There is a very interesting article in Flight this week, also avaialable on their website about Virgin being insistent on keeping its brand are restructuring.
Virgin Atlantic to retain Virgin brand after strategic review
All very interesting. I have heard it suggested that one reason why Virgin is a marginally profitable airline (as Singapore airlines knows too well) but Branson is a billionaire is that VS pays Virgin Management a small fortune for its brand and other services. If VS keeps its brand the franchise agreement will doubtless give Branson significant control over its running.
This gives rise to the question that whilst VS would undoubtably be worth acquiring not just for its slots but also its route structure and assets, would you wish to include its brand and the services of the Virgin Group?
It is undoubtably a safe airline, its pilots can fly, maintenance is fine, etc - all of the things that are regulated - but talking to some recent flyers and looking at sites on the web (OK a few flyers and we can all discuss the reliability of sites such as Skytrax but lets not right now) VS's quality of customer care is slipping. Thats not somehing that can't be turned around - many an airline has gone through a poor patch and emerged stronger (BA in the late 70s for a start) but if I were a CEO I'm not sure that I would want to keep the brand.
Rumours are that the three alliances aren't to keen for VS to join, at lease on RB's terms.
VS is 49% owned by SQ which has a very strong brand. Much as BA would like VS for its slots there would be obvious questions about competition. Lets say that LH purcahsed all of VS or just RB's 51%. The combination of LH group airlines (BD, VS, LH, LX, OS etc) at LHR would be formidable particularly with BD opening more medium haul routes.
This raises an interesting question branding. Lufthansa UK is a possibility - the same has happened in Italy - as is BMI but here's a long shot. Say SQ still owns 49% (which could yet be very lucrative), how about Singapore
(UK) with the UK in a very small font. Leaving aside how oriental VS's flight attendents look Singapore Airlines is a very strong brand.
Any views on what I have said welcome (but please be polite if you think that I have written utter rubbish).