Virgin Atlantic bets on more legroom in economy in trans-Atlantic battle

LONDON, March 7 (Reuters) - Virgin Atlantic said it would offer a new type of economy seat with extra legroom, as it tries to stand out from the crowd at a time when low-cost airlines are intensifying competition on trans-Atlantic (Shanghai: 600558.SS - news) routes.

The British-based airline, partly owned by U.S. carrier Delta, said on Wednesday that it would refit the cabins of its Boeing (NYSE: BA - news) 787 Dreamliners to offer a new type of economy seat with legroom of 34 inches (86 cms), bigger than the current economy offering of 31 inches.

Virgin also said it would offer a new "economy light" ticket which excludes checked luggage.

It gave no information about ticket prices in the new categories.

The airline is increasingly competing against low-cost carriers such as Norwegian Air Shuttle (LSE: 0FGH.L - news) , Canada's Westjet and Iceland's Wow Air, which are all stepping up expansion on routes between North America and Europe.

IAG, the owner of Virgin's old rival British Airways, is also in on the low-cost action, launching a low-cost long-haul unit called Level last year, while Lufthansa has been expanding its Eurowings brand, and U.S. carriers have introduced new fares that don't include baggage or seat selection.

Virgin said a process to refit its cabins to offer the extra legroom was under way and formed part of a 300 million pound ($416 million) investment which included adding wifi to its fleet and new bag drop facilities at airports.

The new 34-inch legroom seat on Virgin, available from this Spring, will give passengers an option in between economy and Virgin's more expensive premium economy seat.

Rival airlines British Airways and Norwegian also offer economy seats with 31 inches of legroom. Both British Airways and Virgin offer legroom of 38 inches in their premium economy, while Norwegian's premium cabin has legroom of between 43 and 46 inches.

Last year, Virgin Atlantic said Air France-KLM (LSE: 0LN7.L - news) would buy 31 percent of the airline from Richard Branson's Virgin Group, making it the second largest Virgin Atlantic shareholder after U.S. airline Delta, which owns a 49 percent stake, and reducing Virgin Group's stake to 20 percent. That deal has not yet completed. ($1 = 0.7206 pounds) (Reporting by Sarah Young; Editing by Adrian Croft)