Virgin Australia to Review Route Network After Profit Loss
Virgin Australia has announced that they will be reviewing their entire route network, and cutting 750 jobs, as part of a drastic restructure to claw back a “disappointing” full year loss of $349.1 million.
On Wednesday, Virgin Australia posted their seventh consecutive annual loss. By cutting jobs and reviewing their route network, they hope to save $75 million a year in costs. They said that the result was driven by subdued trading conditions in the second half of the financial year, combined with fuel and foreign exchange headwinds and increased operational costs.
Virgin Australia will be reviewing every route that they operate, in hopes that it will lower operating costs and enable them to use aircraft more efficiently.
This route map was displayed on news.com.au, and is missing quite a few routes that Virgin Australia currently operates. Some of these routes are:
Melbourne - Adelaide
Adelaide - Perth
Sydney - Adelaide
Brisbane - Adelaide
Melbourne - Mildura (My Home Town)
All routes to Launceston
All routes to Hobart
All routes to the Sunshine Coast
All routes to Darwin
And many more. Some of these routes I have flown on myself, and they have been full, so some of these route changes come as a shock to me.
I’m not sure if the route map above is offical, we haven’t heard anything directly from Virgin Australia in regards to route changes yet. If I am wrong on some of those routes, that’s why.
The head of Strategic Aviation Solutions, Neil Hansford, said the following about the situation:
“Virgin set out on course to become a head to head competitor with Qantas. They invested enormously when they weren’t a profitable business. They tried to be a Qantas alternative, focusing on expensive lounges and provide certain service levels when they were having losses.
Reviewing the flight route is the standard response when you’re in trouble like this.
I think cuts will be made to leisure routes, and the time has come to address whether they should stay in the international market because when you are in this much trouble, you need to get rid of anything that’s not making money.”