Virgin Atlantic Will Offer Cheaper Coach ClassBy
U.K. carrier prices frill-free fares to take on Norwegian Air
Costlier ‘Economy Delight’ ticket will feature extra legroom
Virgin Atlantic Airways Ltd. will split its coach class into three ticket grades in an effort to head off the challenge presented by an emerging low-cost, long-haul sector led by Norwegian Air Shuttle ASA.
The U.K. carrier plans to introduce an “economy light” fare for passengers prepared to take hand baggage only and happy to have their seats allocated at check-in, it said in a statement Wednesday. The new category is aimed at “millennials and customers jetting off on city breaks,” it said.
At the same time, Virgin will offer an “economy delight” product with a 34-inch seat pitch -- three inches more than standard -- priority boarding, checked luggage and seat selection at any time. A third “economy classic” grade offers the same perks, bar priority boarding, but with the smaller berth.
The changes, which include accommodating 24 to 36 of the bigger seats on each plane, are part of a 300 million-pound ($417 million) investment program that represents the biggest change to Virgin Atlantic’s economy-class cabins in more than a decade, Chief Executive Officer Craig Kreeger said in an interview. Cheaper fares should mean Virgin is immediately more visible as an option when the most price-sensitive travelers are booking tickets, he said.
“It gives us an opportunity to win back some customers that might not have found us,” Kreeger said in London. “Some people are clearly most interested in the lowest entry-level price point and are willing to pack light and adjust accordingly.” Prices will be revealed when tickets go on sale in the spring.
Virgin Atlantic is facing a new breed of competitor as Norwegian Air builds London’s Gatwick airport into a major base. Network specialists are responding with lower-cost operations that could begin to threaten Virgin on some of its leisure-oriented routes. Long-time rival British Airways has established a new discount unit, Level, and this week said it separately plans to launch a no-frills “basic economy” fare of its own on long-haul flights.
Kreeger said that the rebranding of coach has been deliberately focused on the process before people take their seats, and that the cabin experience in all three grades will be essentially identical, with everyone getting free food and the same standards of customer care.
Virgin will retain its “premium economy” class, which has a separate cabin and a 38-inch pitch, renaming it simply “premium.” Together with the top-end “upper class,” that will mean passengers have a choice of five service levels in three cabins.
Founded by Richard Branson, Crawley, England-based Virgin is 49 percent owned by Atlanta-based Delta Air Lines Inc. Europe’s biggest carrier Air France-KLM Group, a Delta ally, has also agreed to buy a 31 percent stake in a move that will see the billionaire’s holding reduced to 20 percent.
A joint-venture agreement paving the way for the French investment is now likely to be completed early in 2019 rather than later this year, Kreeger said.