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Virgin Australia Aircraft Blocked at Airports Around Australia
In response to Virgin Australia’s numerous outstanding invoices at Perth Airport, the airport authority has parked vehicles in front of four Virgin Australia jets to prevent the aircraft from leaving the airport.
According to Perth Airport, it is “working cooperatively with Virgin’s administrators to try to help the airline come through the current coronavirus crisis.” In addition, the airport emphasized the airline had owed significant outstanding invoices from Perth Airport for airfield and terminal use charges.
In the meantime, Qantas Airways, the main rival of Virgin Australia weighed in on the incident.
“Protecting your interests is one thing but parking a bulldozer in front of an aircraft while saying you’re working to secure an agreement is ridiculous,” A Qantas spokesman said.
According to local media, seven aircraft are blocked at Adelaide Airport. The airport said that the debt-laden airline owed $6.4 million USD to them. Sydney, Melbourne and Brisbane airports said that they will not consider blocking Virgin Australia aircraft given the current situation.
As a result of weakened travel demand due to the coronavirus, Virgin Australia goes into administration after the government refused a bailout package to the struggling airline. The airline owes a long term debt of $3.17 billion USD. According to Josh Frydenberg, the Treasurer of the country, “The government was not going to bail out five large foreign shareholders with deep pockets, who, together, own 90 percent of this airline.”
Etihad Airways, Singapore Airlines, China’s Hai Nan Group, Nanshan Group and Sir Richard Branson, founder of Virgin Atlantic, collectively own 90 percent of Virgin Australia.
Virgin Australia holds a 30 percent market share in Australia and the administrator Deloitte believed it can find a buyer given the current circumstances.
Rod Sims, chairman of Australian Competition and Consumer Commission (ACCC), raised concern over the lack of competition in the future if Virgin Australia were to cease operations.
“It’s crucial that we have two full-service airlines,” Sims said. ACCC believes the need for competition in all categories on routes between the nation’s main cities to help maintain competitive pricing.
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