|
British business tycoon Richard Branson's Virgin Group has won final approval from the US Department of Transportation (DOT) to launch a budget airline that will operate in the American market.
Virgin America Airlines, plans to launch operations from its base at San Francisco International Airport to JFK airport in New York by mid-summer, pending safety permits for its fleet of A319 and A320 aircraft.
Within the first year of operation, Virgin intends to expand its flight network to 10 additional US cities, including San Diego, Washington and Las Vegas, which will bring it into direct competition with the likes of Jet Blue and Southwest budget airlines.
A BBC report said the Virgin Group was granted the approval of US aviation authorities after making a number of changes, to comply with US regulations that limits foreign control of airlines to 25 per cent shares amid anti-competition concerns.
Mr Branson will also be required to find a new boss for Virgin America, after appointing Fred Reid as the airline's chief executive, owing to Mr Reid's former senior positions at Delta Airlines and American Airlines as US regulators fear that this could lead to possible overseas influence.
"I applaud the DoT for approving our application and fulfilling their long-standing commitment to competition and new choices for travellers," Mr Reid said.
To win flight approval, the airline has also agreed to cut its financial links to the Virgin Group and amend its trademark licence to ensure the carrier operates independently from its British parent, Virgin Atlantic, the report added.
|
RELATED