson To Spend $100 Mil On US Low Cost Airline

Tue May 07, 2002 1:23 am

You got to admire Sir Richard, when his name hasn't been in the papers for a few days, he says something to get it back in. Yes, it is no secret that he wants an American airline in order to have an airline of his own to transfer VAA pax onto. Virgin was at one time rumored to be buying a stake in a U.S. carrier. The U.S. gov't may have to change their policies concerning foreign ownership of airlines in order to get an open skies agreement going again with the UK. $100 million can definitely get an airline started, but he would be better off buying an exsisting carrier and using some of that money to expand it. The U.S. is saturated with low-fare carriers, so buying several of the smaller ones and consolidating them may be the best bet for Branson if he is given the chance.
 
AA717driver
Posts: 1502
Joined: Tue Feb 12, 2002 8:27 am

RE: Branson To Spend $100 Mil On US Low Cost Airline

Tue May 07, 2002 2:55 am

AA/BA is allowed to go. Richard will withdraw his objection about the LHR slots. Foreign ownership rules are changed in the U.S.... With the proper amount of money, anything is possible.TC
FL450, M.85
 
767ALLTHEWAY
Posts: 636
Joined: Mon Nov 22, 1999 5:37 am

RE: Branson To Spend $100 Mil On US Low Cost Airline

Tue May 07, 2002 3:09 am

You say he wants to start operating with A base in the northeast, do we have any indication of to which airport he would want to base Virgin Red out of?
"Courage is not the absence of fear, but rather the judgement that something else is more important than fear"
 
nonrevman
Posts: 1258
Joined: Mon Nov 19, 2001 6:33 am

RE: Branson To Spend $100 Mil On US Low Cost Airline

Tue May 07, 2002 3:09 am

Shoot,

I was hoping that this thread was about Branson, Missouri trying to get a low fare carrier into Branson or maybe Springfield.  Sad

I now return you to your thread.
 
donder10
Posts: 6944
Joined: Sun Oct 21, 2001 5:29 am

RE: Branson To Spend $100 Mil On US Low Cost Airline

Tue May 07, 2002 3:28 am

How would a low fare US carrier help a transatlantic,high fares airline in feed?
 
Guest

RE: Branson To Spend $100 Mil On US Low Cost Airline

Tue May 07, 2002 3:31 am

You can bet the major carriers will be lobbying ferociously against allowing foreign-owned competitors into the market. The odds would be in their favour, since each major carrier carries a fair bit of clout in any state in which it has a hub -- i.e., all the large states and a few medium-sized ones.

That said, liberalising the world's foreign ownership laws would be a good thing. Especially for smaller countries, where foreign ownership restrictions limit struggling carriers' and start-ups' options when seeking investors.

Branson could explore the possibility of franchising out to local owners/operators if he wanted to, but even that faces potential problems. Greyhound Air (originally owned by Phoenix-based Dial Corp.) tried to get around Canada's foreign ownership rules by hiring B.C.-based Kelowna Flightcraft to do the flying while they looked after the marketing and scheduling, but were stopped anyway. Branson could face a similar situation in the U.S. and other countries if he went that route.
 
ryanair
Posts: 646
Joined: Tue Jul 06, 1999 1:41 am

RE: Branson To Spend $100 Mil On US Low Cost Airline

Tue May 07, 2002 6:00 am

So Richard Branson come up with a headline grabbing idea that is actually impossible because of a minor thing called the law. Gee that's never happened before!!!!!!

Back on earth, what's said about Jetblue is very true. Jetblue poached ruthlessly from Virgin Atlantic taking much of that companies best and brightest management.

It's been sad to see VS go down hill ever since, I never thought I'd see the day where former Virginites talked of BA being better. I know my employers corporate account with VS is up for grabs again because they've p"£$ed us around once too often. Rather than rattle on about pipe dreams, come on Richard get what is back to their once proud best!!!!
 
Ciro
Posts: 639
Joined: Mon Aug 16, 1999 5:00 pm

RE: Branson To Spend $100 Mil On US Low Cost Airline

Tue May 07, 2002 6:40 am

A Virgin in Red! Cool name!  Smile/happy/getting dizzy
The fastest way to become a millionaire in the airline business is to start as a billionaire.
 
ba777-236
Posts: 645
Joined: Sat Oct 27, 2001 11:35 pm

RE: Branson To Spend $100 Mil On US Low Cost Airline

Tue May 07, 2002 9:17 am

I thought Mr Branson wanted to start an airline in Canada?
He had said in an interview on a local TV station about a year ago - that he was interested in starting up an airline if Canada changed their foreign ownership law. Have they changed this law?
I like British Airways! I'm not sure why, but I do! ;-)
 
Guest

RE: Branson To Spend $100 Mil On US Low Cost Airline

Tue May 07, 2002 9:47 am

BA777-236 wrote: "I thought Mr Branson wanted to start an airline in Canada?"

He expressed interest in it. Transport minister David Collenette, however, has repeatedly said he has no intention of permitting foreign ownership of Canadian carriers.

There has been talk of raising the foreign ownership limit to 49%, but whether Branson would be interested in anything less than majority control is another question.

This exposes a double standard: Both Collenette and his U.S. counterparts are fine with foreign ownership in the railways. Canadian National was allowed to buy the Illinois Central Railroad, sell one of its domestic lines to a Denver-based company and then seek a merger with BNSF which would have produced North American Railways, the world's largest, had anti-trust regulators not objected.

But with the airlines, it's a totally different story. Go figure.
 
donder10
Posts: 6944
Joined: Sun Oct 21, 2001 5:29 am

RE: Branson To Spend $100 Mil On US Low Cost Airline

Tue May 07, 2002 9:49 am

I suspect Mr Branson has said in an interview that he wants to rule the world too.
 
FrequentFlier
Posts: 410
Joined: Tue Aug 08, 2000 10:45 am

RE: Branson To Spend $100 Mil On US Low Cost Airline

Tue May 07, 2002 10:41 am

Let's get it on!

Go Blue!
 
TonyBurr
Posts: 1059
Joined: Tue Mar 27, 2001 1:00 pm

RE: Branson To Spend $100 Mil On US Low Cost Airline

Tue May 07, 2002 10:46 am

China would be a very intersting place for Branson to start an airline!!! yes there are lots of Chinese airlines, but he would bring an expertise that is missing.

An American line would certainly feed into Virgin's international gateways. If it is possible it makes sense.

It sould be great to have some competition for USAirways in the northeast.
 
tullamarine
Posts: 1612
Joined: Thu Aug 05, 1999 1:14 pm

RE: Branson To Spend $100 Mil On US Low Cost Airline

Tue May 07, 2002 12:20 pm

Jet Blue current has a market capitalisation of USD2.3Bn so you'd have to think that USD100M isn't going to buy Branson much of an existing carrier.

Setting up from scratch wouldn't be easy given the strength of existing US no-frills carriers such as Southwest, JetBlueand AirTran plus the dominant position and power of full-service carriers in many of the hubs Virgin would want to service.

A relaxation of US ownership rules would also involve the elimination of Bermuda 2 restrictions at LHR. Such a move would seriously threaten VS meaning a move into the US may not be financially viable.
717,721/2,732/3/4/5/7/8/9,742/3/4,752/3,762/3,772,W,310,320/1,332/3,388,DC9,DC10,F28,F100,142,143,E90,CR2,D82/3/4,SF3,AT
 
wilcharl
Posts: 1151
Joined: Sun Jun 25, 2000 11:19 am

RE: Branson To Spend $100 Mil On US Low Cost Airline

Tue May 07, 2002 1:27 pm

N863DA

what you said about Virgin and JetBlue sounds like it came from an Embry Riddle Airline Managment Professor...
 
N863DA
Posts: 1140
Joined: Sat Sep 04, 2004 6:36 am

RE: Branson To Spend $100 Mil On US Low Cost Airline

Tue May 07, 2002 9:25 pm

LOL Indeed it did.

Does it show?? I turned around and called them because I was inquisitive. What do you know... he was right.

LOL.
 
wilcharl
Posts: 1151
Joined: Sun Jun 25, 2000 11:19 am

RE: Branson To Spend $100 Mil On US Low Cost Airline

Wed May 08, 2002 3:49 am

i didnt beleive him, so they really are brits... wow

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