![The existing partnership between Virgin Australia and Qatar Airways will be strengthened with today’s announcement that Qatar Airways Group intends to acquire a minority 25% equity stake in Virgin Australia from Bain Capital (subject to FIRB [1] approval). Qatar Airways is one of the world’s largest airlines and earlier this year was awarded the world’s best airline by Skytrax for the eighth time.](https://startuprise.org/wp-content/uploads/2024/10/Qatar.webp)
The existing partnership between Virgin Australia and Qatar Airways will be strengthened with today’s announcement that Qatar Airways Group intends to acquire a minority 25% equity stake in Virgin Australia from Bain Capital (subject to FIRB [1] approval). Qatar Airways is one of the world’s largest airlines and earlier this year was awarded the world’s best airline by Skytrax for the eighth time.
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A deeper strategic relationship between Virgin Australia and Qatar Airways will drive increased competition in Australian aviation. This will ensure Australian consumers have access to even better value airfares and greater choice.
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Domestic competition in Australia is dependent on Virgin Australia thriving through the inevitable ups and downs of aviation. Qatar Airways Group’s strategic investment will provide access to the critical scale and expertise of a world leading global airline. The minority stake also serves as a cornerstone investment ahead of an anticipated return of Virgin Australia into public ownership and the opportunity that would provide for Australians to share in Virgin Australia’s future.
The equity investment by Qatar Airways Group will unlock new areas of cooperation with Virgin Australia, all of which will help to drive additional consumer and economic benefits. Subject to ACCC authorisation [3] this cooperation will enable Virgin Australia to launch flights from Brisbane, Melbourne, Perth and Sydney to Doha, connecting seamlessly into Qatar Airways’ global network. These extra flights will open up more than 100 new connecting itineraries across Europe, the Middle East and Africa for Australian travellers. The proposed wet lease services will begin in mid-2025, allowing Virgin Australia to assess the longer-term merits and viability of wide-body aircraft flying while providing Australians with greater local competition for their long-haul travel needs in the near-term.
The expanded codeshare and collaboration arrangement will provide access to a greater range of international destinations with improved schedules and frequencies, increased earn and redemption opportunities for members of Velocity and Qatar Airways’ Privilege Club, and broader access to great value fares for leisure travellers, small and medium-sized enterprises, and corporate customers.
The deepened partnership has the potential to underpin significant jobs and economic growth, not just in Virgin Australia but across both the broader aviation and tourism sectors in Australia. An important area of future focus is sustainability, including the development of Sustainable Aviation Fuel. The partnership also comes at a great time to explore opportunities as the new Western Sydney Airport and its economic ecosystem are developed.
Commentary from Virgin Australia Group CEO Jayne Hrdlicka: “This partnership brings the missing piece to Virgin Australia’s longer-term strategy and is a huge vote of confidence in Australian aviation. Importantly, it will further strengthen Virgin Australia’s ability to compete over the long term, which will inevitably translate into more choice and even better value airfares for consumers as well as additional Australian aviation jobs.
Qatar Airways has been a valued codeshare partner of Virgin Australia since 2022. This investment by the world’s best airline will deepen an already strong partnership by bringing critical scale and the best industry expertise to support our long-term competitiveness and growth. This proposed investment is subject to regulatory approval. We do not take this for granted and have made submissions outlining the benefits of the transaction for Australian aviation, Australian travellers and the Australian economy. I am super proud of the entire team at Virgin Australia. Together they have done a wonderful job getting Virgin Australia back into a healthy, long term competitive position that has attracted the world’s best airline as a prospective investor. Every member of our team has contributed to this terrific outcome,” Ms Hrdlicka said.
Reflecting on the new proposed long-haul services between Australia and Doha, Ms Hrdlicka noted that they were estimated to generate an economic benefit of ~A$3bn to the Australian economy through incremental visitor flows over the next five years. Additional benefits will flow from increased freight capacity, supporting Australia’s high-value exports to markets such as the Middle East and Europe.
Commentary from Qatar Airways Group CEO Eng. Badr Mohammed Al-Meer: “We are really pleased to be announcing our proposed strategic investment in Virgin Australia today. The alignment of our two airlines is significant, the relationships are deep, and we could not be more proud to bring even more great value and choice to all Australians. The investment further demonstrates our strategic alignment with Virgin Australia and our collective ambition to deliver the best possible service and value to Australian passengers,” he said. Not only that, we believe competition in aviation is a good thing and it helps raise the bar, ultimately benefiting customers. This agreement will also help support Australian jobs, businesses and the wider economy.”
Commentary from Bain Capital Partner Mike Murphy: “Virgin Australia plays a pivotal role in connecting Australians with each other, and with the world. Over the past four years, we’ve had the privilege of working alongside a team that has shown the dedication and tenacity needed to revitalise the airline. After a decade of losses resulting in administration, Virgin Australia has emerged as a strong and profitable company with an attractive market position, a loyal customer base, and a promising growth trajectory, We are pleased to welcome Qatar Airways Group as a partner at this stage to build on Virgin Australia’s strong foundation.”
About Virgin Australia
The Virgin Australia Group was founded in the year 2000 by Sir Richard Branson and is now one of the largest Australian airlines operating an extensive domestic network as well as short-haul international services, charter and cargo operations, and its loyalty program, Velocity Frequent Flyer. The Group employs more than 7,800 people and boasts more than 12 million Velocity members who can use their Points to redeem flights to over 600 destinations around the world through Virgin Australia and the airline’s extensive list of international partner carriers.
About Qatar Airways
A multiple award-winning airline, Qatar Airways won the ‘World’s Best Airline’ for the unprecedented eighth time at the 2024 World Airline Awards, managed by the international air transport rating organisation, Skytrax. Qatar Airways has been the World’s Best Airline in 2011, 2012, 2015, 2017, 2019, 2021, 2022, and 2024. The airline continues to be synonymous with excellence, also taking home, ‘World’s Best Business Class’, ‘World’s Best Business Class Airline Lounge’, and ‘Best Airline in the Middle East’. As leaders in industry innovation and digital adoption, Qatar Airways was also recently voted the ‘World’s Best Airline Website’ by World Travel Tech Awards. Qatar Airways currently flies to over 170 destinations worldwide.
