Qatar Airways on Tuesday unveiled a bid to acquire a 25 percent stake in troubled airline Virgin Australia, a deal that could shake up the Australian market dominated by Qantas.
The airlines, along with Virgin owner Bain Capital, announced details of the long-rumoured proposed deal before markets opened in Sydney.
Under the plan, Qatar would take a minority stake in Virgin for an undisclosed amount.
The airlines said they would introduce more direct flights from Brisbane, Melbourne, Perth and Sydney to Doha, which would better connect Australia to Europe and elsewhere.
This could significantly shake up Australia’s air travel market, which is currently dominated by Qantas, a flag carrier beset by allegations of price gouging and deliberate overbooking.
“This will ensure Australian consumers have access to even better value airline tickets and more choice,” the companies said in a joint statement.
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The deal could also pave the way for Virgin to re-list on the stock market. However, it will be subject to regulatory approval and tough political debate.
Political influence
Qantas has previously supported plans for Qatar to provide more flights from Australia.
Qantas — along with low-cost brand Jetstar — has more than a 61 percent share of the domestic air transport market and has strong political influence.
In 2023, Australia’s centre-left government rejected Qatar’s bid to operate 21 additional international flights to and from Australia.
Political opponents have accused the government of trying to shield Australian carrier Qantas from competition despite record profits, resulting in high fares for international flights.
Qatar Airways chief executive Badr Mohammed Al-Meer said the proposed Qatar-Virgin link would be good for Australians.
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“We believe competition in aviation is a good thing and helps raise the bar, ultimately benefiting customers,” he said. “This deal will also help support jobs, business and the wider economy in Australia.”
Source: AFP