Wednesday, January 28, 2009

Virgin America: Dueling with Southwest (yet again)

Virgin America, the airline that has come up with so many unique ideas (think mood lighting!) just can't seem to find a unique idea when it comes to its route structure.

Southwest announced new service from SFO to Orange County with five daily flights back on January 15th starting on May 9th.

Yesterday, Virgin America announced similar service with, guess what, five daily flights to begin April 30th.

There is no question this route is ripe for low-cost competition - American and United are both currently charging $379 for a one-way walk-up fare vs. ~ $144 for SFO to LAX where Southwest (and Virgin America) provide healthy competition.

But we wonder why Virgin America is so desperate to challenge the most brutal competitor in the business - Southwest. Its a game we doubt they will win. Southwest has deep pockets and proven staying power. Southwest's considerable market power and brand awareness in both Southern California and the Bay Area are tough to match.

For good measure, we predict in the face of plummeting yields, American's current regional jet service on the route will be abandoned shortly after all this new service is inaugurated.

Surely there must be other routes where Virgin America can provide their unique service without constantly banging heads with Southwest. How about using those shiny new A320s on a route long enough to actually appreciate the mood lighting and the massage chairs in First Class....


  1. "a route long enough to actualy appreciate the mood lighting" .. you mean like sfo/lax to ord? we all know how that turned out..
    also, given virgin's california focus, it makes sense to try and build brand awareness and loyalty in cali, even (especially?) if that means matching southwest's offer

  2. ORD was simply a problem of gate space and slots - had Virgin had a place to land and disgorge, they would be flying to the Windy City now... Vis a vis California, more power to them - Virgin is a KILLER brand. Southwest tends to be a killer airline...