Virgin Australia has announced its future masterplan which will keep the company flying high, but at what cost?
Budget carrier Tigerair is set to be cut, as well as around 3000 jobs as part of the streamlined plans after the airline giants have been rocked by COVID-19.
Virgin Australia and its new owners Bain Capital are hopeful that a reduction in the airline’s fleet will save further costs as the company looks to focus on domestic travel.
Virgin Australia Group CEO and Managing Director Paul Scurrah said: “Demand for domestic and short-haul international travel is likely to take at least three years to return to pre-COVID-19 levels, with the real chance it could be longer, which means as a business we must make changes to ensure the Virgin Australia Group is successful in this new world.”
Mr Scurrah said that Australian airports are recording passenger numbers less than three per cent of last year, and therefore a reduction of staff numbers was necessary, with the intention of welcoming them back post-COVID.
We expect approximately 3,000 roles will be impacted as a result of the changes announced today.Paul Scurrah – Virgin Australia Group CEO
Virgin Australia also announced it will be moving to an all-Boeing 737 fleet. This comes after the recent cost-cutting decision to consolidate its corporate offices in Sydney as well as the relocation of its Brisbane HQ.
“Virgin Australia has been a challenger in the Australian market for 20 years, and as a result of this plan and the investment of Bain Capital we are going to be in a much stronger position to continue that legacy,” Mr Scurrah said.
Virgin Australia went into voluntary administration in April with debts of $6.8 billion before being bought out by Bain Capital, one of the world’s leading private investment firms with more than $150 billion worth of assets.