Virgin Australia to reduce capacity with major fleet and network changes

Huntley Mitchell

Huntley Mitchell

Australia’s second-largest carrier has announced a raft of changes to its fleet and network following a strategic review.

Virgin Australia will make several changes to its domestic and international network, including the suspension of Melbourne-Hong Kong from 11 February 2020.

The group will retain a daily service to Hong Kong from Sydney and continue to work on improving its onward connections through its partners Hong Kong Airlines and Virgin Atlantic.

“Demand for the Hong Kong route has declined in line with the political landscape and we feel this is now best serviced through a single daily Sydney-Hong Kong service,” Virgin Australia Group CEO Paul Scurrah said.

“The Airbus A330 currently operating the Melbourne-Hong Kong services will be re-deployed onto our daily Brisbane-Haneda flights commencing in March 2020, where we expect strong demand.”

It’s not exactly surprising that Virgin has made this move. In August, Qantas CEO Alan Joyce said flight bookings to Hong Kong were down 10 per cent due to protests in the region, and as a result, the airline would cut capacity by up to seven per cent.

Furthermore, Qantas revealed last month that the Hong Kong protests – which caused complete chaos at Hong Kong International Airport – would negatively impact its profit result for the first half of FY20 by $25 million.

Virgin will also exit the Sydney-Christchurch route from 29 April 2020, the Canberra-Perth route from 6 December 2019, and the Gold Coast-Perth route from 19 January 2020.

Aside from the Brisbane-Haneda route which has previously been announced for launch on 29 March 2020, Virgin Australia will also enter the Melbourne-Denpasar route from 29 March 2020, subject to regulatory approval.

Virgin has also adjusted its regional schedule by reducing its Sydney-Tamworth service from two daily to six services per week, and adding four additional frequencies per week on the Sydney-Port Macquarie route.

The carrier will also reduce its Auckland-Sydney frequency from up to 19 return services to 14 services per week.

Following a review of its regional airline fleet strategy, three of Virgin’s Fokker 100 aircraft will also be retired from the fleet by March 2020.

Virgin’s budget brand is not immune to the changes either, with Tigerair Australia to reduce its fleet by two with the removal of two Airbus A320 aircraft by mid-2020.

Furthermore, Tigerair will exit the Brisbane-Darwin route from 3 February 2020, the Proserpine-Sydney route from 3 February 2020, and the Adelaide-Brisbane route from 29 March 2020, in addition to capacity reductions on existing routes.

Tigerair’s Adelaide-Brisbane flights will be replaced with five additional services Virgin Australia services per week.

Virgin expects the changes to deliver at least a two per cent reduction in domestic capacity in the second half of the 2020 financial year compared to the same period last year.

“We maintain a strong network of destinations and it’s important that our schedule continues to reflect demand from our business and leisure customers,” Scurrah said.

“Some of today’s changes respond to shifting demand on some routes, and others are about refocusing Virgin Australia and Tigerair Australia on the destinations we feel they are best suited.”

Scurrah has been under pressure to save Virgin from further financial free fall since joining the company in March.

The carrier announced in August it would axe 750 jobs after posting a seventh consecutive full-year loss.