U.K. billionaire Richard Branson’s Virgin Atlantic Airways Ltd. still isn’t sure whether it will ever fly the world’s largest passenger plane as it prepares for delivery of its first Boeing Co. 787 Dreamliners.
“We have options for six A380s” from Airbus Group NV, Chief Executive Officer Craig Kreeger said today in a telephone interview. “We have deferred those a number of times and we haven’t yet decided what we will do when time comes for a terminate-the-batch decision.”
Virgin last deferred options for the superjumbo in July, pushing potential delivery to 2018, after being among the first to order the double-decker plane from Toulouse, France-based Airbus in 2000. It’s expecting delivery of its first 787 from Chicago-based Boeing in September, and plans to welcome passengers aboard starting in November.
The U.K. airline’s A380 hesitance mirrors reluctance by other carriers that have deferred or reduced orders for the aircraft, which is marketed as easily accommodating 525 people in a standard three-class configuration. Air France-KLM Group, Europe’s largest airline, may drop the final two of 12 planes ordered, and Deutsche Lufthansa AG, Europe’s No. 2, last year canceled orders for three.
The addition of Boeing 787 Dreamliners to Virgin’s fleet, replacing aging Airbus A340s, will help improve efficiency and allow the carrier to burnish its image for flashy customer service, according to Kreeger. Virgin is known for resort-like lounges, motorcycle pickups and a large array of onboard entertainment options.
“We are very pleased with the customer features of the aircraft,” Kreeger, who took over as CEO 14 months ago, said of the Dreamliner. It has ordered 16 of the model, with options for another five, the CEO said. Kreeger declined to comment on specific features Virgin will offer, saying the carrier is “always extraordinary.”
The CEO is seeking to restore Branson’s best-known brand to profit this year, in part by boosting fuel efficiency. While it awaits Dreamliner deliveries, the airline cut fuel burn per flight by 6 percent in 2013 after adding 10 Airbus A330s.
Virgin sliced its full-year loss in half as the carrier filled more premium economy seats and gained from new links with shareholder Delta Air Lines Inc. The pretax loss was 51 million pounds ($85.7 million) before exceptional items, compared with a loss of 102 million pounds a year earlier, Virgin said today. Revenue at the airline, which competes with British Airways at London’s Heathrow airport, increased 4.9 percent to 2.98 billion pounds.
Virgin flew 7.5 percent more passengers in premium economy seats last year and boosted “Upper Class” numbers by 1.8 percent. The airline and Delta gained antitrust clearance for joint trans-Atlantic operations last year, giving Virgin access to a network across North America, including more than 40 cities beyond New York.
The Delta tie-up agreed upon in December 2012 saw the Atlanta-based airline pay $360 million to acquire the stake in Virgin previously held by Singapore Airlines Ltd.
Virgin’s load factor, a measure of seat occupancy, rose to 81.6 percent, while the passenger total increased to 6.2 million. The pretax loss for the main airline unit was 39 million pounds, compared with a loss of 124 million pounds in 2012. Profit at Virgin improved by about 20 million pounds in the three months through March, compared with the same period a year ago, Kreeger said.
Virgin today switched reporting financial numbers to the calendar year, and provided pro forma comparables for 2012.
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