UPDATE: Virgin Atlantic Decides To Cut Outbound Japan Fares

Virgin Atlantic Thursday said it is trying to reduce prices of flights out of Tokyo after realizing it was selling single journey flights for several times more than competitor British Airways, but is having difficulty with red-tape.

The long-haul airline was charging in excess of GBP5,000 for a single ticket from Tokyo to London, but that was on a flight operated by All Nippon Airways Co. Ltd. (9202.TO). It is unlikely to be able to control the prices of other airlines' tickets it sells through any joint venture on its website. Still, Virgin was selling tickets for Saturday flights it operates itself for GBP2413.29 including tax, according to its website. Rival BA was selling flights at about GBP600 for Saturday and GBP1,077.55 for Friday.

BA's flights don't include tax.

After being contacted by Dow Jones Newswires, a spokeswoman for Virgin Atlantic said: "Our pricing department has picked this up and has now reduced the prices to reflect normal levels." She couldn't immediately say how much flight prices would fall, but said: "The discrepancy with our pricing arose as usually there is so little demand for a one-way fare from Tokyo to London. However, in these exceptional circumstances we are taking steps to rectify this."

A spokesman for Virgin Atlantic later said it was trying to reduce fares but was still waiting for approval from Japanese authorities, which is standard procedure.

Japan was hit Friday by an earthquake and subsequent tsunami that may have claimed more than 10,000 lives.

The disaster has escalated with the Fukushima nuclear facility becoming seriously damaged.

One passenger, who returned with Virgin earlier this week from Japan, said sales on Virgin's web-site had been had been halted Saturday as some people desperately sought to leave the country immediately after the crisis first struck.

The Virgin spokesman confirmed sales had been suspended, but added it was a necessary part of itinerary planning after uncertainty following the earthquake. The airline is still basing crew at Tokyo, despite other airlines pulling staff out to other regions, including Hong Kong and Seoul.

-By Kaveri Niththyananthan, Dow Jones Newswires; 4420 7842 9299; Kaveri.Niththyananthan@dowjones.com

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