Virgin Australia might not return to long-haul flying

[MelbourneFlyer]

Interesting remark from Jayne Hrdlicka in this article, on the subject of international flying she said "whether we go back in with long-haul flying ourselves is an open question.”

So Virgin intends to do short-haul such as NZ, Bali and Fiji with its 737s but could skip establishing a new long-haul fleet for LAX and rely on partners like Delta. Makes sense if the recovery is going to be protracted and uncertain, why take the risk? Just focus on being a good domestic airline with a bit of short-haul too.

https://www.executivetraveller.com/news/how-virgin-aims-to-win-back-business-travellers-corporate-flyers

[Alfie.floor]

This means they’ll hand over to Qantas all the Haneda slots.

[B772]

The Haneda Slot Co-ordinator will decide who gets any slots that are surrendered.

[ANstar]

Makes sense if the recovery is going to be protracted and uncertain, why take the risk? Just focus on being a good domestic airline with a bit of short-haul too.



Makes sense if you want to focus on profitability and an IPO. I doubt long haul (and the risk it brings) will return before Virgin is IPO'd and Bain exit stage left.

[TBM-Legend]

Well here's an opportunity for the PPRUNE brains trust to start an Oz International carrier: from what I read here so many here know how to run an airline covering all bases from Chairman, CEO, COO, HOFO, marketing and all the other things including aircraft selection etc...

Go for it!

[Agent_86]

Bain were never going to fund an International Long-Haul Arm of VA. They can't wait to 'flip' the current business.

[chookcooker]

Keep banging that drum

[krismiler]

NZ, Fiji and Bali would be about it with the B737. Go longhaul and they're head to head with QF and the big boys in a different market. Unless widebodies are close to full with a decent number of premium class seats filled, the losses can be eye watering.

Best to codeshare with other airlines and act as their domestic network in Australia.

[non_state_actor]

Doesn't having none of your own metal on Long Haul have a detrimental effect on your all important Frequent Flyer Program? In that you then have to buy seats off other airlines instead of your own. So you are gaining revenue from original ticket sale then giving away points which generate revenue and then given to another company? Wouldn't it give QF a big advantage in this domain?

[MickG0105]

Doesn't having none of your own metal on Long Haul have a detrimental effect on your all important Frequent Flyer Program? In that you then have to buy seats off other airlines instead of your own. So you are gaining revenue from original ticket sale then giving away points which generate revenue and then given to another company? Wouldn't it give QF a big advantage in this domain?
Depends entirely on how the cost of your seats stacks up against the purchase price from your partner airline. It's a classic "make versus buy" decision. And if you can't operate long haul profitably the true cost of that frequent flyer seat is astronomical. One thing for sure and certain, you're not going to invest capital in a long haul operation just for the frequent flyer program benefits.

[AerialPerspective]

Interesting remark from Jayne Hrdlicka in this article, on the subject of international flying she said "whether we go back in with long-haul flying ourselves is an open question.”

So Virgin intends to do short-haul such as NZ, Bali and Fiji with its 737s but could skip establishing a new long-haul fleet for LAX and rely on partners like Delta. Makes sense if the recovery is going to be protracted and uncertain, why take the risk? Just focus on being a good domestic airline with a bit of short-haul too.

https://www.executivetraveller.com/news/how-virgin-aims-to-win-back-business-travellers-corporate-flyers

I've always thought that the long term viability of VA relies on a solid niche in the Australian Domestic market, then when Bain are ready to step back, a cornerstone investment from Delta Air Lines. Delta would bring SO much to VA, an international feed that could have VA operating from Australia to HKG with a VA code but Delta livery or eventually brand the whole thing as 'Delta Australia'. They'd get a decent operational and departure control system via Deltamatic which, even though the bones of it are 20 years old, still outlcasses that bloated piece of giraffe crap that they are using at the moment (SABRE??)....... both operationally and otherwise....

Delta has everything that complements VA, a network that feeds directly into Australia, a North American base that then expands to the rest of the world and an extensive Asian network through the merger with NorthWest (originally, let's not forget, 'Northwest Orient').

Any move to re-establish with just one or two routes is a waste of time and resources. How many times does this need to occur (Ansett International, Air Australia...........) before we just accept that out of Australia, Qantas is embedded as the principal carrier and the way to compete is NOT to try and copy it but to approach the market from a different angle. No more of this SQ, EY, NZ, etc etc. rubbish with small interests but not enough to make a difference, get a cornerstone like DL and VA becomes a DL arm with serious clout and a credible alternative product. The VA 'niche' status might even offer a degree of competitive opportunity against Qantas' one-stop Project Sunrise which any other foreign carrier will find it impossible to compete against because they can't afford to configure part of their fleet to compete with QF ultra-long haul whereas QF ULA will be ALL that the fleet is doing.

[Icarus2001]

Qantas' one-stop Project Sunrise which any other foreign carrier will find it impossible to compete against because they can't afford to configure part of their fleet to compete with QF ultra-long haul whereas QF ULA will be ALL that the fleet is doing. I have read that line three times and it makes no sense to me.
If QF can set up a fleet just for ULH so can any other carrier.
If QF want non stop Aus to Europe, then a European carrier can come the other way, or the US.

[PoppaJo]

No reason why Virgin Atlantic couldn’t launch a Heathrow to Perth service.

[neville_nobody]

That got shot down a long time ago.

https://www.independent.co.uk/travel/news-and-advice/virgin-atlantic-london-australia-flights-richard-branson-qantas-perth-a8606376.html

[Ken Borough]

Just maybe the boffins in Canberra are reassessing the nonsense that Virgin Australia is an Australian carrier within the meaning of the refs. It’s absurd that an entity whose ownership is 100% foreign could be considered Australian. It is farcical.

[neville_nobody]

Just maybe the boffins in Canberra are reassessing the nonsense that Virgin Australia is an Australian carrier within the meaning of the refs. It’s absurd that an entity whose ownership is 100% foreign could be considered Australian. It is farcical.

In a regulatory sense what's the difference between going to LA or Denpasar or Nandi or Auckland? Either you can fly internationally or you can't.

[MelbourneFlyer]

If QF can set up a fleet just for ULH so can any other carrier.

The difference is that QF can have a solid fleet of A350-1000ULRs because it's flying SYD-LHR, MEL-LHR, SYD-JFK, MEL-JFK, SYD-CDG, SYD-FRA etc etc. Maybe 12-18 of these A350-1000ULRs.

But how many similar jets would an individual competing carrier in London, New York, Paris or Frankfurt need? Only a handful, because there might only be two routes to Australia that needs them. And it's not efficient yo have tiny sub-fleets compared to the much bigger numbers Qantas is looking at.

If QF want non stop Aus to Europe, then a European carrier can come the other way, or the US.

They can, but again, only makes sense if they have a lot of aircraft to do those missions. The numbers favour Qantas because it can have a much larger fleet.

[43Inches]

In a regulatory sense what's the difference between going to LA or Denpasar or Nandi or Auckland? Either you can fly internationally or you can't.

This is probably what is being referred to;

https://www.smh.com.au/business/companies/virgin-to-use-shell-company-loophole-to-sidestep-foreign-ownership-cap-20210108-p56spl.html

It really does make a mockery of the rules that everyone else has to follow. Especially in the case of QF that is hamstrung by these rules and the sale act which results in no major investors having controlling interests in the airline. This will impact future viability if competition is allowed to court internationals yet QF is stuck with 51% sporadic local ownership.

On the flip side, Virgin would be a dead and roasted duck by now without the loophole...

[Colonel_Klink]

On the flip side, Virgin would be a dead and roasted duck by now without the loophole...

How do you figure? The shell company was a way for Virgin to be able to do their international operations.

There is no legislative restriction on foreign owned companies operating domestic only services in Australia (hence Virgin, Rex and now Bonza).

Whether or not there should be restrictions on foreign ownership of domestic carriers is another question entirely!

[PoppaJo]

Whether or not there should be restrictions on foreign ownership of domestic carriers is another question entirely!
The market here is too small to have all these new startups. It’s probably more a matter of these rules just allowing anyone in, wasting time, creating jobs that don’t need to be created and so on. RexJet also foreign funded, complete disaster. Bonza chasing rainbows and lollipops. None of these airlines are needed unless they are purely here to burn cash.

AirAsia said Tiger was on drugs when it decided to start in 2007. Very true indeed.

Take out Tiger and alongside a leaner and resurgent Virgin, the market was actually setting itself up sustainably for once. You can’t say we lack competition, Virgin has now reduced fares, Jetstar runs the budget space, Qantas the high end...and so on. Then come along these time wasters.

[galdian]

The market here is too small to have all these new startups. It’s probably more a matter of these rules just allowing anyone in, wasting time, creating jobs that don’t need to be created and so on. RexJet also foreign funded, complete disaster. Bonza chasing rainbows and lollipops. None of these airlines are needed unless they are purely here to burn cash.

AirAsia said Tiger was on drugs when it decided to start in 2007. Very true indeed.

Take out Tiger and alongside a leaner and resurgent Virgin, the market was actually setting itself up sustainably for once. You can’t say we lack competition, Virgin has now reduced fares, Jetstar runs the budget space, Qantas the high end...and so on. Then come along these time wasters.

Resurgent Virgin?? :ugh: - you choose to forget what Bain's all about....and it's not about playing "lets run an airline". The controlling entity is Bain, the lipstick on the pig for Bain is Virgin Oz MK2 (or whatever), let's see where things are in the years to come.
Ms Jane is the puppetmaster of Virgin, Bain are the puppetmaster of Ms Jane, I sincerely hope the best for Virgin Oz but Bain just want money however achieved, it may be human nature in some to try to ignore reality....but it's still reality.

Virgin Blue was a time waster until AN went down and things changed.
Should any other time wasters offer employment - for whatever period of time - I'd say that's a good thing. You apparently think otherwise, at least that's the way your post reads.

Cheers

[morno]

The difference is that QF can have a solid fleet of A350-1000ULRs because it's flying SYD-LHR, MEL-LHR, SYD-JFK, MEL-JFK, SYD-CDG, SYD-FRA etc etc. Maybe 12-18 of these A350-1000ULRs.

But how many similar jets would an individual competing carrier in London, New York, Paris or Frankfurt need? Only a handful, because there might only be two routes to Australia that needs them. And it's not efficient yo have tiny sub-fleets compared to the much bigger numbers Qantas is looking at.



They can, but again, only makes sense if they have a lot of aircraft to do those missions. The numbers favour Qantas because it can have a much larger fleet.

If you’re already an A350 operator, half a dozen ULR versions are hardly a “sub-fleet”.

[scrotometer]

Bonza
Forbes to Frankfurt!!!

[PoppaJo]

Resurgent Virgin?? :ugh: - you choose to forget what Bain's all about....and it's not about playing "lets run an airline". The controlling entity is Bain, the lipstick on the pig for Bain is Virgin Oz MK2 (or whatever), let's see where things are in the years to come.
Ms Jane is the puppetmaster of Virgin, Bain are the puppetmaster of Ms Jane, I sincerely hope the best for Virgin Oz but Bain just want money however achieved, it may be human nature in some to try to ignore reality....but it's still reality.

Virgin Blue was a time waster until AN went down and things changed.
Should any other time wasters offer employment - for whatever period of time - I'd say that's a good thing. You apparently think otherwise, at least that's the way your post reads.

Cheers
Sadly I’ve seen too many families destroyed, careers ended, and people’s general mental health shot due to places like Tiger, Strategic, Sky, JetG, Air Australia, and probably RexJet snd Bonza also. I’ve seen good people, who worked for these places, in some terrible and sad circumstances following the collapse of those businesses.

Unless some operator is going to be around for good, the career of Flight Crew in this country would be much more sustainable pathway, especially for the next generation if the market was just QF/VA/JQ/ZL Regional and Alliance/Network. All bases are covered, these players are not going anywhere, and people don’t have to stress if the place is going to collapse year after year.

They are trying to fill a gap that does not exist. Taking employees along for a ride also which only ends in tears at some point. Sure, these employees make the call to join, however the executive teams at all these carriers are out and about giving false hope, all very positive comments to the media around the market and all, meanwhile dive into the commercial numbers and it’s a disaster, as it was expected to be. It’s all very strange at Rex, majority of loads at 10-25%, lets grow the fleet and let the media know its all rainbows. I know one Captain there trying to exit at the moment, he knows what’s coming in the medium term. There isn’t room for a 4th or 5th airline. There is no gap they claim they are trying to fill, even if there was, is there even any management team capable of pulling it off? Unlikely.

[krismiler]

Apart from BA, no European airline fly's to Australia, they can't compete with all the hub airlines in between which have lower costs and offer stopovers.

Any time of the year will be off season somewhere with that country's airline offering seats at break even prices just to fill them. Even QF had such a hard time competing that they had to partner with EK.

​​​​​​The Middle East 2.5 can offer a 1 stop connection from most Australian capital cities to most cities in Europe at a decent price and many of the Asian airlines can do the same, often undercutting if they have a sale on.

Some SE Asian destinations might be worth looking at via a Darwin hub as many of these airlines have restructured due to COVID and dropped everything except Sydney. Brisbane to Phuket requires a connection somewhere and DRW might work.

[Icarus2001]

That is the point Krismiler, NON STOP versus ONE STOP.

Using your argument then QF should also not be able to compete with the ME3 but they do.

[Renton Field]

United anointed as new partner.
Delta gawn.

[krismiler]

Using your argument then QF should also not be able to compete with the ME3 but they do.

QF can't compete with the ME airlines which is why they went into partnership with EK, if you can't beat them - join them.

Due to historical ties and London being a major world city, there is sufficient demand for Australia to LHR for QF to make money on the route. Now try Perth - Athens or Brisbane - Paris, the numbers don't add up unless it's via a hub with other passengers connecting to the same destinations.

United Airlines are Star Alliance so hopefully codeshares with other members will open up for Virgin. They will be much better off as the alliance's Australian domestic network with limited international flights using the B737 rather than trying to compete with major world airlines on long haul routes.

[DanV2]

I think a high chance we can expect UA in BNE with DL gone, should VA give up the HND slot. Can't see BNE-USA being a QF monopoly for much longer with Qld borders opening up further in 2022.

Otherwise if VA intends on holding onto the HND slot, a slim chance of limited 'long haul' flying based out of BNE with BNE-HND in partnership with NH and on flying on behalf of UA on the BNE-LAX and limited BNE-SFO. 4-5 aircraft all based in BNE.

[Kenny]

Not sure if they still have plans to do it but QF were planning ORD-BNE, which I can see United doing.

[LostWanderer]

Wow QF could have some serious competition here on the AUS-USA routes if they expand beyond SYD and MEL.

Pretty much a guarantee VA will not be flying long haul at all as well.