Virgin Atlantic to withdraw from AustraliaBack to Forum
Anonymous4 Feb 2014
We have just learnt that Virgin Atlantic will no longer serve Sydney, Australia with effect from next May.
Its daily London-Hong Kong service will continue but the onward sector to Sydney will be discontinued.
The airline says the cessation of Australia flights is down to economic issues affecting the profitability of the route.4 Feb 2014
BA next to withdraw their services as well. So no British carrier to Australia, sad times. Just shows full Upper Class cabin and Premium and not enough revenue generated?4 Feb 2014
This is the release I received
“Virgin Atlantic has today announced its intention to withdraw operations between Sydney and Hong Kong from 5 May 2014.
Increasing costs and a challenging economic environment has affected revenues and the route is no longer considered profitable. Virgin Atlantic will continue to operate a normal daily service between London Heathrow and Hong Kong.
Virgin Atlantic regrets that this decision will affect some staff based in Sydney and Hong Kong. A consultation period has commenced with all employees likely to be affected.
Craig Kreeger, Chief Executive at Virgin Atlantic said, “We intend to withdraw our services between Hong Kong and Sydney. Despite the best efforts of our employees, external factors such as increasing costs and a weakening Australian dollar have affected our profitability.”
“These are still difficult times for the airline industry and as part of our strategy to operate more efficiently we need to deploy our aircraft onto routes with the right level of demand to be financially viable.”
It is Virgin Atlantic’s intention that the last flight departing Sydney to Hong Kong will be on 5 May 2014 and the last flight departing Hong Kong to Sydney will be on 4 May 2014. Up to that date, Virgin Atlantic will continue to operate its published schedule and customers can be confident booking flights for travel prior to then”4 Feb 2014
European airlines will always struggle to get a decent yield on flights to Australia.
The simple fact is that they can use the aircraft more efficiently and generate more revenue by turning it around in Asia and using a codeshare/alliance partner for the final leg to Australia. Flight sector times from Hong Kong to Sydney are around nine hours. So by the time a Virgin A340 gets to Sydney then sits on the ground before leaving again that afternoon (to meet the LHR night curfew) the same aircraft could be back in London ready to be turned around to the east coast of the USA for another revenue flight. By the time the A340 finally makes it back in London from Sydney it could have gone LHR-HKG-LHR-JFK-LHR. The additional revenue gained by a passenger travelling London – Hong Kong – Sydney versus say a return flight to both Hong Kong and JFK is pretty obvious.
Loads are always healthy on the oz routes but it needs to be combined with decent yields to make it viable. I’m surprised BA are still on the route to be honest and I definitely don’t think it’s future is assured.4 Feb 2014
There is no evidence to suggest BA is planning to stop serving SYD imminently.
It has long been suggested that BA would withdraw from Oz. It was almost a certainty with the previous JV with Qantas, high legacy fleet costs and less efficient aircraft serving the route.
However, with more fuel efficient higher capacity 777-300ERs, lower cost Mixed Fleet crews and without the JV in place, BA is seeing considerable improvement in the route’s profitability.
A non time-specific reference to a £30m uplift on the SYD run was reported at the last Capital Markets day:4 Feb 2014
I can’t possibly write what I first said when I read this but it went along the lines of “oh dear”! 😉
Just when I thought I had flights planned for our trip later this year to Oz ….. Now I wonder what they will do for people, like us, with already booked flights beyond this time?
Anything on your release TimF?
Thanks! 🙂4 Feb 2014
Have just written up my piece for the website. It will be posted online very soon.
Note that the news was first released DownUnder.
In the official statement received from VS it says, “Any passengers, including codeshare passengers, who are travelling after May 5 and are concerned about their travel arrangements, should contact Virgin Atlantic or their travel agent to discuss alternative options.”
Alex McWhirter4 Feb 2014
Given that you can get J fares to Oz for £2000 ex Europe in the right sale at the right time (Etihad ex Istanbul for the last one) you can only imagine how unprofitable it must be. For VS with a limited number of aircraft it makes sense to redeploy albeit a LHR slot will be needed.4 Feb 2014
Virgin has a fare ex ARN and GOT to Sydney for 19,500 SEK which is less than £2,000 return. Not that this is a core market for Virgin, but I can understand why it is hard to make any money with fares like this.
For those interested:
Virgin Atlantic (VS) + British Airways (BA) or SAS (SK) to LHR
Cabin class: Business class
Booking class: VS: Z, BA: D, SK: J
Fare basis: ZRTSK7
Price: 14,285 SEK + taxes and fees ca 5,200 SEK, total ca 19,500 SEK
Buy 7 days before departure
Min/Max stay: 3 days / 12 months
Stopover: 2 free stopovers in Hong Kong. 2 stopover ok in London, for 1,900 SEK per stop but triggers UK ADP
Child discount 33%
Change: Yes, for a fee of 3,600 SEK4 Feb 2014
I phoned VS, the call was answered promptly and I was speaking to someone in 10 seconds, a very helpful lady who was somewhat surprised that I knew already about this. So thank you Business Traveller, first with the news, and I told her exactly where I had read it! 🙂
We have a booking with VS in UC ex SYD to HKG in September using VS miles which I had specifically bought to top up our miles account to make this booking.
Our options now:
1. Total refund of all miles and any taxes etc paid (miles to be credited back to our flying club account of course)
2. They would rebook us on CX but in Y only (and no amount of suggestion to booking another cabin would budge her including telling her that at my tender young age, no way am I doon the back!) and refund any difference in miles, taxes etc.
I also raised the question with her, that these miles were bought specifically for this flight booking, but no joy again, the miles bought are not refundable under any circumstances.
So double whammy here for us, but it’s not the end of the world as I’m sure with a bit of flexibility I can sort us out the now missing segment flights and a quick check shows up various options ex OZ to get us back to HKG. And it wouldn’t be the end of the world if we changed our plans totally for other dates for the whole trip.
And continuing to look on the bright side, and taking on the explanation on the Ad thread that an empty cup is a joy to fill, or an opportunity we now have – my interpretation of course – so we now have a lovely stack of VS miles again, which I’m sure could be wisely spent on a trip to the US as we never did get to Las Vegas last year! Or a shopping trip to New York, now you’re talking! LOL!
Thanks again Mr McWhirter! 🙂
Now I have to just tell the DH!, who will probably just say, “just buy the tickets we need”, but now that’s no fun, now is it!!??4 Feb 2014
I believe VS still code share to Australia on the services of SQ. It is or at least was a strange arrangement where the code share only applies to economy class.
Papillion, is it worth asking if you can fly from SIN on SQ? There may be a way of getting C seats? I guess if you don’t ask you’ll never know. I appreciate it’s not convenient but it’s better than losing all round which sounds like what you are set for at the moment.4 Feb 2014
Thanks CXD for that tip. I’m trying to work out our options, and we don’t have to go back to HKG, but I was hoping to, if for nothing else to go for Sunday brunch at Nicholini’s as per Ianfrom HKG’s lovely suggestion!
So thanks, I think I will call them back as I haven’t actually cancelled the booking yet as I wanted to mull it over, so will let you know what they say! 🙂4 Feb 2014
If I had issued a revenw ticket then you should be put into I Class on Cathay Pacific which is Business Class on the HK to Sydney sectors so I don’t see why they won’t do that for you – especially given FDoS excellent post above. This is what we were emailed:
“Options for affected passengers
We are in discussions with airlines in regards to reprotecting ticketed passengers affected by the intended withdrawal. Currently, we have the following agreement in place with Cathay Pacific:
Ticketed passengers travelling between Sydney and Hong Kong and who are affected by the intended withdrawal may be reprotected using the following booking classes:
Virgin Atlantic Cabin Cathay Pacific
Economy passengers: Y class
Premium Economy passengers: W class
Upper Class passengers: I class”
So go back to them and politely advise them that so far their advice seems wrong!!4 Feb 2014
Ah FDoS, whichever combination – you’re nae a bad lad! 😉 :-)))
Thanks for this and thank you to whomever it was who emailed you 😉 I know who you are :-)))
Anyway, got back on the phone to VS , again answered in a few seconds which I was surprised at, now the news is out.
Quoted the email (thanks TimF :-))) – anyway he went off and read it for himself, I think they are all catching up with this as well. Came back and said yes that’s right, but for reward/redemption bookings they can only offer Y re-bookings, whether originally booked in UC, PE or Y.
I politely asked why as to all intents and purposes a reward booking is a revenue booking as its paid for either with loyalty ff miles or in this case a mixture of loyalty and paid for miles.
Again, apologised and said this was what was on offer or we could have a full refund.
I then told him I could go on to BA.com and book reward flights on CX in business using avios for the booking, so why can’t they offer me the same? He will ask the question, but again repeated the above!
OK, time now to get serious – I mentioned their responsibility as outlined above in FDoS’s excellent post, (rerouted under comparable conditions etc., ) of course he wasn’t prepared for THAT – immediately telling me he would have to escalate it! I also prefaced it all with some comment of a bit of light research, (you have to keep something back) but that I was sure that regardless of how the ticket has been “paid for”, there would be no distinction under the law, quickly qualifying it with an “of course I’m not a lawyer”.
So making sure he had all my contact details, and I have his, he has said he will get back to me when he has an answer from whoever it is he has escalated this to.
So I will now have to wait and see what the outcome is when he phones back.
Sadly CXD, they no longer have any link with SQ, but thanks anyway. 🙂
So thanks everyone, I really appreciate your help with this and will keep you posted.
In the meantime, I can see lots of availability to get us back to HKG, including on CX in business, but I’ll just hold fire and see what happens first.
If all else fails, we can always go on another cruise ……. LOL!4 Feb 2014