Virgin Atlantic Leaving Gatwick, Retiring 747s, Laying Off 3,150 Staff

Filed Under: Virgin Atlantic

Virgin Atlantic is still looking for a lifeline, as the airline is weeks away from running out of money. In the meantime, the airline has today revealed what they call the “post-COVID-19 future,” and it involves some drastic cuts.

Virgin Atlantic notes that the business will be reshaped and resized, with the expectation that it will take up to three years to return to 2019 levels.

Virgin Atlantic CEO Shai Weiss describes the current crisis as the most devastating in the company’s 36 year history. He still hopes the company will return to profitability in 2021.

Therefore Virgin Atlantic is announcing some massive cutbacks, so let’s look at the details.

Virgin Atlantic will retire Boeing 747-400s

Effective immediately, Virgin Atlantic will retire their fleet of seven Boeing 747-400s. Ugh, another airline retires the queen of the skies. This means that the airline will exclusively have twin engine planes going forward.

Virgin Atlantic will also retire four A330-200s in early 2022 as planned, meaning that by 2022 the airline will only have A330-300s, 787-9s, and A350-1000s.

At that point Virgin Atlantic’s fleet will have just 36 aircraft, creating a further 10% cut in emissions. The airline has already reduced emissions by 18% between 2007 and 2019.

The airline does also have A330-900neos on order, expected to be delivered between 2021 and 2024, though there’s no mention of those.

Virgin Atlantic will have a simplified fleet

Virgin Atlantic will leave London Gatwick

Currently Virgin Atlantic operates flights out of London Heathrow, London Gatwick, and Manchester. Historically Gatwick has been one of Virgin Atlantic’s leisure airports, with flights primarily to Caribbean destinations.

Going forward, Virgin Atlantic will be pulling out of Gatwick, so will exclusively operate flights out of Heathrow and Manchester. Gatwick flying will be moved to Heathrow, though also expect some route reductions to correspond with the 747s being retired.

Virgin Atlantic hopes to retain slots at Gatwick so the airline can return in line with customer demand, though no matter what the airline is leaving the airport for now. Without the fleet growing otherwise, the airline seems unlikely to return.

This is a huge blow to Gatwick Airport, especially as British Airways is reportedly also looking at ending or at least reducing flights to the airport. If nothing else, I think it’s safe to assume British Airways is in a good negotiating spot with the airport now.

Virgin Atlantic 747Virgin Atlantic will no longer fly to Gatwick

Virgin Atlantic laying off staff

This is the saddest news of all. Virgin Atlantic plans on laying off 3,150 employees across all functions. The airline currently has just over 8,500 employees, so that represents a huge reduction.

A company wide consultation period of 45 days is starting today, and will involve unions BALPA and Unite.

Virgin Atlantic will be laying off over 3,000 staff

Bottom line

Virgin Atlantic will be retiring 747s, pulling out of Gatwick, and laying off about 35% of staff. How sad. Even with these measures, the company’s future is far from guaranteed, as the airline is still weeks from running out of money.

I love Virgin Atlantic, and in particular their staff. I hope the airline returns stronger than ever before when this is all said and done.

What do you make of this announcement from Virgin Atlantic?

Comments
  1. Would Gatwick even be viable anymore if BA and VS both pulled out? I don’t see how it could survive.

  2. I am curious to see if jetblue will move forward with London for 2021. London slots seem to be now up for grabs and great opportunities available.

  3. I reckon BA should exit Gatwick and use their slots for Aer Lingus, LEVEL and Vueling instead to compete better with the likes of Easyjet and Norwegian.

    I also wonder what will happen in Tokyo. Will airlines start completely withdrawing from Narita and relocating to Haneda instead? I know some airlines have already won slots last year but surely some might not be used so it might be a an opportunity for some airlines that are still solely in Narita to relocate to Haneda instead.

  4. I was thinking about Jetblue. It should be easy for them to find slots at LGW, since VS is leaving the airport for good. At LHR, it might be more difficult, since slot usage requirements have been suspended, and airlines have yet to give up these slots.

  5. @Izz that is a fantastic point! Could B6 make LGW a European hub and use easyJet as a European connection partner, it would cover the vast majority of Europe and be a great alternative to transiting LHR and having to put up with BA plus easyJet already have connect partners with a whole host of airlines!
    It is a shame for Gatwick, as someone who lives within 35mins to both Heathrow and Gatwick, I have always preferred Gatwick. The notion of it being a low cost and leisure airport is beyond me, I travel frequently to Toronto & Tapei for work so make use of both WS & CI. Both have fantastic business class products and wouldn’t otherwise be able to either afford or gain slots into LHR so use the next best alternative.

  6. @Stephan
    Of course LGW would be viable without VS and BA. It has a vast easyJet operation, and huge numbers of charter flights, along with service from a number of international airlines who can’t get into slot-restricted LHR (or can’t afford to).

    We’ve already see LGW consolidate operations into one of the two terminals (just as LHR has closed two). It will contract to the size that is supportable until (if?) we come out the other side.

    The 3rd London airport, Stansted, seems to have had much less trauma than the other two.

  7. I’d be interested in hearing from someone who knows British corporate bankruptcy law. I know the US carriers have come out of bankruptcy before, and I’m curious how the process compares to Britain and whether the company is likely to emerge with restructured debt loads, whether it will get bought by some other airline in a bailout move, or whether it would just get liquidated.

  8. Fun fact: With the retirement of the 744s, they join CX with an all twin-jet wide-body passenger fleet.

    And speaking of the 744s, it’s surprising that Thai that has their 744s in service. Even though they are majority state-owned, don’t they have their share of issues as well?

  9. And the beat goes on, we are just in the first round of consolidation / and thinning of the ranks, sadly. As for international travel does anyone really think it will come back this year, other than business ? I think not. Branson has a real problem with his 51% he lives / domiciled outside of Britain doesn’t pay taxes, his “partner” is Delta who has already stated they don’t have any idle money sitting around to pump into VA it’s a real issue coupled with the fact that most interested buyers would not look favorably at Delta as a partner. Stay tuned more to come

  10. I have a really nice VS partner redemption and am hoping they can stay afloat and that travel resumes sooner than later so we can all get back to globetrotting.

  11. If BA also leaves LGW, I anticipate the North Terminal will not reopen even in the medium term. It makes me wonder if other full service carriers like EK will also consolidate at LHR, leaving LGW basically as a low cost and charter only airport.

  12. Jetblue should join EasyJet at Gatwick.

    Norwegian also has a sizable operation there. Gatwick serves several notable airlines such as Turkish and Emriates and Qatar.

  13. How does Delta avoid taking losses on their financial statements, though Virgin continues to loose tons of money.

  14. I believe their 4 A330-200’s were the ones acquired from AirBerlin after they went bankrupt. Those were based out of Manchester and LGW for leisure routes. Also, Virgin used to operate a majority of their 747’s to Orlando (like, up to 7 of the 8 they had a day) in the summer. While leisure demand is no doubt nonexistent, I wonder how many flights they will now have. Their 4 leisure A350-1000’s meant to replace the 747’s always seemed to not be enough. I’m also excited about MCO’s first flight to Heathrow, which is awesome for one stop connections. Sad about the 747 though. I always wanted to fly either LH or VS on the Queen from MCO. But I guess a Virgin A350-1000 to MCO from LHR isn’t bad either 😉

  15. Just think…if VS stop flying 100% of their aircraft they will have reduced their emissions by 100%!

  16. @sharon
    delta owns shares in the company but even if virgin goes bankrupt they don’t owe anyone one actual money. So the question is what does delta value their virgin stake at and has that changed in q1 this year. Given how there are very few comparable assets in existence it would not be impossible or unlikely for delta to claim their stake is worth the same it was worth when they bought it in 2013, and it’s likely not worth all that much less today then it was worth then.

  17. The 747-400 retirement made me realize I need to fly this real soon. I already missed out on the 747SP. I’ll likely miss out the MD80/90 and possibly 717.

    Another one that is very hard to do a last trip on is the A340-500. I think Lufthansa might not fly A340 again, so I have to start thinking harder when my last 343/346 will be before it’s too late.

  18. Obviously the main point is the sad loss of all these jobs and roles.
    More personally as a traveller, Adios to the iconic VS 747s, with a fantastic premium economy cabin upstairs, 2-2 seating and 21 inches wide (better than their latest premium economy product).

    It will be much missed, Lufthansa and BA looking like the only remaining European 747 operators post crisis??

  19. @Stephen our bankruptcy law is if a company is bankrupt it is liquidated either on a voluntary or compulsory basis. Before that stage, we have administration which is a weaker version of the Chapter 11 in the USA. During administration a team of accountants will go in and manage the business as a going concern if possible to try and sell the business as it stands or close it down if it is not possible.

    What can happen during an administration period is the owners of the company may work with the creditors and the administrators to pay a percentage of the debt, usually at a significant discount and then “buy” the company out of administration. If this does not happen then the administrators will sell all the assets to pay off the creditors as much as possible and then liquidate the company. This is why on some occasions brands in the UK survive but in a different fashion. An example of this is Woolworths which was a large high street store chain which collapsed in the financial crisis and is now a small arm of a UK online trader called Shop Direct Group. The UK Woolworths should not be confused with South Africa’s or Australia’s Woolworths. In fact, they went so well they changed the brand to Very a couple of years later.

  20. My only upper deck flight was in PE on a VS 747 a couple of years ago. I’m glad I took the opportunity when I had it.

  21. Confused why people cite Norwegian being a major player at LGW when it’s clear, despite their debt deal going through, they won’t be back at LGW anytime soon.
    Or why it’s thought North Terminal won’t reopen when the largest operator at LGW is the biggest tenant at North ‍♂️

  22. @ghostrider5408
    No, Business travel is not coming back in any resemblance of what it was.
    There will be much less and for years, the travel will be filtered by, Corporate liability concerns, financial pressures and individual resistance to travel.
    I have traveled for decades and I do not relish the thought now. Perhaps if I were younger and single I might think differently.

  23. Haneda international slots are set by origin/destination country and country of the operator, so it’s not possible for a company to use a slot for Japan-country A to fly a Japan-country B flight, or for a company from country A to use a slot for Japan-country A awarded to a Japanese company (and vice versa).

  24. I’m so sick of all the sanctimony RE: airline layoffs. Until and unless international borders are re-opened, demand will remain in the toilet and revenue will be flat, or even negative. Literally the entire travel industry is in the same boat, by the way. Have some compassion, as hard as that must be from y’all’s glass houses…

  25. I sure hope Virgin Atlantic doesn’t eliminate its exceptional soft product from the club lounge to the better quality wine to the VIP services. It’s what sets Virgin apart from Delta or KLM when flying across the Atlantic as a Delta elite. Only Air France has comparable food and wine. But even then the Air France lounges are weak, except for first-class.

  26. I think Virgin will stay, now if they do go bump, who ever buys them needs to be careful, as ik don,t know if you know the staory of Rolls and Bentley cars, VW and BMW bought them, but one did not buy the Rolls name, I can,tq remember, but they need to buy the Virgin Logo, Myself, I think Gove will loan, and also Delta put in more, they are awaiting, to see whats going on, Also has anyone thought, we may (UK) not need new London runway for a while, Manchester Airport will do OK, as Coucils own most of it and will put funds in(they hasve plenty) then the mad car paek fees will get their funds back in no time, when they are up and running,

  27. @Gertie – You can’t buy the Virgin name and logo.

    You pay Virgin Group a ‘use’ fee – Like Virgin Mobile do – they pay to use the Virgin name but have no other links to the Virgin Group such as ownership.

    As for local councils having plenty of money what world you are living in??

    Yes Manchester Airport is owned by a group of local authorities and a private company parter but it is run on a commercial basis.

  28. If VS and BA are going to do anything, they should both ditch third world LHR (except Terminal 5, a train ride away from connecting flights that aren’t BA)

    LGW has far better rail links, in every direction and into two mainline stations in London.

    LHR has only the crowded, slow tube from its terminus LHR. Nothing goes west. Only London
    OR take the train to Paddington (where?) and have to then take the tube to travel into central london.

    Why LGW appears not to be able to fight their corner, I do not know. The airport’s not great, and could be better. (and there’s ample land around to completely rebuild, which LHR will never have, being in the middle of a surbiban area.

    Whenever I fly to London on EK, I choose LGW over LHR every time.

    Anyone with thoughts?

  29. @UpperDeckJohnny
    Crossrail will destroy most of your arguments about worse rail connectivity from LHR when it opens later this year, followed by the Western rail access project to give direct trains into LHR from the Thames Valley (and beyond, from Bristol/Cardiff/etc).

    Even so, it depends where you live or want to visit. I’m in East Anglia, so Thameslink to LGW (and direct trains to Stansted) always beat LHR.

    But even where I have a choice, the vast majority of my intercontinental flights depart LHR not LGW. There’s just more choice and greater volume from LHR, and that cancels any time saving from LGW’s better rail connections.

    For all sorts of reasons, BA would be insane to abandon LHR for LGW.

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