Virgin In Talks With Us Airways

[BoeingBoy]

Virgin in talks with US Airways
1 February 2004

VIRGIN Atlantic, led by Sir Richard Branson, has held talks with US Airways, the former partner of archrival British Airways, about buying assets that could launch his new discount airline in America.

Branson, who said recently he was in talks with a US airline about 'carving off chunks of that operation', is interested in a hub in Washington or Boston. US Airways has take-off and landing slots at Reagan National Airport in the US capital and Logan International in Boston.

The new airline, to be called Virgin USA or Virgin America, will be launched next year. Virgin executives believe launch costs will be about £115m.

Branson could also be interested in the US Airways Shuttle, which ferries passengers hourly from New York to Washington and Boston. Bids are expected to reach £87m.

Branson faces bids from rivals such as American Airlines, Delta, JetBlue and Mesa Airlines.

US Airways' board is expected to discuss offers for the company's assets in a couple of weeks. A spokesman for US Airways confirmed that the airline had held talks with certain airlines, but declined to confirm that Virgin was among them.

But according to an industry lawyer in Washington: 'Branson wants what US Airways has. Whether he can afford it or is willing to pay the price is another matter.'

Beleaguered US Airways, which climbed out of bankruptcy last year after a £520m loan guarantee from the US government, has hired banker Morgan Stanley to evaluate offers and determine whether it should sell certain assets.

BA owned 20% of US Airways nearly a decade ago, but walked away, writing off much of its investment.

The US carrier has hubs in Philadelphia, Pittsburgh and Charlotte, North Carolina, but Branson is said to have narrowed his search to Boston, Washington and San Francisco.

Branson indicated that most of the money for the airline's launch would come from 'institutional partners' and the start-up would include an order for up to 15 Airbus or Boeing narrow-bodied aircraft.

 

[Light Years]

Rescue what? Some routes... but certainly not anyone's job.

 

[BoeingBoy]

Light,

Admittedly that line was somewhat tongue in cheek.

Jim

 

[AP Tech]

Anyone want to make a wager that if the Shuttle is sold it will be to Dave's buddy over at Mesa and not necessarily to the highest bidder?

 

[javaboy]

interesting can you post the link to the ariticle itself?

Late Tuesday night, Morgan Stanley told investors that JetBlue has been given the right to fly from LaGuardia Airport in the spring.

they also indicated that UAIR had recieved bids from only 4 airlines
JB DAL AIRTRAN AMR, virgin was not listed as one of them when the bidding closed

this would indicate that (if your post is accurate) virgin either did this prior to or after the closing of the bidding. (hence the request for the link)

 

[tadjr]

HERE is a link to one of the articles I've seen about Virgin and US Airways.

 

[Diesel8]

According to the higher ups at jetblue there was no bid submitted for the U Shuttle.

FWIW!

 

[USFlyer]

AMR is claiming they also did not bid. Gotta love the news stories and these supposed inside sources.

 

[BoeingBoy]

Sorry to revive this thread but seemed as good a place as any...

Branson to detail plans for US budget airline soon
Announcement comes on the back of warning clouds for the industry

(SINGAPORE) Richard Branson may announce details as soon as this month of plans to start a low-cost airline in the US, just as intense competition in Europe is about to slow down budget carrier Ryanair,
Mr Branson: new carrier will copy the model used by JetBlue Airways and Southwest Airlines

The entrepreneur is trying to replicate his Australian success with Virgin Blue in the world's largest air travel market.

'You should be expecting something within this month,' Virgin Atlantic Airways Asia-Pacific head McKenzie Grant was quoted as saying in Hong Kong by Bloomberg. 'The name of the company has still got to be decided. The form of the entity is still not decided, but they're pretty close to making a decision.'

 

[EyeInTheSky]

Branson builds airlines from the ground up. Virgin Blue's Australian success is clearly because of Ansett's demise. True, he does take advantage and his timing is impeccable. More than likely he's waiting for US Airways to die. If Branson acquires anything from US Airways employees will more than likely NOT be a part of it. That's his style. That doesn't mean there won't be opportunities for veteran airline personnel, but they'll have to get in line like everyone else.