Flying for Fun

James

sokolov

Here is the court decision:
https://www.bailii.org/ew/cases/EWHC/Comm/2023/322.html

Alaska Airlines shall pay ~$8 Mio per year, adjusted for inflation. Retroactively from 2019 probably until 2040, if I calculated that correctly.

navydevildoc

Wow. Whatever external counsel was the M&A crew that did this deal may be liable for a chunk of this. That would all be handled behind the scenes though, so who knows where it ends up.

sfozrhfco

Not necessarily. AS's management team could have been told and they simply chose to ignore it and assume that once they repainted the planes they could stop paying the fee. As everybody knows by now there were many things about the takeover of VX which the AS management team did not think through clearly

sokolov

On the flipside, Alaska still has the right to use the Virgin brand. :-)

navydevildoc

I just want the little plane salt shakers back.

mfolf

Question is would they actually use it or just spend the dues?

sokolov

I don't expect them to use it, but maybe they could make a few bucks selling branded merchandise.

Tack

Outside of the VX SFO lease hold, VX employees, blocking B6 growth and ultimately forcing them to mortgage their future in a poorly thought out acquisition, VX provided nothing else of value. Certainly not the Virgin name. More Virgin businesses have vanished than currently exist. If there was an airline that was clamoring to use that name, SRB wouldn't be suing to keep AS paying on it. AS might've screwed up on the royalties, lord knows I've never been impressed with Ben and his flock, but having been there when the purchase was made? They wanted nothing to do with the Virgin brand, regardless of what they said publicly.

notquiteaff

True, but quite frankly I don’t know why any airline would want to spend money for a name when you can just make one up for free (Breeze, Avelo), unless there is some sort of integration with other branded airlines, as the franchisee of BA in South Africa had. I don’t think that enough passengers care about what is written on the plane to justify the extra cost.

sfozrhfco

Of those things, the VX SFO lease became a lot less valuable as soon as T1 reopened. T1 has a ton of empty gates and AS hasn't even made great use of the gates they got. Blocking B6 growth was again temporary--and ended up occurring largely during a pandemic when nobody else was growing either. Once the NK merger goes through, B6 will be larger than AS at LAX and has plenty of room to grow in the Bay Area. They gained some staff but a lot of people left again during the pandemic so it is not as if in the end AS is far ahead of other carriers on that front either. In hindsight, the acquisition continues to impede AS's growth, forced them to make otherwise unnecessary cost cuts, and left them with no strategy outside of protecting Seattle for years now. With rising inflation, they will be paying $10,000,000+/year for a useless name. As I said from the start, it was very poorly thought out by AS management. Worked out great for VX shareholders though.

Tack

Made a nice profit in 2022. Um... Scoreboard. (Agree 100% with the word "poorly" relating to Ben and cronies tho..)

PotomacApproach

The DoJ could stop it, and if they don't there will be major concessions. NK also doesn't fly to SFO and B6 is mostly BOS/FLL/JFK transcons along with some LAX flights from there. I'd say there would be an impact at OAK except AS has already taken that airport down significantly.