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Bain Capital Reveals Plans For Virgin Australia 2.0

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Tom Goward | 18/11/2020

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Virgin Australia has today exited voluntary administration under the ownership of US-based private investment firm Bain Capital. The airline also unveiled its future direction under the leadership of new CEO Jayne Hrdlicka. Speaking at Brisbane Airport, Ms Hrdlicka said “Today, we exit voluntary administration with a renewed sense of who we are and who we are here to serve.”

Now, after months of anticipation and guesswork, we finally discover Virgin Australia’s future direction. So what can we expect from Virgin Australia 2.0?

Mid-market carrier

Bain Capital plans to transform Virgin Australia into a mid-market airline, offering a premium experience at an affordable price. While Virgin Australia plans to serve all segments of the market, the airline will build its proposition around its long-standing and most loyal guests, which include price conscious corporate travellers, small to medium businesses, premium leisure travellers and holidaymakers.

“Australia already has a low-cost-carrier and a traditional full-service airline, and we won’t be either. Virgin Australia will be a mid-market carrier appealing to customers who are after a great value airfare and better service.” said Ms Hrdlicka.

Domestic Lounge network

Due to low visitation, Virgin Australia’s domestic lounges in Darwin, Cairns and Mackay will close while the Canberra lounge remains under review. The domestic lounge network is set to concentrate on capital cities, with the following five lounges confirmed for now:

  • Melbourne
  • Sydney
  • Brisbane
  • Adelaide
  • Perth
  • Gold Coast

Virgin Australia will re-open a network of domestic lounges as government-imposed travel restrictions ease and demand returns. Premium Entry will remain and lounge memberships that expired during the COVID-19 period will be extended for 12 months from the original expiry date.

For now, lounges will offer an interim food and beverage menu which will include fresh and pre-made food along with barista-made coffee, juices and premium sparkling, wine and beer.

The recently built Adelaide Lounge will open in the first quarter of 2021 as a prototype of the Virgin Australia Lounge of the future. The new design will roll out to the lounge network over time.

Velocity Frequent Flyer

There are no changes to the Velocity Frequent Flyer program, although Virgin Australia will announce a number of significant new partnerships in 2021, giving members more opportunity to earn points on everyday spending.

Onboard experience

Virgin Australia will retain its Business Class offering but will complete an end-to-end review of the Business Class product before relaunching it in 2021. The review, done in collaboration with the airline’s crew, will ensure better alignment to guests’ needs, while maintaining the elements they love. We can expect more details about the future of Virgin Australia’s Business Class offering next year.

Economy and Economy-X seating is here to stay, although an “exciting” buy onboard menu will replace previously free snacks early next year. Travellers will continue to be offered complimentary tea, coffee and water.

In-flight WiFi and Inflight Entertainment remains under review with more details to be announced in 2021.

Improved technology

To simplify the airport experience, new self-service and assisted check-in facilities will open across major airports by December 2021. A mix of kiosks and assisted check-in counters will allow staff to provide a more concierge-style service for passengers.

The Virgin Australia mobile app will be enhanced through 2021, creating a more integrated experience for travellers and Velocity Frequent Flyer members. The app will enable a much more personalised travel experience and one single gateway to engage with the airline and Velocity.

Passenger Promise

Virgin Australia is providing travellers with unlimited booking changes and waiving change fees for bookings with travel until 31 January 2021. More information on the airline’s Passenger Promise can be found here.

Summing up: pros and cons

Pros:

  • Cheaper fares with a premium experience
  • Closer integration of Virgin Australia and Velocity
  • Five lounges set to re-open
  • No devaluation of Velocity Frequent Flyer
  • New Velocity partnerships to come in 2021
  • Unlimited booking changes and until 31 January 2021
  • Virgin Australia is still here!

Cons:

  • Buy onboard menu to replace free snacks in economy
  • No more flat-bed business class seats
  • Darwin, Cairns and Mackay lounges closed
  • Velocity partner benefits scrapped (more on that here)
  • No mention of changes to the fare structure
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Tom Goward

Tom is a Hobart-based writer with a passion for aviation and travel.

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