Events are forcing Virgin Blue to clarify its plans for international flights, accelerating them from "some day" to next year. This follows a request by rival Qantas Airways for approval to operate four more Hong Kong flights.
Qantas and oneworld partner Cathay Pacific now fly every nonstop between Australia and Hong Kong. If Australia's International Air Services Commission grants the Qantas request, it would control 33 of the 35 frequencies allowed to Australian passenger carriers on the route.
David Huttner, Virgin Blue's commercial head, warns his airline may formally object. "We have significant concerns about all Hong Kong rights being tied up in a oneworld [alliance] monopoly."
Sir Richard Branson, with a 50% stake in Virgin Blue, has confirmed on a recent visit to Australia that the carrier is keen to launch Hong Kong flights and will make a rival application for route rights. Virgin has also been attending bilateral talks between Australia and Hong Kong.
New Zealand has always topped Virgin Blue's overseas agenda. Available aircraft and route rights have been its main obstacles, with the latter largely eliminated in March when Patrick Corp took a 50% stake, effectively making Virgin Blue an Australian airline. It is now watching, say observers, to see if Qantas buys a stake in Air New Zealand.
Huttner hints that Virgin's offshore unit may carry the brand "Virgin Pacific". There is speculation that Virgin Blue's imminent decision on a $A3.6 billion ($2 billion) aircraft order could include some larger jets for overseas flights.
Virgin Blue's plans for an initial public offering in the first half of next year are likely to draw out more details on the "Virgin Pacific" unit. Branson foresees a 20% float with half coming from himself and half from Patrick Corp.
Source: Airline Business
