Wed, May 27, 2009
But Virgin Atlantic's Profits Are UP So Far
More airline industry news from
across the pond today. Virgin Atlantic CEO Steve Ridgeway said
today that no major airline should expect to make a profit this
year, in the face of the global economic downturn.
Ridgway told The London Telegraph that a sharp decline of fares
in the seats, volatile fuel prices, and extraordinary pressure to
cut costs are all contributing factors to the problem. "These are
some of the toughest times any of us [airline executives] can
remember," Ridgway said. "I would be very surprised if anybody made
any money.
Still, Virgin Atlantic, whose majority owner is Sir Richard
Branson of Virgin Group, reported a near doubling of profits
through February of this year. Ridgeway attributed the airlines'
positive balance sheet to "early and decisive" action in the face
of the global economic downturn. He said the airline deferred new
aircraft, and hedged on fuel and currencies.
Sir Richard Branson, the President and Founder of Virgin
Atlantic, had praise for his company. "The last financial year has
proven to be the most volatile yet in our 25-year history", he
said. "To increase profits against a backdrop of such a severe
recession is an excellent achievement by all of our staff at Virgin
Atlantic."
The London Telegraph reports British Airways showed a 13 percent
drop in the so-called "premium sector" of first and business class
fares, and an overall loss of more than $636 million. Mr. Ridgeway
said Virgin Atlantic has not been forced to cut its premium fares
as deeply because their overall passenger numbers have stayed
stronger.
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