Virgin Atlantic chairman Richard Branson has launched a crusade to remove restrictions on foreign ownership of US airlines, so that he can start up a US domestic carrier.
Branson visited Washington DC on 24 September to begin lobbying Congress to amend the "antiquated and outmoded" regulations prohibiting foreign ownership of a US airline. He believes some lawmakers already support lifting the restrictions.
US Department of Transportation assistant secretary for aviation and international affairs Charles Hunnicutt, meanwhile, says the agency is questioning current restrictions on foreign airlines operating in the USA and on foreign ownership of US airlines.
The proposed Virgin America would be modelled on Brussels-based low fare carrier Virgin Express, which is part owned by Branson, but operated independently of London-based Virgin Atlantic Airways.
Details are scant, but Virgin America would use US pilots and ground staff and "more than likely" aircraft built in the USA, Branson says. Virgin says that it would look at starting operations in markets lacking competition, at "fortress hubs" and in regions with high fares. "It would be a sizeable operation," the company says.
Branson reveals that he was approached earlier this year by a venture capital firm which wanted to start a Virgin-branded airline in the USA. "We came very close to going ahead," he says, "but I had to turn the idea down because of the rules on foreign ownership."
The proposal would have involved Virgin taking the full 25% ownership stake allowed by US legislation, and would have required a $250 million investment by the UK firm, Branson says.
Virgin Express has confirmed its plans to launch an Irish operation based in Shannon, which will see some aircraft transferred to an Irish air operator's certificate.
The move will effectively establish an Irish subsidiary, which it hopes will enable it to make substantial savings by reducing the high costs incurred by being based in Brussels. The airline's first route from Shannon will be to London Stansted Airport.
Source: Flight International
