Virgin America expands link with China Airlines

Updated: 2014-10-24 07:49

By JACK FREIFELDER in New York(China Daily USA)

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A codeshare agreement announced on Thursday between Virgin America Inc and China Airlines will expand the two carriers' existing relationship but only yield an incremental increase in business, according to anaviationanalyst.

Michael Boyd, president of Boyd Group International, an aviation consulting firm located in Evergreen, Colorado, told China Daily that the deal with China Airlines is mostly a marketing association because "Virgin America doesn't go across the Pacific Ocean."

"There's a limited amount of traffic that China Airlines can feed into San Franciscoor Los Angeles and get additional traffic, so it's all incremental for both carriers," Boyd said. "Keep in mind, it's not coming fromBeijing, it's coming from Taipei, so it's a net new kind of traffic and it doesn't poach anybody."

"This is not something that's going to open up a floodgate of passengers or revenue for either carrier," he told China Daily Thursday. "It's positive, but it's not a sea change."

The deal calls for the Taiwan-based carrier to place its airline code on a range of Virgin America flights, including trips originating in Boston, Chicago, New York and San Francisco, among others.

That will allow Chinese and other Asian visitors traveling to the United States to book subsequent trips with Virgin America via China Airline's website.

Booking services went live on Thursday when the companies announced the agreement in a press release.

Adam Green, Virgin America's director of Network Planning, said Taiwan and the Greater China Region have become "increasingly important" tourism markets, and the expansion of his company's partnership with China Airlines could create new potential business opportunities for both parties.

"Our interline agreement had been in place with China Airlines since May 2012, and this was the natural next step," Green wrote in an Oct 23 email to China Daily. "The codeshare agreement does present greater and more direct revenue opportunities for our business, but more importantly it allows the two airlines to align their travel policies for a truly seamless experience.

"Given the increasing importance of Asia as a trade and tourism market, it will certainly remain central to our international strategy," Green wrote.

Jeffrey Kuo, a spokesman for China Airlines, said in a statement: "China Airlines began flying to California in the 1970s and we are thrilled to expand our reach. Starting October 26, our guests will have even more travel options from Taipei to 11 destinations in the United States."

The codeshare deal expandson the two airline's existing interline pact, which began in May 2012. Interline agreements streamline the travel process for passengers on trips that include multiple airlines.

China Airlines is Virgin America's fourth codeshare agreement and its first with a carrier from Taiwan.

Virgin America, founded in 2007, is a California-based airline company located outside San Francisco. The firm offers flights to 21 destinations inNorth America, including three cities in Mexico.

Trips with the US airline are known most for the in-flight amenities, which include WiFi on every plane and touch-screen personal entertainment systems.

China Airlines, Taiwan's largest airline with a fleet of 88 aircraft and more than 11,000 employees worldwide, was founded in 1959 and maintains its headquarters in Taipei.

The airline offers daily direct flights from Taipei's Taoyuan International Airport to San Francisco and Los Angeles, as well as three flights per week to New York.

China accounted for almost 1.81 million visitors to the US in 2013, according to the US Commerce department's Office of Travel and Tourism Industries. A 23 percent increase in Chinese visitor volume was the largest percentage change among the top 10 international visitation markets.

Boyd, the aviation analyst, said his firm is working with a number of airports to help them become ``China ready''.

"There are different things Chinese visitors like," he said. "They like to travel in large groups so you want to have a Mandarin translator, you want to have Chinese signage, etc, and that's preparing for a future."

"There were 1.8 million Chinese visitors to the US last year, that's a huge market," he said. "It's going to grow … and you want to be in on that. Virgin America might not get three or four passengers today, but they might get 10 next year. And it will be airports and communities that are 'China ready' that will get these groups."