sndp
Posts: 534
Joined: Fri Feb 18, 2000 6:07 pm

Any News About VG Airlines?

Tue Jul 30, 2002 4:07 pm

I have been abroad some time so I may have missed news about how VG Airlines is performing. Is there anybody who has more news about their load factors and so on? Thanks already.

sndp
 
Established02
Posts: 528
Joined: Mon Jan 14, 2002 4:30 am

RE: Any News About VG Airlines?

Tue Jul 30, 2002 4:23 pm

Hello Sndp,

You can find some info about VG's load factors in a recent article of La Libre Belgique (26/07/02).

Le ciel belge croit en sa bonne étoile
http://www.lalibre.be/article.phtml?id=3&subid=85&art_id=72998

Regards,

Established02
 
sndp
Posts: 534
Joined: Fri Feb 18, 2000 6:07 pm

RE: Any News About VG Airlines?

Tue Jul 30, 2002 5:38 pm

Thanks very much
sndp
 
Guest

RE: Any News About VG Airlines?

Tue Jul 30, 2002 5:53 pm

Hmmm, with loadsfactors of 40% on LAX (most of which would be coming from Armenian Airlines, I assume); and only 50% during the peak summer season on the JFK route they are not going to be around a lot longer!! And as for their plans to break even within 8 or 9 months ... what a load of kak!
 
A330
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RE: Any News About VG Airlines?

Tue Jul 30, 2002 6:37 pm

No, SAS23,

All airlines in their start-up period have the same problem, and let me assure you that these loadfactors have been calculated in the business-plan.

From october, flights to Boston will be reduced to 3 or 4 a week, but this will give the uportunity to open the Miami route.
In summer, a 4th Airbus will probably join the fleet.
Meanwhile, traffic numbers are getting better all the time, and cargo is a succes, and that is where the money is coming from at the moment.

Passengers are VERY happy now with the service, in Emilie as in Michael class!
Shiek!
 
Established02
Posts: 528
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RE: Any News About VG Airlines?

Tue Jul 30, 2002 6:50 pm

> All airlines in their start-up period have the same problem

A330, what other airlines did you have in mind when stating that they face(d) the same problem (as IV) during their start-up period? SNBA, LX, others,...?
 
A330
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RE: Any News About VG Airlines?

Tue Jul 30, 2002 11:45 pm

Almost all new airlines and airlines opening new routes will run at a considerable loss for their new product in the first few months of operation.
That is why so many airlines fail during their first year, they did not forsee to make losses, and capital was weak.
VG has a sound investor though who is now seeing improvement in the airline...
VG needs to earn their passengers, and is working hard now to convince these pax. to fly the Belgian flag carrier!!
Shiek!
 
Guest

RE: Any News About VG Airlines?

Wed Jul 31, 2002 12:21 am

Sure, A330, airlines that (correctly) calculate that they will have low loadfactors tend not to forecast making profits in within a year, though ... generally it takes a year or two, especially on long haul, to break even.

This is the peak season, with lots of tourist traffic - off peak, loads will drop by at least 50%. If in peak season they are struggling to reach 50%, what will happen in winter? Also, if you're reducing utilisation of your aircraft, then your overall fixed unit costs increase ... which makes the situation even worse.

Don't forget CTB tried LAX and MIA and they were a disaster for them. What makes IV think they can be any better?

With cargo yields on transatlantic services being the lowest for two decades, I shudder to think what your pax yields are like if you say that's where the money is coming from! Big grin Big grin Big grin
 
User avatar
Flying Belgian
Posts: 1906
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RE: Any News About VG Airlines?

Wed Jul 31, 2002 12:50 am

In my mind, VG should stop by the end of this year.

I've heard that last week on a flight to Boston there were 42 pax. I know it from the flight's gate agent.
But one question remains for me : Where comes the money from ???
The same friend told me VG was getting a regional political support.

I still can't understand how VG can survive with such poor loadfactors.


FB.
Life is great at 41.000 feet...
 
LJ
Posts: 4127
Joined: Wed Nov 17, 1999 8:28 pm

RE: Any News About VG Airlines?

Wed Jul 31, 2002 12:52 am

I still can't understand how VG can survive with such poor loadfactors.


Wealthy financial backers who just want to own an airline!
 
Leo
Posts: 308
Joined: Wed May 24, 2006 11:32 pm

RE: Any News About VG Airlines?

Wed Jul 31, 2002 1:53 am

And this same guy finances mighty successful Air Holland.

lucky him.......
 
sndp
Posts: 534
Joined: Fri Feb 18, 2000 6:07 pm

RE: Any News About VG Airlines?

Wed Jul 31, 2002 4:11 am

Has anyone an idea of the amount of capital with which VG started?

It was one of my first concerns too, that the Bus. Plan of VG resembled the initial one of City Bird quite a lot. The only thing that City Bird never did (although they planned to do so) was flying to New York. Reutlinger (last but one CEO of Sabena) did not accept this and signed a rather expensive deal with City Bird to stop them going into competition with SN on the route, as we all know.

As they noticed their BP was not working as expected, City Bird transformed firstly into a long haul charter carrier and afterwards in a charter carrier towards southern European destinations, before going bankrupt. Will VG go the same way? I doubt they will survive, but I wish them all the luck, of course.

sndp


 
airDD
Posts: 367
Joined: Tue Oct 16, 2001 3:06 am

RE: Any News About VG Airlines?

Wed Jul 31, 2002 4:26 am


sndp,

Citybird flew to Newark for a while and when SN got into the capital of CTB the flight was moved to SN through a wetlease if I remember correctly.

The difference between CTB & VG is that CTB was a low-cost long haul operator, tickets were only available through the callcenter; VG wants to be a full service provider.

Money comes from Tony Gramm and I heard he put in 30 million euros of financial guarantees in VG

airDD
 
Guest

RE: Any News About VG Airlines?

Wed Jul 31, 2002 5:42 am

AirDD, VG might want to be a full service provider (which also means very much higher costs than a company like CTB ... though CTB also had a two class operation) but at present travel agents can't sell VG, so they, too, are only bookable online and via their call-centre.

What with the aircraft leases, fuel deposits etc, that €30m will disappear very rapidly indeed.
 
airDD
Posts: 367
Joined: Tue Oct 16, 2001 3:06 am

RE: Any News About VG Airlines?

Wed Jul 31, 2002 6:27 am

SAS23,

Actually VG has become available on the CRS systems recently through a ticketing agreement with Icelandic Air.

I don't know their daily cash-burn .. but I suspect it is pretty high  Big grin

airDD