NYTimes.com Article: Virgin CEO Wants to Keep Concorde Flying

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Virgin CEO Wants to Keep Concorde Flying

May 8, 2003
By THE ASSOCIATED PRESS






Filed at 1:53 p.m. ET

LONDON (AP) -- Richard Branson is spending a lot of time
these days in his favorite place -- the spotlight.

The Virgin Atlantic Airways CEO swooped into Iraq last week
with a 747 full of medical supplies and said he might
consider starting commercial flights from London to Baghdad
and Basra.

Now, in another gambit guaranteed to make headlines, the
brash tycoon is styling himself as the savior of the
iconic, supersonic Concorde jet, which Virgin's bitter
competitor British Airways recently announced it was
retiring.

Branson says the needle-nosed plane -- also being put to
rest by Air France, the only other airline to fly it -- is
a beautiful symbol of Britain and deserves to remain aloft.
He claims Virgin Atlantic, which he started in the 1980s as
a direct challenge to British Airways, may be able to make
the Concorde more profitable.

``Concorde is a great ambassador (for) Britain and should
be in the air and not broken up and sold,'' he has said.

But Branson's bid to operate the world's only supersonic
jet might never take off.

British Airways says its Concordes aren't for sale. The
government, after some initial encouragement, has refused
Branson's request to intervene. And Airbus, which services
the planes, says high costs make it unrealistic to continue
doing so.

Still, the bid has brought the flamboyant Branson, 52,
another chance to tweak his rival. Competition between the
two carriers has long been nasty and highly personal --
they have fought in court and Virgin's ads gleefully needle
British Airways.

Branson accuses British Airways of refusing to sell because
it's afraid he'll make the supersonic jet a success.

He says he'd divide the Concordes into two classes --
first, with prices likely higher than those of British
Airways, and standard, with cheaper tickets than are now
available. He hasn't announced any details of his plans or
prospective fares. A roundtrip London-New York ticket on
the Concorde now costs, on average, about $12,800.

Virgin Atlantic has suffered along with the rest of the
airline industry since Sept. 11, 2001. Branson pared
flights by 20 percent just days after the terrorist attacks
and his airline lost 92 million pounds ($147 million)
before taxes in the 2001-2002 fiscal year.

Things now seem to be looking up. Virgin has boosted
service again and recently reported a 10 million pound ($16
million) pretax profit for the fiscal year that ended last
month.

But it's unclear whether the airline can afford a pricey
project like the Concorde. Branson believes he may be able
to fly it at a profit but has reportedly also said he'd
even do so at a loss, just for the prestige.

David Learmount, operations and safety editor for Flight
International magazine, said the aging Concorde -- it dates
to the 1960s -- was getting so expensive to maintain that
it would be nearly impossible to run profitably.

``Sir Richard is very keen to see Concorde flying again,
but it's not going to happen,'' he said.

British Airways and Air France said last month they planned
to ground the planes for good, the French carrier by May 31
and the British in late October.

Steve Double, a spokesman for British Airways, said the
airline's decision to mothball its Concordes was final and
that it would not sell them to Branson.

``It's part of the fabric of British Airways,'' he said.
``We've already been in correspondence over this with
Virgin Atlantic and we made our position clear. ... It's
clearly a nonstarter.''

Double said British Airways was talking to aviation museums
interested in taking custody of the sleek jets. Air France
said it cannot sell its Concordes to Virgin because it also
plans to turn them over to museums.

Despite the aircraft's prestige and speed, filling its
seats grew increasingly difficult because of the global
economic downturn and the impact of the Sept. 11 attacks on
trans-Atlantic travel. Moreover, a July 2000 crash near
Paris' Charles De Gaulle airport killed 113 people and
severely tarnished the Concorde's safety record.

Trade Secretary Patricia Hewitt told Branson this week that
it was not the government's place ``to make a decision on
either the cessation of Concorde services or the disposal
of the aircraft concerned,'' her department said.

Undeterred, Branson said he plans to speak to Prime
Minister Tony Blair.

``We will mount the strongest campaign we can for the next
few months,'' he told journalists traveling with him on the
Caribbean island of Grenada.

Virgin says government loans and subsidies mean British
Airways effectively paid just 2 pounds ($3.20) for its
seven Concordes when the airline was privatized in the
1980s and may be legally obligated to resell them to any
willing British buyer.

British Airways chairman Lord Marshall refutes that, saying
the carrier paid 155 million pounds ($248 million) for the
Concorde fleet and has invested more than 1 billion pounds
($1.6 billion) in it since.

Branson's Virgin group began as a record label, and now
sells everything from soft drinks to bridal gowns, and even
runs a train service and mobile phone network.

The tycoon is an expert at getting attention for himself
and his company and has won extensive publicity with his
ballooning. He was the first to cross both the Atlantic and
Pacific oceans by balloon and made several attempts to be
the first balloonist to circumnavigate the world without
stopping.

http://www.nytimes.com/aponline/business/AP-Bransons-Moment.html?ex=1053418875&ei=1&en=cd077e9752021642



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