Virgin Australia CEO Says She’s Not Done With Growing The Airline

Over this year, Virgin Australia has made several announcements about boosting its fleet, gradually raising the numbers from a late 2020 low of just 56 aircraft.  One year later, the airline has locked in an increase to 84 planes. But Virgin Australia’s CEO says she’s not done yet with growing the airline.

Virgin Australia’s CEO says the airline will keep growing. Photo: Getty Images

Virgin Australia eyes a one-third domestic market share

Burdened by years of losses, sky-high debt, and a questionable overall strategy, the travel downturn in the first half of 2020 pushed Virgin Australia off the financial cliff. The airline went into voluntary administration in April 2020.

Many thought that spelled the death knell for the airline. But the airline was restructured, resold, and relaunched later in the year. But after that happened, the new-look Virgin Australia was a much smaller airline, having offloaded many of its planes.

“We started in November 2020 as a new business with fifty-six 737NGs,” Virgin Australia’s CEO Jayne Hrdlicka told the CAPA Australia Pacific Aviation Summit in Sydney on Wednesday. “We’re are at eighty-four 737NGs, and we’re not done yet. We have a lot of growth left in us. We fully intend to be 33% of the domestic market.”

Those 737-800NGs can comfortably handle the longest point-to-point flying in Australia and around the region. Before the airline’s collapse in 2020, Virgin Australia deployed the jets to nearby countries. Since then, Virgin Australia hasn’t ventured offshore again, but it plans to do so next year.

“We intend to be quite a strong player in the short-haul international market,” said Ms Hrdlicka. “There will be a primary focus on New Zealand, Fiji, and Bali in the first instance, and we’ll see where that takes us.”

Virgin Australia CEO Jayne Hrdlicka. Photo: Virgin Australia

Virgin Australia’s long-haul capacity still lacking

Helping to boost the number of aircraft in Virgin Australia’s ranks is the imminent arrival of 25 Boeing 737 MAX 10 aircraft from mid-2023. But that still leaves Virgin Australia a solely narrowbody 737 operator, and even the latest 737 can only fly so far. That sees Virgin Australia’s long-haul ambitions up in the air.

“Whether we go back into long-haul or not is an open question,” admitted the Virgin Australia CEO. “But we will have strong (international) partnerships. We’ve had them historically, and we will have them in the future.”

Virgin Australia’s frequent flyer program, Velocity, has recently restored frequent flyer point redemptions on international partner airlines like Delta and Air Canada. But a restoring the tie-up with the key regional partner, Singapore Airlines, remains unfinished business at Virgin Australia.

Virgin Australia formerly flew a fleet of Boeing 777-300ER planes to Los Angeles and A330-200s into Asia. The airline has since offloaded the aircraft and now has no widebody long-haul capabilities. It’s a state of affairs that has left many Virgin Australia loyalists dismayed.

Virgin Australia isn’t backing down as it chases market share and growth. Photo: Getty Images

Virgin Australia’s has big ambitions

Not everyone thinks Virgin Australia will hit a 33% local market share in the face of an aggressive Qantas Group, an expanding Regional Express (Rex), and the imminent arrival of Bonza. But Ms Hrdlicka disagrees.

She says the domestic airline business in Australia will primarily concentrate on leisure travelers for some time yet, and Virgin Australia’s full-service mid-market value offering targets that market perfectly. But Jayne Hrdlicka also thinks next year will be a bumpy one.

Like its competitors, Virgin Australia is counting on Australians taking to the air again. However, Ms Hrdlicka is confident they will. But another competitor is arriving on the scene, competition from the existing competitors is heating up, and further capacity will come into the market in 2022. Together, it’s a volatile mix.

“We’re a different organization to what we were 12 months ago,” the Virgin Australia CEO says. “We’re lean, strong, capable, and very purposeful. I think it is going to be competitive – it’s going to be interesting.”