Alaska Airlines will retire the Virgin America brand by 2019. The news is hardly surprising considering the royalties involved in using Sir Richard Branson’s trademark brand, but Alaska will do much more than repaint aircraft.
Changes Coming to Alaska Airlines
In a press release issued yesterday evening, Alaska highlights the following “enhancements” coming in the months ahead–
Modern vibe – new onboard/airport music, mood lighting, and uniforms are coming
Satellite connectivity – high speed internet sufficient to stream YouTube and Netflix is coming first to the Alaska 737 fleet then to the Virgin Airbus fleet. Completion by 2019.
More premium seats – Alaska will install install new first class seats on ex-Virgin America planes, increasing the size of the cabin by 50%, from eight seats to 12 seats. Seat pitch on Virgin planes will be 41″ (currently seat pitch is 55″) and no longer be deep-reclining.
Here’s a look at what Virgin has now in first class–
And here is what the new ex-Virgin America first class cabins will look like–
The end of Virgin America’s Elevate loyalty program – Alaska’s Mileage Plan will be the sole loyalty program starting sometime next year. The program itself will not change much (though I still predict devaluations are coming).
Complimentary upgrades – Currently, Virgin America elites do not receive complimentary upgrades. With only eight seats in first class, this is no surprise. That will change in late 2018 once the Virgin America retrofit is complete.
Free movies / chat – Free streaming movies/TV programs on your own devices will continue to be free on Alaska’s Boeing aircraft and will be expanded to the Airbus fleet. Additionally, the use of Facebook Messenger, WhatsApp and iMessage will be free in the air.
West Coast-inspired food and beverage – Fresh food will remain and pre-ordering will expand to the Airbus fleet and to economy class. No word on whether Virgin’s dining-on-demand program will stick around.
Lounge expansion – Lounges in Los Angels, Portland, and Seattle will increase in size. New lounges are also coming to San Francisco and New York JFK.
Sir Richard Branson Chimes In
Richard Branson penned an open letter about the news, writing in part–
It has a very different business model and sadly, it could not find a way to maintain its own brand and that of Virgin America.
When a company goes public, decisions are made that benefit the shareholders. In the best of times, they also benefit consumers. It remains to be seen what will happen now – for travellers – with fewer airlines in the US than ever. Being different and on a mission to truly reinvent an experience for the customer is increasingly rare in this business.
The man who profited fabulously from the merger despite personal opposition to it argues correctly that Virgin America was a unique experiment. Branson goes on to lament that U.S. ownership laws prevented him from holding a majority stake in the company that he would have used to block the merger. Indeed, it remains an open question whether the merger will benefit or hurt consumers.
My Two Cents
These changes are exactly as expected. The two brands were so different that it was implausible both would survive. While the removal of Virgin’s industry-leading shorthaul domestic seats is a disappointment, it is hardly surprising.
Virgin America currently serves highly competitive transcon routes to New York JFK and Boston. Alaska must make a decision: abandon the route (unlikely) or introduce a special first class seat on the route. Absent a new seat, Alaska will be left with such a competitive disadvantage on its transcon routes that the only thing that may sustain it is blind loyalty or undercutting the competition dramatically in price. I predict the announcement of a new seat sometime next year.
Look on the bright side: Alaska remains committed to awarding miles based on distance flown. That will not change. Alaska also has a great collection of partner airlines. That will not change. While the “coolness” of Virgin will die, the new airline will offer west coast flyers a very compelling product.