Detailed Analysis of Virgin Atlantic Cargo Operations and Management

This report provides a comprehensive analysis of Virgin Atlantic Cargo, examining its history, managerial aspects, corporate philosophy, organizational structure, mission statement, resources, and operational strategies. It details the types of cargo handled, the markets served, and the company's business relationships, including partnerships and future plans. The report also covers the fleet composition, key facilities, and the main airports served by Virgin Atlantic Cargo. It highlights the company's operational philosophies and addresses potential limitations or problems. Appendices include details on perishable cargo handling, labeling, pet handling, regulations, and aircraft considerations. The analysis offers insights into the company's strengths, challenges, and strategic positioning within the air cargo industry.

Running Head: VIRGIN ATLANTIC CARGO
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MANAGEMENT OF AIR CARGO – VIRGIN
ATLANTIC CARGO

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Contents
VIRGIN ATLANTIC AIRWAYS HISTORY AND BACKGROUND....................................3
Managerial Aspects....................................................................................................................3
Corporate philosophy/culture.....................................................................................................4
Organizational chart..................................................................................................................5
Mission Statement......................................................................................................................6
Resources...................................................................................................................................6
Employees..................................................................................................................................6
Equipment and key facilities......................................................................................................7
Main airport that are served.......................................................................................................8
Type and number of aircraft.......................................................................................................9
Operation..................................................................................................................................11
Operational Philosophies.........................................................................................................11
Market served...........................................................................................................................12
Type of Cargo..........................................................................................................................12
General Cargo..........................................................................................................................12
Problem/Limitation..................................................................................................................12
Business relationship................................................................................................................13
Partners, Pacts, Alliances.........................................................................................................13
Code sharing and Joint Venture...............................................................................................14
Future Plans..............................................................................................................................15
Summary..................................................................................................................................16
REFERENCES.......................................................................................................................17
Appendix..................................................................................................................................22
Appendix C (Perishable Cargo)...............................................................................................25
Labelling..................................................................................................................................25
Pet Handling.............................................................................................................................26
Regulations...............................................................................................................................26
Aircraft consideration...............................................................................................................26

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VIRGIN ATLANTIC AIRWAYS HISTORY AND BACKGROUND
Virgin Atlantic Airways founded in the year 1984. After this, it has become second
biggest carrier serving of Britain by expanding its branches in major cities of the World. In
order to become the second largest carrier, it has brought various changes in its services. It
also operates long haul services around thirty destinations apart from Shanghai and Las
Vegas from the main hub at Heathrow airports and London Gatwick (Virgin, 2007).The fleet
of Virgin consists of the cargo aircraft as well as passenger that includes four airbus A340-
300s, 13 Boeing B747-400s, two Airbus A330-300s,19 Airbus A340-600s. The founder of
Virgin Atlantic Airways named Richard Branson started this airway when his flight cancelled
for Puerto Rico to the islands of British Virgin. Therefore, Richard promoted his first flight
on one of the terminal blackboard and named it as “Virgin Airways.” After this, Richard has
sold its record of around $1 billion in order to start the Virgin Atlantic Airways. However, it
started these airways with the second hand Boeing 747 (Greene, 2010). During the period, it
came up with the idea of starting an airline for every passenger who wants to move abroad,
and this led to the success of Virgin Atlantic airways.
In the starting phase, the cargo handling operation for this airway tends to be managed
by the air contact. Furthermore, it has been analysed that the Virgin Cargo has significant
potential in generating the revenue from cargo operation, as it created the Virgin Atlantic
Cargo. Therefore, their operation was managed through the Virgin Atlantic Cargo with all of
its services and operations located at the four core airports of United Kingdom. The Company
has also started the long haul cargo freight services form three major hub including: the
London Heathrow ( to Boston, Accra, Delhi, Dubai, Cape Town, Lagos, Johannesburg, Hong
Kong, Miami, Los Angeles, New York, Mumbai, Nairobi, Shanghai, San Francisco, Sydney,
Vancouver, Tokyo), Manchester (to lag Vegas, Barbados, and Orlando). It also operates in
London Gatwick (to Cancun, Barbados, Antigua, Havana, Bay, St, Lucia, Orlando, and
Tobago). Besides this, The Virgin Atlantic Cargo has started providing the cargo services to
the other airlines like Virgin Australia.
Managerial Aspects
The vision of Virgin Atlantic cargo is to provide effective and valuable services, and
fulfil the needs and expectations of their customers in present and future years. This is

VIRGIN ATLANTIC CARGO 3
considered as one of the major strengths of the company, as now it operates on the global
level in around 350 on going destinations. John Lloyd, the “senior vice president” of Cargo
directs their operations and other major activities. In the last few years, significant
fluctuations or changes were observed in the market of air cargo meanwhile, Virgin cargo
remained resilient. Lloyd believed in optimizing the contribution of Cargo, which is made to
the airline for getting best possible margin from their operations. In this way, from the recent
two years has proved their best for the Virgin Cargo in the period of five years. In the year
2013, it has achieved the revenue at GBP£225.3 million. Further, in the year 2014, its
tonnage was on the par as compared to the record of 2013 despite of the reduction in
capacity. Due to this, the company achieved an increment in their market share and acquired
the load factor of 74 per cent. This potential has helped the company in ensuring their growth
and development regardless of their despite of the reduced growth in the market within
freight industry globally (Kreeger, 2014).
Corporate philosophy/culture
The virgin Atlantic Cargo tends to provide the kid gloves treatment in freight for
ensuring the effective cargo operation to help their customers. Therefore, the customer centric
theory has proved to be successful for the cargo and made it the reputed and biggest air cargo
operation internationally. It does not believe in making fake promises to the customer on
cargo, which differentiates them from the other companies in the industry (KK Frieght). It
satisfies their customers by ensuring positive corporate practices and healthy work culture.
This characteristic led to the high rate for the company, as best cargo airline in the world and
winning the best “Caro Airline of the year” since the year 2002.
Organizational chart

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Mission Statement
The mission statement of the Virgin Atlantic airways states the aim to enhance spirit of the
humans and let them fly. Therefore, it believes in placing its customers and people first
before any corporate need. Besides this, mission statement of Cargo features the idealistic
phrases and lines that mostly end up by getting negative response from the staff instead of
confidence and motivation. Therefore, an overall mission that compares the corporate culture
of the organization rings of the insincerity to the staff, customer’s negative results, affecting
the image of company rather than ensuring benefit. The mission statement of the Cargo
features the idealistic phrases and lines that mostly end up by getting negative response form
the staff instead of confidence and motivation. Therefore, it believes putting their customers,
and their needs before any aspect within corporation. In this way, Virgin Atlantic Cargo
proved to be effectiveness in their mission statement through completing the goal of
providing the best quality services to all it customers and let them fly. Therefore, an overly
mission that stands in the contrast of corporate culture of the organization rings of the
insincerity to the staff, customers results in providing the more damage to the image of
company rather than benefit. In this way, Virgin Atlantic Cargo proved to be effective in its
mission statement by providing the best quality services to all it customers
Resources
John Lloyd the senior Vice president of Virgin Atlantic Cargo has joined it in the year 1987.
It worked in the cargo industry for around 30 years. At the starting, it has joined the Virgin
cargo as the operational officer based in Gatwick. Afterwards, it then shifted to the hierarchy
of the company from management and supervisory position to the general manager before
promoting to the current position of Cargo director.
Employees
In Virgin Atlantic Cargo, it has around 9000 employees across its group. It has appointed
three regional vice president: James Williams who oversees the America, Nike Jones the in-
charge of Middle East, Europe, and Africa, and Dominic Jones who is responsible for Asia
Pacific region. Therefore, Lloyd believed that Virgin Atlantic Cargo would not come on the
position of largest Cargo Carrier. Hence, instead encouraging passion for the better customer
service will established within the organization, and it practices to become the top rated cargo
carrying company (Royal, 2010).

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Equipment and key facilities
The figure given below shows the number of containers as well as their size that it allows for
the carriage on the partner airline and aircraft, VirginAustralia. However, the Virgin Cargo
does not hold the high amount of stock for selling, but the customers are allowed to make
special request with this cargo to lease the containers right from the cargo. They can also
source from the third party suppliers, and apart from this Virgin Atlantic has the approval of
FAA to carry the environtainer e1, CSafe RKN, and T2 RKN/RAP temperature controlled
containers. It also ensures providing the access to the temperature controlled storage facilities
for the store temperature sensitive cargo.

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Main airport that are served
It has been found that US is always the essential and primary market of the Virgin Atlantic
Cargo. It therefore competes well on the routes with reliability and high quality services. It
does not deluge the market in terms of capacity and have the good expanding of the medium
and high demanding routes. The latest route of Virgin Atlantic Cargo has currently started
positively with the encouraging load factors. Besides this, it has also started their tenth of the
US route to the Detroit in June. In addition, it provided the long haul freight facilities
internationally divided across three main regions named Middle East, Europe, Asia pacific
region, and Africa besides the US. The cargo operations are found across 32 destinations with
its major destinations includes Lagos (Nigeria), St Lucia San Francisco (US) and
Johannesburg (South Africa). Appendix A includes the whole network map of the Virgin
Cargo.
The core airports that served: for EMEA

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Route A : Johannesburg to London Heathrow
Route B: London Heathrow to Lagos
For US
Route C: Boston to the London Heathrow
Route D: Miami to London Heathrow
For the Asia Pacific region
Route E: Shanghai to London Heathrow
Route F: Delhi to the London Heathrow
Virgin Atlantic Cargo network has increased their business line to more than 350
destinations all over the world through the trucking partners and global interline. The Air
Cargo also needs both short term as well as long-term forecasts. Short-term forecast is needed
to drive the budgets, as compared to the long-term budget in order to provide validation for
all the decisions related to investment in aircraft as well as other facilities. Besides this, Virgo
Atlantic Cargo has recently expanded the delivery network over 50 airports across thee
Europe with the Jan De Rijk in the April 2015. This recent agreement allowed the airline for
operates with wide variety of destinations to their freight customers into UK from the
Caribbean, North America, Middle East, Asia Pacific, and Africa. Due to this agreement, it is
able to offer destinations across the Scandinavia, and continent as the majority of Cargo come
at London on board Virgin flights for making the connection in Europe. Besides the huge
competition in cargo business, the virgin Atlantic Cargo put emphasis on the well-established
routes in terms of high quality carrier where the good cargo potential is presents along with
providing positive opportunities to customers. In comparison to this, Virgin Cargo has also
pulled around 15 years services in Mumbai this January due to the stagnant revenue
forecasting. In this way, Virgin Atlantic Cargo has found the significance on building
positive and healthy relationship with their customers. It also prefers to promote and
maximize the revenue and growth by making the most from using their expensive aircraft
assets.

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Type and number of aircraft
Virgin Atlantic Cargo use the five types of aircraft, Boeing 747-400, Boeing 787-9,
Boeing 777-300, Airbus A330-300, and Airbus A340-600 with total fleet of around 43
aircrafts and 16 more on order. Table give below also provides the overview of total number
of various types of the aircraft named Virgin Atlantic Cargo, its history as well as the one
who will join their fleet in the near future (Morrell, 2011).
Fleet type Description/ History Nu
mber in
fleet
In-
service
On
Order
Boeing
787-9
In October month of 2014,
the advanced 787s aircraft has
combined the Virgin fleet that
indicates the huge leap in order to
improve the carbon footprint of
Virgin Atlantic Cargo’s in
particular. (Virgin Atlantic Cargo)
5 5 16
Airbus
A340-600
The A340-600 entered into
service with Virgin Atlantic Cargo
as they launch customer in the July
month of 2002. This series is
around 75.3 meters by the
lengthiest civil aircraft that is
produced. (Virgin Atlantic Cargo)
11 11 -
Airbus
A330-300
The A330-300 joined the
Virgin Atlantic Cargo fleet in the
April month of 2011. This aircraft
is the major member of the twin
engine A330 family. It has the
wingspan of 60.3 meters, with the
overall length of 63.69 meters.
(Virgin Atlantic Cargo)
10 10 -
Boeing
747-400
The B747-400 aircraft
consumes around 13% less fuel as
12 12 -

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compare to the previous version
and engine noise is also half than
that of the original 747's in the
1970's. (Virgin Atlantic Cargo)
Boeing
777-300
The B777-300 aircraft are
fuel-efficient. Besides this, it also
has less emission, lighter structure
as well as more efficient engine
(Virgin Atlantic Cargo)
5 5 -
Table 1.1
In this way, from the above table, it has observed that Virgin Atlantic Cargo is
moving to the Boeing 747-400 freighter to the Boeing 787-9 Freighter. It is because Boeing
of 787-9 is much more effective as well as more fuel-efficient as compare to the Boeing 747-
400 (Eva, 2015). As per the Boeing of 2010 and 2014, the freight section of Boeing 787-9
also have the capacity to hold the three lower pallet as well as four more major deck pallets as
compared to the Boeing 747-400 freighter. By ensuring this, it believes in long run improving
the sustainability of Virgin Atlantic Cargo (Axlegeeks, N.D.).
Operation
In their operation, it follows the customer centric approach by making the World’s
most valued cargo organization internationally. It designed the wide range of product by
offering the reliable operation service, customer simplistic and providing flexible working
environment. It aims to work with large number of customers globally as well as offering
them solution for their dissimilar needs. It also believes in offering the unique service with
the availability of 24 hours. Therefore, there is no doubt that customer always get attracted to
the unique operational approach by the Virgin Atlantic Cargo.
Operational Philosophies
The operational philosophy of the Virgin Atlantic comprise of three values. These
values include the consistent delivery, security, and safety. The award winning service also
mainly put emphasis on providing the customer cargo full and proper treatment by ensuring
the proper and smooth functioning of journey and customers will not suffer any kind of
headache in their process. It also believes in bringing the regular improvement in the security
Table 1.1

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and safety and it does not satisfy only with the regulatory standard. Besides this, it also
encourages all the staff towards increasing the awareness for reporting any security and
safety issues. Virgin Atlantic also put emphasis on the importance of stability and consistency
at the time of providing cargo delivery. It helps it in building the reputation and confidence
with all its customers. It also becomes the driving force behind the brand of Virgin Atlantic.
Market served
Virgin Atlantic Cargo runs whole day by handling export as well as import of the
several types of cargo from the general cargo to the dangerous good. It is due to the partition
between the Virgin Atlantic Airways. Among all the carriers, It primarily Handle the belly
hold traffic of cargo through its several airport based in London.
Type of Cargo
Virgin Cargo is well known for their customer centric approach. Moreover, it designs
its services as per the needs of customers, and offers realistic and special services by adding
some type of flexibility. Several types of Cargo that Atlantic delivers is given below-
General Cargo
 General cargo- It is best for the cargo that does not come under any type of special
cargo category. Due to their wide range of partner airline, and network, Virgin
Atlantic Cargo, Virgin Australia can also go forward with any of the destination of
VAC.
 Must ride- Virgin Atlantic Cargo guaranteed the service for perishable shipment and
urgent shipment. It has decided if it will fail in completing on time, it will provide the
next service free of cost.
 VEX- In this Cargo, it do the shipment for all the urgent shipment from one airport to
another airport.
Special Cargo
 Pets- a safe, reliable service and flexible to all the dogs, cats and pets that tends to
travel on the VAC network.