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Virgin Australia has asked the ACCC to approve its wet-leased Qatar Airways flights to Doha by next month.
In its application to the competition watchdog, Virgin requested interim authorisation for the flights by November 2024 for a launch in June 2025, to coincide with the peak northern summer period as well as major events like the 2025 British and Irish Lions rugby tour.
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The new deal will specifically see Virgin sell wet-leased services operated by Qatar Airways from Sydney, Melbourne, Brisbane and Perth to Doha beginning in mid-2025, with potential capacity for up to 28 return Doha flights per week from these major airports under bilateral air service agreements (ASAs).
It will be Virgin’s first attempt to fly wide-body international flights since emerging from administration and switching its fleet to predominantly 737s.
“If Virgin Australia is required to delay the launch and forward selling of the New Services, it will lose the opportunity to make the most of these high seasonal demand windows to attract customers,” the application read.
“If the applicants cannot commence flying by June 2025, it would not be financially viable to launch the first flight until December 2025 to coincide with the high-demand mid-December to mid-January peak of 2025/2026.
“In this scenario, the effect would be that either consumers experience delays in not being able to access these valuable new services until later in the year, or otherwise the applicants would suffer commercial detriment by launching new services at a time of low demand.”
Virgin pointed to higher airfares as a cause for the “dampening” of the inbound international recovery post-COVID-19, with visitors at 74.4 per cent of 2019 levels in June 2024, and said there is an opportunity to capture underserved demand with new long-haul international (LHI) services.
“This opportunity will benefit Australians wanting to travel, importers, exporters and Australian businesses reliant on, or that can take advantage of, tourism spend,” the application read.
“On their own, each applicant faces constraints adding LHI services and much needed capacity, but with their combined complementary networks, scale, expertise and infrastructure they consider they could jointly offer this additional capacity via the new services and proposed conduct.”
The announcement of the deal, which would also see Qatar take a 25 per cent stake in Virgin, came just over a year after Transport Minister Catherine King controversially blocked the expansion of Qatar flights into major Australian airports – a decision that Virgin, a codeshare partner of Qatar, criticised.
The deal has been slammed by Qantas pilots’ union the Australian and International Pilots Association (AIPA), whose president Tony Lucas labelled it a “workaround of bilateral agreements” and of Australian jobs.
“The entire thing just feels like a bit of a sham arrangement. The government introduced closing loophole legislation to try to protect the rights of Australian workers and this just seems to be a loophole to get around those protections in favour of a foreign entity,” Lucas said.
Qatar’s bid for 25 per cent of Virgin also requires approval from the Foreign Investment Review Board.
