The battle for control of Australia’s skies post-COVID stepped up a notch after Qantas announced it was to start flying Canberra routes only recently launched by smaller airlines.
Qantas will now compete with Alliance to fly between the ACT and the Sunshine Coast from 19 November; and fight with Link to service a route between Canberra and Hobart from 4 December.
Meanwhile, Link Airways operated its first flight between Canberra and Hobart on 5 November. The service was due to start on 3 December, but launched earlier when Tasmanian Premier Peter Gutwein opened the border with the ACT on 26 October.
The flights will depart Canberra at 9:30am and arrive into Hobart at 11:35am, while the return service will depart Hobart at 12:05pm and land in Canberra at 2:05pm.
Last week, Australian Aviation reported how Virgin applied to the ACCC to collaborate with Alliance on 40 regional routes to safeguard its market share against Qantas.
The airline argued it would be hard to serve smaller towns with its post-administration, stripped back fleet and ceding to Qantas could result in more expensive fares for passengers.
The deal between Virgin and Alliance would include sharing cost information, agreeing capacity, and collaborating on flight schedules.
In August, Virgin Australia announced plans cut 3,000 jobs and significantly downsize its fleet.
The new network will operate a 737 mainline fleet for domestic services but removing ATR, Boeing 777, Airbus A330 and Tigerair Airbus A320s. Its regional and charter fleet will also be maintained.
Alliance, meanwhile, recently received the first of 14 new Embraer E190s to add to its existing collection of 24 Fokker F100, 13 Fokker 70LRs and five Fokker 50 turboprops.
The ACCC’s report on the proposals states: “Virgin Australia has already announced that it will cancel a number of regional services for the foreseeable future due to depressed demand, unsustainable load factors, and the unsuitability of Virgin Australia’s proposed Boeing 737 fleet for routes with limited demand and which cannot be serviced using VARA’s Western Australia-based F100 fleet. Virgin Australia sees the proposed conduct as the most effective way to service the relevant routes and continue to serve these cancelled routes, in partnership with Alliance Airlines.
“If Virgin Australia does not have a presence or retain its slots on these routes, it will be increasingly more difficult for it to re-enter in the future, strengthening the position of the remaining competitors and ceding market share and reach to Qantas. This may result in more expensive airfares, less favourable terms and conditions, reduction in quality of in-flight services and a reduction in the number of flight options (routes and frequency) available to consumers.
“The ability for Virgin Australia to offer a full network of services, but to do so without sustaining operational losses, is crucial to its ability to restore confidence in its services and brand as it comes out of voluntary administration.”