Vaile backs Virgin plan for 10 weekly flights to US
Steve Creedy, Aviation writer
July 04, 2007
VIRGIN Blue has secured Australian Government support to operate 10 non-stop services a week across the Pacific.
The airline last week lodged applications in Australia and the US to operate Boeing 777-300ER aircraft across the Pacific.
However, it needs approval from both countries to exceed the limit set under the current bilateral agreement, which allows four services a week.
Virgin Blue is hoping it can now avoid getting tangled up in a US push for open skies between the two countries.
The issue of open skies was raised by United Airlines last year, when it opposed a submission by Jetstar International to fly five services a week to Honolulu. US granted Jetstar the extra rights but stressed that they would like to see the open skies issue revisited.
Virgin says the 10 weekly services are essential to the viability of its new international airline. It has ordered six 777s from Boeing, with an option for six more, and will lease one from International Lease Financing Corporation.
Transport Minister Mark Vaile said yesterday he had written to the US Secretary for Transportation to confirm the Australian Government's strong support for the new airline.
"The Minister believes increased competition on the Australia-USA route is highly desirable and that Virgin Blue International's entry will benefit consumers and businesses of both countries," a spokeswoman for Mr Vaile said last night.
"The Australian Government believes Virgin Blue International's planned operations can be accommodated within existing air services arrangements.
"Nonetheless, we have indicated - most recently at the APEC Transport Ministers meeting in March - that in the longer term, the Australian Government is prepared to look at further liberalisation of the bilateral aviation arrangements between Australia and the US, following the establishment of Virgin Blue's operations."
The airline's filing with Australia's International Air Services Commission shows Virgin Blue International as a fully-owned subsidiary of Virgin Australia Holdings.
The airline, which last week shortlisted names for the new airline, expects to announce a trading name for the new carrier later this month. Contenders include Matilda Blue, Australia Blue and Australia Airlines and V. Australia Airlines.
Virgin is asking for a five-year allocation and says the capacity would be fully utilised from November, 2008.
It said it would bring to the market fundamental elements of its existing model that had brought sustained record growth in both the Australian and South-West Pacific markets.
It also noted that Virgin Blue Holdings had "driven significant pricing reform into markets dominated previously by high-cost legacy carriers".
"VBIA's new services will be in the public interest and will expand the travel and shipping options available in the Australia-US market," the airline's IASC submission says.
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