Granted Four-Month Reprieve From Forced Ouster

For a guy who was told by the Department of Transportation he must give up his job, Virgin America CEO Fred Reid doesn't seem eager to move out of his office just yet... but that's OK with the DOT.

The San Francisco Business Times reports the Burlingame, CA-based low-cost carrier successfully lobbied for the DOT to allow Reid to stay as CEO until February 18, 2008 -- three months longer than originally planned.

As ANN reported, DOT officials mandated Reid step down as CEO of Virgin America, as a condition of being granted its operating license. The agency determined Reid might be a bit too close to foreign interests, since he was hired by Virgin CEO Sir Richard Branson -- who also holds an ownership stake in the carrier.

That apparently cozy relationship is a violation of US law... the same kind of foreign-ownership concern that delayed Virgin America's start of operations for months.

The board began the search for a new CEO the moment the DOT finally gave its OK for the airline to begin operations. That process has proven "challenging," Virgin America said in a filing with the DOT, "given scheduling constraints and the complexities of US board members undertaking such an effort when they are busy in other businesses."

In other words... Virgin America says it's too busy running an airline, to give serious thought to replacing the guy at the (almost) top.

Reid (right) was president of Delta Air Lines, until Branson hired him away from the Atlanta-based carrier to help him start Virgin America. Prior to that, Reid held executive positions with American, Pan American World Airways and Lufthansa.

It's no secret Virgin America wants a CEO with similar experience in the business to replace Reid. A spokeswoman wouldn't say how many candidates -- if any -- the carrier has interviewed so far.

Virgin America began flying to San Francisco, Los Angeles and New York last month, and plans to extend its network to Washington, DC and Las Vegas in the near future.

FMI: www.dot.gov, www.virginamerica.com