Virgin Atlantic has eye on open-skies agreement

Friday, Oct. 22, 1999 | 11:23 a.m.

Although Rep. Bud Shuster has proposed legislation that could complicate Virgin Atlantic Airline's plan for nonstop air service between London and Las Vegas, the airline supports the reason Shuster is sponsoring the bill.

Paul Moore, the head of public relations for Virgin Atlantic in London, said the airline supports the relaxation of restrictions that prohibit open competition between British and American air carriers on routes between the two countries.

"We're believers in true open-skies agreements," Moore said, "and we'd like to see all of these archaic restrictions removed as a whole rather than through a piece-meal approach."

Virgin Atlantic has been hurt by the restrictions more often than helped, even though existing treaties favor British companies. That's because Virgin Atlantic is a relatively young company, starting operations in 1984, and its top rival, British Airways, is the established carrier.

"Richard Branson (Virgin Atlantic's owner) can go into the states and sell CDs at his record stores or he can sell Virgin Cola against Coca-Cola," Moore said. "If he wants to take the big companies on, he can do it. It's the same with a lot of American companies in the U.K.

"Why should aviation be different?" Moore asked. "Why should we be required to get permission from the government to serve customers who want to fly to Las Vegas from London?"

And plans for direct flights between London and Las Vegas are progressing.

Moore said Virgin Atlantic is now targeting the startup of service in June, beginning with two flights a week. Moore said the company's growth pattern in the past has been to start small, increase to four flights a week after a year, then daily service after two years.

"And, if demands outstrip our expectations, we could accelerate that schedule," Moore said.

Virgin Atlantic has wanted to fly into Las Vegas for at least 2 1/2 years. Moore said Las Vegas is a good match for the airline, because its target demographic is similar to that of Las Vegas.

When British Airways abandoned flights between London and Pittsburgh last month, it opened the door to Virgin Atlantic to apply to fly between London and Las Vegas. British aviation officials approved the application, which still has to be approved by the U.S. Transportation Department.

"We hoping the U.S. Department of Transportation rubber-stamps this so we can begin selling tickets this side of Christmas," Moore said.

Moore said Virgin Atlantic looks at Las Vegas as a growing business destination as well as a center of tourism. He said the company recently conducted an economic analysis in advance of air service to Chicago and determined that the airline's daily flights there from London would have a $200 million-a-year economic impact on the city.

"Twice a week to Las Vegas, obviously, wouldn't have as big an impact (as daily service to Chicago)," Moore said. "But you have to figure that we could have benefitted Las Vegas by tens of millions of dollars since the time we first wanted to fly there if an open-skies agreement had been in place."