x Abu Dhabi, UAEThursday 20 July 2017

Sir Richard Branson's main pilot at Virgin Atlantic bows out

Profile: While Sir Richard is the public face of Virgin Atlantic, Steve Ridgway has been running the airline for 12 years.

Steve Ridgway, the chief executive of Virgin Atlantic, shaped the airline into a formidable long-haul competitor to British Airways during his long stint with the company. Press Association Images
Steve Ridgway, the chief executive of Virgin Atlantic, shaped the airline into a formidable long-haul competitor to British Airways during his long stint with the company. Press Association Images

If you are a member of the flying public and someone says the words Virgin Atlantic airlines, the first name that pops into your head will be that of its founder, Sir Richard Branson.

But if you're in the airline industry, another name will likely spring to mind - Steve Ridgway.

When he hands in his keys to the executive washroom for the last time on February 28, Mr Ridgway will have been with Virgin for 23 years, 12 of them running the airline. Not many airline executives last that long in the hot seat in what is a notoriously high pressure business.

When he joined, Virgin Atlantic was just two jumbo jets flying between London's Gatwick airport, and Newark, New Jersey, at a time when British Airways (BA) dominated the United Kingdom airline industry - and most of the coveted slots in and out of London's key hub airport - Heathrow.

"We've gone from two aircraft when I joined to what we are today with a fleet of 40 widebodies (jet airliners), almost 10,000 employees and a £3 billion [Dh17.28bn] turnover," he told Flight International, after announcing his departure last September.

"That's a pretty good innings, wouldn't you agree?"

His achievement has been much more than adding airliners to the fleet. He has shaped Virgin into a formidable long-haul competitor to BA, first moving to take on the established giant in its own backyard at Heathrow in 1991, then building up its presence first on transatlantic routes, and then heading East, to destinations including Dubai, India, China, and beyond.

The airline now punches considerably above its weight and although it has only 3 per cent of the slots at Heathrow, it has 10 per cent of the movements and is chasing BA on the North Atlantic routes, where BA has 40 per cent market share.

Virgin might have only 24 per cent of that key market, but it is still well ahead of the American carriers on the route.

The result is that Virgin has built up the necessary "brand and the firepower" to take on BA directly, Mr Ridgway said in one of his last interviews as chief executive.

"Since our move to Heathrow we have pushed really hard, despite all the constraints, to grab as many routes and as many markets as we can. We now pretty much fly to a who's who of the world's great cities. And the North Atlantic has been a big success story for us.

"We've got a very strong position at Heathrow, considering our size, and it is a matter of us exploiting that as effectively as we can. I think we're pretty good at fighting our corner in a tough marketplace. If you look at the impact we've had on BA over the 28 years, they must groan every time we start a new route. We compete head to head on every single route. It's a classic titanic competition and certainly the UK has benefited from that. There's not really another Virgin Atlantic anywhere in the world."

Mr Ridgway, who was born in Tavistock, in south-west England, did not begin his career in aviation. After graduating with a BSc in economics from Oxford Brookes University, he dabbled in a couple of careers, working in the grocery trade for Sir James Goldsmith's Cavenham Foods, then teaching before leaving for the United States and the world of powerboat racing.

Thus began Mr Ridgway's business career working in Miami as business development manager at powerboat builders, Toleman. Then in 1981 he joined Cougar Marine, and it was there he met Sir Richard Branson.

Sir Richard's dream then was not just to build an airline, but to win the Blue Riband as well - the iconic prize for the fastest ship across the Atlantic. Once won by the great liners such as Cunard's Queen Mary, and the America's SS United States, which has held it since 1952, Sir Richard wanted it back in the UK, and he paid Cougar £1.5 million to build him a boat to do it.

She was the Virgin Atlantic Challenger 2, a 72-foot powerboat capable of 50 knots, and Mr Ridgway was hired to be her chief pilot. With Sir Richard aboard, she knocked two hours off the previous record in 1986, but Sir Richard was denied the Blue Riband by the trustees of the award because he had broken two rules of the competition - he had stopped to refuel and his vessel did not have a commercial maritime purpose.

"I've known Richard since 1984, when I put the transatlantic boat project together which became the launch mechanism for Virgin Atlantic in terms of publicity," says Mr Ridgway, who eventually joined the airline in 1989.

"I guess we have worked very well together since because I share a lot of Richard's instincts around running a business that is all about delighting customers. That was the revolution that Virgin started, because back in 1984 many airlines were arms of government.

"They were run by their technical departments and the customer wasn't really front of mind. Many airlines have copied that now, but we have always remained the carrier that tries to do things differently."

Mr Ridgway became a board director in 1994 and then was appointed managing director of Virgin Atlantic in April 1998. He became chief executive in October 2001. His departure is amicable.

"Steve has been a close friend and confidant since the early days. He has shaped the airline into the company it is today," said Sir Richard when Mr Ridgway formally announced his departure. "And he will doubtlessly be involved in other Virgin projects as we value his skills so highly."

However, his friend had warned Sir Richard early, that he thought he should be spending more time on his boat. "I've been chief executive for a long time and seen some fantastic things happen, and it probably is time to wind down a bit. I told Richard at the beginning of the year that it was time for a change and I'd like to go before a summer because I want to do my boating," says Mr Ridgway. "Our product suite is in good shape and we've got the new aircraft coming through, so that's probably a good time to hand over."

Mr Ridgway, who lives on a houseboat in Chelsea, London, also plans to get more involved in the hotel complex he owns at Trebetherick, in Cornwall, with his brother Hugh. The pair have sunk £13.5 million into The St Moritz, already one of the top hotels in Cornwall. The venture, which opened in 2007, includes apartments, villas, an upmarket restaurant and spa centre.

Despite his optimism about the airline, Mr Ridgway will leave Virgin Atlantic at a turbulent time for the industry, in the grip of high fuel prices and a depressed European economy that has already driven Virgin £80.2m into the red in the last financial year, despite revenues climbing 3 per cent to £2.7bn.

Virgin's position has been somewhat stabilised by Delta Air Lines acquiring Singapore Airlines' 49 per cent stake in the airline in a deal that includes a joint venture with the carriers sharing costs and revenues, with Virgin's chairman Sir Richard retaining his 51 per cent shareholding. The deal, which has yet to secure anti-trust approval, will provide a combined transatlantic network covering 31 services between the UK and North America, 23 of them out of Heathrow.

Mr Ridgway's replacement will be Craig Kreeger who is joining after a 27-year career at American Airlines, which included several senior vice-president roles.

 

dblack@thenational.ae