If you met Paul Scurrah (Virgin Australia CEO), what would you say?

[openseat]

I'm not a fan of the idea of joining alliances. I don't understand why people say VA should be different and then turn around and say 'join an alliance' just mimicking QF.
Be a bit daring. Ask DL to tell LATAM to end the QF codeshares and have VA become the codeshare partner.

 

[Danieldj]

I must say. I LOVED Virgin group... But in recent years it's has shown a high decline in how it operates.
Would you think about going back to a budget airlines as it once was with GREAT happy hour offers? (I never use to let one go would fly every month) I know it would be tough in market and not much profit.

I know going through the change is hard. Re branding. Cost cutting. Etc. But you either need to step up tigers footprint or go back to the great days of VirginBlue. Keep your Velocity X seats as high priced full service but put all the others in budget. You just pay for the seat and add on extras.
Maybe you need to get Richard Branson back during this time???

 

[TheInsider]

Maybe you need to get Richard Branson back during this time???

This keeps on coming up time and time again, especially on their FB page.
Dick is insignificant in the companies ownership, and only does media appearances to get the 'virgin' name out more in the media.

 

[Genji88]

1. Join *A.
2. Stop cheapening J fares.
3. Fly 777-300 with "The Business"
cabins from MEL/SYD - DPS.
4. Frequent Buyers club!!!
5. Ability to tap VA card In-store Vs online only

 

[HS-TQE]

This keeps on coming up time and time again, especially on their FB page.
Dick is insignificant in the companies ownership, and only does media appearances to get the 'virgin' name out more in the media.

Agreed, RB only has minority stakes in VS (49%) and VA (10%) those days. DL effectively runs VS, in addition to being VA's TransPacific JV partner.

 

[HS-TQE]

1. Join *A.
2. Stop cheapening J fares.
3. Fly 777-300 with "The Business"
cabins from MEL/SYD - DPS.

1. *A had said they were not interested in VA. In addition NZ and UA will use their veto to block any VA application into the *A.
2. J fares are subject to the same fluctuation as W and Y fares. Suppy and Demand.
3. Using a 77W to a low yielding, price sensitive tourist destination is basically a guaranteed money loser. Considering the CEO has already singled out LAX as one of the few international destinations making money for VA international.

 

[Nexus9]

In addition NZ and UA will use their veto to block any VA application into the *A.

Out of interest, where/when have either of those carriers stated that?

 

[HS-TQE]

Out of interest, where/when have either of those carriers stated that?

Should've said allegedly in the post.

The VA and NZ drama has been well documented throughout this forum, including the allegations from people on VA and NZ side reporting to the media/newspapers that the former CEO Luxon had allegedly demanded that VA 'close down all international' whilst making his case to outst former VA CEO Borghetti. When EY/SQ/Virgin decided to side with JB after those allegations, leading to Luxon/NZ not getting his way, he had no choice but to sell out from VA.

Since then NZ had pulled back all partnership leading to the official split , including Star Alliance (NZ management) withdrawing VA's lounge access in LAX. *A reporting in Executive Traveller that they were no longer interested in VA following the VA/NZ split.

The new NZ and VA management/CEOs had since agreed to restore the interline between VA and NZ when Luxon and Borghetti departed their posts at NZ and VA. Even though NZ will still prioritise the QF partnership set up by Luxon.

As for UA, those problems go way back when former CEO Godfrey whilst setting up V Australia Long Haul, decided to dump UA as partner in favour of the JV with Delta, and the codeshare with Virgin America (VX), prior to Borghetti taking over as CEO.

 

[TheInsider]

BTW joining an alliance costs a LOT of money. VA will high unlikely do this for a very long time.

 

[SeaWolf]

VA will high unlikely do this for a very long time.

I honestly think there's a much broader issue at play than just VA and *A. The recent announcements by Royal Air Maroc and now Alaska Airlines are the first, new full members of any alliance in almost six years.
We're all looking at reasons as to why VA specifically is not joining *A specifically, but it probably makes more sense to look globally at why no airline anywhere and none of the alliances has added a full member in such a long time. Whatever reasons there are for VA not joining an alliance it would seem that VA isn't the only airline and *A isn't the only alliance to be in that position.

 

[Nexus9]

Should've said allegedly in the post.

The VA and NZ drama has been well documented throughout this forum, including the allegations from people on VA and NZ side reporting to the media/newspapers that the former CEO Luxon had allegedly demanded that VA 'close down all international' whilst making his case to outst former VA CEO Borghetti. When EY/SQ/Virgin decided to side with JB after those allegations, leading to Luxon/NZ not getting his way, he had no choice but to sell out from VA.

Since then NZ had pulled back all partnership leading to the official split , including Star Alliance (NZ management) withdrawing VA's lounge access in LAX. *A reporting in Executive Traveller that they were no longer interested in VA following the VA/NZ split.

The new NZ and VA management/CEOs had since agreed to restore the interline between VA and NZ when Luxon and Borghetti departed their posts at NZ and VA. Even though NZ will still prioritise the QF partnership set up by Luxon.

As for UA, those problems go way back when former CEO Godfrey whilst setting up V Australia Long Haul, decided to dump UA as partner in favour of the JV with Delta, and the codeshare with Virgin America (VX), prior to Borghetti taking over as CEO.

Good points on the history certainly.

However whilst there have been issues in the past, I am of the thinking that it is mostly resulting from VA not being part of the alliance and were seen to be treading on toes/territory.
If VA were in the alliance then the other alliance partners would have a bit more certainty regarding demarcation of routes etc.
Former CEO egos aside - if there is money to be made from a partnership (and I don't know enough to say whether there is or isn't in this case) most businesses will pursue that and not worry about what seems tantamount to a high school spat from the past.
"If" there is money to be made or value to be added for their customers I cant see NZ or UA vetoing anything - alternatively, "if" it is going to cost them money or reduce value for their customers then the veto power may come in to play.
Vetoing over personality clashes of past CEO's just doesn't seem likely imho.

Any who, it is all just speculation at this point as VA have not announced any intention of joining an Alliance unfortunately.

 

[HS-TQE]

I honestly think there's a much broader issue at play than just VA and *A. The recent announcements by Royal Air Maroc and now Alaska Airlines are the first, new full members of any alliance in almost six years.

There are also the exits by CZ from SkyTeam (due to partnerships with OW airlines plus minority stake investments), as well as the recently announced exit by LA from OW (due to minority stake investment by DL).

If we were to go by past history here, Mexicana had to be alliance-free for a certain period prior to joining OW.

If we go by today's trends of increasing 'cross-alliance' JVs such as NZ/CX, QF/EK as opposed to sticking with Alliance partners, this means that we're not even sure if CZ will eventually be joining OW or even LA joining SkyTeam in the future.
VS deciding to remain alliance free despite being run by DL, just like their baby brother VA is another stand-out.

We're all looking at reasons as to why VA specifically is not joining *A specifically, but it probably makes more sense to look globally at why no airline anywhere and none of the alliances has added a full member in such a long time. Whatever reasons there are for VA not joining an alliance it would seem that VA isn't the only airline and *A isn't the only alliance to be in that position.

IMO, DL will always be the elephant in the room when it comes to VA and *A discussion, considering that partnership goes way back to the pre-Borghetti, Godrey CEO era. Which is before SQ, EY, NZ, et al decided to buy stakes in VA.

Apart from VA mending bridges with NZ, the only other (unlikely) option where VA is considered by *A as a "potential member" in the future, is UA ambushing DL and subsequently buying either the EY and/or HNA stakes in VA. Making it a 'game-changer'. Similar to how DL ambushed AA and purchased a stake in LA.

If DL is the party to buy the HNA and/or EY stake in VA, it would be at that point where "VA joining *A" would be 'finally' considered dead, buried and cremated. SQ at that point would consider looking at selling out.

Saying all that, it's unlikely that any party will be interested in buying into VA for the foreseeable future, considering the recent record low VA share price. HNA had looked at selling out a number of times and wasn't able to secure a serious buyer suggests that VA is not a entity to invest in as of the moment.

 

[dajop]

So it seems that the alliance issue always comes up with VA. It’s important probably only because of the strength of QFF. The absence of such probably does mean they miss out on both market share and margin.

The question is what are the big problems with not being in alliance? I don’t think “alliance fare” products are the issue - they have become quite expensive in recent years. Nor is “connectivity” ... if you look at the alliances the connectivity they offer with consistency only applies when on the same PNR .... which is no different to any airline with a broad range of interline agreements.

So to me it seems to be :
1) Geographic coverage of partners. With VA Europe seems to be the main gap, they should probably seek out the LH group (given the weakness of their current partner - AZ - and that the horse has already bolted on KL/AF with QF).
2) Consistency in delivery of benefits to elites. It seems the most egregious inconsistency is the absence of lounge access when flying partners from ports where the partner doesn’t offer its own lounge (and vice versa with partner elites flying VA). Surely there can be a creative fix to this somehow?
3) What else?

 

[Must...Fly!]

BTW joining an alliance costs a LOT of money. VA will high unlikely do this for a very long time.

Or as stated earlier in this thread it doesn't, and there are significant other issues at play.

I've seen first hand the financial impact on joining an alliance (from multiple airlines perspective - working both inside an airline, and then as an external consultant for another airline), and the 'cost to join' is almost entirely irrelevant. The gains and losses for the airline are in other areas of the group. From my perspective - folks get too hung up on the costs and don't look at the opportunities for incremental gains.

I bet Paul has a tough job. I'd buy him a beer.

 

[Bagpuss]

So to me it seems to be :
1) Geographic coverage of partners. With VA Europe seems to be the main gap, they should probably seek out the LH group (given the weakness of their current partner - AZ - and that the horse has already bolted on KL/AF with QF).

This was suppossed to be fixed with Flybe being rebranded to Virgin Connect. Once rebranded it would be a Velocity partner. This was noted in the application for better tie up with Virgin Atlantic.

However, with the ongoing liquidity issues with Flybe it may never rebrand to Virgin Connect.

Welcome to Virgin Connect

Virgin Connect is your new go-to name in regional travel. Follow Flybe, Europe’s largest regional airline, as it takes off on its journey to Virgin Connect here.

www.virginconnect.co.uk

 

[Scarlett]

Not sure where the *A fascination is coming from... that ship has sailed. Instead, I'd suggest he looks much closer at what could be achieved with Skyteam:
- the solid DL partnership continues.
- look to Australia's northern doorstep and you'll find GA, a much improved airline, with a functional LCC in Citilink and a country with a growing middle class that will shortly be DOUBLE the size of total Aus population. Get together with them now! Hubs in CGK and DPS get you to most places in Asia.
- VN flies into Aus and is another growing market. Sure they'd love domestic connections on codeshare.
- China Eastern, China Airlines and Korean would also cover lots of Asia for you and probably wouldn't upset your new work with ANA into Japan.
- it would potentially rattle the QF deal with AF/KLM.
- taken further, you may be able to value add by having AF codes on some of your very thin south west Pacific flights. It might be the missing piece that encourages AF to fly to Aus (CDG-PER connecting to the VA domestic network).

Whilst there may be some start up costs associated, it's the linkages with a significant number of other airlines that would instantly drive additional pax your way that would seem to be the biggest benefit. Biggest unknown is how would SQ and EY react?

 

[HS-TQE]

Good points on the history certainly.

However whilst there have been issues in the past, I am of the thinking that it is mostly resulting from VA not being part of the alliance and were seen to be treading on toes/territory.
If VA were in the alliance then the other alliance partners would have a bit more certainty regarding demarcation of routes etc.
Former CEO egos aside - if there is money to be made from a partnership (and I don't know enough to say whether there is or isn't in this case) most businesses will pursue that and not worry about what seems tantamount to a high school spat from the past.
"If" there is money to be made or value to be added for their customers I cant see NZ or UA vetoing anything - alternatively, "if" it is going to cost them money or reduce value for their customers then the veto power may come in to play.

While I agree that the new management teams at NZ and VA would allow for a fresh start, there are likely to be some remnants from the previous teams. NZ for example are prioritising the QF codeshare partnership despite recently re-enabling the VA interline agreement.

As for *A discussion and partners, DL remains the "elephant" in the room as long as DL/VA remain Joint Venture partners on the Trans-Pacific routes.
UA would want the DL partnership to end as it's not in their best interests for revenue to go to their major rival, otherwise UA are likely to use their veto vote until DL are out of the picture.

One of the only ways VA comes 'into consideration' for *A in the future is if UA "does a DL (buying a stake in LA)" and ends up purchasing (either the HNA or EY) stake in VA. Therefore enabling UA to remove DL from the picture themselves.
Saying that UA purchasing a stake in any other airline in the short term, let alone VA, is very much extremely unlikely.

 

[jase05]

While I agree that the new management teams at NZ and VA would allow for a fresh start, there are likely to be some remnants from the previous teams. NZ for example are prioritising the QF codeshare partnership despite recently re-enabling the VA interline agreement.

As for *A discussion and partners, DL remains the "elephant" in the room as long as DL/VA remain Joint Venture partners on the Trans-Pacific routes.
UA would want the DL partnership to end as it's not in their best interests for revenue to go to their major rival, otherwise UA are likely to use their veto vote until DL are out of the picture.

One of the only ways VA comes 'into consideration' for *A in the future is if UA "does a DL (buying a stake in LA)" and ends up purchasing (either the HNA or EY) stake in VA. Therefore enabling UA to remove DL from the picture themselves.
Saying that UA purchasing a stake in any other airline in the short term, let alone VA, is very much extremely unlikely.

In a perfect world DL would purchase a decent stake in VA and convince LA to dump QF and go with VA instead but not much chance of that either unfortunately

 

[pauly7]

While I agree that the new management teams at NZ and VA would allow for a fresh start, there are likely to be some remnants from the previous teams. NZ for example are prioritising the QF codeshare partnership despite recently re-enabling the VA interline agreement.

There was a report somewhere that suggested commercially NZ would make more money partnering with QF because of their domestic reach and offering being far wider than VA so NZ are making more coin on the codeshare deal (making money on all flights) rather than just the ones that VA flew on then having to on sell QF flights with no code where all VA gaps were - seemed messy.... and the present situation is also much better for NZ customers...

 

[dajop]

Biggest unknown is how would SQ and EY react?

SQ are not going to want VA giving GA and VN access to its customer base. Besides from VA perspective, between them GA & VN operate 47 services a week to Australia. SQ/MI operates 145 services from SIN to Australia (soon to become 152). Which could provide better feed to VA? From a branding perspective, which is of more interest to Velocity?