David Prosser: Virgin still looks lonely but there is no sign of a partner

 

Outlook It has not been a bad few days for Virgin Atlantic. On Tuesday, Sir Richard Branson's airline announced it had been successful in heading off a potentially humiliating strike by its pilots. Yesterday, Virgin was able to reveal it has returned to the black over the year just gone. All very satisfactory, one might think.

Still, the biggest question of all for Virgin remains resolutely unanswered – where does the airline's future lie in an industry where consolidation continues to be the dominant theme? Only yesterday, Virgin's results announcement coincided with the unveiling of a share swap between Malaysia Airlines and AirAsia.

We might have expected an answer by now. After all, Sir Richard asked Deutsche Bank to begin reviewing his options last year. Since then, Virgin's founder has publicly conceded that the days of his majority ownership might be numbered. Yet plans for a deal seem to be stuck in the departure lounge.

The simple explanation for that is the slowing pace of the global recovery. In the second half of last year, when the outlook looked healthier, airline trading improved dramatically. Not only did Virgin look a more attractive target in that context, but potential suitors expected to be getting richer. Once the doubts began creeping in, however, there were second thoughts.

Virgin itself insists there is no imperative for change – it points to the substantial investments it continues to make as evidence of the viability of independence. But the status quo is becoming ever harder to maintain. If it looked tough for Virgin to stand alone before last summer, the decision by regulators in Europe and the US to clear the transatlantic co-operation deal between British Airways and American Airlines – so bitterly opposed by Sir Richard – has made the matter much more pressing.

The simplest thing would be for Virgin to join one of the big airline alliances – most likely Star or SkyTeam – though doing so has never appealed to Sir Richard, whose business ventures are always built on a foundation of brand control.

If not that, what about a merger? Virgin's transatlantic routes and its slots at Heathrow make it an attractive proposition for any number of partners, even if the shortlist of candidates is shorter today than a year ago. That, however, would see Sir Richard finally lose control of his pride and joy.

One thing is for sure. While Virgin ponders its future, the trading environment is not going to get any easier, even if the falling oil price will help with fuel costs. The faltering global recovery does not bode well for the airline sector. The sooner Sir Richard bites the bullet, the better.

Start your day with The Independent, sign up for daily news emails
Sport
wimbledonScot will face Ivo Karlovic next
Sport
football
News
Hillary Clinton comments on viral Humans of New York photo of gay teenager
Arts and Entertainment
The gang rape scene in the Royal Opera’s production of Gioachino Rossini’s Guillaume Tell has caused huge controversy
music
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Sales Assistant / Buyer

£15000 - £17000 per annum: Recruitment Genius: This company offers a range of ...

Recruitment Genius: Customer Service Advisor

£15000 - £16000 per annum: Recruitment Genius: Customer Service Advisors are r...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45K: SThree: SThree were established in 1986....

Recruitment Genius: Compliance Manager

£40000 - £60000 per annum: Recruitment Genius: A Compliance Manager is require...

Day In a Page

Is this the future of flying: battery-powered planes made of plastic, and without flight decks?

Is this the future of flying?

Battery-powered planes made of plastic, and without flight decks
Isis are barbarians – but the Caliphate is a dream at the heart of all Muslim traditions

Isis are barbarians

but the Caliphate is an ancient Muslim ideal
The Brink's-Mat curse strikes again: three tons of stolen gold that brought only grief

Curse of Brink's Mat strikes again

Death of John 'Goldfinger' Palmer the latest killing related to 1983 heist
Greece debt crisis: 'The ministers talk to us about miracles' – why Greeks are cynical ahead of the bailout referendum

'The ministers talk to us about miracles'

Why Greeks are cynical ahead of the bailout referendum
Call of the wild: How science is learning to decode the way animals communicate

Call of the wild

How science is learning to decode the way animals communicate
Greece debt crisis: What happened to democracy when it’s a case of 'Vote Yes or else'?

'The economic collapse has happened. What is at risk now is democracy...'

If it doesn’t work in Europe, how is it supposed to work in India or the Middle East, asks Robert Fisk
The science of swearing: What lies behind the use of four-letter words?

The science of swearing

What lies behind the use of four-letter words?
The Real Stories of Migrant Britain: Clive fled from Zimbabwe - now it won't have him back

The Real Stories of Migrant Britain

Clive fled from Zimbabwe - now it won’t have him back
Africa on the menu: Three foodie friends want to popularise dishes from the continent

Africa on the menu

Three foodie friends want to popularise dishes from the hot new continent
Donna Karan is stepping down after 30 years - so who will fill the DKNY creator's boots?

Who will fill Donna Karan's boots?

The designer is stepping down as Chief Designer of DKNY after 30 years. Alexander Fury looks back at the career of 'America's Chanel'
10 best statement lightbulbs

10 best statement lightbulbs

Dare to bare with some out-of-the-ordinary illumination
Wimbledon 2015: Heather Watson - 'I had Serena's poster on my wall – now I'm playing her'

Heather Watson: 'I had Serena's poster on my wall – now I'm playing her'

Briton pumped up for dream meeting with world No 1
Wimbledon 2015: Nick Bollettieri - It's time for big John Isner to produce the goods to go with his thumping serve

Nick Bollettieri's Wimbledon Files

It's time for big John Isner to produce the goods to go with his thumping serve
Dustin Brown: Who is the tennis player who knocked Rafael Nadal out of Wimbeldon 2015?

Dustin Brown

Who is the German player that knocked Nadal out of Wimbeldon 2015?
Ashes 2015: Damien Martyn - 'England are fired up again, just like in 2005...'

Damien Martyn: 'England are fired up again, just like in 2005...'

Australian veteran of that Ashes series, believes the hosts' may become unstoppable if they win the first Test