30 November 2022, Virtual
12 December 2022, etc.venues Monument, London
Business Travel Show Europe, presented by The BTN
BBT editor Paul Revel talks to Virgin Atlantic’s chief executive officer Craig Kreeger about his plans for the airline
I catch up with Virgin Atlantic’s CEO, Craig Kreeger, in the plush surroundings of 8 Northumberland Avenue in London’s West End, just before the Virgin Atlantic Agency Awards kicks off. The evening that follows our meeting is a typically lively affair. Celebrating Virgin’s new Little Red routes from London to Edinburgh, Aberdeen and Manchester, the gala dinner features a rip-roaring performance by rock’n’roll bagpipers the Red Hot Chilli Pipers.
It also sees the airline’s UK sales director Scott Davies (see below) marking the new domestic routes by taking to the stage in Liam Gallagher Oasis garb – with accompanying soundtrack – and then in full tartan-kilted glory, complete with ‘see you, Jimmy’ hat-and-wig combo. The chief is, by contrast, more soberly dressed – his subtle nod to the Little Red dress code is a scarlet pair of socks.
EVENTFUL BEGINNINGSKreeger took up the role of CEO in February this year, and it’s been an eventful start: top of the agenda in our conversation is Virgin’s joint venture with Delta Air Lines on transatlantic flights – shortly after I speak to Craig, the US Department of Transportation gives its formal approval to the deal and a ‘harmonised schedule’ effective from March 2014 is announced: nine daily flights between Heathrow and New York (seven to JFK, two to Newark). I ask Kreeger how the deal will affect travel buyers.
“We began in July offering code-share across both of our networks, with frequent flyer earn-and-burn, and reciprocal lounge access,” says Kreeger. “But what will drive more value for travel buyers is co-ordinating selling – working together with Delta to offer a competitive alternative in this marketplace.”
This, of course, means taking on his former employer – American Airlines’ joint business with British Airways is the dominant player on the key transatlantic routes. “I absolutely feel confident this venture will benefit travel buyers – it has to, for this to work,” he says. “We need it to be positive for customers.”
Virgin has long resisted the attractions of the big three airline alliances. Does the joint venture mean the airline will now join Delta’s alliance, Skyteam? Kreeger says this is not a simple decision for his airline – nor, at the moment, a priority. “We have very good partners that drive value around the world that are not Skyteam members,” he says. “We’ll have to weigh up the values of our current partners and a partnership with Skyteam.”
In the meantime, however, he says the next few months will see the airline “laser-focused” on making a successful relationship with Delta work, rather than on the issue of whether or not to join the alliance.
SERIOUS BUSINESSUniversity of California graduate Kreeger joined American Airlines in 1985, and has been in the aviation industry ever since. “In my experience, half the people who joined airlines had this love of travel or aviation – I wasn’t one of those people,” he says. “I was at business school in UCLA. I’d never thought of working for an airline before, but saw this job description and it sounded interesting: financial analyst in an industry that had just gone through deregulation, so there was all this change happening.
“This wasn’t a brilliant career path decision – I just thought, that sounds like a cool job. So I did the prep work, and five minutes into that interview, I was in love – and that has never left.”
SATISFIED CUSTOMERSo after what sounds like 27 good years with American – he rose through the ranks to senior vice-president roles – he took up the top job at Virgin Atlantic. Kreeger says his first experience with the brand was as a customer – while working for the competition at the time – and this was to have an impact on his decision when the post was offered.
“I was based here in the UK, and needed to get to China, and the best way was to buy an Upper Class ticket on Virgin. I was very struck by the experience, and it left an impression on me. From the moment I walked into T3 and saw the bright red and purple, the classy check-in area... Then at the Clubhouse, I’m greeted with a big smile, and when I give my flight number, she says: ‘Mr Kreeger, we’ve been expecting you. Have you been here before? Can we show you around?’ I don’t think she actually put her arm around me, but I really felt welcomed into this wonderland of cool and hipness.”
PERFECT BLEND“It was a great experience, and of course it continued on the aeroplane, in the cabin and bar – the whole thing. The impression I got was a blend of the service, features, style and personality of the people and the company – that creates magic.”
Talking of that magic; Virgin’s various pioneering products, from the Clubhouse to the Upper Class onboard bar, have always been launched with maximum wow-factor, but they’ve been around several years now. Isn’t it time for something new? “We are launching the B787 in September next year, and it will have some new features onboard,” he says – but in general, headline-grabbing new products don’t seem to be on Virgin’s agenda at the moment. However, Kreeger disagrees with me that rival airlines are catching up, product-wise.
“I don’t think other airlines match the combination – the style and personality of the people combined with the product features,” he says. As for the strategy, “it’s to become more fuel efficient, to create more connectivity within our network and continue to capitalise on the unique Virgin brand, and grow our customer base through our partnership with Delta and others”. He adds: “Increasing connectivity is also why Little Red is an important part of our strategy.”
Virgin launched Little Red in March this year, after it secured the rights to Heathrow slots released by the purchase of Bmi by British Airways parent company IAG. Virgin won’t reveal load factors, but a rough calculation using Little Red’s passenger numbers for the first six months of operation – around 250,000 – and its capacities on the routes, show significantly low average load factors over that period – under 50 per cent.
Kreeger doesn’t discuss figures, but says Little Red is “on plan – it does need to grow, but we expect it to”. He emphasises its key role in feeding the long-haul network – he says 27 per cent of passengers are “connecting traffic” and he expects this percentage to increase. “One of the reasons why we remain confident we can make this work – when it wasn’t so easy for Bmi – is because we will measure success or failure by the combined incremental revenue on our network,” he says.
Before we head into the ballroom for the celebrations, Kreeger reflects on what, for him, is his dream assignment. Earlier this year, when he sent a note to colleagues announcing his new position at Virgin, “three different people replied, saying: ‘You have the coolest job in the industry’,” he says. “That summarises my feelings perfectly.”
CVCraig Kreeger was appointed chief executive officer of Virgin Atlantic on February 1, 2013. The airline has a fleet of 40 long-haul aircraft, flying six million passengers a year.
Kreeger joined American Airlines in 1985 as an analyst, and has held commercial, financial and strategic roles in the US and around the world. He spent six years in London as senior international vice-president, and was responsible for AA operations and sales throughout Europe, the Middle East, Africa and the Pacific. He was appointed senior vice-president for customers in 2012.
He worked on AA joint ventures with British Airways and Iberia across the Atlantic, as well as its partnership with Japan Airlines in the Pacific.
Kreeger holds a BA degree in economics from the University of California at San Diego, and a MBA degree from the University of California at Los Angeles.