Pre-weekend shuffle clears Virgin in the Americas

It’s one of the oldest dodges in the Washington flak’s big book of tricks: if you have bad news or new that’s going to tick someone off, wait until Friday night when most people have either left their offices or are thinking about the weekend so much that mentally they’ve left the office already.Empty%2520Office.jpg It’s the favourite time for a government official to resign after he’s been found carousing on that lobbyist’s yacht or for a congressman to apologise after a television station finds him delivering ‘constituent services’ in a certain comely constituent’s boudoir at 3 am, or it’s just a good way to get something out that’s bound to anger someone somewhere. Like other federal agencies, the Transportation Department loves the Friday afternoon shuffle because news released on Friday goes into the Saturday paper, which has the lowest readership of the week.
So they chose Friday afternoon to announce that they finally given in on Virgin America despite continuing screams and howls from organised labour. planeonrunway-sm.jpgAirline unions had waged their battle against Virgin for more than two years running, forcing the government to continue examining the Virgin plan and finally late last year getting DoT to reject Virgin’s start-up plans. Branson, they concluded, was a foreigner and that is not allowed. In response, Virgin America co-founder Fred Reid reworked the start-up’s finances, got more money, reduced the voting power of Richard Branson and his allies, and, perhaps most importantly, offered to quit. Reid may have grown up around San Francisco, but if he was beholden to a foreigner, he said, he would go. That didn’t satisfy the unions and the Association of Flight Attendants in particular remained steadfast in its opposition to Virgin clearing the regulator’s hurdle. Not only should Reid quit, the union said, but Virgin shouldn’t be allowed to fly, anyway. (Take that, foreigners!)

So the regulators had to call Fred on his bluff: they came out at about 5 o’clock on a Friday afternoon and said they really had run out of arguments against Virgin, as they had signalled in March, but added that they would accept Reid’s scalp. Virgin can start flying so long as Reid, a former number two at Delta and before that the number two at Lufthansa, leaves the new airline within six months. They’ll let him stay on for three months after that as a consultant. Reid says that “this was never about one person” and so he’ll move on; the airline says it will be up and flying by this summer. First routes: transcons out of the Virgin America homebase at San Francisco International (SFO), first to New York and then to other cities. The unions, which managed to find out about the news anyway, still aren’t happy, but have moved on to their next battle.

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