In a huge development for Australian aviation, Qatar Airways Group has announced its intention to acquire a 25% minority stake in Virgin Australia from Bain Capital, pending regulatory approval.
This strategic move represents a major vote of confidence in Virgin Australia and highlights the airline’s promising future in the competitive skies of Australia.
Virgin Australia Group CEO, Jayne Hrdlicka, says the partnership “brings the missing piece to Virgin Australia’s longer-term strategy”.
“Importantly, it will further strengthen Virgin Australia’s ability to compete over the long term, which will inevitably translate into more choice and even better value airfares for consumers as well as additional Australian aviation jobs,” Hrdlicka said.
“Qatar Airways has been a valued codeshare partner of Virgin Australia since 2022. This investment by the world’s best airline will deepen an already strong partnership by bringing critical scale and the best industry expertise to support our long-term competitiveness and growth.
“This proposed investment is subject to regulatory approval. We do not take this for granted and have made submissions outlining the benefits of the transaction for Australian aviation, Australian travellers and the Australian economy.”
Reflecting on the new proposed long-haul services between Australia and Doha, Hrdlicka noted that they were estimated to generate an economic benefit of $3 billion to the Australian economy through incremental visitor flows over the next five years. Additional benefits will flow from increased freight capacity, supporting Australia’s high-value exports to markets such as the Middle East and Europe.
This partnership is poised to deepen the existing relationship between the two airlines, fostering greater competition that will lead to more choices and better value for Australian travellers. By gaining access to Qatar Airways’ extensive scale and expertise, Virgin Australia will bolster its financial resilience and position itself for continued strategic growth.
As early as mid-2025, this collaboration is set to enable Virgin Australia to launch long-haul international flights, significantly benefiting both Australian travelers and the national economy.
The partnership will expand earning and redemption opportunities between Virgin’s Velocity program and Qatar Airways’ Privilege Club, along with enhanced code-sharing arrangements for better scheduling and connectivity.
“I am delighted that our closer relationship allows us to put our ‘toe in the water’ regarding long-haul international, as well as the ability to deepen other areas of existing cooperation, including between our respective loyalty programs and code sharing arrangements,” Hrdlicka said.
Hrdlicka said that she was particularly excited by the potential to expand the two airlines’ relationship into new areas such as sustainability and development of the western Sydney aviation ecosystem, including broader jobs and training opportunities.
“Sustainable Aviation Fuel will play a critical role in aviation’s long-term decarbonisation effort. Virgin Australia has been an active participant in the Federal Government’s Jet Zero Council, and we expect our partnership with Qatar Airways to support SAF opportunities in a manner consistent with the Federal Government’s Future Made in Australia agenda,” she said.
“Both airlines are thrilled by the opportunity to work together more closely, which will bring significant benefits to Australian travellers and the economy.”
Additionally, this alliance opens doors for new initiatives, including sustainability efforts and collaboration on the development of Western Sydney’s aviation ecosystem.
Qatar Airways Group CEO Eng. Badr Mohammed Al-Meer echos Hrdlicka’s sentiment, emphasising the alignment between the two airlines and their shared commitment to elevating the travel experience for Australians.
“We are really pleased to be announcing our proposed strategic investment in Virgin Australia today. The alignment of our two airlines is significant, the relationships are deep, and we could not be more proud to bring even more great value and choice to all Australians. The investment further demonstrates our strategic alignment with Virgin Australia and our collective ambition to deliver the best possible service and value to Australian passengers,” he said.
“Not only that, we believe competition in aviation is a good thing and it helps raise the bar, ultimately benefiting customers. This agreement will also help support Australian jobs, businesses and the wider economy.”
Bain Capital Partner Mike Murphy added that “Virgin Australia plays a pivotal role in connecting Australians with each other, and with the world”.
“Over the past four years, we’ve had the privilege of working alongside a team that has shown the dedication and tenacity needed to revitalise the airline. After a decade of losses resulting in administration, Virgin Australia has emerged as a strong and profitable company with an attractive market position, a loyal customer base, and a promising growth trajectory,” he said.
With Bain Capital remaining involved and a strong foundation already established, this investment signals a bright future for Virgin Australia, creating exciting opportunities for travellers and contributing to the growth of the Australian economy. Buckle up, because this partnership is set to take off!
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