Virgin Australia Gets the Nod for China Service
Jackie Reddy June 21, 2016
The alliance between HNA and Virgin Australia was announced just weeks ago, but the carrier has already received official confirmation with respect to seat allocation capacity for its proposed service.
Late last month, it was announced that Virgin Australia will be commencing direct daily service from Australia to Hong Kong and Beijing under a new partnership with Chinese multinational HNA Group.
It seems that Australian authorities have already given their consent for the new agreement to roll forward. On Monday, ATWOnline reported that Virgin Australia has received approval from the country’s International Air Services Commission (IASC) regarding seat capacity allocation for these daily flights.
It has been revealed that there are over 26,000 weekly seats available to Australian operators for flights between Australia and various Chinese cities and Hong Kong. The daily Beijing flight alone will use 1,925 seats per week.
While it hasn’t named the Australian gateway cities that will host these flights, the carrier has said that it will use Airbus A330-200s to serve its new routes.
The website also reports that there are currently 42 flights weekly between Australia, China and Hong Kong, with Cathay Pacific and Qantas operating the bulk of these frequencies. At present, Virgin Australia serves Hong Kong via a codeshare with Singapore Airlines.
The carrier has announced that it will also coordinate codeshare agreements and frequent flyer programs in an effort to support the upcoming arrangements.
As part of the deal, HNA Group has invested in the carrier, a move that has seen the multinational take a 13 percent stake in Virgin Australia.
The details of this new agreement are still subject to further authorization, but John Borghetti, chief executive officer of the Virgin Australia Group, expressed excitement over the deal in an official statement in May.
“The Chinese travel market represents Australia’s fastest growing and most valuable inbound travel market … By 2020, almost 1.5 million Chinese travelers are projected to visit Australia in a market expected to be worth up to A$13 [USD$9.7] billion,” he said.
“We are pleased to welcome HNA as a new shareholder and strategic alliance partner,” Borghetti added.
HNA’s Chief Executive Officer supported the announcement and said, “We look forward to working together to create a seamless travel experience between Australia and to China.”
[Photo: Wikipedia]
There is a lot of capacity available for Australian carriers under the China and Hong Kong air service agreements. Qantas did not contest the VA request, there was no reason for it to take more then a few days after submissions closed to approve it. Australian carriers have access to 70 flights/week to HKG from the major Australian ports (SYD/BNE/MEL/PER) and unlimited from other Australian ports. VA now has 7 and QF has 28 leaving 35. Hong Kong carriers have access to 70 flights/week from HKG to the major Australian ports. CX is using all 70. Australian carriers have access to 28330 seats/week from the major Australian ports to PEK/PVG and CAN. VA has 1925 seats and QF has 2301, leaving 24104 available. This increases by another 3000 seats in October. Australia has another 26500 seats for flights between the major Australian ports and the rest of China, other then PEK/PVG/CAN. None of these are in use. There is currently over 50,000 seats/week available for Australian carriers for flights into mainland China from PER/SYD/MEL/BNE and unlimited from other Australian ports.