Virgin Atlantic to fold - Just BMI staff gossip?

I think we have a good ol' fashioned case of chinese whispers and gossip mongers based solely on yesterday's IFBT news, but my BD employee friend tells me that BD's pilots were called to a meeting yesterday where they were either told, or were discussing, the apparently imminent demise of VS. These pilots then proceeded to pass this gossip onto their colleagues.

Silly gossip or is this even possible???

[preiffer]

Funny, BD saying that another airline has 'problems'.

This would be the airline that nobody *really* wants to buy, even if they are dirt cheap (LH still aren't sure they want the AIRLINE, just the slots).


No, I'd say your friend heard/told you utter b*llocks and certainly isn't helping the situation faced by the industry in general by spreading it further.

I would be very suprised if it was true.[:0]

There would have been more drastic measures then just the ending of the IFBT service, just to keep VS flying. I would have expected to see non-porfitable flights being cancelled,a hold on recruitment and even immediate redundancies. Also I would expect to see a slash in prices to get bums on seats.

Anyway, there are other airlines who are in a worse state than VS.

I think its important to remember that VS is SRB's baby. He is proud of VS and has in the past sold off other Virgin Group companies in order to gain the finance to keep his more favourite companies alive (Virgin Megastores is a prime example). Therefore if this were true I think we would be seeing SRB selling off other Virgin companies.

VS is going through a tough patch but BD is also feeling it pretty tough.

With LH announcing it wants to buy SN in order to help them grow it makes any buyout of BD look even more slot driven than it already does.

Perhaps the failures will be a blessing in disguise for some carriers who make it through this period. Not only is there the obvious reduced competition, perhaps some airframes will become available, some airlines can pick these up whilst others may benefit from reduced leasing costs given the current tight market must've made costs spiral upwards. As an example, when Oasis went down, there were 3 744s with perfect specs for VS. If they'd wanted them that'd be a good way of increasing revenues by offering extra seats without incurring the costs of brand new planes etc.

Where the failues benefit VS of course is another question since most failures have been local carriers with not much overlap with VS routes. However, certainly on the routes I've flown on VS, the front of the plane always has a similar loading to the rear so I can't see them being in dire-straights any time soon.

A colleague whose wife works at Gatwick says that these rumours are doing the rounds: to do with a defaulted loan or something. Of course this doesn't mean these rumours are in any sense true, just that yes, they are in circulation, whether because they have basis, because someone misheard something, or someone is trying to be malicious.

I was talking to my cousin, an Engineer for BA at LHR, he told me the that VA were in trouble about a month ago. Didn't bother saying anything then as I didn't have anything to back it up with. (Still don't)

It's probably the usual Chinese Whispers that you usually get in airport circles, but if it's that bad, you have to ask yourself where on earth the money has gone?

Too much paid out to the shareholders - i.e. straight to SRB - when it should have been retained as strategic reserves?
Exec salaries too high? Too many high-salaried execs?
Poor load factors? Poor yield management?
Expanding onto crazy (non-profitable) routes?
Too much money being spent on tarty interior design in VS offices?
Too much money being spent on airport facilities?
Overspends on frivolous marketing and other things which aren't core to the flying programme?

Or has the pot been emptying slowly over a decade or more, the damage being done 10 years ago, or even earlier than that?

Certainly the descriptions I hear of 'The Base' (with screens saying 'You're gorgeous' or something ridiculous) smack of crazy excess, and that money is gone now, you likely can't change it or cancel it.

Dark times indeed if this really is the case, and if they are just rumours, they are damaging, all the same.

Mike

If there was major issues, they would shut down virgin nigeria and kenya routes.

They are hemmoraging cash.

Nigeria lost 40 million last year on its own!

Originally posted by poggsuk
If there was major issues, they would shut down virgin nigeria and kenya routes.

They are hemmoraging cash.

Nigeria lost 40 million last year on its own!

Welcome to the boards.

ORD and NBO are two routes that have been rumoured to be axed.

With regards to VK- there is not much VS can do about it. The airline is jointly owned 49% by VS and 51% by the Nigerian Government. I would imagine in the contract that was signed there is a clause preventing VS from jumping ship for at least 10 years.

The only people who really know what's what are the powers that be at VS.

I hope this is just a case of the rumour mill working overtime, but if there were issues at VS they wouldn't exactly want to advertise the fact.

Like Willd says, there's probably legalities that ties VS in to various things that we might look at and say why on earth are they still doing this or that.

If it's something as simple as VS have defaulted on a loan if the bank are understanding (which I'm sure they are with VS), no problem. The 'problem' only arises if it happens on a regular basis. (Been there, seen it, done it).

Clare

'"As an example