Delays thwart Virgin America's first flight

As the new airline gears up for its virgin voyage, there's one thing that's certain to fly: The buzz surrounding the low-cost carrier's initiation into American skies.

By Jessica Dickler, CNNMoney.com staff writer

NEW YORK (CNNMoney.com) -- After years of preparation and planning, Virgin America finally took off Wednesday, despite delays caused by a summer storm in New York. But whether all the hype surrounding the new airline is anything more than hot air remains to be seen.

For its inaugural flight from New York to California Wednesday, DJ Samantha Ronson will provide hip tunes while celebrities like Stephen Colbert and executives Sir Richard Branson and Chief Executive Officer of Virgin America Fred Reid walk the red carpet at Virgin America's LAX premier.

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One-way fares between San Francisco and Los Angeles will start at $44.
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In First Class, white leather seats have a massage function and footrests.

"You can't ignore the fact that Richard Branson has shown a flair for promotion that is hard for anybody to match," said Ed Perkins, contributing editor at SmarterTravel.com. "These guys are very, very good - and that matters in a market where there isn't much product differentiation."

While consumers continue to demonstrate that they care far more about cost than in-flight bells and whistles, Virgin America has gone to great lengths to score points with modern amenities like satellite TV and mood lighting.

Some of the other cool features onboard include a self-service mini bar, meals on-demand and music in the bathroom. The in-flight entertainment system has on-demand movies, games, music and the ability to compile individual song playlists. Passengers can even text message other passengers or talk in an online chat room about the episode of Sex in the City they are watching.

Virgin America also scored a deal with Google (Charts, Fortune 500) Maps, so travelers can pan and zoom on where they are, see how far they are from their destination and check how much time is remaining in the flight.

In First Class, the privileged few get plush white leather seats with an in-seat massage function and footrests.

But some industry analysts are not impressed. "I don't think it's a big deal that you can order your in-flight meal from your screen," said Joe Brancatelli, editor of JoeSentMe.com. "We've seen a lot of this before."

Indeed, JetBlue (Charts) still has a leg up on legroom and on United, First Class seats really do go all the way (as opposed to Virgin's 165-degree recline).

But "bottom line, people buy on cost," said airline analyst Ray Neidl of Calyon Securities. And if Virgin America can keep costs down, consumers are sure to embrace a new snazzy airline on the scene.

One-way fares on the Airbus 320s and 319s between San Francisco and Los Angeles start at $44, according to the airline, while First Class could cost as little as $149. For service between Washington, DC and both Los Angeles and San Francisco, fares start at $129, although prices will rise shortly after the airline gets off the ground. Exit rows will cost extra.

"Our goal is to provide topnotch service at low fares," Reid said in a statement.

The first flight comes after years of feuding between Richard Branson's Virgin Group, which owns a 25 percent stake of the new airline, and the Department of Transportation over foreign ownership laws.

Finally, in May, the DOT granted its approval for Virgin America to begin operations after deciding that airline's financing did in fact comply with a 1926 federal law that bars foreigners from controlling domestic carriers.

The airline's soon-to-be competitors, including Delta (Charts, Fortune 500), Continental Airlines (Charts, Fortune 500) and AMR Corp.'s (Charts, Fortune 500) American Airlines had all lobbied against the giving a new rival a green light.

It's been a turbulent time for those airline giants, many of which have had to trim their fleets and cut costs. But traffic is strong and major carriers are reporting that their system wide load factor - a measure of the number of passengers in proportion to seats available - has reached record levels.

With the number of full flights rising, the industry is finally set to post a solid profit this year after hemorrhaging money for a long time, and that could spell good news for Virgin America.

According to airline consultant Mike Boyd, the airline's timing, while not intentional, will work to its advantage - not to mention $177 million in financing and the Virgin name.

Virgin America started service from San Francisco to Los Angeles and San Francisco to New York. More flights will be added in the coming weeks, including daily service to Washington DC, San Diego and Las Vegas.

The airline said it expects to serve as many as 10 cities within a year of operation and up to 30 cities within five years of service. Top of page

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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.