Virgin Australia is still not making money

By SteveCF | May 18, 2017, 03:37 PM
Another quarter and Virgin losing millions again while qantas domestic posting record profits. What does Virgin need to do to turn things around, and can they do it?
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By Mightyreds | May 18, 2017, 03:56 PM
It is a worry I agree. I believe they will turn a profit but not sure when. It is in the best interest of everybody that both major airlines in Australia make healthy profits so they can compete with each other and make the product better for us the traveling public.
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By GBRGB | May 18, 2017, 04:09 PM
Just another " me too" business offering nothing new, it's not just airlines, lots of industries where a second player does the same thing and it never really works. Unless they start to offer new routes and products that are not available I can't see it changing. Lots of options to open new routes in regional areas but that would depend on available aircraft. We also need to consider whether making a profit is all that important to its major shareholders, they could well be happy with the performance of Virgin and how it enhances their bus
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By ajstubbs | May 18, 2017, 04:10 PM
They occupy a strange part of the market. QF has a bigger share of the business market - their reputation, history and FF program give them a lot of loyalty. Not that there's anything wrong with VA but they aren't cheaper so people who have always travelled with QF have no reason to switch. Equally, they aren't comparable to JQ in price or product so they occupy a space all their own and struggle to capture big sections of market share. Their current fleet won't allow for much expansion yet intl. expansion is arguably the only way they will seize more market share by prioritising routes QF don't run or that are under-served. 
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By afloskar | May 18, 2017, 04:55 PM
Is it really a surprise...
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By tonywills | May 18, 2017, 06:37 PM
Ditch their international operations and become (revert to) being a quality domestic airline.
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By terryj | May 18, 2017, 11:02 PM
I fly regularly in regional WA and abandoned Virgin when they started altering schedules on the day causing 3+ hour delays.
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By MattJelonek | May 18, 2017, 11:12 PM
Join Star Alliance please.
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By Andrew Barkery | May 19, 2017, 12:12 AM
Lots of people seem to still love Jetstar.
If no Jetstar, Virgin probably would be making money with itself and Tiger Air.
Qantas might the top class domestic air carrier, but still, its not making squillions of $ either.
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By btomp | May 19, 2017, 09:11 AM

Join Star Alliance please.

 


I'd love to know the pros and cons when it comes to an Airline joining an arrangement like Star Alliance. Surely, the pros outway to cons? I do find it odd that VA are so reluctant to get involved, particularly noting that their major competitor if a member of OneWorld.

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By freshthoughts | May 19, 2017, 10:07 AM
its idiotic that virgin don't join star alliance, it will consolidate their network, provide a flow of new travellers and allow them to compete with qantas on an equal footing. all serious international travellers want an alliance, the mix match of etihad and delta and singapore just don't cut it. get your act together Borghetti
Last edited by freshthoughts at May 19, 2017, 10.07 AM.
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By richard89 | May 19, 2017, 11:37 AM
So many armchair CEO's!!!! We can never begin to imagine why things are the way they are so stop trying. If VA don't elect to join an alliance, they'll have very good reason.
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By russell | May 19, 2017, 02:30 PM
So many armchair CEO's!!!! We can never begin to imagine why things are the way they are so stop trying. If VA don't elect to join an alliance, they'll have very good reason.

Its called giving an opinion. Don't need to be a CEO to do that last time I checked.

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By Mjudd | May 19, 2017, 04:15 PM
I agree that VA needs to focus on new routes, and not just try and compete on existing routes where major competitors control the market. Melb-HKG....seriously Virgin???
There is certainly a place for them in the International market, it is just a matter of selecting the right routes. Think of ANZ opening up AKL - BA for instance.
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By JBL | May 19, 2017, 04:24 PM
I can see the financial logic behind Virgin not joining Star Alliance. Joining alliances seems to benefit carriers with more developed international networks.

At the moment, Virgin makes a reasonable amount of money off the codeshare passengers it puts onto Etihad and Singapore on the way to Europe. If they were to join Star Alliance, VA would lose money for its flyers that opt instead to fly Air China or Thai Airways, for which it would not have a codeshare, and which generally offer the same connection to Europe at lower price points. VA would likely not codeshare with every Star Alliance carrier flying to Europe and would not gain as much out of it.

In regards to the US, VA would not gain anything in particular out of joining. It would most likely lose Delta as a partner, replaced by the smaller and less reputable United. Furthermore, United currently has no domestic Australian partner so it's not like VA would be gaining many customers other than the ones that would opt for Qantas.

All in all, it makes sense for me that VA wouldn't want to join. There's not much in it for commercially.
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By crwilkins | May 19, 2017, 04:28 PM
Get rid of Borghetti, time is up. Also I query the benefit of their partners other than the equity/cash they bring, SQ bring their own pax on their own metal into and out of every Australian capital city, so what's there for VA, DL have great coverage in NA but are a tiny player on the Pacific behind QF/AA and UA so again I question the level of pax feed to make any real difference and lastly Etihad is the same, long way behind EK, QF and SQ on flights to Europe so again questionable pax feed imo. With no alliance participation they are not able to truly articulate a better value proposition than the competition apart from leisure travellers and the occasional mix of premium.....they are on a dead end strategy in my view, need new CEO and new ideas
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