It was on the front page of today’s San Francisco Chronicle Business section: Virgin America’s first year off the ground has landed them in the red!
Based out of San Francisco International Airport (SFO), Virgin America reported an operating loss of $35 million after its first quarter in business.
The operating revenue for the new carrier was $16.16 million with the operating expenses hitting $51.16 million in the period that ended Sept. 30, reported the Department of Transportation. However, it is important to note that these numbers are a result of only 53 days of revenue but 92 days of operating expenses.
Moreover, start-up expenses can be extreme and may need a good deal of time to surpass. An airline will pay around $100,000 to train a pilot and over $10,000 to train a flight attendant.
Henry Harteveldt, an airline analyst for Forrester Research in San Francisco, had this to say: “It’s going to be awhile for Virgin America to be profitable, but Dave [Cush, CEO] has the capability to shorten the time.”
Virgin America is the only airline based in California and is privately held. At this time, they employ over 800 people, fly 12 aircrafts, and have orders in for 31 more. Service is provided to San Francisco, Los Angeles, New York, Washington, D.C., and Las Vegas. Service begins to San Diego from SFO on Feb. 12 and to Seattle from SFO and Los Angeles on March 18 of this coming year. The company would like to serve 30 cities in five years.