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Delta & Virgin like ice cream & hot fudge

(Photo: Mike Turner / Flickr)

When news broke over the weekend about the possibility of Delta Air Lines buying a large stake in Virgin Atlantic, I knew I had to get the opinion of Henry Harteveldt, co-founder of The Atmosphere Research Group, and one of the smartest people I know when it comes to the airline biz. Read through his analysis and see how such a deal could affect the fate of San Francisco-based Virgin America

Here’s his take… please read it and let us know how YOU feel about the possibility of a Delta-Virgin tie up- or the possibility of Virgin America joining a global alliance like SkyTeam.

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Atmosphere Research Group co-Founder Henry Harteveldt

This will be one of the best pairings since ice cream and hot fudge.

Delta and Virgin Atlantic have cooperated in the past (the two had a limited code share relationship in the 1990s). Virgin Atlantic will bring both Delta and all of SkyTeam access to London– one of the most important business markets in Europe. Delta, in turn, can help generate more feed for Virgin’s flights through its JFK hub. Importantly, I think both airlines have similar, “customer first” cultures. I think Virgin Atlantic would find itself more welcome and able to have more influence in the SkyTeam alliance, which is smaller than Star Alliance.

For this deal to truly work, the two will need to secure the ability to enter into an antitrust-immunized joint venture or joint business agreement. A joint venture or joint business agreement will give the two airlines the ability to align their flights and fares, while pooling both revenues and expenses. These are common, especially between US and European airlines (American Airlines and BA have a joint business agreement).Delta and Virgin Atlantic have cooperated in the past (the two had a limited code share relationship in the 1990s). Virgin Atlantic will bring both Delta and all of SkyTeam access to London- one of the most important business markets in Europe. Delta, in turn, can help generate more feed for Virgin’s flights through its JFK hub. Importantly, I think both airlines have similar, “customer first” cultures. I think Virgin Atlantic would find itself more welcome and able to have more influence in the SkyTeam alliance, which is smaller than Star Alliance.

This won’t be an easy deal to accomplish. It will have to obtain regulatory approval in both the UK and US. A key part of a deal’s success will hinge on making sure that Sir Richard Branson and Virgin Group work to facilitate a Virgin Atlantic-Delta deal. Partnering with Delta and joining an airline alliance will take Virgin Atlantic in a very different direction compared to its present state.

It’s unclear what impact, if any, this will have on Virgin America. Virgin America is an independent business unit. It doesn’t rely on Virgin Atlantic for a substantial amount of its passenger feed. It would be interesting to see if Delta will invite Virgin America to join SkyTeam, either as a full or affiliate member. A Delta-Virgin America partnership could be beneficial to Bay Area and Los Angeles Basin travelers and businesses, and enable SkyTeam to offer stronger competition in both the Bay Area and Los Angeles region.

Thank you, Henry! - cjm

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A few minutes with Richard Branson

Last week, Virgin America launched new nonstops between San Francisco and Palm Springs (one daily in each direction; $180 round trip).

As usual, the swashbuckling Brit billionaire Sir Richard Branson showed up from the other side of the world to lead the celebration for the new service.

The fete included free cosmopolitans for everyone at SFO’s new Terminal 2, speeches by dignitaries, paparazzi and a troupe of crooning Rat Pack lookalikes as passengers waited to board. Plus, there was the obligatory ribbon cutting with Palm Springs mayor Steve Pougnet. (SEE PHOTOS BELOW)

After the short flight south, an 8-foot wide red carpet welcomed passengers at Palm Springs International- and led to a catered party at the terminal including a full bar and thumping DJ for the enjoyment of all.

In the midst of all this, I was able to snag a few minutes with Branson in seats 1A and 1B on the flight to Palm Springs.

He told me that his spin through SF was actually at the tail end of a weeklong business trip that made my eyes crusty with jet lag…

He started from home base in London and flew to Nairobi, Kenya for a conference about overcoming barriers to business success in Africa. Then it was on to Johannesburg, South Africa to promote his new book “Screw Business As Usual” and to open one of his new Virgin Active gyms.

From there he jetted up to Israel to promote his new space travel venture, Virgin Galactic.

From Israel he buzzed over to Portugal to investigate the country’s decriminalization of personal possession of drugs- “It is time to end the war on drugs worldwide. We must stop criminalising drug users,” he says on his blog.

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After Portugal, there was quick stop back in the UK before flying to San Francisco for the Palm Springs launch plus an appearance at an environmental conference with Governor Jerry Brown out at the California Academy of Sciences in Golden Gate Park.

As soon as Branson got off the plane in Palm Springs, he made some witty remarks on the tarmac and cuddled with a couple leggy flight attendants (our arrival in Palm Springs was surprisingly wintry). Then it was off to a waiting helicopter that sped him to LA where he filmed a television commercial with Nike that evening.

After that, he told me he was headed to Necker Island, his private Caribbean island, to celebrate his 29-year-old daughter Holly’s wedding, “under the stars on the ruins of the main house, where I was married many years ago.” (The house was destroyed earlier this year by a fire caused by lightening.)

During his 24 hours in San Francisco, Branson told me he bedded down at the posh St Regis (“lovely Christmas decorations in the lobby; that hotel does on the ground what Virgin does in the air,” he said.). He also said he had an excellent, fresh lunch next to the fireplace at the super-hot Cotogna in SOMA (reportedly with financier Dick Blum, spouse of Senator Dianne Feinstein).

Just before our chat, Branson had walked the length of the A320, shaking hands, flashing his big toothy smile back at the cameras, and chatting with the media and astonished passengers—he was totally “on.”

But after hearing him describe his business trip and brutal itinerary leading up to this flight, I had to ask, “How do you deal with all this…the cameras, the conferences, the jet lag?”

“Well, I drink lots of water, avoid alcohol and occasionally take melatonin or a sleeping pill to help get some rest.”

And then, looking wearily and longingly toward the front of the plane he said, “And sometimes I sneak into the lavatory for about three minutes just to be alone.”

Richard Branson, Palm Springs Mayor Steve Pougnet and SFO chief John Martin cut the ribbon (Photo courtesy: Joe Enos)

A red carpet welcome under wintry skies at Palm Springs International