The life and times of virgin australia
As it celebrates its 25th birthday, our man down under, Chris Frame, looks back at the airline that still regards itself as a challenger after all these years
As Virgin Blue scaled up, the 737-800 became its primary workhorse, and remained so, after the rebrand as Virgin Australia
The vast size of flight-friendly Australia has for decades led to a reliance on airlines to link cities and regional hubs. Historically, this encouraged successive Australian governments to pursue a two-airline policy. This policy aimed to protect the viability of vital air routes across the nation by restricting competition on domestic trunk routes. The consequence was two dominant airlines – Ansett and Australian Airlines – offering a similar product, on a similar network, with similar aircraft, and at similar prices. However, during the 1990s the government loosened its grip; deregulation was in vogue, and it provided opportunities for new airlines to enter the market. New entrants brought different products, and throughout the decade, the industry started to shift.
In 1993, Qantas merged with Australian Airlines, creating a giant with an impressive international and domestic network. Floated as a public company, the scale of Qantas created big problems for Ansett, which attempted to expand internationally, and woo business travellers. During this period, the globally lucrative low-cost carrier model had failed to take off in Australia. In the 1990s, Compass Airlines tried not once but twice, to establish affordable flights, and both times it collapsed in spectacular fashion.
Other airlines had also attempted to gain a foothold on domestic routes. East-West Airlines tried to build a network bypassing major cities, in the days of regulated services. Impulse, the regional carrier, started carrying passengers on busy commuter routes from June 2000, using Boeing 717s. But even as its first jet took off, work was well underway to establish a brand-new airline. A true low-cost carrier, this new player would not just rival Impulse, it aimed to take on Qantas and Ansett – enter Virgin Blue.
Virgin Blue
Virgin Blue commenced operations in August 2000, with a fleet of half a dozen Boeing 737-400s. The brainchild of Virgin Atlantic and Virgin Express veteran, Brett Godfrey, it set out to succeed where Compass had failed. Key to this was an ability to bring a respected brand and desirable product to the market from day one. Geoffrey Thomas is one of Australia’s most respected aviation journalists and having written for various publications, he reported firsthand on the formation of Virgin Blue and told Airliner World: “Essentially, Virgin Blue was Brett Godfrey’s idea. He saw the niche in the market. There was a place for a low-cost airline, which [until then] had continually failed to materialise.” Importantly, the new airline saw the mistakes other entrants had made and countered them. “The difference was to marry a low-cost airline to the Virgin brand, and that’s what was lacking before, a reputable brand. Virgin is an incredible name that immediately attracted travellers.” Early services were focused on the east coast, adding a significant boost to the number of affordable seats on some of the most lucrative air routes in Australia. The airline’s early success was a welcome change for the Australian traveller – welcomed by all – with one notable exception: Ansett. Established in 1936, Ansett had been a staple of the Australian aviation landscape for so long it had become a household name, but the post-deregulation era had not been kind to it. In the years following deregulation, it attempted to broaden its appeal to business travellers, establishing international services and joining Star Alliance. It was fully acquired by Air New Zealand in 2000, and even sponsored the Sydney 2000 Olympic Games, to expand brand awareness to international travellers.