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Wirraway
6th Nov 2002, 19:35
Thurs "The Australian"

Virgin tempts Qantas frequent-flyers
Steve Creedy, Aviation writer
November 07, 2002

RICHARD Branson will use an innovative fully flexible frequent-flyer scheme as part of his ambitious plan to tackle Qantas head-on in the wake of yesterday's deal to gain access to Ansett's former Sydney terminal.

Describing the midnight deal, which follows a bitter six-month feud with Sydney airport and removes a significant hurdle to the airline's growth, as a "victory", Sir Richard predicted it wouldn't increase fares "one cent".

"It really does mean that we can be a head-on competitor to Qantas," Sir Richard said. "Our aim of reaching 50 per cent of the market one day I think now is a realistic one."

Virgin Blue's chief executive, Brett Godfrey, yesterday outlined the scheme to sidestep the bottlenecks of conventional programs by allowing members access to all spare seats.

Unlike other carriers, Virgin's frequent-flyers would be rewarded with a full economy ticket, which would be valid for any flight with spare seats.

The new loyalty scheme due to be unveiled next year is part of a wider strategy that includes expanding its fleet to 40 aircraft, the introduction of user-pays lounges, more links with international airlines and possible overseas expansion.

Mr Godfrey said the airline was still considering its frequent-flyer options and had yet to decide whether the loyalty program would use a points system or offer a free flight after a given number of journeys.

But he said it would be internet-driven and would offer people the kind of flexibility often denied under existing frequent-flyer programs, which placed strict limits on the number of frequent-flyer seats on any given flight.

Those limits were a big flaw of other frequent-flyer programs and meant members were "screwed" when they wanted to use their points in busy periods such as holidays, he said.

"Rest assured that if we do something that once you've earned a flight it's a full Y (economy) ticket in the sense that if there's a seat there, you get it," he said.

"There's not going to be blackout periods or anything like that."

It was not clear how the scheme would link with other airlines, such as code-sharing partner United Airlines.

Virgin Blue is expanding its code-sharing agreement with United to other Australian routes, and is talking to other overseas airlines about similar arrangements.

It has also not ruled out a deal with the giant Star Alliance.

Mr Godfrey said Virgin was not seeking Star Alliance membership but was prepared to look at a "Star Light" arrangement that did not involve adopting the alliance's systems.

Officials also confirmed Virgin Blue was continuing to investigate international services but said they would not start until at least the middle of next year. A tender document is being sent to 18 cities around the Asia-Pacific.