Summary

  • Virgin Australia is focused on rebuilding and enhancing its brand after bankruptcy, with a prospective stock exchange listing in mind.
  • The airline has proposed a codeshare agreement with Air New Zealand, allowing customers to access flights into Auckland, Wellington, and Christchurch.
  • The deal offers benefits to Virgin Velocity frequent flyers, including point earning and redemption, as well as lounge access between Australia and New Zealand.


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The Virgin Australia that emerged from bankruptcy is vastly different from the airline that carried its name before being engulfed by poor management decisions and the onset of COVID-19. Today’s Virgin Australia is a pragmatic beast with its eyes firmly fixed on a prospective stock exchange listing and is open to doing deals that enhance value and make it more attractive to future investors.


A trans-Tasman hook-up

That deal-making pragmatism was on show today when details emerged of a proposed codeshare across the Tasman between former partners Virgin Australia (VA) and Air New Zealand. The two airlines have submitted applications to the Australian Competition and Consumer Commission (ACCC) and the New Zealand Ministry of Transport to enter into a unilateral trans-Tasman codeshare agreement.

Air New Zealand A321neo

Photo: Airbus

In a statement, VA said that if the agreement is authorized, its customers will have direct access to Air New Zealand flights into Auckland, Wellington and Christchurch. VA already has partnerships with Qatar Airways, Etihad and Singapore Airliners and chief strategy and transformation officer Alistair Hartley said the tie-up would help grow the airline’s international network. He added:

“This codeshare agreement would complement Virgin Australia’s popular direct Queenstown services by expanding our trans-Tasman footprint with a world-class partner airline our customers know and love. New Zealand is the most popular overseas destination for Australians, making this a great addition to our international network offering.”

The deal offers some great benefits for Virgin Velocity frequent flyers who could earn and redeem points across the Tasman and, for eligible members, have lounge access when flying between Australia and New Zealand. Before the pandemic, VA had around 14% of the trans-Tasman market, which abruptly ended when the Australian airline financially imploded in March 2020. Last year, Virgin Australia resumed flights to Queenstown but has not restarted flights to the main centers of Auckland, Wellington and Christchurch.

Not much information is available

The agreement submitted to regulators is a one-way partnership where Virgin Australia would codeshare on Air New Zealand flights between Australia and New Zealand. In effect, that would see Virgin Australia flight numbers used on Air New Zealand flights, allowing passengers to earn points and status credits on those flights. Air New Zealand also partners with Qantas, and they have existing codeshare agreements on routes other than across the Tasman.

Virgin Australia 737-700 take off

Photo: Ryan Fletcher I Shutterstock.

Air New Zealand chief transformation and alliances officer Mike Williams said the airline looked forward to welcoming Virgin Australia’s customers onboard. The application contained minimal comment, and neither Virgin Australia nor Air New Zealand expanded on the proposal.

The previous partnership between Air New Zealand and Virgin Australia ended acrimoniously in 2018, although at one point, Air New Zealand held a 26% equity stake in Virgin Australia. The joint venture allowed the airlines to manage capacity jointly, book passengers on each other’s planes and share revenue. Passengers benefited through each airline’s domestic networks and shared lounges and points schemes.

What do you think of these types of airline partnerships, and do they give value to passengers? Let us know your thoughts in the comments.

Source: NZ Herald

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