Insights from the world of aviation 

VIRGIN AUSTRALIA NEWS

Virgin Australia has received the necessary traffic rights to commence nonstop flights between Brisbane and Tokyo Haneda Airport from the end of March 2020. On October 29, Australia’s International Air Services Commission (IASC) said it had awarded Virgin Australia one of the two available slots for nonstop flights to Haneda. The Brisbane-Tokyo Haneda nonstop flight would be operated in partnership with Japanese carrier All Nippon Airways (ANA).
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While Brisbane-Tokyo Haneda was given the green light, Virgin Australia chief executive Paul Scurrah announced at the airline group’s annual general meeting in Brisbane on November 6 the curtain would come down on the airline’s Melbourne-Hong Kong service in February 2020. Scurrah said the route “continued to underperform in line with the political landscape”. The airline would continue to fly between Sydney and Hong Kong.
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Still on Virgin Australia, the airline also announced a slew of route changes as part of an ongoing review of its fleet and network that began earlier in 2019. This included ending Canberra-Perth from 6 December 6 2019, Gold Coast-Perth from 19 January 19 2020 and Sydney-Christchurch from 29 April 29l 2020, while there were also frequency reductions on Sydney-Tamworth and Sydney-Auckland. “Flying to the right destinations, with the right customer demand, and the right sized fleet will improve our financial performance,” Scurrah told shareholders.
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On the other side of the ledger, Virgin Australia planned to re-enter the Melbourne-Denpasar market with nonstop flights using Boeing 737-800 equipment from 29 March 29 2020. Scurrah said it had previously been a “very profitable” route in the airline’s network. In 2016, Virgin Australia handed the route to its low-cost carrier (LCC) unit Tigerair Australia, which ended its services to Bali from Adelaide, Melbourne and Perth in early 2017 due to an impasse with Indonesian regulators.
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Further on Tigerair Australia, Scurrah said the company was looking to “re-focus Tigerair flights on key holiday destinations” and would withdraw two Airbus A320s from the LCC’s fleet and drop three routes – Brisbane-Darwin and Proserpine-Sydney in February 2020, and Adelaide-Brisbane in March 2020. Tigerair Australia operates a mix of A320s and Boeing 737-800s and is moving to an all-Boeing fleet.

QANTAS GROUP NEWS

Qantas has reported total revenue of $4.56 billion for the three months to 30 September 30 2019, up 1.8 per cent from $4.49 billion in the prior corresponding period. The trading update published on October 24 noted market conditions were challenging, with weaker demand for corporate travel in the financial services and telecommunications sectors, as well as among small businesses and price-sensitive leisure travellers. On a more positive note, the resources-related markets had improved.
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Still on the trading update, Qantas said the airline group would have an “increased focus” on cost reduction efforts in the second half of 2019/20. “Given the slower revenue environment, we have a strong focus on cost reduction to make sure we keep delivering on our transformation targets,” Qantas chief executive Alan Joyce said in a statement. “Part of this is about taking opportunities to reduce complexity and constantly improving how efficiently we manage our business.”
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Jetstar group chief executive Gareth Evans said on November 1 the first of 18 Airbus A321LRs on order were expected to arrive in August 2020. Evans told reporters in Sydney the long-range narrowbody would be configured to carry 232 passengers in a single-class layout at 29-inch pitch. Jetstar planned to use the A321LRs on Australian domestic routes, as well as on international services from Australia to Asia and the South Pacific.
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Almost a quarter of Qantas shareholders have supported calls for the airline to undertake a review of the way it conducts involuntary transfers of asylum seekers on behalf of the Australian government. While the resolution put forward by the Australasian Centre for Corporate Responsibility (ACCR) at the company’s annual general meeting in Adelaide on October 25 failed to pass, the 23.56 per cent who voted in favour represented a significant increase from 2018, when 6.43 per cent supported a similar resolution proposed by the ACCR. Qantas directors had recommended shareholders vote against the resolutions, arguing the proposals were not in the their best interests and the review was unwarranted.
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Qantas has received one of the two available new slots for Australian carriers at Tokyo Haneda Airport. The airline had been hoping to secure both slots to add a second Sydney-Tokyo Haneda service and switch its Melbourne-Tokyo Narita flight to the close-in Haneda Airport. However, Australia’s International Air Services Commission (IASC) decided to give Virgin Australia one slot and Qantas one slot. In response to the decision, Qantas said in late October it would announce how it planned to use its one slot at a later date.