Qantas is stuck with very highly paid staff.
The new virgin whatever they'll be called, will have new ETAs, so staff will be paid less & at same time, will have to do more. More multitasking.
So on the highly profitable routes
SYD/MEL (2nd busiest route in world)
SYD/BNE
&
MEL/BNE
the new airline will have a definite cost advantage.
So qantas doesn't want to cut fares to match virgin mark 2 & in a recession, while many will be looking for cheaper fare options.