Virgin Atlantic withdraws domestic flights

<p>Virgin Atlantic has scrapped its Little Red service after just 18 months in operation.</p>

Virgin Atlantic has announced it will be phasing out its domestic flights despite only launching 18 months ago.

The company's Little Red carrier ran services between London Heathrow and Edinburgh, Aberdeen and Manchester but has struggled to fill seats in recent months. Virgin Atlantic, owned by entrepreneur Sir Richard Branson, has now confirmed that the Little Red daily services to Manchester will be withdrawn in March with the Scottish services ending in September.

Virgin Atlantic launched Little Red in 2013 to provide competition to British Airways after it had taken over bmi. Following the acquisition European competition authorities forced BA to give up its domestic flying slots at Heathrow. Little Red was aimed at being the main competition to BA but has failed to live up to those expectation.

The airline had hoped to attract more passengers travelling to connecting flights on Virgin Atlantic's more profitable long-haul routes. However, it found that the demand had come mainly from point-to-point customers and at time planes were flying at only half capacity. Sir Richard explained that while the venture did help consumers but conceded "the odds were stacked against us".

Craig Kreeger, Virgin Atlantic's chief executive, added: “Little Red came about through an enduring passion at Virgin Atlantic to make a difference for our customers. We really wanted it to be a success and everyone involved worked extremely hard and has given it their best efforts."

Virgin Atlantic has been changing its approach in recent months with the company moving away from destinations such as Mumbai, Cape Town and Tokyo to focus on its transatlantic routes. It is also planning a £300 million investment programme to upgrade both its planes and passenger lounges while also introducing the Boeing 787 Dreamliner to its fleet.

Despite the withdrawal of the Little Red service, Virgin's share price on the FTSE 100 closed 0.50 per cent up at 235.70p on Monday (October 6th).

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