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The business section of today’s Sunday Times leads with a story (subscription required) that Virgin Atlantic is to close its “Little Red” domestic operation from London Heathrow to Manchester, Aberdeen and Edinburgh.
The “Little Red” operation launched in March 2013, initially to Manchester (3-4 times daily) and then to Edinburgh (6 times daily) and Aberdeen (3 times daily).
The flights to Manchester were launched using slots from Virgin Atlantic’s own Heathrow slot portfolio.
The nine combined flights to Edinburgh and Aberdeen were launched using slots forfeited by British Airways as a condition of the acquisition by its parent company, International Airlines Group, of bmi.
Anecdotal evidence about the performance of Little Red has been mixed. International Airlines Group claimed in its last investor update that Little Red’s load factor is 47%.
It has often been mentioned whether Virgin could ultimately convert these forfeited slots into long-haul use to bolster its transatlantic operations. The answer to this is simply no. There are clear conditions attached to the use of the slots and they can only be used on certain specified routes where competition was lessened as a consequence of IAG buying bmi. The only flexibility Virgin would have is that after three years, the slots could be used for any European route.
It is important to note there is no comment from Virgin in relation to the story and no date has been specified for the closure of Little Red, if it were to happen. At the time of writing it has not been picked up by other media outlets, which is usually a sign of a story having legs.
In light of the restructuring of Virgin Atlantic’s long-haul network this week where routes to Tokyo, Cape Town, Mumbai and Vancouver have been suspended in favour of additional frequencies and routes to Delta’s North American hubs we can see less of a logic for a domestic feeder operation at London Heathrow if Virgin is more focused on flying to Delta hubs which offer onward connections in North America.