Virgin consider merger to compete with BA

The number of airlines in merger talks seems to keep growing. Virgin Atlantic’s chief executive officer, Sir Richard Branson, has commented that his airline may no longer be able to avoid their own need to merge.

Continental and United Airlines in the USA, last month announced their merger plans which are currently awaiting state approval. If the plans go ahead they will create the world’s biggest airline.

At the start of the year Virgin’s main competitor in the UK, British Airways, announced their merger with the Spanish carrier Iberia. The UK flag carrier also has advanced plans in place for an alliance with American Airlines, that has always been strongly opposed by Branson.

Branson has threatened legal action against the cross Atlantic tie up in an attempt to stall it. Meanwhile the company is benefitting from ongoing industrial action at British Airways. Virgin is claiming to have seen a 10% increase in business class load factor since the beginning of the most recent walk outs.

Virgin own a 49% stake in Singapore Airlines, but it is rumoured they are looking to sale their stake. If this goes ahead it is likely they will look to another carrier for merger negotiations.

Source: Perth Now