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TD breaking news – Virgin Australia, HNA Aviation alliance revealed

VA codeshare on Hong Kong Airlines, Hainan Airlines & HK Express

Virgin Australia has just confirmed its intention to commence Airbus A330 services from Australia to Hong Kong from mid-2017, subject to regulatory approval.

Specific routes from Australia have not been specified at this stage, however they are intended to operate under a new codeshare alliance with Virgin Australia shareholder, HNA Aviation, through its subsidiaries Hong Kong Airlines, Hainan Airlines and other sister-carriers.

Previously mooted direct flights to Beijing in China are still on the radar, however VA is now stating it is planning to introduce flights “between Australia and mainland China” in further stages of the pact.

The “landmark alliance” will see the parties co-operate in relation to route planning, sales, distribution and marketing, as well as frequent flyer programs, lounge access and other activities.

Customers of Beijing Capital Airlines, Hainan Airlines, Hong Kong Airlines and Tianjin Airlines will be able to book travel on Virgin Australia’s domestic and trans-Tasman network.

Group ceo John Borghetti said the alliance will be a “game changer for travel between Australia and China, providing significantly more competition and choice for travellers”.

“The alliance will accelerate and support our access to the Chinese market, which is Australia’s fastest growing and most valuable inbound travel market,” Borghetti said.

Meanwhile, Virgin Australia Holdings has also released its financial results for the first half ended 31 Dec, showing an underlying profit before tax of $42.3 million, although a group statutory loss after tax of $21.5 million.

Group revenues were down 9% to $2.6 billion and group underlying EBIT was down 20.9% to $127.7 million, impacted by ongoing subdued trading conditions in the domestic market.

On the positive front, Virgin achieved a reduction in net debt of $936.3 million, an improvement of 44.5% on the same period last year, and made a significant improvement in its Virgin International operations – from an underlying EBIT loss of $30.8 million to a profit of $800,000.  It reported its highest ever total cash balance of almost $1.6 billion, up by $689 million.

“Notwithstanding continued subdued trading conditions in the domestic market, the Group has strengthened its liquidity and cash position and is ahead of schedule in the implementation of the Better Business program,” Borghetti said.

 

More details in today’s issue of Travel Daily.

 


The above Breaking News Alert was sent to Travel Daily subscribers on 17 Feb 17

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