The Delta Air Lines-Virgin Atlantic Airways tie-up is all about scaling Virgin’s network so it can effectively compete, says Delta chief executive Richard Anderson.
“They need the scale of a network,” he says at the Society of American Business Editors and Writers (SABEW) fall 2013 conference in New York today.
“My point is that when you’re a 33 airplane airline and you hook with an airline that has 1,400 airplanes and connect the networks together it’s incredibly powerful,” Anderson adds.
Delta and Virgin Atlantic received US antitrust approval for flights between the UK and USA in September after beginning a codeshare in July. The airlines plan to implement their metal neutral joint venture by the end of the year.
The codeshare is already bearing fruit. Anderson says that Virgin Atlantic bookings were up by more than 10,000 passengers in July when it was included in some of Delta’s corporate agreements.
The partnership also generated at least $8 million in new joint sales in July, Delta president Ed Bastian said that month.
Virgin Atlantic sees the network advantages as a big plus as well. “We've struggled with a lack of connectivity in our network, [compared with] British Airways,” said Craig Kreeger, chief executive of the UK-based carrier, in an interview with Airline Business in August.
“Delta's distribution in the USA and our product and service will be a hugely winning combination,” he added.
Anderson says that Delta can learn a lot about product from Virgin Atlantic, which is often ranked as one of the world’s best airlines from a passenger experience perspective.
Delta has already announced new daily nonstop service between London Heathrow and Seattle from March 2014, and the carriers will introduce an optimised schedule between London and New York’s John F. Kennedy International airport the same month.