Virgin Atlantic’s Hub Nears Full Capacity.
Virgin Atlantic started operations in 1984 with the concept of serving strong demand
destinations. The maiden flight from London Gatwick to Newark Liberty International Airport
took place on 22 June 1984 (Nandy, 2015). Since then the airline expanded but largely remained
as a single city hub airline. That hub is now in England’s capital, London’s Heathrow airport,
(IATA’s code LHR) (see route map in annex 1). As a long-haul airline Virgin Atlantic is highly
dependent on an airport that can attract both business and holiday destination travellers. LHR
traffic just like Virgin Atlantic has experienced a continued growth over the last decades (see
annex 2 graph.) The airport operates
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LHR is without a doubt an important strategic airport for any
international carrier. ‘Almost 75m passengers travelled through Heathrow airport in 2015, setting
a new record for the UK’s biggest and most congested airport’ (Powley, 2016, online). Many of
those passengers went to China with a 14% increase in 2015. The Middle East also saw
increased growth with a 6% increase while Latin America grew by 6 per cent (Powley, 2016).
Though these record numbers show a continued progression plans for increasing capacity have
been delayed attending to ‘‘further consideration on environmental impacts’’ (Powley, 2016,
online). Heathrow is operating at near-full capacity on its two runways (Powley, 2016). But the
rise in passenger numbers was made possible by airlines’ increased use of large capacity aircraft
such the Airbus A380 superjumbo (which Virgin Airlines is also contemplating adding to their
fleet). For example, by the end of 2015, there were more than 20 daily A380 flights into
Heathrow operated by eight carriers (Powley, 2016).
VIRGIN ATLANTC: LEVERAGES VALUE OVER LONDON BASE.
5
Conclusion
While the use of big aircraft able to carry from over 500 passengers to excess of 800
The airline industry has long attempted to segment the air travel market in order to effectively target its constituents. The classic airline model consists of First Class, Business Class and Economy, and the demographics that make up the classes have both similarities and differences to the other classes. For instance there may be similarities between business class travellers on a particular flight, but they will not all be travelling for the same reason. An almost-universal characteristic of air travel is that customers do not fly for the sake of flying; the destination is the important element and the travel is a by-product, a means-to-an-end that involves the necessity of an aircraft that gets the customer from point A to point B. Because the reasons can differ greatly in the motivations for a customer wanting to fly, it can be difficult to divide the market into discrete segments, that is, there is always going to be overlap in the preferences and characteristics of any given segment. With that in mind, the commonalities that are shared between the clientele that make up the respective classes can easily withstand analysis.
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Use of a single-type aircraft fleet. The A320 Airbus has an increased seating capacity of 30 seats (24 after additional seating reconfigurations), is cheaper to maintain, fuel efficient and reduces training costs, relative to other aircraft models used in the industry.
According to the International Air Transport Association, 2001 was only the second year in the history of civil aviation in which international traffic declined. Overall, it is believed that the IATA membership of airlines collectively lost more than US$12 billion during this time (Dixon, 2002).
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Through a vast worldwide route system Delta has flown over 117 million passengers, more than any other airline in the world. Delta mainline, domestic and international service, Delta Express, Delta Shuttle, Delta Connection®, Delta Sky Team and Worldwide Partners operate 6,400 flights each day to over 450 cities in 98 countries. Not only is Delta a beast in the market it wields its power quite intelligently. Along with this momentous market share, Delta has enormous control over some of the nations key gateways. Delta controls 72 percent of the air traffic at Salt Lake Utah.
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number topped 650 million. All other factors being equal this would result in more passengers
Tourism is an industry, with air transport becoming an indispensable factor. One major growing trend in airline industry is market globalization. People travel to other countries for both business and leisure purposes, leading to 7% increment in air travel per year. As a market is globalized, those involved will evolve into global customers who go in search of suppliers running on global base. This leads to a growth in business travel due to the global involvement of companies in terms of investments, production chain, supply and customers. Thus, the participation of air transport in facilitating the world trade is prodigious. Aviation implements another economic benefit of the air transport by providing consumer welfare to individuals while considering the environmental brunt such as the air quality, congestion and noise in the proximity of airports. Air transport being highly demanding has doubled the passenger numbers since the 1980s and over the last decade, it has increased by 45%. The huge growth and development of the aviation field has benefitted in heaps regarding
Political · The expansion of the European Union (EU)· BAA’s proposed Stanstead expansion· CAA’s new regulations on airport charges
Virgin Atlantic is UK's second largest major airline; it had its first take-off in 1984 and nowadays has routes leading to the world's major cities, having carried more than 38 million people to this date.
First, an extra runway can expand the capacity of the airport to satisfy the expected strong traffic demand. Facing the rise of many developing countries in Asia, especially China, the total number of passengers and cargo of HKIA in 2030 will be doubled of 2012 (AAHK 20). The expansion into China’s market, which is crucial to establish greater network to stay advantageous over its competitors, also requires higher air-traffic capacity. Yet, under the existing two-runway operation, the airport will be saturated by 2020 that would lead to great economic losses without further expansion (AAHK 24). In fact, Hong Kong has embedded with geographical advantages that not only as the significant gateway to China, but also being able to reach half of the world population within five-hour. Airbus (22) predicts Asia as ...