Virgin and Flybe in the tree, K-I-S-S-I-N-G...

Dressing this up in COVID-19 is dishonest. Flybe has been a basket case for years. When they wanted the £100 million and APD cut the virus was a non story.

If Virgin wanted the slots they blew it, if they wanted the feeder network was Flybe ever the right fit? Structurally Flybe had to be a mess to burn through money like this. £135m in a year is £11m a month, how did they think they could turn that round. Just to get the £11m in revenue you'd need to sell 44,000 tickets a month at an average of £250.

If Virgin were ever serious about it why only 30%?

Interesting reply from Virgin on twitter to someone asking about virgin connect

"Hi there, the Virgin Connect name stays in the Virgin family and may be introduced as we explore options to connect the UK regions to our London Heathrow, London Gatwick and Manchester hubs. I hope this helps"

BBC Breakfast are reporting that Exeter and Southampton are considering an extension of their runways so as to accept larger aircraft which might appeal to Ryanair, Easyjet etc...

Not sure where they got this from, Exeter already has a longer runway than Bristol (which is a major easyJet and Ryanair base already, and has transatlantic TUI 787 flights as well) and has even been used as storage for 747s and had Concorde visit back in the day! It isn’t the runway getting in the way for sure here!

Dressing this up in COVID-19 is dishonest. Flybe has been a basket case for years. When they wanted the £100 million and APD cut the virus was a non story.

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If Virgin were ever serious about it why only 30%?

With COVID-19, I think the drop off in travel was probably one of the last straws combined with the government being unwilling to lend it money. You're right though in saying that Flybe as a business has been a basket case for yearsthanks to poor and it was never going to be an easy job for Connect Airways or whoever to turn it around.

As for the 30% stake, my guess is because when you look at what happens with other businesses within the Virgin empire in recent years, the Virgin Group/SRB have tended to go for minority stakes and earn money from brand licencing. VS would have been minority owned by SRB now had he not cancelled the sale of some of his remaining stake to Air France-KLM. I'm not saying it's the right approach, but it seems SRB doesn't go for sole/majority stakes in businesses anymore.

BBC Breakfast are reporting that Exeter and Southampton are considering an extension of their runways so as to accept larger aircraft which might appeal to Ryanair, Easyjet etc...

Not sure where they got this from, Exeter already has a longer runway than Bristol (which is a major easyJet and Ryanair base already, and has transatlantic TUI 787 flights as well) and has even been used as storage for 747s and had Concorde visit back in the day! It isn’t the runway getting in the way for sure here!

SOU needs a longer runway more than EXT as its runway is only 5,600ft, but that's easier said than done at SOU as there's a motorway to the south of the runway and Eastleigh Works railway yard to the north. The problem with both SOU and EXT is that they're competing with LGW and BRS respectively (along with BOH and NQY/CWL respectively) as there's an overlap in their catchment areas.

I genuinely fear for the futures of SOU and EXE airports as they were two of the airports most heavily reliant on Flybe.

Another ghost town airport now is Belfast City (BHD) as Flybe accounted for approx. 80% of traffic (around 2.5m passengers last year which will probably drop to around the 500k mark), with the rest coming from BA, Aer Lingus, KLM, Eastern and Loganair. What doesn't help BHD is its runway, annual traffic movement and passenger numbers and curfew after 9.30pm. Little wonder Ryanair eventually ended up at BFS a few years later after withdrawing from BHD.

Dressing this up in COVID-19 is dishonest. Flybe has been a basket case for years. When they wanted the £100 million and APD cut the virus was a non story.


If Virgin were ever serious about it why only 30%?

The virus hadn't affected bookings back then! We now have LH canceling 50% of their routes, easyJet, Ryanair etc. canceling routes left right and centre and it is easy to see how a weakened Flybe just wasn't up for the drop off in bookings.

If Virgin were ever serious, the big question is why, with the £135m put into Flybe in the last year, was no major changes to their network made.

If Virgin were ever serious, the big question is why, with the £135m put into Flybe in the last year, was no major changes to their network made.

Was it intended so Virgin Connect could be set up with no competition and ex-Flybe staff would come running to them? Or will there no longer be any kind of virgin connect?

I don’t think anything will come from Virgin Connect, either through the Connect Airways consortium, or otherwise.

All sides have lost a lot of money in this.

Worth adding that we never saw a proper Virgin Connect logo nor a CGI of a Virgin Connect livery which suggests Virgin knew there were huge reputations risks with this project and the chances of Flybe being turned around were remote.

Flybe had some profitable routes. SOU-GLA was one example I saw, which was well used by Navy personnel IIRC.

Trouble is that’s of no use whatsoever to VS and its strategy of providing feed into its mainline network.

Flybe had some profitable routes. SOU-GLA was one example I saw, which was well used by Navy personnel IIRC.

Trouble is that’s of no use whatsoever to VS and its strategy of providing feed into its mainline network.

The question I think is whether the SOU-GLA markets can be served through a Virgin Connect hub at MAN (as SOU-MAN-GLA).

This would roll several routes into one service (for example the SOU-MAN sector could carry SOU-EDI/ABZ/INV/NCL traffic for example) and I think this model (basically the standard hub concept but on a regional basis) provides the solution for VS and also UK regional connectivity...

The question I think is whether the SOU-GLA markets can be served through a Virgin Connect hub at MAN (as SOU-MAN-GLA).

Not a chance. The hub and spoke model works well in the US, where the distances are generally much greater, but it wouldn’t here. Having to factor in a 60-90 minute connection at MAN would make cross country journeys far less competitive vs road or rail.

And by and large, we don’t like to change planes or trains if we don’t have to. Hence BA and VS can still get away with charging a hefty premium for direct long-haul flights from the UK when ex-EU can be half the price, and CrossCountry can charge a premium for slow, overcrowded trains from (eg) Manchester to Bournemouth when it’s often quicker and cheaper to go via London.

The question I think is whether the SOU-GLA markets can be served through a Virgin Connect hub at MAN (as SOU-MAN-GLA).

Not a chance. The hub and spoke model works well in the US, where the distances are generally much greater, but it wouldn’t here. Having to factor in a 60-90 minute connection at MAN would make cross country journeys far less competitive vs road or rail.

And by and large, we don’t like to change planes or trains if we don’t have to. Hence BA and VS can still get away with charging a hefty premium for direct long-haul flights from the UK when ex-EU can be half the price, and CrossCountry can charge a premium for slow, overcrowded trains from (eg) Manchester to Bournemouth when it’s often quicker and cheaper to go via London.

I agree with all of these points - however I think solutions must be found in order to make Virgin Connect a success (if it is still planned). An example is 30-45minute domestic transfers at MAN - which is a long way away!

If Virgin were ever serious, the big question is why, with the £135m put into Flybe in the last year, was no major changes to their network made.

Changes were afoot. Numerous routes were axed from their southern Britain hubs late last year. Unfortunately, with other issues such as being tied into long leases for aircraft and Connect getting to grips with what they've bought exactly, I'm not surprised changes weren't done on a major scale quickly.

If Connect still want to do something, the opportunity exists to start afresh and mould it into how they wanted it be.

[mitchja]

I still don't think there's enough demand these days for more domestic flights in / out of MAN.

You only need to look at the monthly passenger / traffic stats Manchester Airport provide here to see that domestic traffic & domestic passenger numbers continues to decline every month (domestic traffic movements roughly averages about an 8% drop every month compared to the previous year).

I just don't see this pattern changing.

If anything VS should be considering some sort of partnership with local train companies around the MAN airport area as you can get pretty much anywhere now from MAN on a train with easy links to both the West coast and East coast main lines.

From an O&D perspective, in my opinion the only major domestic demand ex-MAN is to Isle of Man, Belfast, Aberdeen, Inverness and the Channel Islands, and possibly Newquay, as these places either take all day by train or aren’t possible to get to by ground transport. I would also say Norwich, but that route was recently scrapped so that says it all.

That’s one beauty of MAN and it’s catchment area being where it is as it’s centrally located relative to most parts of Great Britain, with only the extremes or places involving going over a sea necessitating air travel.

http://www.iomtoday.co.im/article.cfm?i ... ol%20route

In this good news story from the Isle of Man about Loganair stepping in to take over the Liverpool route is something that gives you a clue as to the dire straits Flybe were in. Apparently they owed just over £300k in unpaid landing fees to the DoI that operates the airport there. It would be interesting to hear what figure (if any) is owed in APD given the extra time they were able to negotiate with HMRC 2 months ago before their demise.