Virgin says UAE market share 9.7 per cent

SHALU CHANDRAN quizzes Virgin Atlantic CEO Steve Ridgeway on deregulation, agent commissions and the future of aviation
Ridgeway: growing markets

VIRGIN Atlantic has set a target of 10 per cent of the Dubai-London market by the end of 2006 – and has almost reached that goal.

CEO Steve Ridgeway told TTN in an interview that the airline’s market share stands at 9.7 per cent a mere six months into the route.
“It’s been a great six months. We have a really strong commercial schedule that competes really well with our competitors, which obviously is Emirates and British Airways,” he said.
The airline opened the route in March with four weekly flights and moved to a daily schedule in July. Its success, Ridgeway said, is a product strategy that works very well in the Middle East market.
“Virgin has two business modules, one that competes very effectively in the business market and the premium market and the other in the leisure area. The unique thing in the premium segment is our first class product sold at a business class fare, and it’s obviously the business class cabins that generate the bulk of the revenues in the premium segment,” he said.
The upper class suites offer flat beds in a design that Ridgeway said is very well protected. “It’s easy to make seat go flat, but it’s usually lumpy, but on Virgin’s upper class suite, you just turn it over and you have a bed. So, it’s a great product.”
The airline has begun focusing on its upper class on the route and will roll out advertising aimed at both the trade and the corporate customers, he said. Flying upper class also means a limousine service, a drive-through, the use of a new club house at Heathrow, onboard beauty therapy service, bar and so on. “It’s a very strong offer and we are confident we will gain market share and grow the market. In new markets, Virgin always grows the market, particularly at the leisure end, where we market together with Virgin Holidays in the UK.”
Naturally Virgin Holidays benefits from this increased market share. “With the number of hotel rooms doubling in Dubai over the next three or four years, we think that Virgin and Virgin Holidays will together grow the Dubai market for the UK very strongly – it’s a nice flight, six and a half hours, with three hour time difference, safe, guaranteed sun and beaches.”
While the airline is still far behind other players in the market – like Emirates Airline, which offers 91 weekly connections to the UK – Ridgeway pointed out that Virgin has in fact benefited from Emirates’ marketing of the shiny emirate. “Emirates has been fantastic with us, they’ve realised that our supporting Dubai in our home market with such a good reputation will be very good for Dubai, their home market and for the good of Emirates,” he said.
Ridgeway also talked up the airline’s connectivity with North America.
With its highest concentration on London, it has six flights a day to New York and up to three flights a day to Orlando. “I know Emirates is now offering non-stop flights to New York, but there are still many gateways to the States where we have a strong presence,” he said.
Among the other markets Virgin is looking at is India. Just over a year ago, the airline only ran three flights a week to Delhi under Air India’s traffic rights. “Now there are daily flights to Delhi, Mumbai and with a daily to Dubai, in this region, we are massive compared to where we were before. It’s quite interesting to see at what rate [the market] grows, certainly it will be quite fantastic if we can ultimately have more than one flight a day to Dubai.”
Ridgeway took the now traditional Virgin line of highlighting dereg-ulation, offering a healthy outlook for the future of the loss-making aviation industry subject to certain conditions. “There must be a level playing field across the industry. We need to take the regulatory shackles off. People are genuinely competing and playing by force of commercial rule. We are not there yet because many airlines are still subsidised by government funds. The aviation industry is absolutely central to the global economy,” he said, offering the case of the Indian economy, which he said could never have become the powerhouse it is with-out domestic airline Jet Airways.
“Aviation is making huge strides in terms of efficiency of aeroplanes, engine, fuel burn, machinery and noise and we need to carry on with it. It needs to become more rational and make a better overall return for shareholders.”