Today's Sunday Times is reporting that Virgin is to close its unsuccessful UK domestic operation "Little Red" after only eighteen months:

http://www.thesundaytimes.co.uk/sto/...iness/Companies/article1455799.ece

Load factors have been very poor. It's bad news for Aer Lingus as well, as the aircraft and crews are on lease from the Irish carrier.

Given VS's recent chopping of non-US routes, I wonder if this is part of the process, but also whether the shutting down of Little Red coincides with VS being able to use those slots for long haul flights now? Previously, they could not be so used, one of the reasons LR was set up in the first place.

Pity it has to close down, as BA now has now domestic competition from LHR, but really, Virgin did a poor job, with not much marketing and badly chosen routes; was it really just a slot sitting operation in the first place?

Quoting kaitak (Thread starter): but also whether the shutting down of Little Red coincides with VS being able to use those slots for long haul flights now

Quoting kaitak (Thread starter): Virgin did a poor job, with not much marketing and badly chosen routes; was it really just a slot sitting operation in the first place?

The EDI+ABZ slot were BA-bmi remedy slot with restricted use on selected former bmi routes only were compeition issues were created following their takeover by BA. EDI/ABZ/NCE/Moscow/Cairo/Riyadh are the only options for using those slots IIRC for the first three years (traffic rights dependent) then any European routes plus Moscow/Cairo/Riyadh

Only the MAN slots are Virgin's to do whatever they want with

Well, not many people here would be surprised, but is this just DL saying they want all those LHR slots ?

From the original European decision to approve the BA/bmi deal on condition of slot divestiture:
http://ec.europa.eu/competition/merg...6447_20120330_20212_2452290_EN.pdf

Quote: 644. As a general rule, the slots obtained by a prospective entrant must be operated on the city pair(s) for which they have been requested from IAG and cannot be used on another city pair unless the prospective entrant has operated them during at least six full consecutive IATA seasons ("the Utilisation Period").272 The prospective entrant would be deemed to have grandfathering rights for the slots once appropriate use of the slots has been made on the city pairs at issue, for the Utilisation Period. Once the Utilisation Period has elapsed, the prospective entrant would be entitled to use the slots obtained on the basis of the Commitments exclusively to operate services on any route connecting London with any other part of Europe (including Aberdeen and Edinburgh), or on London-Moscow, London-Cairo and London-Riyadh. 645. During the Utilisation Period, the prospective entrant shall not be entitled to transfer, assign, sell, swap or charge in breach of the Commitments any slots obtained from IAG (except for changes to any such slots which are within the twenty/sixty minutes time window and which have been agreed with the slot coordinator.). Provisions on misuse of slots also apply. In the event of a misuse, the prospective entrant shall have thirty days after such notice to cure the misuse, failure to which gives IAG the right to terminate the agreement and obtain restitution of the slots.

If Little Red ends, am I reading it right that the EDI/ABZ slots would return to IAG?

That's a shame, I've enjoyed watching these.

View Large View Medium Photo © Steve Brimley

View Large View Medium Photo © Steve Brimley

I flew little red to edi last week.

The flight up was hardly crowded, and the lf on Friday night must have been 40-50 per cent.

This is therefore no surprise.

Would an a319 or even an Erj have been better for this route.

Is it confirmed from Virgin?

Quoting Humberside (Reply 1): Only the MAN slots are Virgin's to do whatever they want with

Does this mean that EDI and ABZ will remain under Virgin mainline? Sorry the article is subscription based so couldn't read the full story.

Can't find this news on any other media outlet or VS press release?

Sandyb123

Quoting sandyb123 (Reply 7):

Oh If true the MAN slots alone will be enough reason for DL to shut down Little Red.

If, and it's a big if, the article is correct about the demise of Little Red, the slot position is:

The three slot pairs used for LHR-MAN belong to Virgin and could be used for any destination for which they have traffic rights, leased to another airline. or sold to another airline.

The slots used for ABZ and EDI are competition remedy slots as Humberside has explained. They do not currently belong to Virgin or EI so would indeed revert to IAG if they are surrendered.
If any other airline wants to try to use them on any of the six routes that bmi and BA competed on, they can apply for them under the same terms Virgin used them under.
However the bilateral governing traffic between LON and MOW only allows 2 UK airlines and 2 Russian airlines, and there are already two airlines from each country flying the route (BA from LHR and EZY from LGW), so that leaves just five possible routes they could be used on in practice. The Riyadh and Cairo routes would need an airline with a UK AOC, but ABZ, EDI, and NCE could be flown by any airline with an EU/EEA member country AOC.
For an airline to claim the slots they need to be flying all the slots they actually own (none leased out).

If nobody wants them under these conditions, IAG keeps them. Of course then they need to find aircraft, crews and routes to use them, if they aren't flown on 80% of possible dates in each IATA season they are cancelled and return to the pool.

My understanding is that 12 slot pairs were originally allocated as remedy slots, three were never taken up and IAG have been using them ever since they took over bmi.

Edited to add - bmi and BA competed on LHR - MAN as well but so much of the traffic goes by rail or road that the merger was deemed not to have any competition implications for this route.

[Edited 2014-09-07 01:28:36]

And yet as recently as this week they were still recruiting for cabin crew..thank god I took my time thinking about that!!

Quoting andy33 (Reply 9): Edited to add - bmi and BA competed on LHR - MAN as well but so much of the traffic goes by rail or road that the merger was deemed not to have any competition implications for this route.

BMI had already withdrawn from MAN-LHR before the takeover, so it wasn't a matter for consideration by the competition people.

If this is true, its a further confirmation that VS will in future be run as a commercial airline rather than an extension of a multi millionaires ego.

Quoting Bongodog1964 (Reply 11): BMI had already withdrawn from MAN-LHR before the takeover, so it wasn't a matter for consideration by the competition people.

Always open to correction, but I thought it was GLA they withdrew from, leaving BA as the sole airline operating from LHR.
MAN was notorious for having such poor traffic on some timings that bmi used one of its regional subsidiary's E145s and still went out with empty seats.

BMI also often used the E145 on the Aberdeen route. Maybe this is an opportunity for the 'new' Midland to return to Heathrow.

Yeah it was GLA, I flew on the last GLA-LHR and also MAN-LHR on the last day of BMI. GLA closed 18 months before the end.

[Edited 2014-09-07 01:46:38]

Quoting fcogafa (Reply 13): BMI also often used the E145 on the Aberdeen route

Was just going to mention that I've always wondered if the A320 was too big for the airline on these routes and if a smaller jet would have been better. E170 for example. Easier said than done - trying to find an airline available with the right equipment.

I wonder if Little Red would have been more successful if they had focused on x8 daily to Edinburgh rather than playing at Manchester.

Quoting phunc (Reply 15):

Thing is BA manage quite well with a mix of A319s/A320s/A321s on ABZ-LHR with up to 9 flights a day, plus E170s/190s on ABZ-LCY.
I think it is more of the case that BA outcompeted bmi, and if the article is true, also VS.
Then there's also EZY flying to LGW and LTN...

Quoting BestWestern (Reply 16):

Very likely, it's always been said that EDI has better loads for VS than the other two routes. Yields of course are shrouded in secrecy.

Am I right in assuming that including the recently announced route closures and the closure of Little Red about 80% of VS's entire operation will fall under the DL joint venture ?

Who's in control ?

Could VS be in talks with RE to salvage their domestic operation?

Considering the success with EI and now BE, surely the thought would have crossed them.

Sad to hear this news but not surprised.

Quoting 1400mph (Reply 19): Am I right in assuming that including the recently announced route closures and the closure of Little Red about 80% of VS's entire operation will fall under the DL joint venture ? Who's in control ?

We can probably expect "Go Home Delta" on the side of aircraft and formal complaints to the European Commission any day from BA...  

Well, maybe just the latter...

Perhaps with hindsight VS could have gone with Flybe to operate Little Red services. Better sized aircraft for one thing.

I have a vague recollection that the landing/takeoff fees at LHR are unhelpful to operators using aircraft smaller than A319/73G, intentionally so as it's not much use complaining about lack of runway capacity and then allowing regional jet size planes to take up slots.
Gatwick certainly introduced such a policy this year, which explains the closure of flybe's base there (well, also the money raised by selling the slots to easyJet came in handy).

Guys
When is it potentially coming to an end? Surely they will do at least operate coming week?

End September end?

[Edited 2014-09-07 03:53:51]

MAN/LHR is still bookable in Summer 2015.

Quoting SK736 (Reply 25):

True, it is. But LHR-NRT was bookable 11 months ahead right up to the beginning of this month, at which point VS announced it would cease from 31 January 2015. That's just one example.

Airlines don't give a year's notice of stopping routes!

Where is it actually coming from that they will shut it down?

I can't read the full article without paying can anyone cut and paste? Is there some direct quotes in that?

Telegraph running this morning with a story of Little Red running 60% empty, nothing about it shutting down.

Is this just the Times using the same info and jumping to the conclusion that they will shut down?

Also nothing from VS themselves, although unlikely being a Sunday. But last I heard they were happy with Little Red's performance, whilst not making money, they were looking more towards the benefits of feeding the network.

This article is pure speculation and the closure has not been confirmed by VS. Flights are not suddenly going to stop next week. I think we all know this was always going to be a short term venture but I'd be surprised if they didn't operate until at least the end of next summer.

Let us not talk about this being a done deal until VS say so. Personally I feel there is a touch of crossed wires with whatever source the Sunday Times has for this story. Something is going on for sure, but not necessarily what they report.

As always I reserve the right to be wrong!

Quoting BestWestern (Reply 16): I wonder if Little Red would have been more successful if they had focused on x8 daily to Edinburgh rather than playing at Manchester.

Problem is whether or not the combined slots are useful for a competitive 8 flight schedule with flights spread nicely over the day - and if the slots allow sensible aircraft utilization. It is not just about the number of slots, but also about the times.

Quoting vfw614 (Reply 29):

True, their first LHR-MAN flight if the day departs at 9.30.

That's not going to please many business travellers, and the tight ass leisure travellers like myself are over at Standsted flying north with Easyjet and Ryanair.

Don't forget Ryanair are launching some new intra UK flights next month from STN. Different airport yes, but just takes more potential Virgin passengers.

Quoting b78710 (Reply 27): Telegraph running this morning with a story of Little Red running 60% empty, nothing about it shutting down.

That article is from June the 8th and not current. They are not running that in today's paper.

Quoting ManchesterMAN (Reply 28): Telegraph running this morning with a story of Little Red running 60% empty, nothing about it shutting down.

Looks like that article is from June 8th:

http://www.telegraph.co.uk/finance/n...s-Little-Red-flies-60pc-empty.html

Quoting andy33 (Reply 9): However the bilateral governing traffic between LON and MOW only allows 2 UK airlines and 2 Russian airlines, and there are already two airlines from each country flying the route (BA from LHR and EZY from LGW), so that leaves just five possible routes they could be used on in practice.

Just a thought, technically could EZY apply for LHR-MOW to add capacity to its existing LGW-MOW. The traffic figures show that EZY is successful from LGW, as LGW-MOW traffic is growing while LHR-MOW traffic is falling in July 2014.

It is unlikely EZY would make this move at present, as overall traffic to Russia (-6% July 2014) is hurting in the current political climate.

Quoting Johnwaynebobbet (Reply 31):

You're right, don't know how I managed to get that wrong

Quoting kaitak (Thread starter): Given VS's recent chopping of non-US routes

Can someone give a link pls, did not realise they were cutting so many routes.

This is a darn shame!
London may be huge but I can't imagine that London alone is worth focusing almost all of ones effort on as a UK based carrier. Now how will their passengers connect to/from MAN, EDI, GLA? By just flying other carriers instead? (And I don't mean the JFK/ATL here and there)
I can't help but wonder if VS' lack of success on these and some of their other routes is the lack of much inter-europe partnership... It seems they made themselves a completely O&D carrier in one of the most competition heavy markets.

I flew Little Red LHR-EDI back in June and it was quite nice.

[Edited 2014-09-07 07:05:47]

The whole purpose of Little Red was to feed the LHR longhaul network after the takeover of bmi by IAG, and its subsequent merger into British Airways.

The routes were limited to MAN (using existing VS slots) and EDI/ABZ (using the slots IAG were required to release if a competitor wanted to enter the market). Even then, not all the slots that could have been taken from IAG have been (7 out of 10).

Since then VS has seen DL acquire the 49% stake formally held by SQ. DL and VS have formed a JV across the Atlantic, and DL is clearly being a lot more involved with VS in terms of influencing the future strategy of the airline.

It could also be possibly be said that Sir Richard Branson is taking more of a backseat role than ever with regards to organisations using the Virgin name. His big focus is currently Virgin Galatic. Virgin Trains in the UK, which is currently 49% owned by Stagecoach Group for the West Coast Mainline franchise is in fact 90% owned by Stagecoach Group in terms of the company bidding for the East Coast Mainline franchise. Sir Richard is 64, and his kids don't have the profile he does to become the front people for Virgin Group, so maybe this is part of a future positioning of the brand?

Then we have the announcement this week of the changes to the VS route structure. Longhaul is now very much geared around LGW leisure (O&D with no feed); LHR across the Atlantic (the majority of the business) and LHR to elsewhere (reduced to HKG, PVG, DEL, DXB, JNB and LOS).

With these changes we see that next year VS will serve JFK five times daily (a DL hub); ATL twice daily in Summer and daily in Winter (another DL hub); DTW daily (a DL hub); and LAX twice daily in Summer and daily in Wnter (a DL focus city). VS will also operate MAN-ATL and have codeshare on DL's MAN-JFK. This means that VS has access to onward connections in the US via those hubs but also flies on its own metal to them.

With the two MAN flights VS can offer one-stop connections to a heck of a lot of places via JFK and ATL, so is there any need to route these passengers via LHR? As for EDI and ABZ maybe the question is how many people are actually connecting to longhaul, particularly across the Atlantic? There's not much point operating those flights if actually a majority of the passengers are O&D, because they should really be there as the icing on the longhaul feed cake.

In light of the longhaul changes it wouldn't surprise me to see Little Red close. As I say above, a lot of MAN tarffic across the Atlantic be fed one-stop via JFK or ATL rather than via LHR. I don't think ABZ adds that much, and if EDI was actually sending a lot of value traffic across the Atlantic via LHR then I would have expected the announcement this week to have included the announcement that DL was resuming either ATL-EDI or JFK-EDI to provide the one-stop connections at the US end (like MAN will now offer) rather than sending people via LHR.

With regards what happens to the slots if Little Red ends, well as has been said, the slots from LHR-EDI and LHR-ABZ revert to IAG unless another airline wants to try make a go of those routes. Would anyone be interested? Hard to say, unless EI felt it could make a go of the routes itself. But the risk is that you end up with a dozen or more codeshares on the same flight and be like BD in that you were selling a lot of seats heavily discounted to codeshare partners. With regards the LHR-MAN slots, well VS/DL can look how to use those to further leverage more flights across the Atlantic. If necessary I'm sure they could be leased (possibly to AF or KL) in the short term.

People will hate me for saying it but it does seem as though VS is now on permanent life support with DL's finger for ever more hovering over the on/off switch.

How much longer can the non U.S routes remain viable ( they're not exactly without competition and are under increasing pressure ) for DL as opposed to using the slots for more juicy joint venture stateside routes.

Can you have an airline whose entire operation falls under a joint venture with another one ?

Quoting Airbusa322 (Reply 24): Guys When is it potentially coming to an end? Surely they will do at least operate coming week? End September end?

My understanding, from talking to the crews, is that the VS Little Red contract with EI runs to Feb 15 and the crews were expecting a decision on whether it would continue or not sometime before Christmas 14.

Personally, I will be very sad to see it go (if it is going), I used BMI quite a bit on LHR-EDI-LHR and now use VS Little Red even more on the same route (30+ returns since Little Red started operations i.e. ~1 every 2 weeks). I don't use BA because (a) I have found them horribly unreliable to EDI and (b) when no one else is operating the route they (unsurprisingly) push up prices. So looks like it is back to EZY at LTN for me.

Well we know that during the period of SQ's 49% ownership VS was mostly loss making, because as a quoted company SQ had to report the performance of its investment, and did.

If a dose of the DL pick-me-up brings VS into full-year profitability, well that's good news for DL, for VS staff whose jobs would be more secure, and for Sir Richard Branson's pocket if not his ego.

And once it becomes consistently profitable, why would DL need to turn off the system that was supplying them with both dividends and transfer pax for their US domestic network. Of course if it doesn't become sufficiently profitable, there's all those LHR slots...

[Edited 2014-09-07 07:54:15]

Quoting S75752 (Reply 37): This is a darn shame! London may be huge but I can't imagine that London alone is worth focusing almost all of ones effort on as a UK based carrier.

There was an article in the Washington Post last week regarding Great Britain. If Great Britain were a state in the United States it would be the second poorest in front of only Mississippi. If that information is accurate, it may explain why the UK's air market is so London centric.

Quoting andy33 (Reply 36):

thank you.  

Quoting andy33 (Reply 41): Of course if it doesn't become sufficiently profitable, there's all those LHR slots

DL will find it hard to get there hands on those if it all goes tits up though.

They are minority shareholders, and have a minoity of seats on the board. The other directors would be derelict in their responsibilities if they just nodded through an asset stripping program by Delta.

Quoting GCT64 (Reply 40):

No offence but if you're O&D domestic traffic and price sensitive and LTN is geographically acceptable then LTN is your best option.

There are reasons why EZY doesn't operate at LHR. Cost being the main one.

Quoting 1400mph (Reply 19): Who's in control ?

Quoting luckyone (Reply 42): There was an article in the Washington Post last week regarding Great Britain. If Great Britain were a state in the United States it would be the second poorest in front of only Mississippi. If that information is accurate, it may explain why the UK's air market is so London centric.

This is only a gut feeling, but this statement stinks of bull****. I can't see any of the Central states of the US having an economy anywhere near that of the UK, and a quick search proves this out. The main reason however why the UK air market is so London centric is that not only are we a small Country, but a large proportion of our population lives either within our capital or within 2 hours driving time of it.

Quoting someone83 (Reply 6): Is it confirmed from Virgin?

No as it is just rumour from a newspaper. Perhaps they have got confused that VS little red are finishing up at T1 and moving to T2 next week and they put 2 & 2 together and got 9.

Quoting luckyone (Reply 42):

Mmm.

GDP per capita tells us little about how wealthy or poor people in a nation are.

Quoting 1400mph (Reply 45): No offence but if you're O&D domestic traffic and price sensitive and LTN is geographically acceptable then LTN is your best option.

That isn't true when you look at the specifics of my circumstances, so please don't tell me what is right for me.
I think after taking 400+ LON-EDI return flights, and being CEO of an international company, I am perfectly capable of making my own decisions.