Virgin Australia and UK-based Virgin Atlantic have applied for regulatory approval to coordinate services between Australia and the UK. The expanded Virgin Atlantic partnership would allow the two airlines to offer a more seamless experience to passengers flying to London through better schedules, easier connections and enhanced frequent flyer benefits.
Virgin Australia does not fly to London, but does fly to Hong Kong and Los Angeles. Virgin Australia already codeshares on Virgin Atlantic’s flights from both Hong Kong and Los Angeles to London, allowing Virgin Australia customers to continue their journey on Virgin Atlantic.
According to the ACCC submission, Virgin Australia and Virgin Atlantic currently have a combined market share on the Australia-UK market of around 3%. This equates to an average of 24 passengers each day. By comparison, Qantas and its alliance partner Emirates enjoy a combined market share of closer to 40%.
Virgin says that the increased cooperation would allow the two airlines to align baggage allowances, seat selection and lounge access, among other things, to offer a more seamless customer experience. The alliance could also result in improved schedules and reduced connection times for customers transiting via Hong Kong to Europe. Currently, a 7-hour layover is required in Hong Kong when flying with Virgin to London. (Despite this, Velocity Gold and Platinum members have a 4-hour lounge access time limit ahead of their onward Virgin Atlantic flight.)
An AFF member recently tested the existing Virgin Atlantic partnership when flying from London to Australia. Despite holding Velocity Platinum status, this member complained that the experience was far from seamless.
Reciprocal frequent flyer benefits are not currently provided automatically to Velocity Frequent Flyer members when flying with Virgin Atlantic. The ACCC application notes “while the Applicants recognise the loyalty status of each other’s members, all recognition of high value guests is manual and requires passengers to show their loyalty card.”
The airlines also intend to make it easier to redeem frequent flyer points for reward seats on the other carrier. It is already possible to redeem Velocity points for Virgin Atlantic reward seats, but this is a cumbersome process that requires members to call the Velocity contact centre.
If approval is given, Virgin Atlantic would also seek to codeshare on Virgin Australia-operated flights between Australia and New Zealand. The airlines have also hinted that Virgin Atlantic could upgrade its Hong Kong-London flight to a larger aircraft if the alliance stimulates enough extra demand.
Virgin Australia already codeshares on Singapore Airlines and Etihad Airways services between Australia and Europe.
Australian regulators recently blocked a proposed codeshare agreement between Qantas and Cathay Pacific on flights between Australia and Hong Kong.
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