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DeltaMD90
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RE: DL Poised To Swoop On Virgin Atlantic.

Mon Dec 10, 2012 4:49 pm

Quoting ual777uk (Reply 148):
As expected if the Bloomberg report rings true SRB will not give up control of VS.

There has to be some background deals... I really hope DL won't be so stupid and buy 49% of VS without some assurances...
 
Bongodog1964
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RE: DL Poised To Swoop On Virgin Atlantic.

Mon Dec 10, 2012 5:18 pm

Quoting DeltaMD90 (Reply 150):
Quoting ual777uk (Reply 148):
As expected if the Bloomberg report rings true SRB will not give up control of VS.


There has to be some background deals... I really hope DL won't be so stupid and buy 49% of VS without some assurances...

Are you basing your assesment on the fact that SQ had the best part of a Billion dollars tied up for 13 years and now look like only getting 1/3 of it back ?
 
rwy04lga
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RE: DL Poised To Swoop On Virgin Atlantic.

Mon Dec 10, 2012 5:29 pm

Quoting jfk777 (Reply 144):
Virgin to become " Delta UK" ?

Would that be possible/feasible? How about 'Delta's Sacrificial Virgin'?
Just accept that some days, you're the pigeon, and other days the statue
 
LGWflyer
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RE: DL Poised To Swoop On Virgin Atlantic.

Mon Dec 10, 2012 5:33 pm

Quoting rwy04lga (Reply 152):
Quoting jfk777 (Reply 144):
Virgin to become " Delta UK" ?

Would that be possible/feasible? How about 'Delta's Sacrificial Virgin'?

If something like that did happen, would they paint all the current VS aircraft into DL livery?
3 words... I Love Aviation!!!
 
ldvaviation
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RE: DL Poised To Swoop On Virgin Atlantic.

Mon Dec 10, 2012 6:06 pm

Quoting jfk777 (Reply 144):
Walsh saying the Virgin brand is going to "dissappear" is laughable, but what would you expect the CEO of IAG to say. What does Walsh expect Virgin to become " Delta UK" ? He is the only one thinking that, Walsh should worry about Iberia and not Virgin Atlantic.

It is not laughable, it is brilliant. He is playing Branson's ego against him.

Either way, Walsh wins.

If the Virgin brand disappears, BA becomes the only true premium choice on the route. The Delta brand cannot compete with BA's.

If Virgin stays around as-is, BA still wins because Delta adds nothing to Virgin that will fix what is wrong with Virgin today.
 
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GCT64
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RE: DL Poised To Swoop On Virgin Atlantic.

Mon Dec 10, 2012 6:23 pm

SQ and LH are two of the smartest and best run airlines in the world, they have both had their hands severely burnt playing in the UK market with VS and BD and both will have exited realising significant losses. That alone would make me nervious if I was a DL share/stockholder - are DL's management really cleverer than SQ's and LH's?
Flown in: A20N,A21N,A30B,A306,A310,A319,A320,A321,A332,A333,A343,A346,A359,A388,BA11,BU31,(..56 more types..),VC10,WESX
 
jetlanta
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RE: DL Poised To Swoop On Virgin Atlantic.

Mon Dec 10, 2012 6:29 pm

Quoting GCT64 (Reply 155):
SQ and LH are two of the smartest and best run airlines in the world, they have both had their hands severely burnt playing in the UK market with VS and BD and both will have exited realising significant losses. That alone would make me nervious if I was a DL share/stockholder - are DL's management really cleverer than SQ's and LH's?

Yes.
 
anstar
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RE: DL Poised To Swoop On Virgin Atlantic.

Mon Dec 10, 2012 6:35 pm

Quoting LDVAviation (Reply 154):
If Virgin stays around as-is, BA still wins because Delta adds nothing to Virgin that will fix what is wrong with Virgin today.

I would disagree - I think a DL/VS tie up would have lots of benefits for both carriers.

Quoting GCT64 (Reply 155):
SQ and LH are two of the smartest and best run airlines in the world, they have both had their hands severely burnt playing in the UK market with VS and BD and both will have exited realising significant losses.

But SQ and VS never really had much to offer each other. DL on the other hand is a carrier that is much better at working with others and utilising Joint Ventures etc
 
TeamintheSky
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RE: DL Poised To Swoop On Virgin Atlantic.

Mon Dec 10, 2012 6:43 pm

Quoting GCT64 (Reply 155):
That alone would make me nervious if I was a DL share/stockholder - are DL's management really cleverer than SQ's and LH's?

Hi All,

I would not argue about how clever any of the management teams are as all have had good and bad times and made good and bad decsions. I would say the problem faced by SQ and LH was that they did not or were unable to extract the value out of BD or VS (or UK carriers in general). The value that UK carriers bring to the table (especially VS in this case) is flying over the Atlantic ocean. If VS signs a JV with DL, the JV gives DL more connections to LHR to sell to corporate clients and more connections for VS when it lands in the US to sell to corporate and non-corporate clients. LH nor SQ were able to set up similar agreements with BD and VS.

I think it is less than a done deal, but I am excited as a DL flyer. It would be great to try out VS and earn some miles!

Kind Regards,

Team
Since 2010: DL, KL, AF, WX, IG, FR , FL, U2, AK, BA, OK, UX, VS, VN, K6, AT, US, AY, BE, EI, LG, AZ, 9W, SG, AA, JL, W6
 
ldvaviation
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RE: DL Poised To Swoop On Virgin Atlantic.

Mon Dec 10, 2012 6:53 pm

Quoting anstar (Reply 157):
But SQ and VS never really had much to offer each other. DL on the other hand is a carrier that is much better at working with others and utilising Joint Ventures etc

How is this Joint Venture going to transform Virgin from a point to point airline from the US to LHR? It needs help in its own domestic market. Its brand alone is no longer cutting it.
 
skipness1E
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RE: DL Poised To Swoop On Virgin Atlantic.

Mon Dec 10, 2012 7:03 pm

Quoting jfk777 (Reply 144):
Walsh saying the Virgin brand is going to "dissappear" is laughable, but what would you expect the CEO of IAG to say. What does Walsh expect Virgin to become " Delta UK" ? He is the only one thinking that, Walsh should worry about Iberia and not Virgin Atlantic.

It has good logic behind it though. If Delta gets de-facto control of VS then it's way too tempting to re-focus on gaining a bigger foothold in key markets like LON-NYC where they are under-represented in comparison to AA/BA. VS have three daily JFK slots DL would love to use I am sure. Ideally on Delta metal too. The North American routes could be served by DL and the feed from the East could stay with a downsized VS alongside holiday flights from LGW /MAN/GLA. That would be a much better focus strategically than a mish-mash partnership.
 
mcogator
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RE: DL Poised To Swoop On Virgin Atlantic.

Mon Dec 10, 2012 7:13 pm

Quoting TeamInTheSky (Reply 158):
but I am excited as a DL flyer. It would be great to try out VS and earn some miles!

Me too. Especially on MCO-UK. No more 1 stop into ATL/JFK.
“Traveling – it leaves you speechless, then turns you into a storyteller.” – Ibn Battuta
 
jetlanta
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RE: DL Poised To Swoop On Virgin Atlantic.

Mon Dec 10, 2012 7:26 pm

Quoting TeamInTheSky (Reply 158):
Hi All,

I would not argue about how clever any of the management teams are as all have had good and bad times and made good and bad decsions. I would say the problem faced by SQ and LH was that they did not or were unable to extract the value out of BD or VS (or UK carriers in general). The value that UK carriers bring to the table (especially VS in this case) is flying over the Atlantic ocean. If VS signs a JV with DL, the JV gives DL more connections to LHR to sell to corporate clients and more connections for VS when it lands in the US to sell to corporate and non-corporate clients. LH nor SQ were able to set up similar agreements with BD and VS.

I think it is less than a done deal, but I am excited as a DL flyer. It would be great to try out VS and earn some miles!

Kind Regards,

Team

Much better than my answer. You are EXACTLY right here.
 
slinky09
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RE: DL Poised To Swoop On Virgin Atlantic.

Mon Dec 10, 2012 7:52 pm

Quoting skipness1E (Reply 160):
VS have three daily JFK slots DL would love to use I am sure.

You miss the large O&D market that VS has from London and giving that up would not make good logic - what incentive would one have to fly DL with its inferior (albeit good) product? It makes much more sense to revenue share through the JV for DL, for it to gain connecting passengers in the US, for VS to get more flyers from DL etc.

Then there's the whole LHR operation to consider - through questions like would DL / VS consolidate at T4 (I hope not), what would happen to VS domestic,
 
jfk777
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RE: DL Poised To Swoop On Virgin Atlantic.

Mon Dec 10, 2012 7:58 pm

Quoting skipness1E (Reply 160):
It has good logic behind it though. If Delta gets de-facto control of VS then it's way too tempting to re-focus on gaining a bigger foothold in key markets like LON-NYC where they are under-represented in comparison to AA/BA. VS have three daily JFK slots DL would love to use I am sure

Today Delta flies 3 daily nonstop 767 from JFk to LHR (without Virgin) , Virgin is about getting more flights from JFK to LHR.
 
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FlyCaledonian
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RE: DL Poised To Swoop On Virgin Atlantic.

Mon Dec 10, 2012 8:12 pm

If this deal goes ahead - and it looks increasingly likely to do so - there would be nothing to stop VS splitting a few years down the line. LHR ops become owned by DL and AF-KL (with AF-KL owning a majority), perhaps using the VS name under licence. Other UK ops remain with Sir Richard Branson as a leisure carrier for Virgin Holidays. A fleet split could be LHR goes 787-9 and A330/A346, while the leisure ops take the 744 fleet, perhaps with A350s on order (using the deposit from a cancelled A380 order).
Let's Go British Caledonian!
 
boysteve
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RE: DL Poised To Swoop On Virgin Atlantic.

Mon Dec 10, 2012 10:30 pm

Quoting skipness1E (Reply 160):
It has good logic behind it though. If Delta gets de-facto control of VS then it's way too tempting to re-focus on gaining a bigger foothold in key markets like LON-NYC where they are under-represented in comparison to AA/BA. VS have three daily JFK slots DL would love to use I am sure. Ideally on Delta metal too

Would the new VS/DL tie up mean a pull out from LHR-EWR? If these flights are moved to JFK then that would be 8 flights per day JFK-LHR which would be a competitive schedule!

Quoting skipness1E (Reply 160):
The North American routes could be served by DL and the feed from the East could stay with a downsized VS alongside holiday flights from LGW /MAN/GLA. That would be a much better focus strategically than a mish-mash partnership.

Hmmm whatabout bilaterals between the UK and Asia. What would happen to VS's flights to NRT or PVG for example. They could not be operated by DL as a US based airline and they would not fit with a 'holiday' brand for marketing reasons. Are you thinking that the VS/DL tie up would pull out of such routes?
 
skipness1E
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RE: DL Poised To Swoop On Virgin Atlantic.

Mon Dec 10, 2012 10:47 pm

Quoting Boysteve (Reply 166):
They could not be operated by DL as a US based airline and they would not fit with a 'holiday' brand for marketing reasons.

The same VS branding already does exist as a LHR and LGW brand, it's not an issue.
 
commavia
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RE: DL Poised To Swoop On Virgin Atlantic.

Tue Dec 11, 2012 12:04 am

Quoting jfk777 (Reply 144):
Walsh saying the Virgin brand is going to "dissappear" is laughable, but what would you expect the CEO of IAG to say. What does Walsh expect Virgin to become " Delta UK" ?

Agreed. Walsh is just being sarcastic ("cheeky") - just as Branson has been for 30 years about every single thing BA does.  

A large portion of whatever value there is in this for Delta would be tied to Virgin's brand presence in the U.K. (specifically London) market. A large portion of that goes away if Delta's brand takes over.

Quoting GCT64 (Reply 155):
SQ and LH are two of the smartest and best run airlines in the world, they have both had their hands severely burnt playing in the UK market with VS and BD and both will have exited realising significant losses. That alone would make me nervious if I was a DL share/stockholder - are DL's management really cleverer than SQ's and LH's?

I tend to agree. I am sure there is value in this deal for both sides, but I struggle to see how the value to Delta is worth $300M (let alone $500M). From what I can see, Virgin brings essentially zero value to Delta for anything beyond London - connections over LHR can be better handled over CDG/AMS, and the LGW/MAN-beach market is low-yielding. The only substantial value I can see is boosting Delta's standing in the local LHR-U.S. market (for both U.S. and U.K. POS), and in connections from LHR to interior U.S. points over Delta/Virgin U.S. gateways. That it helpful for Delta, to be sure, but I just don't know if that's worth hundreds of millions of dollars.
 
Prost
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RE: DL Poised To Swoop On Virgin Atlantic.

Tue Dec 11, 2012 12:18 am

Well, Continental paid $209 million for four pairs of LHR slots, so if DL pays $300-500 million, increases their presence in the LHR market, and adds allure to their NYC operations, it seems like a good investment to me.
 
skipness1E
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RE: DL Poised To Swoop On Virgin Atlantic.

Tue Dec 11, 2012 12:35 am

The LGW beach market isn't low yield, that's just an assumption people make. Indeed it was apparently the only bit of BA making money post 2008 banking crisis. It's got a decent yield mainly as there's no LHR direct option.
 
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mayor
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RE: DL Poised To Swoop On Virgin Atlantic.

Tue Dec 11, 2012 1:30 am

Quoting commavia (Reply 168):
I tend to agree. I am sure there is value in this deal for both sides, but I struggle to see how the value to Delta is worth $300M (let alone $500M). From what I can see, Virgin brings essentially zero value to Delta for anything beyond London - connections over LHR can be better handled over CDG/AMS, and the LGW/MAN-beach market is low-yielding. The only substantial value I can see is boosting Delta's standing in the local LHR-U.S. market (for both U.S. and U.K. POS), and in connections from LHR to interior U.S. points over Delta/Virgin U.S. gateways. That it helpful for Delta, to be sure, but I just don't know if that's worth hundreds of millions of dollars.

I wonder. If DL is just looking for Virgin to join Skyteam or a JV (or both) I wonder why DL should have to pay money to get Virgin to do it, unless that's the only way Branson would do it. Otherwise, I don't see the value. What IS the value of slots at LHR, nowadays? On top of all that, DL would have to make sure that AF/KL got a portion of Branson's pie to go along with what they want to buy from SQ, otherwise, what's the point? What good is owning just 49% of Virgin?
"A committee is a group of the unprepared, appointed by the unwilling, to do the unnecessary"----Fred Allen
 
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DeltaMD90
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RE: DL Poised To Swoop On Virgin Atlantic.

Tue Dec 11, 2012 2:13 am

Quoting Bongodog1964 (Reply 151):
Are you basing your assesment on the fact that SQ had the best part of a Billion dollars tied up for 13 years and now look like only getting 1/3 of it back ?

Yes, I know, so DL would be that much stupider if they repeated the same error!
 
NYCAdvantage
Posts: 109
Joined: Sun Sep 13, 2009 3:01 pm

RE: DL Poised To Swoop On Virgin Atlantic.

Tue Dec 11, 2012 2:55 am

Quoting mayor (Reply 171):
I wonder. If DL is just looking for Virgin to join Skyteam or a JV (or both) I wonder why DL should have to pay money to get Virgin to do it,

Maybe SQ has a veto power on that, maybe the only way out for VS to join Skyteam is for DL to buy the shares.
Since it has been reported that is a three way deal, and,"if AF/KL are not in it" then my guess is DL is making sure on what they are getting in to. meaning the "VS, SQ and DL are the three involved.

[Edited 2012-12-10 18:57:51]
 
notdownnlocked
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RE: DL Poised To Swoop On Virgin Atlantic.

Tue Dec 11, 2012 4:20 am

Perhaps while the DL execs are in SIN working on a VS deal they can recall the close relationship that SQ once had with DL and restart some lost opportunities ie: Global Excellence Alliance. Just substitute Swissair for VS and see what happens. It's worth a shot even though I don't think any members of either airline are or with their respective companies at this time nor would they remember the past. Could be another way to shake the alliances as they are all in a state of flux at the moment.
 
anstar
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Joined: Sun Nov 23, 2003 3:49 am

RE: DL Poised To Swoop On Virgin Atlantic.

Tue Dec 11, 2012 8:08 am

Quoting Boysteve (Reply 166):

Would the new VS/DL tie up mean a pull out from LHR-EWR? If these flights are moved to JFK then that would be 8 flights per day JFK-LHR which would be a competitive schedule!

I can't see VS giving up the EWR market. Even BA/AA keep a presence in EWR-LHR after the JV started.

Quoting mayor (Reply 171):
If DL is just looking for Virgin to join Skyteam or a JV (or both) I wonder why DL should have to pay money to get Virgin to do it, unless that's the only way Branson would do it.

I would say that DL have had seperate discussions with VS in hpw they will work with them etc if they take the 49% stake of SQ. I am pretty cofident "control" has never been the key here... the key is getting VS into Skyteam before moving to STAR and getting them in the Trans Atlantic JV... all of which will help DL and could easily be worth a $300M investment in the long term. Heck DL were willing to pay UA $21M just for one route authority into LHR (LHR-JFK).
 
stlgph
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RE: DL Poised To Swoop On Virgin Atlantic.

Tue Dec 11, 2012 1:17 pm

Deal is official.

Delta spending $360 million to 49% stake in Virgin Atlantic currently held by Singapore.

Delta gets 3 seats on the board.
if assumptions could fly, airliners.net would be the world's busiest airport
 
FlyKev
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RE: DL Poised To Swoop On Virgin Atlantic.

Wed Dec 12, 2012 12:32 am

As this topic is now confirmed, a new thread on the topic has been started:

Breaking NEWS: DL Acquiring 49% In VS (by mindscape Dec 11 2012 in Civil Aviation)

Please continue all discussion there.

This thread will now be locked and any posts appearing after this message will be removed for housekeeping only.

On behalf of the moderators,

FlyKev.
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