Queensland government hands Virgin $200m lifeline (but there are strings attached)
The Queensland government has called upon the federal government and other states to support Virgin Australia, as speculation continues to swirl around its future.
Queensland’s Minister for State Development Cameron Dick said it was imperative Australia has two airlines to support tourism, jobs and regional investment.
“Queensland has given Australia both our national airlines – we won’t let them go, or let thousands of families watch their jobs go, without a fight,” he said.
“The Queensland government is ready to do its bit to support, offering $200 million towards a national support package to help get Virgin get back in the skies.
“But we can’t do it alone, and nor should we, because all parts of Australia benefit from two national airlines.”
Dick urged the federal government to lead a national effort to keep Virgin flying.
“We also want to keep the air fair. We know that it can cost up to 25 per cent more to fly on single-carrier routes, and we want to avoid that at all costs, when we emerge from this crisis,” he said.
Dick said Queensland government support was conditional on federal government backing, debt restructuring, shareholders and bond holders doing their bit, headquarters remaining in Brisbane, and ongoing regional flights.
“We know other investors are looking at Virgin too,” he said.
“Our message to potential investors is that we are prepared to put money on the line to keep a national carrier based in Queensland.”
The Transport Workers’ Union has echoed the Queensland government’s call for other state and federal governments to financially assist Virgin, with national secretary Michael Kaine saying now is the time for them to decide on the struggling airline’s fate.
“The choice is to save 16,000 jobs and it is about whether to consign Australia to a monopoly by one airline, which will mean the country will struggle to get back on its feet,” Kaine said.
“We welcome the announcement by the Queensland state government, and we urge the NSW and Victorian premiers and the federal government to follow suit.
“Virgin workers need certainty about their futures and the travelling public needs assurances that our economy will not be allowed to fall apart.”
Virgin CEO Paul Scurrah joined trade unions and industry experts in a roundtable discussion on Friday about the future of Australia’s aviation industry, and once again called for Qantas to “put rivalry aside”.
Scurrah has already complained to ASIC and the ACCC about Alan Joyce’s comments on what Virgin deserves in terms of government support.
Qantas and the federal government declined invitations to join the roundtable, according to the TWU.
The wait continues
Virgin has been in a trading halt on the ASX since last Tuesday, having extended the pause on Thursday to buy some more time for either the government or outside investors to come to the rescue.
The company originally proposed a $1.4 billion bailout from the government to help survive the impact of COVID-19.
However, given $165 million worth of funding has just been allocated to help keep Virgin and Qantas flying domestically, on top of the $715 million relief package for Aussie airlines announced last month, as well as a $300 million lifeline for the regional aviation sector, it seems unlikely that the government will offer specific financial support to Virgin.
Also, if the recent comments of Prime Minister Scott Morrison, Deputy Prime Minister Michael McCormack and Treasurer Josh Frydenberg are anything to go by, the government would prefer Virgin be saved by private investors.
Two companies that are continually being speculated as potentially lining up a play for the airline are Bain Capital and BGH Capital.
Right now, voluntary administration seems the most likely outcome for Virgin. It’s major shareholders – Etihad Airways, Singapore Airlines, Nanshan Group and HNA Group – have passed up the opportunity to provide an equity injection, according to media reports.
Richard Branson’s Virgin Group, which owns just over 10 per cent of Virgin Australia, still appears to be undecided as to whether it will help out.
And to make matters worse for Virgin, credit rating agencies Moody’s and Fitch have just issued downgrades for the airline.
In any case, we should have a clearer picture by Thursday.
Featured image credit: iStock/Andrew Hanlon
Email the Travel Weekly team at traveldesk@travelweekly.com.au
Cameron Dick federal government Michael Kaine Paul Scurrah Queensland government Transport Workers Union twu virgin virgin australiaLatest News
Groupe Barriere appoints La Collection as ANZ representative of its Fouquet’s properties
Groupe Barriere has announced it has appointed La Collection as the exclusive representative for Australia and New Zealand of its two flagship Fouquet’s properties. This partnership brings together La Collection’s dedication to exceptional boutique experiences with the legendary heritage of the Fouquet’s brand. Groupe Barriere, a name synonymous with French luxury and the art of […]
The best way to spend three days in San Francisco with Infinity Holidays
Three days will never be enough time in San Fran, but with the help of Infinity Holidays, you can give it a good nudge.
A Culinary Journey Through Southwest France
Let's face it - if you're going to France, you just have to enjoy all of the food and drink on offer.
Royal Caribbean unveils its latest Perfect Day Mexico adventure
Royal Caribbean: Building the biggest ships in the world one day, buying islands the next.
Salter Brothers acquires iconic Bannisters luxury retreat hotels in Mollymook and Port Stephens
$100m is a lot of pricey Rick Stein fish, chips and mushy peas. As long as someone else pays...
Women in Travel: Carnival’s Kara Glamore on the one person you need to make happy in your career
In the same way people say take love over money, Kara's saying take your happiness over money. We're happiest with both!
20,000 Supercross fans descend on Moreton Bay ahead of adrenaline filled weekend
We're not sure of the nutritional value of this seafood feast as a pre-race meal, but we do know it would be delicious!
South African Airways ramps up Perth service with up to five flights a week by January
We are almost certain there will be an increase in local kangaroo boerewors production given the numbers coming in.
After Perth success, WTTC’s Global Summit heads to the Eternal City in 2025
Perth was a blast, but sadly we had to catch the red-eye back his morning to launch this newsletter.
Much-delayed Villa Vie Residences life at sea concept sets sail on inaugural voyage aboard MV Odyssey
You'd want to make sure you didn't get seasick before you boarded this little sea jaunt.
Escape This brings Australia’s best-rated escape rooms to George Street
Just in time for a spooky end to the month. That's Halloween for anyone not reading between the lines!
APT announces the return of Queensland Expedition Cruising
Daylight savings or not, these expedition cruises are coming back with vengeance.
Luxury Escapes unveils winners of inaugural LuxList Awards
There's a lot of luxury talk going on at the moment, but this list is your one stop shop!
Robert Irwin’s plea to travel industry: Spend tourism dollars on supporting the planet
If there's any name we're going to listen to on this topic, it is Irwin!
Indigenous tourism drives economic growth: The World Travel & Tourism Council finds
Indigenous tourism is projected to contribute US$67 billion ($AU100 billion) to the global economy by 2034, a landmark World Travel & Tourism Council has found. This economic boom is fuelled by increasing demand for authentic cultural experiences, in countries such as Australia, Canada and the United States, among others. The report showcases the sector’s role […]
Perth’s Matagarup Zip+Climb becomes world’s first member of WTTC’s ‘Together in Travel’ for SMEs
Perth’s Matagarup Zip+Climb co-founder Ryan Mossny has been named the world’s first member of the World Travel & Tourism Council’s new ‘Together in Travel’ program for Small and Medium Enterprises (SME). Announced at the 2024 Global Summit in Perth (Boorloo), today the ‘Together in Travel’ program is a unique initiative aimed at providing support and […]
Famous Northern Territory fishing contest lures $35m+ from out-of-town hopefuls
This competition always catches our attention, even with our lack of patience... There's $1m swimming around up there!
Expedia Group says affluent Asian travellers will boost global travel industry
Turns out Crazy Rich Asians was pretty on the money with this growing travel trend.
Travel DAZE Speaker Dee Madigan tackles polarisation at DCA debate
If you've ever found yourself knee-dip in a Facebook feud with some dude that lives in Ohio then this is for you.
La Tour d’Argent reveals menu for the Sofitel Legend Metropole Hanoi
If you travelled to Vietnam for Vietnamese food then you'll be disappointed!
TAG partners with SXSW Sydney 2024 as preferred travel partner
With a load of big wigs in town it'll be easy to miss the travel sessions you're supposed to be at. Just look for TAG!
The new Oyster at Byron Bay’s Hotel Marvell set to catch seafood lovers this summer
If we couldn't come up with a fishing-related pun for this headline it may of been time to hang up the joke book.
More than 2500 flights cancelled as Florida braces for Hurricane Milton
Scary headlines coming out of the US today, thoughts with the many people impacted.
Globus family of brands picks Allianz as insurance partner
Whilst some accuse Allianz as being a 'pick-me girl' you can't deny that it worked out here.
Battle against global warming can be won – with help from tourism – says former US Secretary of State
Maybe John Kerry should look at more flights to the Antarctic if one D. Trump is looking good in the polls.
Global tourism roars back to life with APAC leading the way
With news like this you can tell the family overseas that there's no excuses for missing family Christmas this year.
Travel in Oceania could add $166 billion to the regional economy and 1.1m jobs
Travel is booming here, there and everywhere and Oceania is in the business of sticking with the trends.
WA leverages Indigenous heritage as a key topic at WTTC Global Summit in Perth
This is great news! Time to shout about Australia's rich and far-reaching history.
Mother-daughter bonding redefined: A five day wellness getaway at Elements of Byron
Big fight with your favourite daughter? Say sorry with a trip to Elements of Byron. P.S - this wasn't why we visited!
Delta Airlines opens the premium Delta One Lounge at LAX
We would almost take the round trip to LAX just to check this lounge out. Almost...
Civil penalties for airlines not using allocated slots under Albanese Government slot reform
Rex and Bonza are rolling in their proverbial graves right now...
Newcastle Airport joins forces with CommBank to fund sustainability programs via $235m green loan
We're sure the bank would prefer if CommBank yellow was the colour associated with net-zero, rather than green.
Qantas to fly third repatriation flight between Cyprus and Sydney
The Flying Roo may have lost of few fans in recent years, but these flights are sure to win a couple back!
Qantas apologises for broadcasting ‘clearly inappropriate’ adult movie to entire plane
You'd be pretty livid if you've been hiding this stuff from your children only for it to end up right in front of them.
Topdeck offers 30 per cent off on selected departures to Europe
As long as you can wrench their phones away from them, this sounds like it should get some positive eye contact.
La Vie Hotels and Resorts group appoints Marcus Hanna as chief operating officer
Hanna's done the hard yards both here and overseas, but no time to put his feet up even though resorts is in his remit.