How Virgin Atlantic CEO will cut costs in 2 years

In Airlines, Ancillary Revenue, Asia, Featured on App, Investments by lornaLeave a Comment

How Virgin Atlantic CEO will cut costs in 2 years (James Bowe on flickr)

The relatively new CEO of Virgin Atlantic, Craig Kreeger, has given himself 2 years to cut costs and restore the brand to profitability while maintaining reputation.

He plans to freeze capacity, review staffing levels and get the most benefit out of an accord with Delta Air Lines. Kreeger said in an interview that Virgin must keep the energy alive that differentiates them from other airlines.

In the fiscal year 2012, Virgin Atlantic lost £80.2m but the CEO assures that a return to profitability by 2015 is achievable. Their alliance with Delta is aimed to be the main source of revenue growth, rather than through capacity gains. The alliance comes after the carrier paid $360m for a 49% stake originally held by Singapore Airlines.

Enter Henry Harteveldt who says Kreeger must also spur innovation in order to keep up with Delta and keep Virgin ahead of Asian and Gulf carriers.

The firm has acquired 10 new airbus SAS A330 planes in the past year which will trim costs along with the arrival of 16 Boeing 787 Dreamliners.

Do you think it's possible? Balancing Clubhouses with putting greens and meetings Branson style with shearing costs and spurring profitability might seem a daunting task… What are your thoughts?

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