Australia’s second-largest airline has announced its complete withdrawal from Hong Kong, in what is another blow for the beleaguered Asian hub.
Virgin Australia’s announcement comes amid the ongoing Coronavirus outbreak, which has led to a reduction in demand for travel to Hong Kong. The negative impact on the historically thriving city has led global carriers to reduce capacity amid the worsening health crisis; while earlier this week US airlines American and United announced the temporary suspension of flights to Hong Kong.
Coronavirus’ impact on passenger traffic follows months of civil unrest in the city – leading to dampened demand for services transiting Hong Kong International Airport – as international travellers seek alternative hubs for long-haul connections between Europe, Oceania and North America.
Unrest in the city peaked late last year, with civil protestors overcrowding the airport in August, leading to a grounding of flights that caused mass disruption to travellers.
It was expected that a proposed agreement with Virgin Atlantic would see increased traffic on Virgin Australia’s Hong Kong routes. With ACCC approval granted in September 2019, the airlines were given the green light to strengthen cooperation on services that would link the UK and Ireland to Australia via Hong Kong.
However in November last year, Virgin Australia announced the removal of Melbourne – Hong Kong flights – set to cease on 11 February 2020 – while the worsening viability of Hong Kong flights has now led the airline to withdraw from the city altogether. The final Sydney – Hong Kong service will take place on 2 March.
Of the withdrawal, Virgin Australia’s Chief Commercial Officer, John MacLeod said: “Hong Kong has continued to be a challenging market… While the decision to withdraw from the Hong Kong market has been a difficult one, it demonstrates our strong focus on driving greater financial discipline through our network,”
“Current circumstances demonstrate that Hong Kong is no longer a commercially viable route for Virgin Australia to continue operating, however international tourism remains an important part of our strategy through our other international routes and partner airlines,” MacLeod added.
Virgin Australia is by no means the only airline suffering to sustain flights to cities in the region amid the ongoing Coronavirus crisis.
Last week Qantas announced it would cease all flights to the Chinese cities of Beijing and Shanghai from 9 February. British Airways, Virgin Atlantic, KLM and Delta are among a host of other carriers to suspend services to Mainland China.
Hong Kong received a blow on Wednesday when American Airlines and United announced the temporary withdrawal of flights, while local carrier Cathay Pacific is among the hardest hit, reporting significant drops in demand leading it to the airline significantly reducing capacity.
This includes the progressive reduction of around 90% of flights to Mainland China, as well as capacity adjustments across its international airport.
The situation has led the airline to ask its workforce to take three weeks unpaid leave between March and June, however, the company said that its: “current financial position remains strong and will enable it, despite the current difficult trading conditions, to maintain the quality of its products and services,” in a statement to the Hong Kong Stock Exchange on 4 February.
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