Richard Branson doesn’t like to cut corners or budgets where his airlines are concerned. Visiting Chicago on May 25 for Virgin America Inc.’s first flight there, the billionaire handed travel vouchers to people riding a train from the airport. At a party later he offered to write a check to fund a flight attendant’s request for red stilettos for female members of the carrier’s 500 cabin staff.
Branson’s sense of theater, combined with a love of flying that suffuses his latest book, ‘Reach for the Skies,’ set Virgin Atlantic Airways Ltd. apart when it was founded in 1984. That same yen for doing things differently may thwart a bid to win allies and investment for a company that’s becoming isolated among fast-consolidating rivals matching Virgin’s service standards without endorsing his approach to business.
“Richard has never been a believer in being the biggest in the sector but in always trying to be among the best,” said Will Whitehorn, Branson’s right-hand man at a variety of Virgin Group companies for more than 20 years. “Virgin Atlantic has always been close to his heart. Other CEOs are interested in the aviation business, but Richard is interested in aviation.” Branson’s commitment to flying was put to its sternest test when he took on British Airways at London Heathrow airport, and it was BA that prompted Virgin’s current search for partners by coordinating trans-Atlantic services with American Airlines and bulking up through a merger with Spain’s Iberia.
KEEPING CONTROL
Branson hired Deutsche Bank AG to review alliance options last year and is still considering what best to do, he said yesterday in an interview in Miami while celebrating the 25th anniversary of Virgin Atlantic’s second route.
Branson said he’s had approaches from alliances and would probably “sell a few shares” from his 51 percent stake in the carrier to facilitate joining one, though he would prefer a reduction in the 49 percent held by Singapore Airlines Ltd. “Virgin Atlantic was very much my baby and now she’s a very beautiful young lady,” Branson said, adding that he watched the carrier grow alongside his own daughter. “I will always remain a major shareholder in this airline.”
Branson’s attachment to Virgin Atlantic means he will struggle to relinquish enough control to attract partners and investment, with potential allies seeing at least as much value in the airline’s operating slots at Heathrow as the brand and its founder’s “avant-garde” approach, said Laurie Price, director of aviation strategy at Mott MacDonald Group Ltd. in Croydon, England.
SMALL BEGINNINGS
Branson made his name through Virgin Records, signing the Sex Pistols and reaping chart success through acts including Culture Club and The Human League. But it was into aviation that he plowed his first fortune, founding Virgin Atlantic with a single leased Boeing Co. 747 operating between London’s Gatwick airport and Newark in New Jersey
