- Qatar Airways is eyeing a 25% stake in Virgin Australia through the latterโs private equity owner Bain Capital.
- The proposed deal will allow VA to begin offering long-haul flights for the first time since 2020.
- Such a development is also designed to challenge the supremacy of fellow Oneworld Alliance airline Qantas; which notably lobbied against Qatarโs Aussie expansion in 2023.
A year after the Labor government controversially rejected its request to double flight operations to Australia, Qatar Airways seems to have figured out a workaround.
The Gulf carrier plans to acquire a 25% stake in Virgin Australia, as well as establish a wet-leasing agreement, pending regulatory approvals from the Foreign Investment Review Board and ACCC, respectively.
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This would effectively clear the path for Virgin Australia to begin offering long-haul flights again โ from Sydney, Melbourne, Brisbane, and Perth to Qatarโs Doha hub by 2025, opening the door to over 100 routes, if all goes to plan โ and compete more decisively within the domestic market.
The move also aims to strengthen the Velocity Frequent Flyer loyalty program with โincreased [earning] and redemption opportunitiesโ between Velocity and Qatar Airwaysโ Privilege Club. Along, per the official press release, with expanded code-sharing arrangements plus โimproved schedule and connectivity options.โ
โThis partnership brings the missing piece to Virgin Australiaโs longer-term strategy and is a huge vote of confidence in Australian aviation,โ said Virgin Australia CEO Jayne Hrdlicka.
โImportantly, it will further strengthen Virgin Australiaโs ability to compete over the long term, which will inevitably translate into more choice and even better value airfares for consumers as well as additional Australian aviation jobs.โ
Hrdlicka added: โQatar Airways has been a valued codeshare partner of Virgin Australia since 2022. This investment by the worldโs best airline will deepen an already strong partnership by bringing critical scale and the best industry expertise to support our long-term competitiveness and growth.โ
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โWe believe competition in aviation is a good thing and it helps raise the bar, ultimately benefiting customers,โ said Qatar Airways Group CEO Badr Mohammed Al-Meer.
โThis agreement will also help support Australian jobs, businesses, and the wider economy.โ
Translation: itโs time for a shake-up. In fact, the tides already appear to be turning โ since the pending partnershipโs announcement, Qantas share prices (ASX: QAN) have dipped as much as 5.5%.
