What is Virgin Australia's strategy (post-administration)?

Change in fleet strategy isn't really an option. Yes they decided on the MAX a long time ago and long before the "troubles" but they're stuck with it. And I don't think it's inherently a bad thing, however for timelines it does present a future growth problem. As others have said, mid-life NGs are not exactly difficult to get a hold of so they'll be able to keep pace easily enough.
 
And then there is staffing, VA2 are already struggling to hold onto their current pilot base, they’d all need re-training, would be a pretty huge disruption for them to manage.
With the way QF are treating pilots it might be a real struggle to keep any pilots in Australia. Both VA and QF seem to have no regard for them
 
You do know the strategic position of VA is to fly mainly domestic routes with 737 narrow body operation and a few ISH destinations right?

The core focus isn't on LH operations.
Long haul would be a great way of growing the top line sales.

And shrinking the bottom line and burning through cash.
 
VA2 focusing on domestic (and nearby Int'l) is actually a fine strategy. If it can demonstrably shore up the domestic market, it becomes a more attractive option for another airline that already has widebody ops to compliment it.

That way VA2 doesn't have to be the one stretching itself into a massive money hole with no guarantee of success. (QF, JQ and Int'l airlines can all massively cut their own fares if VA tries to launch a widebody Int'l again).

If anything I just think that they probably missed a few opportunities to make the 737M8s much more modern and polished to give it a significant advantage over QF 737s (until QFs replacement a320s come in).

There's still little things you can add here and there to the Y experience that would make it stand out over other narrow bodies.
 
You know what I love about VA now? They're disciplined. They don't entertain la la fantasies about long haul routes which got them in financial trouble in the first place.

It might be okay for right now - but I can’t help but think this lack of ambition will hurt VA in the long term both from a potential sale view, but also it’s attractiveness to any semblance of a premium flyer.
 
It might be okay for right now - but I can’t help but think this lack of ambition will hurt VA in the long term both from a potential sale view, but also it’s attractiveness to any semblance of a premium flyer.

I think any buyer would prefer to set their own strategy from the current domestic base. Choosing particular overseas routes/aircraft now would really restrict the pool of potential investors.
 
I think any buyer would prefer to set their own strategy from the current domestic base. Choosing particular overseas routes/aircraft now would really restrict the pool of potential investors.
Agreed. Very much similar to the reasons why VA's international partnerships are not going past the simple codeshare and FF reciprocation deals.

JVs and Alliances costs them considerable amounts of money to apply for and to implement (and also having to apply for approvals for JVs from the respective countries)
 
It might be okay for right now - but I can’t help but think this lack of ambition will hurt VA in the long term both from a potential sale view, but also it’s attractiveness to any semblance of a premium flyer.
Lack of ambition... Is the meaning of ambition to fly LH and nothing else? There's more to the whole scheme than just flying LH, Gee whiz.
They've been adding partners along the journey.

VA are NOT a premium carrier, it couldn't be more obvious and they've stated it like 2 million times, they're a mid-tier / hybrid carrier service.
 
Last edited:
Indeed, as Virgin had said "Virgin Australia aims to be the best value carrier in the market, not a low-cost carrier,"

Basically a hybrid/LCC with a Recliner Business cabin attached with a FF program and domestic lounge services.

Sure VA's aim may change in a post Trade Sale/IPO under any potential new owners, but for now their aim has already been stated.
 
Lack of ambition... Is the meaning of ambition to fly LH and nothing else? There's more to the whole scheme than just flying LH, Gee whiz.
They've been adding partners along the journey.

Let me rephrase this to a lack of ambition to be a lack of any obvious growth pathway.

Domestic growth is going to be minimal. Go more downmarket or build a seperate brand like Jetstar, unlikely since they are already basically there. LH is on the only half decent day dream even if itself is a poor avenue of growth. Go up market and get destroyed by QF.

Basically, while it’s nice for a consumer to for VA to stick to the lane of value carrier - from an investment standpoint they are going no where. Who wants to be on the train to nowhere and see it all fall over a few years again.
 
Let me rephrase this to a lack of ambition to be a lack of any obvious growth pathway.

Domestic growth is going to be minimal. Go more downmarket or build a seperate brand like Jetstar, unlikely since they are already basically there. LH is on the only half decent day dream even if itself is a poor avenue of growth. Go up market and get destroyed by QF.

Basically, while it’s nice for a consumer to for VA to stick to the lane of value carrier - from an investment standpoint they are going no where. Who wants to be on the train to nowhere and see it all fall over a few years again.
Someone gets it.

And with QF and JQ growing they’ll erode VA’s domestic marketshare little by little from both end. Plus with Rex in the mix it doesn’t look rosy at all.
 
All this talk of widebodies and long hall is not going to happen. The initial setup and acquisition costs would eb ridiculous.
I am no airline expert, but would they even get landing slots at some of the major airports ie LAX? I know there is open skies to a. Certain extent to USA but if you cant get a landing slot you cant go. Again, im no expert and happy to bw explained how they can get slots.
I personally think they are getting their cough together and operating a lean, efficient operation. Last year was a shocker with reliability and efficiency but they really seem on top of that the past few months.
 
All this talk of widebodies and long hall is not going to happen. The initial setup and acquisition costs would eb ridiculous.
I am no airline expert, but would they even get landing slots at some of the major airports ie LAX? I know there is open skies to a. Certain extent to USA but if you cant get a landing slot you cant go. Again, im no expert and happy to bw explained how they can get slots.
I personally think they are getting their cough together and operating a lean, efficient operation. Last year was a shocker with reliability and efficiency but they really seem on top of that the past few months.
LAX isn't slot restricted.
 
Someone gets it.

And with QF and JQ growing they’ll erode VA’s domestic marketshare little by little from both end. Plus with Rex in the mix it doesn’t look rosy at all.
If you look at the numbers VA had increased its capacity share from ~33% to ~37%. if as you say QF & JQ also growing and rex taking a nibble of the market, then my math says something doesn't add up.
 
Someone gets it.

And with QF and JQ growing they’ll erode VA’s domestic marketshare little by little from both end. Plus with Rex in the mix it doesn’t look rosy at all.

Exactly what do you & @ThatMrBlake want Bain/Virgin to do to grow? Place an order for a dozen or so new widebodies and announce plans to fly to LAX, JNB and SIN? Extra 50% capacity on Golden Triangle routes? Join Star Alliance? Take over REX?

When you are going to sell something (as Bain is committed to do), you try to keep a stable product# & not do anything out of the ordinary, as you will only restrict your potential buyer base. If you are going to sell your house, you don't sign a contract to put additions on just before sale. Leave it to the new owners to decide what they want to do with the house, airline or whatever. I dare say if a buyer does have expansion plans, they will first bed down their purchase for a while.

#Not least of all, financially, so forecasts will mean something.

And QF and JQ nibbling the market back from both ends - this is pretty much what Bain acknowledged when they announced that they wanted to be a value proposition & not chasing corporate nor the horrid cheapie end. And I'm not convinced VA has been losing out anyway.
 
If you look at the numbers VA had increased its capacity share from ~33% to ~37%. if as you say QF & JQ also growing and rex taking a nibble of the market, then my math says something doesn't add up.

I think you’ve got that backwards. VA’s share was 31.4% in March 24 and has hovered in the low 30s since the start of the pandemic. Pre-pandemic, including Tiger, the market share was around 37%.

QFs share hasn’t really changed at all, hovering in the low 60s both pre and post pandemic, 61.8% in March 24. It had a small period of up to 70% in 2021 but that’s an anomaly as the charts below show.


1719098858438.png
1719098925959.png

Source: https://www.accc.gov.au/system/files/domestic-airline-competition-in-australia-may-2024-report.pdf

 
Turn business expenses into Business Class! Process $10,000 through pay.com.au to score 20,000 bonus PayRewards Points and join 30k+ savvy business owners enjoying these benefits:

- Pay suppliers who don’t take Amex
- Max out credit card rewards—even on government payments
- Earn & Transfer PayRewards Points to 8+ top airline & hotel partners

AFF Supporters can remove this and all advertisements

Become an AFF member!

Join Australian Frequent Flyer (AFF) for free and unlock insider tips, exclusive deals, and global meetups with 65,000+ frequent flyers.

AFF members can also access our Frequent Flyer Training courses, and upgrade to Fast-track your way to expert traveller status and unlock even more exclusive discounts!

AFF forum abbreviations

Wondering about Y, J or any of the other abbreviations used on our forum?

Check out our guide to common AFF acronyms & abbreviations.

Staff online

Back
Top