Originally Posted by Count von Altibar
Saw Steve Ridgeway on CNBC business channel and he didn't talk about expansion and recruitment it seemed to be along the lines of survival with respect to high fuel costs and continual worsening of the economic outlook. He did say Virgin had hedged some fuel though over the next year or so. I think we're in for rough times in the UK airline industry.
Virgin is pretty well hedged for the next year, less well for the year after. Survival is the name of the game for all airlines over the next part of the cycle. Virgin's strategy will include very tight cost-control and moving capacity from stalling markets to stronger ones. I assume, if it really becomes necessary, Virgin will take capacity out of the market, but no such actions have been mooted as yet despite BA suggesting that they will do so, and Ryanair talking in terms of grounding 20% of their fleet through this winter (though their unhedged position makes them particularly sensitive to spot fuel prices).
Certainly, recruiting is very much on the back boiler. At the moment, there are some 'attrition' appointments ongoing, but it's unlikely there'll be more this year. As has been said, folks don't leave Virgin in any numbers so don't hold your collective breath. Talk of substitute aircraft for the 787 is hypothetical and somewhet irrelevant right now as the first delivery (prior to Boeing's delays) was not scheduled for another 3-4 years. The A380 is also not due for some years. Once we can see our way out of the current downturn the news may change, but the consensus of economic opinion is that this downturn will be deeper than anything of the last 20 years thanks to the combination of tight credit, inflation, and high oil prices, and the subsequent upswing will be some time in coming. Despite Virgin's legendary ability to buck the trend, this one looks like keeping Virgin's recruiting door closed for the next year or so.
Edit: I should make the point, once again, that I am not part of the Virgin recruiting organisation and everything I say is my own opinion, based on my own observations. Don't hold me - or Virgin Atlantic - to any of it!