Virgin Atlantic needs more room to grow

Dubai: A lack of readily available gates at Dubai International Airport combined with very tight access at Heathrow Airport is hampering Virgin Atlantic's efforts to compete on an even playing field for business travellers between the two cities, Gulf News has learned.

Speaking exclusively to Gulf News, Virgin Atlantic's sales and marketing director, Paul Dickinson, said the airline is making serious inroads into the heavily travelled route.

And a highly troubled debut at British Airways' flagship Terminal 5 last year resulted in a permanent boost for the Richard Branson-owned Virgin Atlantic airline.

"After Terminal 5 opened, there was a dramatic spike, particularly in business travellers, of those who would do anything to avoid using the terminal," he said. "Certainly there was an immediate increase in excess in Virgin Atlantic's business class travel of 10 per cent as a result of British Airways' handling of that debacle," he said. "And we're certainly seeing that once a person enjoys the Virgin Atlantic experience, they are very likely to remain committed to Virgin Atlantic."

According to the 47-year-old executive, Virgin Atlantic's Club House in Heathrow's Terminal 3 remains hugely popular, providing business travellers with a unique experience.

"It really is relaxing, totally different and unlike any of the usual stuffy airline lounges provided by other carriers. We actually find that if travellers have time, they look forward to coming to Heathrow early so that they can hang out and relax in the Club House."

Indeed, the Club House offers massages, manicures and hairdressing services and others to passengers. It's all part of the Virgin Atlantic experience — an airline determined to break the mould, put passengers first, and make air travel relaxing again.

"I think a large part of the reason why we're so popular is that we are different — and our passengers know it and appreciate it," Dickinson said. "We're friendly, cool, put passengers first — and by that I mean we don't pay lip service to that like most other carriers do; we actually encourage passengers, for example, to talk to our staff, walk about the plane, enjoy the experience of flying."

Dickinson says that the Virgin Atlantic experience allows the carrier to compete against bigger, flagged airlines.

Limited slots

While the airline operates from its hub at Heathrow, gaining more access and greater flexibility to limited slots there will be an issue.

"Ultimately, the answer is another runway at Heathrow," he said. "In the meantime, there will always be an over-demand for the key early-morning departures from the airport and that departure window is vital to the business-class traveller."

London's second airport at Gatwick isn't an option right now. "Although Gatwick has been recently sold, until the facilities there are substantially upgraded, Heathrow will remain the airport of choice for travellers. Access to Gatwick is always an issue."

A sister Virgin company, however, does operate holiday charter flights from the south London airport at present.

"Dubai Airport also has limited gates available and until we can secure another gate, unfortunately we are limited to a schedule that isn't necessarily business-class friendly," Dickinson said. "Business people want to land in London for the start of the business day."

At present, Virgin Atlantic has orders placed for 15 Boeing 787 Dreamliners, with options on a further 10. The Dreamliner project has been repeatedly delayed by development and technical difficulties in building the world's first carbon-fibre composite commercial aircraft, with a delivery date currently set for late 2012. Even then, however, Dickinson isn't optimistic that the ultra fuel-efficient aircraft will be ready.

"We have taken the decision to go with the Airbus A330 in the interim and, with their fuel-efficient Rolls-Royce engines, we are well positioned," he said. "Next year, most of the leases on our aircraft are coming up for renewal, so we're in a good position until such a time as the 787s enter service, likely in 2013 or 2014."

Surviving the storm

Despite the economic downturn of last year, Virgin Atlantic is continuing to operate in a healthy environment. "We entered the downturn with our largest cash reserves ever and we've managed to weather it with those cash reserves largely intact," he said, adding that the decrease in fuel costs helped the bottom line.

"If anything, this economic downturn has shown us the resilience of the economy traveller," he said. "The load factor in our economy class continued to remain high, and while there was a fall-off in business class travellers, which was to be expected, economy class remained strong."

For now, the challenge for Dickinson and his team is to convince business class travellers that they need to return to the skies to get out and meet and service clients.

Dubai If Virgin Atlantic's sales and marketing director Paul Dickinson had a face-to-face meeting with Michael O'Leary, the founder and CEO of budget airline Ryanair, he would congratulate the mogul on creating a successful business model.

"That's the first thing I would do," Dickinson told Gulf News. "But its very easy to strip down costs by cutting every level of service and make passengers pay for any and everything, cut staff levels, cut staff salaries, cut the number of cabin crew.

"But I would also admonish Mr O'Leary for totally frustrating the users of his airline and putting the service and comfort level of his passengers last. What Ryanair, like most cut-price budget airlines are good at, is getting people from A to B. That's it. And it's not a good experience. And point B might be at a secondary airport with poor facilities and poor connections miles from your actual destination."