Thirty years ago when he launched the Virgin Atlantic, Richard Branson had no cash for advertisements and on an industry veteran's advice took to off beat and daring promotions to market his airline. On Friday Branson lived upto that reputation perching upon a Mumbai's fabled black-and-yellow taxi to announce the return of Virgin Atlantic airline to Mumbai. Virgin's Mumbai-London flight starts on October 29.
Branson said there was no immediate plan to invest in an Indian carrier as the market conditions are tough but his airline hopes to start new services from London to Goa, Hyderabad and Bangalore. Branson said the new flights were subject to airline securing slots at Heathrow. The airline is also hoping to grab upto 20 percent market share on Mumbai-London route and earn better yields with its business class product. In a press release the airline said it is pledging 300 million pounds in product investment programme on its India market by introducing new airbus planes on the route.
In an interaction with media persons in Mumbai, Branson spoke on a range of issues and said Kingfisher chairman Vijay Mallya deserves credit for keeping the airline afloat. Edited excerpts.
What has gone wrong in the Indian aviation sector?
First of all the positive. When you switch the clock back, there was one government airline flying in India and did not result in millions of people flying.. (with the launch of private airlines) you have grand mothers able to visit grand children, children able to visit parents...It is wonderful from consumer view point. When you open up market (like India) there are going to be hiccups and what has happened is that there is over capacity which is going to result in one or two casualties. People were brave enough to set up airlines and some have expanded too quickly.
India is no exception to rule....Of the 15 American airlines which have competed against Virgin Atlantic every single of them has gone bankrupt and some of them have gone bankrupt four times. I don't think India needs to be embarrassed about the fact that some of their airlines have gone bust or may go bust...Overall India is benefitting from the free open market and now that the government has said foreign companies can buy 49 percent I think it is a stabilising factor.
Vijay Mallya is known as Richard Branson of India. What do you think he has done terribly wrong?
I do not know specifically what has gone wrong but he is fighting to keep it (Kingfisher) flying. I hope he manages to keep it flying. Airline industry is not easy and atleast he needs to have the credit for fighting and lot of people would have closed the airline six months ago and every member of staff would have been on street. He has obviously spent last six months to see if there is a way forward and needs credit for trying to keep the airline going.
Do you want to invest in an Indian carrier
We will have a look. I do not promise we will. If we see an obvious opportunity we will do so. The situation today is different from seven years ago...You have IndiGo, Jet and you have quite a few airlines set up..We have a great brand and we will have a look.
Why are you so confident about the India-UK market
Virgin Atlantic has been flying for 30 years and it is rare we do not succeed on a route...We did not have the right slots at London last time..Most of the business which comes on Mumbai route comes from the US and 50 percent of booking on the route for next month is from the US..We have the right slots and the right plane (airbus A330).
Would Virgin be joining a global airline alliance or partnering with Indian carrier
We have a good relation with Jet Airways and its a mixture of code share... It has worked well for us. It is quite possible Virgin Atlantic may enter into a bigger (global) alliance and we will let you know in three-four months.
There are are anti-competitive alliances and competitive alliances. If some airline controls 60 percent of the market it becomes dominant and they tie up with some one which controls 20 percent they become very dominant. We successfully fought British Airways-American Alliance creating alliance for twelve years..If Virgin has one alliance British Airways has 30 of them. That will not be anti-competitive. We are minnows compared to bigger competitor (British Airways).
How do you balance flamboyance with credibility
When I launched Virgin Atlantic thirty years ago I did not have advertising budget to compete with British Airways. Sir Freddie Laker who had an airline before us and went bust said to me "The only weapon you have got is yourself..Go out there, make people smile..Try and get on front page of the newspaper rather than back pages and if it means dressing up in a saree or sitting on a London taxi...Do it..You may end up on front pages and not on the back page..Your business might be successful. It will save you a lot of money on advertising.'' I have taken his advice...I have had a lot of fun...I think credibility comes from success that you get..We have built perhaps one of the most admired brands in the world and we would not be admired unless quality of products were excellent..They are excellent. The one has helped the other.
