Virgin America

2931 Words12 Pages
Executive Summary
Despite Virgin America’s numerous awards, acclamations and recent success, the airline is still not classified as a major carrier by the Department of Transportation (DOT).
To be considered a major carrier, an airline must achieve $1 billion dollars in operating revenue and meet the Department of Transportation’s requirements on baggage handling, on-time performance and other operational statistics. Virgin America currently operates 39 Airbus 320A aircraft to 14 destinations around the United States and Mexico. According to the 2010 financial statements, full year operating revenue was $724 million, a 32% increase YOY. They are the recent recipients of several customer service awards such as: Air transport World’s
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Discovering new and innovative ways to expand the airline nationally, while keeping the same quality customer satisfaction, will be the biggest challenge.
Analysis
To achieve the results desired for Virgin Airlines, the company must concentrate on expansion in domestic niche markets by adding aircraft and destinations. By focusing on expansion within the United States, Virgin America can expand in their specialty market without losing their touch as one of the best customer service airlines in the world. In order to achieve this, several alternatives must be considered to bring about the desired result by emphasizing the driving forces, and lessening the resistant ones.
The first strategic imperatives are to expand domestic destinations. One way to accomplish this is by increasing Virgin America’s fleet size to 60 new airbuses A320 by 2013. The 60 Airbus A320 new planes will be delivered from 2013 through 2019 with 18 on order, four being from Jazzier Airways, a Kuwaiti airline. Four will be on the property by end of 2011, with 10 in 2011 and the last four on grounds beginning of 2012, with a potential total of 111 planes by 2019.
The second imperative is to continue revenue growth, which will fund the expansion of the airline. Virgin America will continue to report strong revenue performance,
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