View Full Version : Virgin expects 30 pc (Corrigan)

1st Oct 2002, 04:00

Virgin expects 30 pc
By Megan Neil
October 01, 2002

LOW cost airline Virgin Blue expected to have 30 per cent of Australia's aviation market by the end of 2003, its half owner Patrick Corp said.

Patrick managing director Chris Corrigan also said the stevedoring and logistics group would not sell down its 50 per cent stake in the airline if Sir Richard Branson's Virgin Group went ahead with a float of Virgin Blue next year.

Mr Corrigan told investors in New York that Virgin Blue now had 20 per cent of the market, up from 10 per cent a year ago.

Qantas Airways Ltd currently held around 78 per cent, he said.

"We have aircraft on order which will be delivered before March of next year, which should take us to a 30 per cent market share we believe by December of 2003," Mr Corrigan told the Merrill Lynch Australasia investment conference.

But he said the target was dependent on better terminal access, particularly at the former Ansett terminal at Sydney airport.

"Hopefully reason will prevail there and we'll get access to the old Ansett facility there and that will allow us to expand," he said.

"It's not critical for us in the next 12 months but obviously the sooner it happens the better."

Mr Corrigan said Patrick did not have "any particular interest" in selling down its Virgin Blue stake, acquired for $260 million in March, but he noted that the Virgin Group was pursuing a secondary sale of its interest.

"If that occurs or not I don't know but it wouldn't surprise me if that occurred some time in the first half of next year."

He later told journalists that Patrick had an obligation to sell down five per cent of its stake if that occurred, but did not know if the company would be required to do so and it would not divest a greater share.

The airline was currently servicing 19 of the top 20 routes in Australia, which represented 85 per cent of all passenger movements in Australia.

The last - the Sydney to Canberra route - would follow when Virgin Blue gained access to the Ansett terminal in Sydney, Mr Corrigan said.

There has been talk of a third airline entering the Australian market, with Singapore Airlines the subject of much speculation.

But Mr Corrigan did not think a third carrier was likely.

"Do I think it's likely, no I don't think it's very likely but the airline business does seem to be notoriously unpredictable."


Boeing Belly
1st Oct 2002, 04:30
Wouldn't it be ironic if Branson sold off his interest, leaving Patrick as the major shareholder. How would JR and co. feel working for the mother of all scabs ( and a transport magnate to boot). The world certainly is a funny place!!

1st Oct 2002, 11:33

Virgin Blue takes further action
October 01, 2002

DISCOUNT airline Virgin Blue has stepped up its battle against Sydney Airport, asking competition regulators to declare it a monopoly infrastructure.

Virgin Blue said it today asked the National Competition Council (NCC) to have the facility "declared" under the Trade Practices Act.

If it succeeded in its push, the Australian Competition and Consumer Commission (ACCC) would set prices for access to the airport.

Virgin Blue recently also launched legal action against Sydney Airports Corp Ltd (SACL) in the NSW Supreme Court over access to the former Ansett terminal.

The airline said it had today asked the NCC to recommend airside services, including the use of runways and taxiways at Sydney Airport, and domestic terminal services be declared under the Act.

If a service is "declared", the ACCC would have the power to arbitrate any dispute over access to the facility, taking into account the public interest in having competitive markets in Australia, Virgin Blue said.

"In practical terms, this means that if the services are declared as requested by Virgin Blue, then airlines that use Sydney Airport can have the ACCC arbitrate any access dispute that they have with Sydney Airport over the use of the runways, taxiways and terminals," Virgin Blue said in a statement.

"The ACCC will then set a price that is a reasonable balance between the interests of the airlines and Sydney Airport."

Virgin Blue said declaration would provide airlines with fair access to the terminals and some protection from excessive fee increases for using the airport.

Virgin Blue head of commercial David Huttner said the issue affected all business and leisure flyers going to or from Sydney.

"We believe this is an important policy issue," Mr Huttner said in a statement.

"Should these vital monopolies be allowed to operate without effective oversight and charge the travelling public whatever they please?

"This matter impacts upon all business and leisure flyers going to or from Sydney and we look forward to presenting our views."

Virgin Blue said it would also continue its legal proceedings in the NSW Supreme Court against SACL.

Comment was being sought from SACL.