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Qantas CEO Vanessa Hudson has suggested Australia has no room for more domestic airlines following the collapse of Bonza.
At a press conference in Perth to launch the Flying Kangaroo’s new non-stop Paris service, Hudson pointed to Australia’s long history of failed airlines as evidence that “more players” will find it hard to gain a foothold in the domestic aviation market.
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“If you think about why three airlines really struggle it’s a number of things – our population, the US has 250 million people, we have 26 million and spread between the economics of being a viable airline, it’s incredibly challenging because it’s capital intensive,” she said.
“The next biggest challenge is decarbonisation, so that is significant and we believe no one can be winners or losers from decarbonisation, everyone should be doing it. And I don’t think there’s sufficient volume to sustainably support a significant growth in the number of players, but we want to grow.
“We are an island nation – our economy relies on domestic aviation and the role that we play as a national carrier. We want our airlines, and Virgin and Rex, we want them to be sustainable, and to be sustainable they’ve got to be making a certain amount of revenue to invest. We don’t want a weak aviation market.”
Hudson’s comments come after Bonza, which had ambitions to connect mostly regional destinations unserved or underserved by the major players, was put into liquidation earlier this month.
In its report to creditors, Bonza’s administrator – now liquidator – Hall Chadwick blamed several factors for the business’s failure, including “insufficient” and “sporadic” funding from parent company 777 Partners, and recommended the company be wound up.
CEO Tim Jordan and CFO Lidia Valenzuela, both local directors of the collapsed airline, also appeared to lay blame at the feet of Bonza’s parent company, accusing it of underfunding the business.
“Bonza was wholly reliant on funding from our sole investor 777 Partners. Although there was no feedback that funding had ceased, our ongoing and progressing execution plans were curtailed abruptly on the 30th April 2024 with the repossession of our aircraft,” they said.
“With the positive momentum in the business up until that time, coupled with maturing markets and additional fleet growth, Bonza was progressing positively towards being cash-positive late in 2024.
“Unfortunately for our Bonza team, our customers, our partners and the communities we serviced across Australia, that didn’t get an opportunity to come to fruition owing to the undercapitalisation of the business and the consequential repossession of our aircraft.”
Jetstar has already announced it will move in on one of Bonza’s former routes, with a new service between the Sunshine Coast and Cairns set to launch in December.
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says:Ms. Hudson’s comments may not be well rcvd but she 100% correct.