Delta and Virgin Atlantic announce details of their joint venture (fuel surcharges are up in the air)

Back in December of last year, Delta announced they’d be taking over Singapore Airlines’ 49% stake in Virgin Atlantic, which would lead to a pretty damn powerful joint venture for transatlantic travel. At the time the details hadn’t been hashed out, though that has now changed, as the details have been announced and the partnership will go live on Wednesday, July 3, 2013.

Earning miles

The SkyMiles accrual chart for travel on Virgin Atlantic looks as follows:

Virgin_Atlantic_Rates

Meanwhile the Flying Club accrual chart for travel on Delta looks as follows:

Delta_Rates Delta_Rates2

So the accrual charts for both carriers are actually extremely generous with near metal neutrality (so you’re earning basically the same number of miles regardless of which airline you choose to fly). That’s great news, though for a joint venture like this hardly surprising (then again we’re talking about Delta, and they always manage to surprise me).

Elite benefits

Delta BusinessElite passengers as well as Diamond Medallion and Platinum Medallion members will receive access to the Virgin Atlantic Clubhouse. Meanwhile Diamond, Platinum, and Gold Medallion members will receive priority boarding, check-in, security, baggage handling, and one additional bag at no cost. I haven’t seen anything published yet on what Flying Club elite members get for travel on Delta.

Virgin_Atlantic_Clubhouse
Virgin Atlantic Clubhouse London Heathrow

Redeeming miles

This is going to be the really interesting one. On their award travel and mileage partners page, Delta has published the following about Virgin Atlantic:

*Virgin Atlantic Award Travel available for flights beginning July 3, 2013 and booked beginning June 29, 2013.

So it looks like we can start redeeming Delta SkyMiles for travel on Virgin Atlantic this Saturday, June 29. I suspect the redemption rates will be the same as on any of Delta’s other partners (60,000 miles roundtrip between the US and Europe in coach, and 100,000 miles roundtrip between the US and Europe in business class), though I’d be willing to bet almost anything they’ll impose the standard fuel surcharges that Virgin Atlantic would also charge their own members. If they don’t impose fuel surcharges, that’ll be the biggest shock in the industry in a long time.

So how bad are these fuel surcharges? For a roundtrip Upper Class ticket between Los Angeles and London, here’s the fare breakdown on a revenue ticket:

Virgin_Atlantic_Fuel_Surcharges3

Assuming you have to pay fuel surcharges, on an award ticket you’d be responsible for paying everything except the base fare. So you’re looking at paying about ~$1,200 roundtrip for an Upper Class award between taxes, fees, and fuel surcharges.

While that sucks, the reality is that all of Virgin Atlantic’s partners, with the exception of Hawaiian (which now has crappy redemption rates), impose these fuel surcharges. But there’s something that potentially makes Delta miles actually more valuable than other mileage currencies with which you can redeem on Virgin Atlantic. If you’re redeeming for travel on Virgin Atlantic either through their own program or through ANA, for example, you can’t mix partners.

Historically Delta will let you mix partners — both alliance and non-alliance — on an award ticket, so for example this means on a single award ticket I’d likely be able to book Seattle to Los Angeles on Alaska, Los Angeles to London on Virgin Atlantic, and London to Rome on Alitalia.

And that potentially makes this a better value, since it will allow you to completely avoid the UK Air Passenger Duty (which, as you can see above, is ~$210USD). As I covered in this post, the UK APD is only levied if your ticket has travel originating in the UK.

So say you book an award ticket to Europe, and the outbound is on Alitalia or Delta, for example. Then say you return on Virgin Atlantic, but don’t originate in London. Instead you fly Rome to London on Alitalia, and then London to Los Angeles on Virgin Atlantic with less than 24 hours in London.

If you’re at all familiar with how fares to/from the UK work, you’ll notice that fuel surcharges are always higher going to the UK than coming from the UK. That’s because the airlines have to charge the APD when flying from the UK, so to balance things out they increase the fuel surcharges flying to the UK and decrease them when flying from the UK. For example, here’s a fare breakdown from London to Los Angeles:

Virgin_Atlantic_Fuel_Surcharges2

As you can see the fuel surcharge is “only” ~$280, while if you booked a one-way from London to Los Angeles it would be ~$480. So if you can skip the APD as well by originating from somewhere else, the fuel surcharges actually wouldn’t be that bad.

And if you fly Virgin Atlantic you’ll want it to be out of London anyway, so you can experience their awesome Clubhouse, which I’d argue is one of the nicest business class lounges in the world.

As far as Virgin Atlantic’s chart for travel on Delta goes, well, let’s be honest — does anyone really care? It’s not like Delta releases much low level award space domestically, and I assume Virgin Atlantic will be imposing fuel surcharges for international travel on Delta, so I doubt it’ll be of interest to many. That being said, this is what the redemption chart looks like:

Virgin_Atlantic_Redemption_Chart

There’s nothing there that jumps out at me as being especially awesome.

Bottom line

This is exciting news for Delta and Virgin Atlantic flyers, though I’d love to be wrong as far as fuel surcharges on award tickets go, both when redeeming Delta SkyMiles and Virgin Atlantic Flying Club miles. Anyone more optimistic on the fuel surcharges front than I am?

Comments

  1. wow that was fast! I’d imagine the Virgin Clubhouse at JFK Terminal 4 will be more crowded now that Delta elite members have access to it!

  2. Will this mean Virgin Clubhouse access with a delta lounge membership?

    What about with a membership and a SkyTeam flight like AF? Or AF with a DL flight number?

  3. @ Iolaire McFadden — I haven’t seen an announcement suggestng that SkyClub members would get access, so I doubt it.

  4. Do you think Singapore Airlines suites/PPS members will still have access to the Virgin Clubhouse?

  5. @ Joey — That’s a great question. As of now they still seem to have a contract for the lounge, though I suspect that will change. Maybe not immediately, but eventually it will I’m sure.

  6. I’ve had trouble figuring this out – I know that Hawaiian changed their mileage rates for redeeming Hawaiian miles on VS, but didn’t they also add fuel surcharges to the awards as well? What would an upper class JFK->LHR RT award run with HA miles?

  7. I’m looking forward to learning more about their partnership and how we can use Virgin Atlantic miles to fly on Delta.

  8. @ Bill — To the best of my knowledge Hawaiian still doesn’t impose fuel surcharges on Virgin Atlantic.

    They charge 125,000 miles for Upper Class between the east coast of the US and Europe, and 160,000 miles for Upper Class between the west coast and Europe.

  9. I believe BE/DM/PM will only get access to the clubhouses when travelling to transatlantic on wither Delta/Virgin.

  10. Clubhouse access for Platinum and Diamond members is ONLY WHEN TRAVELING TO AND FROM THE UK on Delta or VS. This is made clear in the FAQs and fine print but Delta keeps excluding it from the headline text, which is very misleading…there are going to be lots of angry Delta Diamonds banging on the door at the JFK Clubhouse!

    That said, given how nice the Clubhouse is, I’m happy they’re doing something to keep it uncrowded and to avoid feeling cost pressure to water down the product, but still — don’t bait and switch.

  11. Also, seems like this would be a good time to book VA tickets using DL miles if one is planning to…if VS tickets come with fuel surcharges, it seems like DL might take the opportunity to decide “why not” and start charging them more broadly.

  12. If I’m reading this correctly, i will be able to book Delta business class SFO-CDG for 90,000 VA miles. Is that right? That looks like a good deal, but how is availability? And, do i use the delta website or the VA website?

  13. @ David O — In theory that’s correct, though Delta is horrible about releasing low level award space, and chances are there will be hefty fuel surcharges imposed as well, so you’d probably pay close to $1,000 in addition to the miles.

  14. I happen to have a Delta top tier something or other thanks to their partnership with SPG program. As a SPG Platinum that gives me something worthwhile when flyign with delta, but does it mean I am truly of that level in Delta, and therefore will be treated top tier on VS now too?

  15. Suspected as much. When I lived in London I was VAA gold for a few years, was a great experience as regularly seemed to get comp’ed from Prem+ to Upper. Moving to the states and switching to United was an eye opener!

  16. While you mention not too many people would care, I would really like to know how I can book domestic flights on Delta with Virgin Atlantic! I just happen to beb in those small towns where Delta has the only direct flight to ATL, hence the fares are ridiculous on Delta, but they do offer plenty of low award space that make redeeming for points worthwhile. I haven’t been able to find a way to redeem on Virgin Atlantic this whole day on their website. Once I select a departing US city, it automatically populates only UK destinations. Much thanks!

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