Rewind to Aug 8, 2007: Virgin America's two maiden flights - one arriving from New York, the other from Los Angeles - land simultaneously on adjoining runways at San Francisco International Airport before a crowd of Bay Area dignitaries, a scrum of journalists and a squadron of teenage cheerleaders in scarlet uniforms.
"Virgin! Virgin!" they cheer as passengers file into the terminal. "Branson! Branson!" they shout as Virgin America's high-profile minority-owner - the shaggy-haired British billionaire Richard Branson - gives a two-handed wave. Branson grins broadly, surveying the crowd at SFO, which the startup, low-cost carrier has chosen as its hub airport.
Fast-forward to Aug. 8, 2012: Virgin America marks five years of flying.
Award-winning, money-losing Virgin America is a hit with travelers, especially the high-flying Silicon Valley executives and multitasking digital media addicts courted by the Burlingame carrier. With 2,600 employees, about half of them in the Bay Area, Virgin America operates 93 flights a day on 52 aircraft (average age: a young 3.3 years) to 15 cities around the country and three destinations in Mexico. Last year, the airline flew 5 million passengers; it expects to board 6.6 million this year.
Branson's London company Virgin Group Ltd. owns 49 percent of the stock and has a 25 percent voting stake, the maximum allowed for foreign nationals under U.S. law. American investors own 51 percent of Virgin America, which licenses the Virgin brand.
"I've always had the dream of helping create a really good, quality airline in the U.S.," Branson said in an e-mail. "America has the best of everything, but for whatever reasons the airline industry there has forgotten entirely about the guest. Virgin America launched with the guest in mind. No matter where I go in the world, people tell me they love Virgin America. That is pretty amazing to hear when you are in, say, Malaysia."
Wow factor
Indeed, the carrier has a wow factor. Boarding a Virgin America flight, bathed in 12 alternating shades of mood lighting and awash in globalized dance/trance music, is not unlike rolling into a late-night club, cocktail in hand. Unlike low-cost carriers that fly with single-class seats and service, Virgin America offers first class, premium economy and economy.
Virgin America's stylish aircraft interior design, avid embrace of in-flight technology and young, energetic staff account for much of its popularity. So do its fares.
Tom Parsons, chief executive officer of BestFares.com, said Virgin America often offers the most attractive fares in the country, especially on transcontinental flights. "They are probably the most consistent airline out there giving deals day-in, day-out."
For all the buzz, though, there is one thing Virgin America hasn't done: Make money.
Losses over 5 years
Buffeted by the recession, high fuel costs and the expense of expanding its route network, it has recorded but one profitable quarter since the airline went wheels-up. In the first quarter of this year the company reported a loss of $49 million on revenue of $267 million. Since 2007, Virgin America has recorded a net loss of $671.3 million and an operating loss of $447.3 million.
If Virgin America can bring its financials in line with its high marks for style and service, it will have a much smoother flight path.
"Virgin pays attention to design, product and service details," said Henry Harteveldt, a San Francisco analyst for Atmosphere Research Group. "Virgin is the most experiential of U.S. airlines."
Long before it sold its first ticket, Virgin America made an impact at SFO.
In May 2007, three months before Virgin America's first flights, JetBlue Airways flew to SFO for the first time. JetBlue's founder and then-CEO, David Neeleman, told The Chronicle that Virgin America's imminent arrival was one reason JetBlue entered a market it had previously ignored. "It's going to be a party," he said.