Major airline pulls out of North Coast hub
THOSE who regularly fly from Coffs Harbour to Sydney or Melbourne will soon discover a significant reduction in flight options
The Virgin Australia Group today announced a number of further changes as part of its fleet and network review to help manage costs, improve financial performance and respond to current market conditions.
The changes come as coronavirus has a weakening effect on international and domestic demand, with an expected $50-75 million impact to the Group's earnings for FY20 as reported in its 1H20 results today.
The Group will reduce overall network capacity by three per cent in 2H20, which includes a three per cent reduction in domestic capacity and short-term capacity reductions on the Tasman in Q4FY20 to manage current conditions.
The changes focus largely on leisure destinations where demand is weaker, and where Virgin Australia and Tigerair both operate, and includes the withdrawal from five unprofitable Tigerair routes and some frequency consolidation on existing domestic routes where demand has also been impacted.
In line with the reduction, seven additional Tigerair A320 aircraft will cease flying by October 2020. This follows the announcement of five aircraft exits in November 2019, bringing the total to 12, which will help the Group further manage costs and improve financial performance.
The impact of the current fleet reduction initiative is equivalent to approximately a five per cent Virgin Australia Group capacity reduction in FY21. Network changes
Tigerair Australia will exit the following domestic leisure routes in addition to frequency reductions on existing routes:
- Melbourne-Coffs Harbour from 27 April 2020
- Sydney-Coffs Harbour from 27 April 2020
- Adelaide-Sydney from 27 April 2020
- Sydney-Cairns from 27 April 2020
- Hobart-Gold Coast from 28 April 2020
Internationally, the Group already announced the withdrawal from the Hong Kong market due to ongoing challenges with the route, impact of civil unrest and coronavirus on demand. Short-term capacity reductions will be made on the Tasman in Q4FY20 due to weakening demand attributable to coronavirus.
Passengers with bookings impacted by these changes will be proactively communicated with and re-accommodated onto other services. Tigerair customers impacted by the above route exits will be re-accommodated onto other Tigerair flights where possible, or onto Virgin Australia services.