Alliance in air: Virgin, Delta weigh transatlantic venture
The source said Virgin founder Richard Branson was not immediately looking to sell any of his 51% stake in the UK airline and was “concentrating on working with Delta”, which is closing in on agreeing a deal to buy Singapore’s stake.
Delta and Virgin plan to set up a revenue-sharing deal on flights between Britain and the US, which would involve a code-share agreement, allowing both to sell flights on the other airline and share revenues from ticket sales, the source said.
The joint venture could eventually lead to the pair sharing costs and bringing their prices and schedules into line, the source added.
The partnership would be similar to that operated by IAG’s British Airways and American Airlines since 2010 on all transatlantic flights on routes between the US, Canada and Mexico and many European routes.
Airlines like Delta have long hoped to break into London’s capacity-constrained Heath-row airport, a lucrative hub for corporate passengers where landing slots are generally hard to acquire. Virgin Atlantic is the second-largest carrier at Heathrow after BA.
A combination with Delta, the second-largest US airline by revenue after United Continental, would be a shot in the arm for Virgin. The British carrier has been battered by rising fuel prices and the euro zone crisis, and posted a loss of around 80 million pounds ($128.16 million) in
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