Virgin to axe Etihad partnership under Qatar Airways deal?
Qatar Airways’ 25% stake in Virgin Australia would come at a cost for frequent flyers…
By David Flynn, October 25 2024
Virgin Australia’s long-standing partnerships with Etihad Airways would be cut back as part of the proposed 25% investment by Qatar Airways.
Although the investment is yet to be approved by Australia’s Foreign Investment Review Board, both airlines have applied to the Australian Competition and Consumer Commission (ACCC) seeking approval for their “proposed integrated alliance.”
Contained within that application lodged with the ACCC (click here to download a PDF copy) are details of how the Qatar Airways partnership would impact Virgin’s relationship with Etihad Airways and Singapore Airlines.
“Qatar Airways will become Virgin Australia’s exclusive interline, codeshare and loyalty partner headquartered in the Middle East or Türkiye (excluding interline for passenger re-accommodation purposes),” the application reads.
This would appear to immediately remove Etihad Airways, which has been a Virgin Australia partner since 2010, from Virgin’s roster of partner airlines.
An extract from the Virgin Australia & Qatar Airways submission to the ACCC.
In addition, the application states “Virgin Australia will not codeshare on the international flights of other airlines to, from or within the Middle East, Europe, and Africa.”
This appears to effectively restrict Virgin’s Singapore Airlines codeshare flights to Asia and India, while Qatar Airways would be the sole VA partner for travel across Europe, the UK and Africa.
Included in the ACCC document is a map showing an ‘overview of Virgin Australia’s partner network’ showing how Virgin’s international network would be redrawn under its Qatar Airways alliance.
An extract from the Virgin Australia & Qatar Airways submission to the ACCC.
Virgin Australia and Etihad Airways declined to comment when approached by Executive Traveller, while Singapore Airlines responded it was “unable to comment on any confidential commercial discussions.”
Virgin would also cut its ties with South African Airways, based on paragraphs citing that Virgin would not “codeshare on the international flights” or “supply any loyalty point accrual services or high value guest services” with any airline in Africa.
As previously reported, Qatar Airways plans to provide jets and crew to Virgin Australia so that Virgin can run daily flights from Sydney, Melbourne, Brisbane and Perth to Qatar’s Doha hub as early as mid-2025.
The partnership between Virgin Australia and Qatar Airways will also be strengthened to add benefits including increased earning of Velocity Points and status credits and greater availability of points-based “redemption opportunities”, the airlines have promised.
27 Feb 2014
Total posts 5
Doesn't this also mean that Virgin Atlantic has to be dropped as a partner as their services are to and from Europe? As a European-based airline they would now be excluded from points accrual?
Qantas - Qantas Frequent Flyer
14 Apr 2014
Total posts 45
Removal of “high value guest services” from “airline headquartered in Europe” reads to me like this kills Virgin Atlantic lounge access too.
Virgin Australia - Velocity Rewards
24 Jan 2018
Total posts 758
Good question. VR's Clubhouse lounges require a J-class fare for access (as best I recall, VA Platinum doesn't cut the grade, but I may be wrong). Below Clubhouse, is the No.1 Lounge - never been there (yet).
Virgin Australia - Velocity Rewards
24 Jan 2018
Total posts 758
Parting ways with EY comes as no surprise, but to even slightly singe the VA-SG relationship is a cause for concern. I'm beginning to worry that what's good for Bain and QR may not be that good for VFFs, but happy to be fair and let time tell me otherwise (though when it does, it will tell quickly).
18 Sep 2015
Total posts 136
Virgin Atlantic is headquartered in England, which is not part of Europe. Remember Brexit?
05 Feb 2022
Total posts 5
Europe is a continent, a place on planet Earth. Political agreements, such as the European Union, don't change the location of a country :)
Virgin Australia - Velocity Rewards
12 May 2022
Total posts 15
Exiting the European Union doesn't change its location on the map, completely different, England is in Europe no matter what political changes occur.
22 Sep 2017
Total posts 93
Seems like this would be a substantial lessening in competition in the market for international services to Australia. The inability to interline or code-share would limit any other carrier's ability to serve customers outside the main cities. For example they could not sell a single-ticket trip to Europe from Townsville or wherever via Virgin, leaving them negotiating with Qantas in a monopoly position. Given how precious the regions are, I can see this becoming a hot topic in both the ACCC and political arena.
QF
11 Jul 2014
Total posts 1002
Current cost of a return ticket business class to Europe is $10k was $5.4K with Singapore. Cost with Qatar is around $28k from what I found. I can’t see people paying extra for any seats and I’ll also mention Turkish Airlines with there around the world ticket business class for $7.8k
Virgin Australia - Velocity Rewards
12 May 2022
Total posts 15
I'm seeing business to MEL to LHR from $5800 with Qatar Airways each way in August. Only looking then as I am considering a booking. Not too bad price wise.
05 Mar 2015
Total posts 418
Very predictable when you think about it. VA being equally allied to both EY and QR was always odd. But this latest move shows the shortcomings of Virgin's 'DIY alliance' model in how it has to accommodate different partner airlines. A big loss for VA flyers who value Etihad and SQ, use their award seats etc.
Qantas - Qantas Frequent Flyer
04 Nov 2017
Total posts 344
VA cutting off what's left of the partnership with EY comes as no surprise to most, but SQ being blocked from Europe is definitely a QR move to take exclusivity on the European and African corridors.
Considering according to the AFR that SQ was approached by Bain reps and had declined interest for a cornerstone stake in VA again, this would've had been predicted once they were in negotiations with QR. Seems SQ was not interested in burning billions at the Australian domestic market again after their Air New Zealand (Ansett), Tiger and Virgin 1.0 disasters.
QF
11 Jul 2014
Total posts 1002
I’m sure there would have been a bidding war if SQ did offer a price, I normally bid even if not interested just to drive the price up or get it at a discount.
28 Sep 2022
Total posts 23
Not great news, I love flying SQ and EY - and in particular using the first class EY lounge, which in my opinion while smaller than EK one, is much nicer and more private.
I have no doubt that QR will not extend the same privilege to VA platinum members, and so I really see this as a significant diminishing of the benefits of VA.
With Turkish making big inroads into Australia, maybe star alliance would be better, and then it's just a matter of figuring out whether to go with Turkish or Singapore loyalty program - I guess SQ would be better for now as it's already quite established in Australia.
Qantas - Qantas Frequent Flyer
30 Mar 2015
Total posts 13
I hope I can continue to access va lounge with my sq pps. Otherwise it’s back to Qantas. Sigh.
04 Sep 2019
Total posts 67
time to transfer your VA points to SQ if thats what you stockpile them for. Never know whats around the corner on that alliance perk
Qantas - Qantas Frequent Flyer
04 Nov 2017
Total posts 344
There is also the potential that "Krisflyer/Velocity" transfer could be devalued in favour of a 'new' "Velocity/Avios" transfer program under the incoming new part owners.
QF
11 Jul 2014
Total posts 1002
I wonder what the percentage of air travel will be through the G (ulf) Spot after QR and VA get together?
Virgin Australia - Velocity Rewards
24 Jan 2018
Total posts 758
Good question (curious delivery notwithstanding). The progeny of this QR-VA union will rely heavily upon the transfer pricing of fares between QR and VA. And given the 25% equity position, QR could be forgiven for wanting to steal market share from the rainbow kangaroo (including former finance-media journalists trying their hand at books?). But, hey, that's Karma for you.
08 May 2020
Total posts 84
Interesting how long the Singapore Airline relation ship will last as it is my preferred Airline to Europe. So what I can read that will not be beneficial on Virgin benefits. All is already lost with Virgin travelling to New Zealand with no beneficial way with Virgin. Queenstown is not an option for my need. Yes Virgin points may need to be transferred to SQ .
QF
11 Jul 2014
Total posts 1002
I wonder if Alaskan / Hawaiian buy 25% of Virgin to secure the USA and Canada? Remember Jayne was / is a board member of Hawaiian.
Qantas - Qantas Frequent Flyer
04 Nov 2017
Total posts 344
The Hawaiian board members which include Jayne will cease to be board members once HA/AS achieve a Single Operating Certificate. I'd also tip there's a better chance of UA being a darkhorse to buy a minor stake (say 10%) instead of AS (a partner of QF) getting involved in QF's rival.
11 Sep 2015
Total posts 224
I can't see that happening at all, as mentioned below, the Hawaiian board is on the way out, plus it doesn't seem to make sense that Alaska would invest in Virgin when it has closer ties to Qantas & OneWorld.
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