Delta set to buy half of Virgin Atlantic
by Joshua Freed
The Associated Press
December 12, 2012 12:00 AM | 470 views | 0 0 comments | 3 3 recommendations | email to a friend | print
Delta Air Lines said it will buy almost half of Virgin Atlantic for $360 million as it tries to catch up to rivals in the lucrative New York-to-London travel market.

Delta plans to form a joint venture with Virgin Atlantic so they can sell seats on each other’s flights, share the costs and profits, and set the flight schedules in ways that help both airlines. American Airlines has a similar deal with British Airways.

Because Delta would be setting fares and schedules in coordination with an airline it used to compete with, it said it will need antitrust approval from U.S. and European regulators in order to form a joint venture. Delta said the share purchase will happen with or without antitrust approval.

Delta is aiming to have the joint operation running by the end of 2013.

The deal won’t add flights between the U.S. and Britain. But travel will be more seamless. Travelers would be able to buy one plane ticket from, say, Lansing, Mich., on Delta and connect in New York to a Virgin Atlantic flight to London. Travelers from Europe will also have a smoother transition onto Delta flights to locations inside the U.S. Delta said their frequent flier programs would be linked, too.

Combined, Delta and Virgin Atlantic have 31 flights a day in each direction between North America and the U.K., including nine each way between Heathrow and John F. Kennedy International Airport in New York and Newark Liberty International Airport in New Jersey.

By itself, Delta has only three flights a day straight from New York to Heathrow. American and British Airways have 14 between them. And that’s the problem. New York-to-London and back is one of the world’s prime business travel routes. Delta has loads of travelers coming into its New York hubs at JFK and LaGuardia. But without more flights to bring those travelers on to London, Delta is at a serious disadvantage.

Landing rights at London’s Heathrow Airport are limited, so Delta can’t just add more flights there.
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