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Virgin considers joining an alliance

5 Dec 2011

IOL reports that Virgin Atlantic Airways, which until now has remained independent of any international alliance, has consulted Deutsche Bank over the possible advantage of joining one. Virgin flies to Jo'burg all year round, but withdraws its service to Cape Town in winter, when its passengers are carried between Cape Town and London by SAA under codeshare arrangements.

It could, therefore, be convenient for both Virgin and SAA to have the former joining in as the British member of the Star Alliance, particularly in view of the amount of traffic between the UK and South Africa and the number of business travellers who prefer to travel between this country and the US by way of London to taking the very long direct flight from Jo'burg, this created an opening for Virgin Atlantic Airways, who has a number of convenient flights between London and the US and was not happy about competing in the US market alone against BA and its combination of partners.

According to IOL, there have also been suggestions the British government may withdraw its unpopular passenger arrivals tax - as it has been argued that the tax, which was introduced ostensibly to limit the amount of CO² emitted by aircraft, serves simply to raise money for the UK fiscus. At the moment, the International Air Transport Association (IATA) and most governments outside Europe are objecting to the compulsory emissions trading scheme on the grounds that Europe cannot tax airlines for emissions outside its air space.

Read the full article on www.iol.co.za.