Virgin America deemed to be an American airline

The US Department of Tranpsort has ruled that British offshoot Virgin America would be able to maintain its US citizenship, in what has been viewed as a setback for other US low-cost carriers.

In a letter dated last Friday, the Department of Transport said that the carrier had at least 75 per cent of its interest controlled by US citizens, and therefore meets the agency requirements to be a certified US carrier. Virgin is 75 per cent owned by VAI Partners LLC and 25 per cent owned by Virgin Group, founded by British billionaire Sir Richard Branson.

Additionally, the low-cost carrier will expand its board to nine from eight to include Chief Executive David Cush, the letter said.

Domestic carrier Alaska Airlines has objected to the US citizen status given to Virgin, as the airline poses a significant threat to budget carriers as it expands deeper into the American market and slashes ticket prices to win customers.

CEO Cush said in a statement that with the matter behind them, the airline will now focus on injecting new competition into markets as the carrier grows, creating new jobs and delivering unrivalled guest experience.

The carrier is a small airline with only 100 flights operating on a daily basis with over 1,500 employees. The company’s headquarters is located while its primary hub is located in San Francisco, and operates services to New York, Boston, Seattle, Ft. Lauderdale, and other destinations within the US.