Australian carrier will no longer fly its own planes to the United Arab Emirates.
VIRGIN Australia has scuttled plans to fly from Perth to Abu Dhabi, saying increased competition has made the route unviable.
Australia’s second biggest airline had planned to start flying three services per week on the route from June using Airbus A330-200 aircraft.
But a slow consumer response and the highly competitive nature of the Kangaroo Route between Australia and Europe, including the decision by Qantas to launch direct Boeing 787 Perth-London services, forced a rethink.
“Subsequent changes in market conditions have made the route no longer viable for Virgin Australia,’’ the airline said on Monday.
“Virgin Australia customers can continue to book travel on alliance partner Etihad Airways’ daily service between Perth and Abu Dhabi and all connecting services as usual.”
The airline said customers booked to travel with it on the Perth-Abu Dhabi route would be accommodated on alliance partner Etihad’s services and would be sent new flight details.
The move means Virgin will no longer fly its own metal to Etihad’s Abu Dhabi base and will now rely on its partner to handle passengers on low-yielding routes to Europe, where fares have hit historic lows in real terms.
Virgin axed its Sydney-Abu Dhabi services this month so that it could concentrate its Boeing 777 services on flights from Melbourne, Brisbane and Sydney to Los Angeles.
It is also looking towards Asia, particularly China, for international growth and recently announced plans to fly to Hong Kong later this year using A330s, which also service transcontinental routes and Fiji in peak periods.
The airline has asked the Australian Competition and Consumer Commission to grant interim authorisation for an alliance with part-owner HNA Aviation, Hong Kong Airlines and HK Express that will see it able to offer ongoing connections to mainland China.
It is seeking interim authorisation by March 20 so that it can sell tickets ahead of the launch in the middle of the year from an as yet unspecified Australian city, rumoured to Melbourne but almost certainly an east coast capital.
The initial stages of the alliance will see the airlines codeshare on each other’s flights between Australia and Hong Kong as well as between Australia and mainland China and on each other’s domestic networks.
Virgin’s Velocity frequent flyer members and HNA’s Fortune Wings Club members will get reciprocal access to frequent flyer benefits and lounges. The airlines are also proposing to co-operate on route planning, sales, distribution and marketing.
In a submission to the ACCC, Virgin argues that fares on flights between Hong Kong and Australia have not fallen as much as those on other routes because of the lack of competition on a route dominated by Qantas and codeshare partner Cathay Pacific.
“The result is that there has not been significant downward pressure on prices, with the average for routes between Australia and Hong Kong decreasing less than 10 per cent since financial year 14,’’ it said.
“By expanding the capacity and the services in the Australia-Hong Kong market, the Alliance will not have any adverse impacts on competition but will be pro-competitive.”
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