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Virgin America Inc.
IATA ICAO Call sign
VX VRD REDWOOD
FoundedJanuary 26, 2004(2004-01-26)
Commenced operationsAugust 8, 2007(2007-08-08)
Ceased operationsApril 24, 2018(2018-04-24)
(merged intoAlaska Airlines)
AOC #VQIA199L[1]
Hubs
Focus citiesDallas–Love
Frequent-flyer programeleVAte
Fleet size67
Destinations31
Parent companyAlaska Air Group(2016–2018)
HeadquartersBurlingame,California,U.S.
Key people
RevenueIncreaseUS$1.529 billion(2015)
Operating incomeIncreaseUS$177.2 million(2015)
Net incomeIncreaseUS$340.5 million(2015)

Virgin America Inc.was alow-cost airlineheadquartered in theSan Francisco Bay Areacity ofBurlingame,in theU.S.state ofCalifornia.It primarily focused on operating low-fare, higher-quality service between cities on theWest Coast of the United Statesand other major metropolitan areas. It operated both domestic and international flights, with hubs inSan FranciscoandLos Angelesas well as a smaller focus city operation atLove FieldinDallas,Texas.

Originally established in 2004, the airline began operations in 2007 as an independent airline company using branding licensed from the United Kingdom–basedVirgin Group,which also controls the brand of theVirgin AtlanticandVirgin Australiaairlines. TheAlaska Air Groupacquired Virgin America in April 2016, at a cost of approximately $4 billion and continued to operate Virgin America under its own name and brand until the airline was fully merged intoAlaska Airlineson April 24, 2018.

History

[edit]

Founding (2004–2007)

[edit]

In early 2004,Virgin Groupannounced its intention to found a United States–based, low-fare airline called "Virgin USA". At the time, Virgin USA expected flights to begin by mid-2005. After considering several key areas, theSan Francisco Bay Areawas chosen as the location of its flight operations center and later as its corporate headquarters.[2]The airline changed its name from "Virgin USA" to "Virgin America" and due to the difficulty in finding U.S. investors willing to gamble on a new airline in an already congested industry, the launch date was pushed back from mid-2005 to early 2006.[3]

Virgin America secured U.S. investors Black Canyon Capital and Cyrus Capital Partners in late 2005.[4]Once the new owners were on board, Virgin's General Counsel submitted the required U.S. Department of Transportation certificate application on December 9, 2005.[5]Unfortunately, despite significant public support for the new California-based airline, the approval process was mired in a debate between the supportive city and state representatives fromCaliforniaandNew Yorkand the opposing national aviation labor union,Air Line Pilots Association,as well as a potential competitorContinental Airlines.The review of Virgin America's application was prolonged due to this opposition, which claimed Virgin America, a subsidiary of the United Kingdom–based Virgin Group, would not be under U.S. ownership or control. The application was initially denied by the Department of Transportation on December 27, 2006.[6]

In order to achieve the necessary approval, Virgin America's General Counsel David Pflieger and CEO Fred Reid filed a revised application that proposed a restructuring of the airline in January 2007; voting shares would be held by a Department of Transportation–approved trust and only two Virgin Group directors would be on the eight-person board. Additionally, Virgin America was open to removing Richard Branson from the airline's board of directors and possibly removing the "Virgin" brand from the title altogether.[7]Virgin America was tentatively cleared to fly by the U.S. Department of Transportation on March 20, 2007, on the condition that the airline would alter its business structure, including the limitation of foreign ownership shares to 25% and the replacement of Fred Reid (who had been hired by Virgin Group).[8]The airline protested the stipulation concerning Reid's removal to the federal regulators, arguing that the other stipulations ensured that the business would not be ruled by foreign interests.[9]The Department of Transportation's final agreement allowed Reid to remain involved with Virgin America until February 2008, after which he was required to leave the company.[10]

Virgin Group operations (2007–2016)

[edit]
"Air Colbert", the aircraft used on Virgin America's inaugural flight, atSeattle–Tacoma International Airport

Virgin America began selling tickets in July 2007. On August 8, 2007, the airline made its inauguralNew YorkandLos AngelestoSan Franciscoflights — the aircraft was named "Air Colbert", after comedianStephen Colbert.[11]In December 2007,C. David Cushreplaced Reid as CEO of the airline.[12]From the beginning of operations, Virgin America reported losses, beginning with $270 million in its first month, until the third quarter of 2010, when it achieved its first profit of $7.5 million.[13][10]

On May 21, 2009, Virgin America became the first U.S. airline to offerWi-Fiaccess on every flight, viaGogo Inflight Internet.[14]Between November 10, 2009, and January 15, 2010, the airline offered free WiFi with a subsidy fromGoogle.[15]On December 17, 2014, Virgin America announced that it would offer faster fleet-wide ATG-4 in-flight WiFi service from Gogo, with speeds three times faster than the first generation system.[16]

Virgin America's check-in area atChicago O'Hare International Airport.

In March 2010, Virgin America announced its intention to start flying toTorontofrom Los Angeles and San Francisco, making it the airline's first international destination.[17]Following the Department of Transportation's approval of Virgin America's proposal to fly to Canada, international service began with flights toToronto Pearson International Airporton June 29, 2010.[18]However, due to high operating costs, response from competitors, slower growth than anticipated, and higher demand for Dallas/Fort Worth, Virgin America terminated Toronto service on April 6, 2011.[19]Virgin America began its service toDallas/Fort Worth International Airportin December 2010, and continued until after the repeal of theWright Amendmentin October 2014, when the airline leased two gates and established a focus city atDallas Love Fieldand enhanced the number of connecting destinations. As a result, Virgin America transported almost 31,000 passengers through Dallas Love Field in the first month, achieving 3.58% market share at Dallas Love Field.[20]

Virgin America announced in January 2011 a firm order for sixty new Airbus A320 aircraft, including thirty newAirbus A320neos,that would be delivered starting in 2016, as a formal expansion of an initial commitment made by Richard Branson at theFarnborough Airshowin July 2010, though in November 2012 the airline deferred delivery of the aircraft to 2020.[21][22]In April 2011, Virgin America's hub at San Francisco International Airport relocated to the newly remodeled Terminal 2, sharing the gates with American Airlines.[23]In late October 2011, the airline migrated toSabre'sglobal distribution system (GDS)that handles reservations, frequent-flier accounts, flight operations data and crew scheduling. Difficulties with the changeover sparked widespread customer complaints, due to early technical malfunctions surrounding the program.[24]On December 12, 2012, Virgin America opened their first airport lounge, the Virgin America Loft, atLos Angeles International Airport.[25]

The Virgin America exhibit at theFrontiers of Flight MuseumatDallas Love Field

Alaska Airlines acquisition (2016–2018)

[edit]
An Airbus A321 acquired byAlaska Airlinesfrom Virgin America in the "More to Love" livery, depicting the acquisition of Virgin America by Alaska Airlines
AnAirbus A320repainted in theAlaska Airlineslivery

Virgin America had its first public offering at theNASDAQstock exchange on November 14, 2014, selling 13.3 million shares to raise $307 million for the company.[26]

A number of airlines interested in a takeover of Virgin America approached the airline in late 2015, prompting Virgin America to correspond with an undisclosed financial adviser about how and if to proceed with a sale.[27]Alaska Air GroupandJetBluewere the two most interested companies to make offers to purchase the airline from Virgin Group.[28]In December 2015, Alaska was interested at $44.75 per share, before JetBlue manifested its interest in February 2016. A bidding war ensued culminating on March 31 and April 1 at $57 per share, 47% higher than the day's closure at $38.9.[29]On April 4, 2016, Alaska Air Group announced that it had agreed to buy Virgin America for $2.6 billion. Including debt and aircraft leases, the transaction was worth approximately $4 billion.[30]Had the merger agreement been terminated by Virgin America, they would have been contractually obligated to pay Alaska Air Group a termination fee equal to $78.5 million.[31]

Virgin America's founder Richard Branson expressed disappointment with the merger between Alaska Airlines and the airline he founded.[32]In July 2016, Virgin America's shareholders approved the merger, leaving the approval by theUnited States Department of Justiceas the only foreseeable hurdle.[33]In September 2016, a lawsuit was filed against Alaska Airlines by consumers to block the merger between the two carriers, which the Alaska Air Group settled in court in December 2016.[34]Subsequently, the Department of Justice approved the acquisition, which was completed on December 14.[35]Following the acquisition, the former chief financial officer of Alaska Airlines, Peter Hunt, became the president of Virgin America, while the former chief operating officer and president of Alaska Airlines, Ben Minicucci, became the chief executive officer.[36]

Virgin America became the launch customer for theAirbus A321neo,with the airline placing a firm order for 10 aircraft through leasing companyGE Capital Aviation Services.The first A321neo was delivered in Hamburg to Virgin America and entered service on May 31, 2017; a total of five A321neos were delivered to Virgin in 2017 and five in 2018.[37]In early February 2017, Alaska Air Group said it was working with GE on an arrangement where it would not take delivery of all 10 ordered jets, in favor of keeping a predominantly Boeing fleet.[38]A presentation given by Alaska Airlines'chief financial officerin March 2017 indicated that Alaska would take delivery of all 10 leased A321neos, and would absorb and operate Virgin America's existing A319 and A320 fleet through at least 2024.[39]

As part of the merger, some of Virgin's amenities would be integrated into Alaska's product.[40]As Alaska Group was licensing the Virgin brand from Virgin Group, Branson indicated a willingness to relaunch the airline after the Virgin America brand was retired.[41]

Virgin America made its final revenue flight under its callsign "Redwood" on January 10, 2018. The next day, on January 11, 2018, theFederal Aviation Administrationissued a single operating certificate for a combined Alaska Airlines and Virgin America.[42][43]

Virgin America flights continued to operate using Virgin America aircraft, crew, and brand name until April 25, 2018, when the airlines merged into the same passenger service system. The final Virgin America revenue departure was Flight 1948 at 9:32 PM, traveling from the airline's San Francisco headquarters to its other hub in Los Angeles, while the true final Virgin America departure was an employee charter operating as Flight 1947 from Los Angeles to San Francisco, which departed at 9:35 PM and operated under Virgin America's original "Redwood" callsign.[44]Overnight, the customer-facing portions of the company (including flight numbers, website, and airport check-in kiosks) were converted to use the Alaska Airlines brand.[44]

From April 25, 2018, passengers could only see the Alaska Airlines brand online and in airports, andvirginamerica.comwould redirect toalaskaair.com.Prior to the brand cutover, livery repainting of Virgin America's Airbus aircraft began in January 2018. Additionally, the interiors of the Airbus aircraft underwent refitting with seats similar to those in Alaska's Boeing aircraft from September 2018, in another project expected to take several months to complete,[45]with the first aircraft refit and unveiled in early 2019.[46]The last plane wearing the Virgin America livery, the one that operated Flight 1948, was repainted in Alaska Airlines livery on June 2, 2019.[citation needed]Following the completion of the repainting of Virgin America's aircraft,virginamerica.cominstead redirected toVirgin Group's websitevirgin.comrather than toalaskaair.com,and Virgin America's social media profiles, such as itsFacebook,TwitterandYouTubewere subsequently either merged with those of Alaska Airlines, had their accounts closed, or otherwise had their content largely removed.

Corporate affairs

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[edit]

The key trends for Virgin America over its later years were as follows (as at year ending December 31):

2012 2013 2014 2015
Net Profits (US$,in millions) −145.4 10.1 60.1 340.5
Turnover (US$, in millions) 1,323 1,425 1,490 1,530
Number of employees (full & part-time, year end) 2,509 2,660 2,672 2,911
Number of passengers (in millions) 6.2 6.3 6.5 7.0
Passenger load factor (%) 79 80.2 82.3 82.2
Number of aircraft (at year end) 53 53 60
References [47][48][49] [48][49]
[47][50][48][51] [50][51][48]

Offices

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Virgin America leased 68,000 square feet (6,300 m2) of space at Bay Park Plaza II (formerly known as the Forbes Building), a building at 555 Airport Boulevard inBurlingame, California,in theSan Francisco Bay Area,owned, leased, and managed byEQ Office.[52]Virgin America occupied suite 500 in the building, which was located across a lagoon fromU.S. Highway 101(Bayshore Freeway).[52]Some of the space had since been repurposed as an Alaska Airlines office.

Destinations

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As of April 2018, Virgin America flew to a total of 31 destinations, consisting of 28 domestic destinations and three in Mexico.[53]In addition, the airline served five destinations that were terminated prior to the merger, consisting of four domestic destinations and one in Canada. Its primary hub was located atSan Francisco International Airport,with its secondary hub atLos Angeles International Airport.[2]Virgin America also maintained a focus city atDallas Love Field,and operated a route betweenLas VegasandNew York JFK.

Codeshare agreements

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The airline hadcodeshare agreementswith the following airlines at the time of its acquisition:[54][55]

Fleet

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Virgin AmericaAirbus A319-100

As of January 11, 2018, at the time of the merger, Virgin America's all-Airbus fleet consisted of the following aircraft:[56]

Virgin America Fleet
Aircraft In service Orders Passengers Notes
F Y+ Y Total
Airbus A319-100 10 8 12 99 119 All were transferred toAlaska Airlinesand later retired in 2020.
Airbus A320-200 53 8 12 129 149 All were transferred toAlaska Airlinesand later retired in 2023.
126 146
Airbus A320neo 30
N/A
Orders were transferred toAlaska Airlines,but were later canceled when Alaska ordered additionalBoeing 737 MAXs.[57]
Airbus A321neo 4 6 8 18 159 185 All fleet and remaining deliveries transferred toAlaska Airlinesand later sold toAmerican Airlinesin 2023.
Total 67 36

Cabin

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Virgin America economy class
Virgin America First Class

In-flight entertainment

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Virgin America offered dual-class service on all flights it operated. Both cabins featured mood lighting and all seats were equipped with a Panasonic Avionicsin-flight entertainmentsystem running a customizedtouch-screenGUIcalledRed.In July 2010, theRedsoftware had been upgraded to version 2.0 across the entire fleet. This update included new features such as an updated position mapping system powered byGoogle Maps,in-flight shopping, and open tab capabilities.[58]TheRedsystem was upgraded again in June 2015, introducing the new Android seatback touch screen service, and a new position mapping system by Flightpath 3D.[59][60]

Seating

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First Classseats offered 55 inches (140 cm) ofpitchand were 21 inches (53 cm) wide. The seats featured power-ports, adjustable headrests, a massage function, tablet friendly tray table (with two positions), and various recline controls. Passengers seated in first class received complimentary meals, refreshments and alcoholic beverages, small amenity kit, long-haul guests received a large duvet & pillow and received dedicated airport check-in, security screening, and aircraft boarding. In first class,Redoffered free live satellite television, free on-demand movies, free on-demand television programming and a selection of games. Guests could also utilize GoGo for limited, but free messaging on certain platforms. The front lavatory was for first class guests only.[61]

Main Cabin Selectwas Virgin America's premium economy product.[62]It was not a distinct class; instead, on the A319-100 and A320-200, the service was located at Main Cabin seats in the exit row and behind the bulkheads. On their A321neo, the service was located in the first three rows of the Main Cabin. Passengers were offered more conveniences than in normal Main Cabin seats and had 38 inches (97 cm) of seat pitch, 17.7 inches (45 cm) of width and dedicated luggage bins. Like in first class, meals, refreshments and alcoholic beverages were free, as were the premium television channels and movies. Airport check-in, security screening, and aircraft boarding were prioritized over Main Cabin passengers. Guests could also utilize GoGo for limited, but free messaging on certain platforms. The lavatories in the back were for all passengers flying in economy, including Main Cabin Select.[62]

Main Cabinseats offered 32 inches (81 cm) of pitch and were 17.7 inches (45 cm) wide with power-ports and adjustable headrests. Following the merger withAlaska Airlines,Redmirrored Alaska's in-flight service by offering live satellite television, on-demand movies, on-demand television shows, and a selection of games for free.[62]In aligning further with Alaska Airlines, all movies and content were free for all guests, regardless of cabin. Furthermore, in addition to the free beverage service, passengers could order more complimentary non-alcoholic beverages, or purchase snacks, meals, special-branded amenity kit, pillow/blanket, and alcoholic beverages from their seats viaRed.Guests could also utilize GoGo for limited, but free messaging on certain platforms.[62]

Alaska Air Group had stated that as part of the reconfiguration, the Virgin America First Class seats would be removed and replaced with a different model to streamline the product with the Alaska Airlines product. The seats, while considered a downgrade from the current seats, would have only 41 "of seat pitch, slightly more recline than the current Alaska Airlines 737 First Class product, retaining the Virgin America foot rests, and different placement of the powerports. The number of First Class seats would increase from 8 to 16 seats on the A321neo, and from eight to twelve seats on both the A319 and A320.

Alaska also reconfigured the Virgin America Airbus fleet to include at least three rows of Main Cabin Select, which was a significant change as the current configuration included the emergency exit row (or second row in Airbus A320 fleet) as part of Main Cabin Select; these seats would now just be considered preferred seats/extra legroom after integration.[63]

In April 2020, in response toCOVID-19 pandemic impacts,Alaska indefinitely stored all aircraft that retained Virgin America interiors,[64]and none had flown for Alaska again.

Frequent-flyer program

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Virgin America'sfrequent-flyer programwas Elevate, which allowed passengers to earn five points for every dollar spent on a flight's base fare, which excluded taxes and other fees. The program was discontinued on January 1, 2018. Elevate members were given the option to manually convert Elevate points into Alaska Airlines'Mileage Planmiles until January 31, 2018, with any remaining Elevate points automatically converted by February 8, 2018.[65]

Following the discontinuation of Elevate in January 2018, flights operated by Virgin America continued to earn credit on Alaska Airlines' Mileage Plan and the frequent flyer programs of partner airlines (including Hawaiian Airlines‘ HawaiianMiles, Emirates Skywards, Singapore Airlines’ KrisFlyer, or Virgin Australia's Velocity Frequent Flyer) until Virgin America was integrated into Alaska Airlines on April 25, 2018.[66][67][68][69]

See also

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References

[edit]
  1. ^"Federal Aviation Administration – Airline Certificate Information – Detail View".Av-info.faa.gov.RetrievedSeptember 18,2010.
  2. ^abChiang, Harriet; Armstrong, David (June 4, 2004)."SFO lands new carrier Virgin USA -- 1,500 jobs / Airline sets sights on low-fare market; corporate center to be based in N.Y."San Francisco Chronicle.RetrievedJanuary 4,2017.
  3. ^Wallack, Todd (April 9, 2005)."Start of Virgin America delayed / Branson's airline apparently needs more investors".San Francisco Chronicle.RetrievedJanuary 4,2017.
  4. ^"Virgin America Secures Funding".Los Angeles Times.December 9, 2005.RetrievedFebruary 7,2017.
  5. ^"APPLICATION OF VIRGIN AMERICA INC. FOR A CERTIFICATE OF PUBLIC CONVENIENCE AND NECESSITY".Wall Street Journal.December 2005.
  6. ^Armstrong, David (December 28, 2006)."Virgin America gets the no-go / Government cites foreign ownership; airline plans appeal".San Francisco Chronicle.RetrievedJanuary 4,2017.
  7. ^Branson, Richard(2007).Losing My Virginity: How I've Survived, Had Fun, and Made a Fortune Doing Business My Way.United States:Crown Publishing Group.ISBN978-0-8129-3229-4.
  8. ^Armstrong, David (May 19, 2007)."Virgin America given permission to operate".Los Angeles Times.RetrievedJanuary 4,2017.
  9. ^Young, Eric (April 11, 2007)."Virgin America fights to keep CEO".American City Business Journals.RetrievedJanuary 4,2017.
  10. ^abField, David (October 17, 2007)."Fred Reid prepares to farewell Virgin America".Flightglobal.RetrievedJanuary 4,2017.
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  12. ^Raine, George (December 18, 2007)."Virgin America $35 million in the red in first quarter of operation".San Francisco Chronicle.RetrievedJanuary 6,2017.
  13. ^Young, Eric (February 2, 2009)."Virgin America has lost $270M".San Francisco Business Times.RetrievedFebruary 3,2009.
  14. ^Franklin, Eric (May 20, 2009)."Fred Reid prepares to farewell Virgin America".CNET.RetrievedJanuary 4,2017.
  15. ^Reardon, Marguerite (October 19, 2009)."Free Wi-Fi for the holidays on Virgin America | Signal Strength".CNET.Archived fromthe originalon February 26, 2012.RetrievedFebruary 4,2011.
  16. ^Shu, Les (December 17, 2014)."Virgin America completes rollout of faster Gogo ATG-4 Wi-Fi across fleet".Digital Trends.RetrievedDecember 20,2014.
  17. ^Beehner, Lionel (March 28, 2010)."IN TRANSIT; Virgin America to Add Orlando and Toronto".The New York Times.RetrievedJanuary 6,2017.
  18. ^McCarthy, Caroline (June 29, 2010)."Green tech, jobs hailed in Virgin America expansion".CNET.RetrievedJanuary 6,2017.
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  20. ^Keller, Stephen (December 1, 2014)."See how Southwest and Virgin America did at Love Field with Wright Amendment gone".Dallas Business Journal.
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  30. ^Kottasova, Ivana; Wattles, Jackie (April 4, 2016)."Alaska Air buys Virgin America for $2.6 billion".CNNMoney.RetrievedDecember 18,2016.
  31. ^"Alaska Air says Virgin America may be required to pay termination fee equal to $78.5 mln".Reuters.April 4, 2016.RetrievedJanuary 6,2017.
  32. ^Kim, Susanna (April 4, 2016)."What You Should Know About the Virgin America, Alaska Air Merger".ABC News.RetrievedJanuary 6,2017.
  33. ^Boyle, Alan (July 26, 2016)."Virgin America shareholders OK Alaska Air merger, bringing deal closer to completion".GeekWire.RetrievedAugust 11,2016.
  34. ^Carey, Susan (December 7, 2016)."Alaska Air Agrees to Settle Consumer Lawsuit Opposing Virgin America Merger".The Wall Street Journal.RetrievedDecember 18,2016.
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  38. ^McIntosh, Andrew (February 9, 2017)."Alaska Air doesn't want all of the Airbus A321neo jets Virgin America ordered".Puget Sound Business Journal.RetrievedMarch 26,2017.
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  40. ^Martin, Hugo (March 22, 2017)."Virgin America will disappear into Alaska Airlines in 2019".Los Angeles Times.RetrievedMarch 23,2017.
  41. ^Forgione, Mary (March 24, 2017)."Virgin Voyages cruise line steams forward. Virgin America airline gets ready to fade away".Los Angeles Times.RetrievedApril 7,2017.
  42. ^Hemmerdinger, Jon (January 11, 2018)."FAA grants single AOC to Alaska and Virgin America".FlightGlobal.RetrievedJanuary 12,2018.
  43. ^"Alaska Airlines receives single operating certificate from FAA - Jan 11, 2018".Alaska Airlines.January 11, 2018.RetrievedJanuary 12,2018.
  44. ^abRizzo, Cailey (April 26, 2018)."Saying Goodbye to Virgin America on the Airline's Final Flight".Travel + Leisure.RetrievedApril 28,2018.
  45. ^Gates, Dominic (April 23, 2018)."Alaska Air to add some passenger fees and basic fare, says merger with Virgin on track".The Seattle Times.RetrievedApril 28,2018.
  46. ^McGinnis, Chris; Jue, Tim (February 28, 2019)."The future of flying Alaska Airlines (PHOTOS) - Airline reveals new interiors as Virgin America era fades away".SFGate.Hearst Communications, Inc.RetrievedJune 4,2019.
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  48. ^abcd"US Department of Transportation - Airline Employment Data by Month".January 2016.RetrievedMarch 10,2016.
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  53. ^"Flight Route Map & Destinations - Where We Fly".Archived fromthe originalon July 1, 2017.RetrievedJanuary 6,2017.
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Further reading

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[edit]

Media related toVirgin Americaat Wikimedia Commons