$165m govt deal for Virgin, Qantas

Virgin Australia is resuming a minimal national schedule while Qantas is expanding its domestic passenger services, with the new schedules including eight regional centres in Western Australia.

Virgin will operate 64 return services across Australia, equal to about five per cent of the services it operated prior to the COVID-19 travel restrictions.

About 200 Virgin staff will be ‘stood up’ to operate the services.

The airline previously had about 10,000 staff and until today, its only scheduled services were between Sydney and Melbourne six days a week.

Qantas will increase the number of passenger flights it operates from 105 per week currently to 164.

Virgin’s new schedule includes seven return services per week between Perth and Melbourne.

It will also fly three return services to Broome and two return services per week to Port Hedland, Newman, Karratha, Kununurra and Kalgoorlie.

Qantas will fly between Perth, Sydney and Melbourne as well as seven regional routes in WA, including Learmonth, Geraldton and Kalgoorlie.

The agreement with the government comes after Virgin had sought a $1 billion-plus subsidy or loan guarantee to ensure its viability.

That was opposed by Qantas, which has operated reduced services since the onset of COVID-19 restrictions.

Announcing the agreement last night, which will see the government spend up to $165 million, deputy prime minister Michael McCormack said sustaining Australia’s aviation industry was critical to protecting livelihoods and saving lives.

“We are ensuring secure and affordable access for passengers who need to travel,” Mr McCormack said.

“This investment will also help Australians returning from overseas, who find themselves in a different city after 14 days of mandatory quarantine, complete their journey home safely.”

The government said it has already invested more than $1 billion to support Australia’s aviation industry.

This includes a $715 million package waiving fuel excise and government charges backdated to 1 February, $198 million to support regional services and $100 million to directly support regional airlines.

The new flights will sell as normal commercial fares; however given the limited demand for air travel and the social distancing restrictions that will limit the number of passengers per flight, they will be underwritten by the government to ensure the airlines covers their costs.

Qantas said on-board service will be a scaled back version of what would normally apply, with cabin crew focused on in-flight safety and wearing personal protective equipment.

The new schedules will commence immediately and run for a period of eight weeks, until June 7.

Virgin said the domestic schedule was in addition to the international repatriation flights to Los Angeles (one per week) and Hong Kong (two per week) it operates at the request of the federal government.

In addition, Virgin continues to transport cargo internationally and domestically and provide charter services to mining companies.

The domestic network operated by Qantas and its subsidiary Jetstar are in addition to a small number of international flights (operated by Qantas) and ongoing operations by Qantas Freight.