What does Virgin Australia’s cuts mean for CQ flights?
THE dramatic restructure of Virgin Australia on Wednesday where it was confirmed 3000 jobs would be slashed, the aircraft fleet would be halved and the Tigerair brand would be suspended, has Central Queenslanders worried about future flight options and prices.
CQ’s members of parliament have discussed the implications of Virgin’s decisions and their hopes that our region would be adequately serviced.
Rockhampton MP Barry O’Rourke said he would always be concerned about flight services to CQ.
“You have to have competition in the air otherwise you have a monopoly on the market and they can charge whatever they want,” Mr O’Rourke said.
“I will always be supporting competition in the air and I hope that Virgin will continue servicing this region into the future.”
Capricornia MP Michelle Landry she was saddened to hear of the job losses and her thoughts were with all Virgin employees, as well as their families and those businesses relying on them for their livelihoods.
“The Australian Government acknowledges Virgin’s plan is an important step towards a sustainable, competitive aviation industry and we welcome its continued commitment to regional and charter flying, recognising the importance of maintaining connections for those communities,” Ms Landry said.
“We are living through a one-in-100-year event – the biggest challenge the aviation industry has ever faced.
“The Australian Government has and will continue to support the industry through our various initiatives, which to date have seen more than $1.3 billion committed to maintaining operations across the sector and supporting jobs.”
She said this investment came on top of the recently extended JobKeeper package, which continued to be available to Virgin employees at this time.
“While we look forward to a strong domestic recovery in the aviation industry, it will be some time before the industry can bounce back to pre-COVID levels of activity,” she said.
“We understand airlines have needed to make structural adjustments to ensure they can survive and ultimately thrive in the long-term.
“The Australian Government remains confident the current market-led solution will see Virgin Australia emerge in the best position possible.
“We continue to do everything we can to ensure our strong and competitive aviation industry is maintained through COVID-19, because we know Australia’s economy recovers relies upon it.”
Virgin Australia currently operates between Brisbane and Rockhampton using its Boeing 737-800 aircraft.
It has previously outsourced flying of a number of regional routes to Alliance Airlines.
A spokesperson for Virgin Australia responded to concerns saying it would offer an extensive network of regional destinations across Australia once the market recovered from COVID-19.
“We are assessing our ramp up in line with travel restrictions and travel demand,” the spokesperson said.
“We are currently reviewing options for our regional flying, and the routes previously flown with our ATR72-600 aircraft.
“Options for these routes may include replacing flying with a Boeing 737 aircraft, working with airline partners with smaller aircraft types, or using codesharing partnerships.”
State LNP respond to Virgin Australia decision
Shadow Minister for Northern Queensland, Dale Last, says regional Queenslanders were promised ‘blue sky dreaming’ but are, in fact, waking to a nightmare after Virgin Australia announced a plan to drastically cut staff and “overhaul” the carrier.
Mr Last said that comments from the Virgin Australia managing director proved the current Queensland Government hadn’t done its due diligence before committing taxpayer’s money to the rescue package.
“When a managing director says an investment of $200 million had a ‘limited impact’ you have proof positive that Labor has failed regional Queensland,” Mr Last said.
“Basically, the Queensland government has given them a $200 million cheque in return for no guarantees on jobs, let alone people in the regions.
“You could almost argue that paying each of the 3000 people who lost their job a share of the government investment would have represented better value for the regions. At least some of them may have taken a holiday outside the South East corner while they looked for a job.
“With a stake in an airline, you would hope a government would not only ensure value for money for taxpayers, but also explore opportunities that could benefit the airline and the state. That obviously didn’t happen here because we didn’t even get good value for money.”
Mr Last said that, with further cutbacks not being ruled out, there was the potential for regional Queensland to suffer on a level not seen since 1989.
“Unfortunately, it’s quite possible that regional routes will get the axe in an effort to strengthen the balance sheet, which is one of the steps in Virgin’s six-point plan,” he said.
“If Virgin reduces or eliminates regional routes you will have centres with limited or no services and, where there are services, the price will go through the roof. It will be back to the days of the 1989 pilot’s strike where air travel from regional Queensland will be basically non-existent.
“We constantly hear about Australian jobs and businesses being sold out to China but what the Queensland Government has done is sold out regional Queensland to an American private investment firm. Those firms typically buy businesses with a view to on-selling them for a profit so there’s no guarantee of a better outcome in the longer term either.”
Federal Labor responds to Virgin’s decision
Labor’s Shadow Minister for Industrial Relations Tony Burke and Shadow Minister for Infrastructure, Transport and Regional Development Catherine King released a joint statement expressing their disappointment with the Federal Government for a lack of support for Virgin Australia, forcing their hand with the cut backs.
“This is another sad day for Australian aviation, Australian workers and regional communities.
Labor’s thoughts are with Virgin Australia’s 9000 workers and their families on what will no doubt be another difficult day,” the Labor MPs said.
“When Scott Morrison took the decision to refuse support to Virgin Australia he left the future of the airline up in the air.
“In preferring a “market-led solution” to Virgin Australia’s difficulties, the Morrison Government has now ensured that thousands of workers will lose their jobs and regional centres around Australia will lose the flight routes on which they rely.
“This is the latest in a long line of government missteps when it comes to the aviation sector.
“Scott Morrison decided to deny JobKeeper to thousands of essential aviation workers, he waited too long to save thousands of jobs at Qantas, and he allowed Virgin Australia to fall into administration, resulting in the loss of thousands more jobs.
“In the face of such government inaction, Labor commends Virgin Australia, the independent administrators and Bain Capital for protecting as many workers and as much of the airline as possible. We encourage them to work closely with unions and workers throughout this process.
“With continuing domestic and international border closures, it is clear that ongoing support will be required across the aviation sector to ensure we do not see further avoidable job losses.”