Virgin America to Add Tad of Competition
Wednesday August 8, 6:03 pm ET - by John Wilen, AP Business Writer
NEW YORK (AP) -- Just as major airlines are beginning to return to profitability after cutting capacity to lower costs and boost profits, Virgin America entered the fray Wednesday.
Virgin America's inaugural flights, which could mark the beginning of stiffer price competition, will link its San Francisco hub with New York's John F. Kennedy International Airport and Los Angeles.
The new carrier got a taste of the challenges other airlines face when its first flight out of Kennedy Airport was delayed due to the severe storms that hit New York Wednesday morning. Airport officials said the storms caused flight delays of up to an hour and a half and much worse ground delays.
Virgin America's scheduled 10 a.m. flight lifted off about 10:50 a.m., said spokesman Gareth Edmonson-Jones. Onboard were billionaire Richard Branson and Chief Executive Fred Reid, who was late arriving at the airport.
The New York flight and one from Los Angeles landed seconds apart at San Francisco International Airport to cheers from hundreds of Virgin America employees and other spectators at the highly coordinated arrival. Fire trucks sprayed the planes with water cannons, and at the terminal, Branson waved a giant American flag as he and Reid hung out the cockpit windows.
"Everyone knows the quality of service of the big carriers in America has always been rather sad," Branson said later after a news conference with San Francisco Mayor Gavin Newsom. "The carriers have never cared about their passengers, never given their staff the tools they need, never entertained their passengers, and they keep going bankrupt, going into Chapter 11. The industry needs new blood, it needs Virgin America."
The airline, a brainchild of Branson, plans to add direct New York to Los Angeles flights beginning Aug. 29 and more routes later this year, including service between Washington's Dulles International Airport and the West Coast. It will also fly into Las Vegas.
Virgin America is offering round trip fares of $278 between New York and the West Coast. First-class round trips start at $778. Some airlines, including JetBlue Airways Corp., have already been forced to match Virgin America's economy fares, while other airlines are offering even cheaper fares.