Cheaper fares than ever before, free snacks to go and in flight entertainment under review: What to expect from the new look 'mid-market' Virgin Australia
Virgin Australia has unveiled its brand new look with no free snacks and cheaper fares, positioning itself as a mid-market airline under its new owners.
On Wednesday, incoming chief executive officer Jayne Hrdlicka revealed major changes on the way for the airline.
Under the changes, fares will drop but in-flight perks, such as free snacks, will be scrapped. Free tea, coffee and water will continued to be offered.
Virgin's shift from being a full-service carrier will mark the end of a decade-long arms race with Qantas Airways Ltd for corporate travellers involving lavish airport lounges, celebrity chefs and lie-flat business seats on longer domestic flights.
The debt-ridden airline has already cut subsidiary Tiger air, trimmed down its fleet and discontinued its business lounges until travel demand resumes
Virgin Australia will be a mid-market carrier appealing to customers who are after a great value airfare and better service
'Australia already has a low-cost-carrier and a traditional full-service airline, and we won't be either,' Ms Hrdlicka said.
'Virgin Australia will be a mid-market carrier appealing to customers who are after a great value airfare and better service.'
The country's second-biggest airline said it would introduce new on-board food purchase options in economy class but would retain business class seats and airport lounges in major cities.
It would also continue to include checked baggage in its economy-class fares. In-flight Wi-Fi and entertainment remains under review.
The changes were announced on Wednesday morning as US private equity firm Bain Capital formally took over Virgin Australia.
Virgin was delisted from the stock exchange on Tuesday after the Bain purchase closed, allowing it to exit from voluntary administration.
Complimentary snacks in economy will be replaced by purchase-only food (stock image pictured)
Under the changes, fares will drop but in-flight perks, such as free snacks, will be scrapped. Free tea, coffee and water will continued to be offered
The debt-ridden airline has already cut subsidiary Tigerair, trimmed down its fleet and discontinued its business lounges until travel demand resumes.
Qantas Chief Executive Alan Joyce said he expected Virgin to emerge 'leaner and meaner' given it was able to change the terms of its aircraft leases as part of the administration process, Australia's nearest equivalent to the U.S. Chapter 11 bankruptcy regime.
Qantas has announced plans to achieve A$1billion in annual savings by the 2023 financial year to help weather the coronavirus pandemic.
Analysts have said Virgin's move down market would give Qantas room to trim product expenses or introduce fees on cheaper fares while maintaining its premium market position.
The country's second-biggest airline said it would introduce new on-board food purchase options in economy class but would retain business-class seats and airport lounges in major cities
Virgin Australia Group has been struggling under billions of dollars worth of debt and the impact of the pandemic on the passenger jet market, which has led to the near-collapse of international travel and a huge slump in domestic markets
'We have no intention of changing the Qantas product apart from what we have done around COVID-19,' Joyce said at an Aviation Week webinar.
Virgin Australia Group has been struggling under billions of dollars worth of debt and the impact of the pandemic on the passenger jet market, which has led to the near-collapse of international travel and a huge slump in domestic markets.
When it was forced into voluntary administration in April, the airline's woes attracted a pack of private equity firms and other parties keen to acquire the airline before Bain Capital came out on top.