This month, Virgin Atlantic Airways began rolling out hydrogen-powered cars for its Upper Class passenger limousine service in Los Angeles and New York and unveiled a $2.6 billion order for Rolls-Royce Trent 1000 engines to power 15 Boeing 787-9 aircraft it ordered last year (BTNonline, March 3). Afterward, COO Lyell Strambi spoke with BTN editor-in-chief David Meyer.Business Travel News: One year ago, you said you would reduce costs as well as emissions. What were you able to accomplish?
Lyell Strambi: I'm really proud to report that in the last year, depending on aircraft type, we've taken between one-half and one ton of weight off every plane that we fly. The program, called Weight Watchers, focused on things like galleys. It's great for business in that it helps our profitability. At the same time, our business is lifting things from one place to another, be it people or cargo.
BTN: What kind of savings in fuel does that give you?
Strambi: Quite considerable. Under other initiatives we targeted last year, a 1 percent fuel-burn savings. That doesn't sound like a lot, but it is a lot in our business. There are also initiatives like engine washing. Compressors in the engines get filled up with soft deposits that reduce the efficiency of the engines. There are now compressor-washing techniques that restore that efficiency. There are savings in the operational policies too, such as the amount of reserve fuel that airlines carry. If you can be more accurate about what you need, then you realize a benefit by not carrying around unnecessary added weight.
BTN: You also conducted starting grid tests.
Strambi: It's not a technology that we can roll out now, but this is where aircraft can be towed much of the distance to the runway. For this to work, you would have to redevelop the airport holding bays and make other changes. We tried it and showed that the emissions reductions could be enormous.
BTN: You also talked about continuous descent.
Strambi: It's a technique we've been trying to use for some time. It's about trying to get the profile as you descend for a landing as smooth as possible. We've been more interested in the way the airspace is controlled. Particularly here in New York, there are historic patterns. We need to go back and look at the most efficient use of that airspace.
BTN: You said today that Phase One of Open Skies does not go far enough in addressing U.S. protectionism. What does Phase One let you do that you couldn't before?
Strambi: It allows us to provide service from points in the European Union to points in the United States.
BTN: Yet, you are not ready to take advantage of that because you are waiting for the Boeing delivery?
Strambi: You have to have the right timing to go into these things. You have to have the right commercial relationships, the right aircraft and a regulatory environment that is stable, and that's one that is worrying us. I am not going to launch a new airline that I might have to dismantle in a couple of years' time because of a political stroke of a pen. That's not good business.
BTN: What is your outlook for corporate and general demand?
Strambi: It's very hard to call at this point. We saw some softness in the marketplace post-Christmas, but it's very difficult to judge. Our corporate business is doing incredibly well, but I'm not sure that is representative of what is going on in the market. Because of our efforts to modernize, we have gotten more than our travel share versus capacity share.
BTN: To what do you attribute that growth?
Strambi: Making it easy for our customers, approaching the market on a global basis with global selling techniques, cutting global deals right into local area deals, and the innovations at Heathrow, which have been enormously successful, beyond our wildest dreams, actually. Our Heathrow Club House lounge has become a game changer and people are actually changing their schedules to that they can use it. With the new dedicated security lanes, more people are looking at our business class product.
BTN: Have you been hearing new questions from buyers these days?
Strambi: Yes. There is much more interest in what we are doing about the environment. We're seeing it becoming much more a part of the request-for-proposals process now. We have a very modern fleet, so we are very well-positioned. We're trying to play on a bigger global scale of influence in the industry, and that's what we have been doing the past year and a half.
BTN: You were saying that the average age of the fleet is five years.
Strambi: Yeah, actually under five years. It will age a year or two as we wait for delivery of the delayed Boeing Dreamliner, and then it will reduce again.
BTN: To date, no company has yet made a contractual decision on the basis of an airline's environmental efforts, right?
Strambi: We see it as a tiebreaker, if everything else is equal, which it wouldn't have been before. The challenge for us is to say, we have a great fleet, we're doing the right things today, so how do we get credit for doing the right things for the industry? It's very hard to do that. Sometimes you do things because they are the right things to do.