Originally Posted by
JimNich
The Virgin domestic services will be run on whatever Branson can get his hands on at the best possible price (but not a prop, London pax hate those). However, as always the problem will be, who makes the money? Any feeder service being ticketed by the long haul operator will never make any cash. I believe the old BA-CityExpress/BAconnect set up used to go like this: Ticket (for instance) Aberdeen to LA Via LHR, Total distance about 5800 miles, ticket cost, one way, say 300 pounds for arguement's sake. But, distance from ABZ to LHR is about 400 miles which is about 7% ish. So BA hand over to Cityexpress/BAconnect 40ish quid for their share of the journey (full service remember), no wonder they never made any geld.
What you describe is a "straight rate prorate" which indeed never makes money for the short haul operator, and that's why typically either the formula is tweaked to give more to the operator of the shorter sector, or there is a "proviso" or minimum amount payable. I can't speak to the particular BACX prorate setup, but within one parent company there could be reasons to make one or other part of the organisation look good or bad
