Virgin Nigeria

AdamSmithee notes that Richard Branson is branching out his airline business to ... Nigeria. Yes, you read that right, Nigeria.

Virgin Atlantic Airways is to launch a new airline in Nigeria next year, the airline's latest international venture. Virgin has signed a deal with the Nigerian government to create Virgin Nigeria, to be jointly owned by Virgin Atlantic and Nigerian investors. The airline will operate domestic, regional and international services including flights to Europe and the US.

[...]

Virgin Atlantic, co-owned by Sir Richard Branson's Virgin Group and Singapore Airlines, will own a 49% stake in the business.
Financial investors will control the remaining 51%.

AdamSmithee evinces some scepticism about the wisdom of such an endeavor on Branson's part, but in this case I think (and certainly hope) that the doubt is overdone. To begin with, as previously noted, Nigeria scores better than China on at least one index of business risk, so it really isn't at all obvious that doing business in the country is an act of foolishness. Another encouraging point is that the new venture will apparently be an entirely private operation, which should make for a more professional and soberly run enterprise than is the case with other state carriers elsewhere in the continent.

That the Nigerian aviation market has sufficient potential demand to be profitable ought to be clear enough from the fact that flights from Lagos to Europe and North America are nearly always fully booked, despite occurring on a daily basis, and despite being serviced by British Airways, Air France, Lufthansa, KLM Royal Dutch Airlines, United Airlines and Virgin Atlantic, amongst others. It would be strange indeed if Branson couldn't make a going concern of his venture in a country where air travel is so much in demand, especially in light of the superior brand equity it will have right from the outset. I expect all the other domestic operators will be quaking in their boots at this news.

PS: This story suggests that the commercial potential of the Nigerian air travel market was recognized by other foreign investors, and by South African Airways in particular. The following snippet is interesting, in light of my comments above:

The once mighty Nigeria Airways has been put into liquidation after decades of mismanagement and corruption, but the new flag carrier is expected to inherit its lucrative routes from Lagos to London and New York.

Flights from Europe to Lagos, the biggest city in Africa and a hub for the wealthy Gulf of Guinea oil industry, are among the most profitable in world air travel and invariably overbooked.

Richard Branson isn't looking quite so rash now, is he?

Comments

[tmex12]

I think its an excellent deal for Virgin mainly on the international routes. The local market is highly regulated, margins are thin and I dont expect Virgin to do well in that market. The local market is simply a loss leader. The goal is to use Nigeria's bilateral agreements to acquire direct flights to major international markets : ATL/NYC/Houston/London/Paris ( anywhere you have a large concentration of Nigerians) from Lagos.

There is no direct flights from Nigeria to this major markets. All flights are currently routed through major Europeans cities.

[adeshina adewole]

we are highly delighted and happy that such international firm is finding much interested in our economy {v mobile , virgin nigeria} God bless you sir and also sir i would like to work in virgin nigeria am am economics graduate a native of nigeria once more God bless you sir because you have reduced our unemployment level sir

[Hussam Ali]

Good luck to all of the applicants. This is certainly going to be a fascinating adventure for the Virgin Brand in Africa, and an unprecedented leap forward for an African government to put politics and national pride aside to allow for a new, modern, branded-airline run on sound business principles and driven by market forces. The Virgin brand is a huge success and Virgin Nigeria will surely compete effectively against foreign airlines flying into Nigeria such as British Airways, Emirates and South African Airways.

[Hussam Ali]

tmext12,

Just wanted to disagree with you on your domestic flights prediction. Virgin will simply kill most of the other independent airlines and will surely give huge headaches to the likes of Bellview Airlines and ADC. Deploying modern Virgin Nigeria Airbus A320s on the domestic front, with reasonable fares and the virgin style of service, will be a market killer. Wait and see.

[Ida Gelbart]

I am most interested in obtaining the e-mail address of Virgin Nigeria CEO, or Sir Richard Branson's Office address for the purpose of introduction of my patented product "AEROmate" which prevents deep vein thrombosis on long flights.

[Ida Gelbart]

I am most interested in obtaining the e-mail address of Virgin Nigeria CEO, or Sir Richard Branson's Office address for the purpose of introduction of my patented product "AEROmate" which prevents deep vein thrombosis on long flights.

[nogie odemwingie]

thank GOD for small mercy. Thank u mr president for creating virgin nigeria.Now one can hope for a job.I am very interested in applying for a position in the Airline. Hope they will start recruiting soon.

[Adeyinka Adewumi .J]

It is a good development in the Nigerian history that our National carrier will be back in the sky again I thank Mr.President for this landmark achievement,but be ware of psycophants who will not want this laudable project to see the light of the day.I think this is an opportunity for me to get the job I have been dreaming of. Please when is the recruitment commencing, and how one can apply, if online what website? Thank you.

[pardeep sharma]

Pardeep Sharma
HIG Flats #239, SECTOR 71,
SAS NAGAR-160059
NORTH INDIA
Phone Res:+91-172-5094087
FAX:+91-172-667770 , 2270363
Mobile:+91-98151-82299 ,+919888021962
email:p_sharma@mailexcite.com
email:pardeep39@hotmail.com
ICQ#70995234
http://chandigarh.nic.in/frind.htm
Dated - 28th Nov,2004

Dear Friends,
Please do suggest me and help in getting the direct phone numbers and office address of Sir Richard Branson of CEO of Virgin Atlantic.I shall be very very great ful for any one who write me complete address and direct phone lines of Sir Richard ,I need to have them because he has announced that he is interested in taking as partner in Telecom in India and I provide this kind of service in arranging all foreign direct investment in india for large big projects.
please help

My email is pardeep39@hotmail.com
regards
pardeep sharma India Chandigarh