Qatar Airways (QR) intends to acquire a 25 per cent minority equity stake in Virgin Australia, increasing the airlines’ existing partnership and paving the way for VA’s return to long-haul international flying by mid-2025. So, what does it mean for Aussie travellers?
Subject to the Foreign Investment Review Board and other regulatory approvals, Qatar Airways will acquire the stake from Virgin Australia’s current owner Bain Capital.
The expanded codeshare deal will see Virgin Australia launch flights from Brisbane, Melbourne, Perth and Sydney to Doha and ‘wet lease’ wide-body aircraft from Qatar Airways in mid-2025.
Virgin Australia said the investment will open up more than 100 new connections for Aussie travellers to Europe, the Middle East and Africa via Qatar.
The proposed wet lease services will begin in mid-2025, allowing Virgin to assess the long-term viability of wide-body aircraft flying while providing increased short-term local competition for long-haul travel.
It’s a turnaround from the airline’s positioning as a value carrier offering domestic and short-haul international routes after its 2020 acquisition by Bain Capital. Since then, Virgin Australia has rebuilt its offering to return the airline to profitability and a sustainable future.
Virgin said the minority stake also “serves as a cornerstone investment ahead of an anticipated return of Virgin Australia into public ownership”.
Outgoing Virgin Australia Group CEO Jayne Hrdlicka said the new long-haul services are expected to generate around $3 billion for the Australian economy over the next five years.
“This partnership brings the missing piece to Virgin Australia’s longer-term strategy and is a huge vote of confidence in Australian aviation,” she said.
“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.”
Hrdlicka said she was particularly excited by the potential to expand the airlines’ relationship into new areas, such as sustainability and development of the western Sydney aviation ecosystem, including broader jobs and training opportunities.
For Qatar Airways, an increased 25 per cent stake in Virgin Australia could see the alliance go up against the Qantas-Emirates partnership.
Qatar Airways Group CEO Eng. Badr Mohammed Al-Meer said: “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.”
Bain Capital Partner Mike Murphy added: “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.”
Qatar Airways and Virgin Australia have been strategic and codeshare partners since September 2022.
