Competition watchdog to investigate Qantas-Virgin aid row

March 24, 2020
Virgin ACCC aid row

The competition watchdog says it will look into Virgin Australia’s allegations it has been the subject of a smear campaign by Qantas.

Virgin Australia chief executive Paul Scurrah has complained to the Australian Competition and Consumer Commission about comments made by rival Alan Joyce and tactics he believes were employed to undermine his airline’s credibility and convince governments against supporting Virgin.

An ACCC spokesperson confirmed the regulator had received a letter from the Virgin boss and that it would be looking into the issues raised.

These included briefing journalists about Virgin’s financial viability as well as social media reports that Joyce had maligned the smaller airline when he urged staff to contact their local MPs and lobby for airlines to be treated equally.

Quotes published by The Australian suggest that the call to staff saw Joyce reiterating previous comments about Virgin being badly managed and referring to the airline’s majority foreign ownership as a reason to refuse it support.

Memo to Aussie airline chiefs: stop squabbling.

It came after Joyce kicked off the row on Friday by suggesting on Sky News that the government should preference healthy companies over those that had been badly managed for 10 years, a thinly veiled reference to his competitor.

In his letter to ACCC chairman Rod Sims, Scurrah warned that the Qantas conduct could damage a competitive Australian airline industry and said Virgin was gathering examples to back its complaint.

Qantas has subsequently denied it was the source of the Virgin media speculation or that its comments were anti-competitive.

Airlines globally are seeking government aid as they are forced to ground flights and lay off staff due to plummeting demand and government travel restrictions.

The Australian government has already provided airlines with $A715m in relief but they will need more.

The rancor in Australia contrasts sharply with the approach in the US, where airlines joined forces in a united approach to lobby government for industry support.

A joint letter sent to House and Senate leaders was signed by the chief executives of Alaska, Delta, American, United, Hawaiian, JetBlue. And Southwest as well cargo operators UPS, Atlas and FedEx and lobby group Airlines for America.