An estimated 3.3 million new passengers, for whom price is a big consideration, could be drawn into the market.
So what does this mean for the average passenger? Well Virgin America will be based in San Francisco, which is a major hub for United Airlines, as well as a major international connection point. The markets that VA enters into would cause pricing wars and the one thing any Virgin airline brand is known for, service. United's P.S. service might be in trouble, but more likely a JetBlue, Frontier type of service might be in more trouble.
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The San Francisco market and Bay Area residents stand to benefit the most, according to the study, with Virgin America's presence saving San Francisco passengers $402 million each year, and stimulating 1.7 million new passengers in and out of the market.
The study examined the expected national and regional benefits of Virgin America's potential services on fares and passenger traffic for a theoretical set of markets based on service and fleet objectives already announced in public documents.
"If crowded planes and higher air fares this summer are not enough evidence, what Campbell-Hill has found confirms that the U.S. market needs another airline," said Virgin America CEO Fred Reid. "Whether it's lower fares, better service or simply more consumer choice, Virgin America can't wait to bring these tremendous benefits to U.S. consumers. We are pleased that the DOT, as promoter of consumer interests in the U.S. aviation market, recognizes what is at stake and is moving forward with a timely review of our application."
"These tremendous direct cost and service benefits to flying consumers will have a ripple effect across regional economies," said Brian Clark, Virgin America vice president of planning and sales. "Increased passenger traffic in turn stimulates spending on tourism and local businesses, bringing additional benefits to communities we hope to serve."
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