Layoffs coming soon
 

http://www.bizjournals.com/sanfranci...html?ana=yahoo

Looks like Alaska's dedication to the Bay Area starts with laying off 225 Virgin America staff members as soon as the deal closes...

While entirely unsurprising, this certainly does put an *ahem* interesting spin on that video the PR people put together.

Looks like the article specifically says management jobs, which is not surprising at all with the takeover of one company by another.

Many have already abandoned ship or have been actively looking to get out. Just a bit ironic as mentioned that AS just released a video saying how committed they are to the Bay Area and immediately announce that they are eliminating the jobs of those that created and kept the company running.

Sorry to burst the bubble of fans, but the informed crowd knows how big a fiscal flop Virgin America was.

Prior to the acquisition the stock hovered at half it's present value, and the airline lost money far more quarters than it didn't.

I'm sure there's a lot of redundancy in the merger, and thus a lot of Burlingame will be let go.

I'm not sure how smooth the transition will be, but we've hit a total race to the bottom in airlines- so I'm curious if they even care. We've lost 5 airlines now in the last 10 years to Mergers and Consolidation.

Yeah, but a lot of that was down to incredibly bad timing on the launch. Remember, the stock price doubled not because of a change in the inherent value of either company but because the VX folks put the company up and B6 and AS got into a brutal bidding war and really bid more than VX was worth.

How many airlines are profitable when they launch? Your point -- unprofitable more quarters than not -- isn't quite valid when the airline's been around less than 10 years and it takes an enormous amount of time to get an airline into profitability.

It has nothing to do with "bursting the bubble of fans" and everything to do with someone who likely knows little about VX attempting to inform others about what he incorrectly perceives as fact.


Also, nearly all US airlines have share valuation far below VX/AS' $55-57. LUV and AAL are 36. DAL is 37. JBLU is under 16. The fact that VX was trading at less than half its present value is entirely irrelevant. Please redirect your post to some forum for arrogant and ill-informed stock brokers. It's not relevant in the present forum, either in substance or in tone.

Only one in the last 20 years, and the only modern Airline that will remain in business. JetBlue. Even they went through some stuff bouts from 2005 on, but they turned profit more than twice as many quarters as VX did it's first 10 years.

... an airline that also wasn't deeply, deeply subsidized by cash infusions from angel investors and Richard Branson.

VX has undersold it's product since day 1- and did so without making enough money to keep itself afloat. Read historical posts on here about VX- it's always been a question of how long will it be until they run out of investor cash, another infusion, then another countdown.

The fact that VX stock was trading at half value is incredibly relevant. If the merger is canceled tomorrow you can bet your ... the stock would plummet.

How is that not relevant to the fact this airline's biggest success story is getting out of the game?

I agree with your other points (re ramp-up time), but the price of a single share (and the fact that VX/AS's single share is priced higher than DAL's) is totally arbitrary and irrelevant. DAL has far more shares, and thus a much higher total valuation; it could choose to merge shares so that its shares are more expensive than VX/AS if its shareholders wanted to for some reason. A 50% drop in a company's value is a 50% drop -- it would have been the same 50% drop if VX had split its shares 2:1 and they were going for $28. And hard to dismiss that as entirely irrelevant even granting that the company was not fully mature.

(OT, but this is also the reason why the Dow Jones is a stupid index--a 1% drop in the value of GOOG will make the Dow go down ~$7.70, because the company doesn't split its stock as much as others, so it's very expensive per share; whereas if GOOG issued far more shares -- say, enough to price the stock at $1/share -- then a 50% drop in the company's value would only make the Dow go down 50 cents.)