Bain reveals plans for new 'mid-market' Virgin Australia 2.0

Here's what we now know about the shape of the rebooted Virgin Australia.

By David Flynn, November 18 2020
Bain reveals plans for new 'mid-market' Virgin Australia 2.0

Virgin Australia's new owners Bain Capital have mapped out the mid-market flight path for the rescued and rebooted airline, although many details remain to be resolved.

Bain's blueprint will see Virgin target travellers "who want a more premium experience at an affordable and competitive price."

"Australia already has a low-cost-carrier and a traditional full-service airline, and we won’t be either," said newly-minted CEO Jayne Hrdlicka.

"Virgin Australia will be a mid-market carrier appealing to customers who are after a great value airfare and better service."

The airline's new focus will centre on giving passengers "what they value without the big price tag: premium lounges, a new and fresh retail offering onboard, a choice of cabins, better digital technology and a more streamlined check-in experience."

Here's what we know so far.

Business class under review

Business class will be revamped "to better align to the expectations of the cabin’s core customers."

This will involve "a complete an end-to-end review of the Business Class offering" aimed at making the premium cabin "more accessible", with Virgin's new business class proposition to launch in 2021.

The airline says its target market includes "price conscious corporate travellers" and small- to medium-sized businesses, along with "premium leisure travellers."

As tipped by Executive Traveller in October, Virgin will remove complimentary meals and snacks in economy class from early 2021 in favour of a 'buy on board' menu, although "customers will continue to be offered complimentary tea, coffee and water."

Read more: Virgin drops complimentary snacks, moves to ‘buy on board’

Inflight WiFi, which remains switched off on Virgin's Boeing 737s, is also "under review", along with inflight entertainment.

Fewer lounges, but a fresh look coming

Most of Virgin's airport lounges will eventually reopen, but when that happens is TBA. Virgin says this will be in line with demand, including the easing of border restrictions.

As previously reported, Virgin's Brisbane lounge unlocked its doors this week.

However, "due to low visitation" the Darwin, Cairns and Mackay lounges will will be scrapped. These join the previously-reported closures of Alice Springs, Perth T2 and Wellington.

That leaves Sydney, Melbourne, Brisbane, Adelaide, Perth and the Gold Coast as the six remaining lounges in a network which was once twice the size.

Intriguingly, Virgin says its Canberra lounge "remains under review."

The Sydney and Brisbane lounges will keep their Premium Entry feature (we're checking to see if this also includes Melbourne's Premium Exit).

Notably, Adelaide's all-new lounge – the expected April 2020 opening of which was delayed by Covid-19 restrictions – will now open in the first quarter of 2021, and serve as the prototype of a new-look lounge which will be rolled out across the entire domestic lounge network.

The airline says this fresh design "will provide customers with an experience and aesthetic more aligned to the Virgin brand they know and love.

Virgin declined to comment on the fate of The Club, its invitation-only VIP tier and exclusive lounge, created by former CEO John Borghetti to match the Qantas Chairman's Lounge program.

Read more: Virgin to reopen some lounges, but others stay closed for good

Investment in technology

"No material changes" are promised for Velocity Frequent Flyer, while "a number of significant new partnerships" based on earning points on everyday spending are slated for 2021.

The airline will double-down on technology, both for airport check-in and a turbocharged mobile app and experience.

The airline's current Velocity Frequent Flyer app will be rolled into an all-new Virgin Australia app, with "a significant pipeline of technology projects which will combine to create significant enhancement to our guest’s experience."

The 'hybrid' check-in systems at Melbourne and Perth, which combine self-service and staff-assisted modes, will be extended "across major airports by December 2021, simplifying the airport experience and leveraging new technology."

The Perth-based Virgin Australia Regional Airlines (VARA) will remain part of the Virgin portfolio "following a strategic review of its operating model."

David

David Flynn is the Editor-in-Chief of Executive Traveller and a bit of a travel tragic with a weakness for good coffee, shopping and lychee martinis.

JJM
JJM

Qantas - Qantas Frequent Flyer

02 Mar 2013

Total posts 18

The Mackay lounge closing due to "low visitation" is a nonsense. I visited the lounge a few times a month for years pre COVID-19, and you were often lucky to find a seat if you didn't arrive as soon as the doors opened. Many of the pax ex Mackay are FIFO and mine support folk, most of whom hold status allowing them to access the lounge. Looks like QF will get a leg up from this poor decision.

Qantas - Qantas Frequent Flyer

09 Feb 2015

Total posts 313

Yes, this seems like a stupid decision. Not sure of the logic behind Cairns closing either, considering the traffic that is anticipated through this airport with a projected upswing in domestic visitors thanks to international borders remaining closed and Australians expected to travel more domestically once all state borders are open.   

I've been in the Cairns lounge quite a few times and I an entirely UNSURPRISED that they are not reopening.  I cannot recall ever seeing more than half a dozen people there.  I did speak with staff and they did say it was often SLIGHTLY busier for the lunchtime flights to Sydney

Qantas - Qantas Frequent Flyer

07 Aug 2013

Total posts 203

Well not really - if they FIFO then it's the company paying the airfare not the individual and if the contracts are still in place the bulk of those lounge visitors being FIFO will still have to fly VA sans lounge. It's the same situation with Perth T2 lounge closure - it was 99% FIFO workers. 

XWu
XWu

09 May 2020

Total posts 285

@Dan22

Then it will depend on whether the contracts stipulated lounge access, although I would admit it is quite possible that it probably didn’t, and even if it did, if VA offer cashback instead of opening lounge, the companies won’t say no.

NMC
NMC

Etihad - Etihad Guest

27 Apr 2019

Total posts 3

I absolutely agree. The few times I have been in this lounge, it has been crowded. Cairns too. 

25 Feb 2013

Total posts 64

Ditto, always packed when I'm there. If there's no lounges at the destinations you're flying to because they've consilidated them all, what's the point of choosing VA when QF can provide the full experience. This just tells me any frequent flyer who deigns to have travel practices that sometimes exist outside the big 5 shouldn't bother choosing VA 

XWu
XWu

09 May 2020

Total posts 285

Comment transferred from another ET discussion and which contains statements already highlighted in this article 

“According to Hrdlicka’s press release on VA website

Business class offering still under review, relaunching in 2021, no further details until then

Economy will be fresh buy onboard menu from 2021, complimentary tea coffee water 

Wifi under review 

Lounges DRW, CNS, MKY to close, CBR under review (which says a lot about what they are chasing)

Wonder what is constitutes LCCs in the eyes of the new VA CEO? Maybe because they are keeping lounges so they can call themselves mid market?”

XWu
XWu

09 May 2020

Total posts 285

What is interesting for the hard-core VA folks and not yet mentioned in this article is the declaration of waiving applicable change fees and unlimited booking changes for reservations from now until 31 January 2021, under “passenger promise” so go for it!

Hopefully the wait at the call centre isn’t going to be too long

17 Jun 2020

Total posts 161

Seems like a bit of a circus at Virgin. They have had many months to review the offering and yet still cannot provide any detail on what the product will look like from 2021 onwards.

For an airline that has "premium leisure travellers"  and "small to medium sized businesses" in its target market, closing lounges in Darwin, Cairns and Mackay seems quite illogical. 

Looks like under Jayne it will become Jetstar with some trashy purple lipstick. 

XWu
XWu

09 May 2020

Total posts 285

At least she kept some lounge toilets open where people can put on that lipstick

Virgin Australia - Velocity Rewards

30 Oct 2015

Total posts 61

Lost me as a VA Platinum - no confidence in them whatsoever any more. I expected more from the launch today. I do fly business class and this "wait until 2021" approach has me jumping ship. I expect business will go - Jane wouldn't know what to do in a business class seat. Surprised she didn't wear thongs to the launch. Bye bye Virgin.

XWu
XWu

09 May 2020

Total posts 285

You realise of course Jetstar do have a Business class bundle... although the onboard meal included is the same slop as those who buy onboard on other end of the plane. 

NT
NT

30 Apr 2013

Total posts 6

Clearly you never flew Jetstar Business

Virgin Australia - Velocity Rewards

06 Aug 2017

Total posts 55

The Cairns lounge was actually my favourite Virgin Australia lounge. Great location, views, and the best customer service in the country, with staff who were willing to go the extra mile to help. I have a particularly fond memory of a staff member sitting with my teenage daughter, helping her to get the lounge's wi-fi to work on her iPhone. There seemed to be extra food options as well, that weren't provided in other VA lounges. 

Virgin Australia - Velocity Rewards

13 Jun 2018

Total posts 8

Agree the Cairns lounge is a great facility with great staff.  Very short sighted closing that lounge. There was up to 10 VA flights a day out of Cairns in normal times.   Closing Cairns will likely mean zero chance of the Townsville lounge ever coming into existence.  

AV
AV

Virgin Australia - Velocity Rewards

16 Apr 2013

Total posts 47

At least Velocity points aren't being devalued!

31 Mar 2014

Total posts 345

Yet

Qantas - Qantas Frequent Flyer

30 May 2013

Total posts 334

The long awaited Hobart Lounge, first mooted nearly 10 years ago will never happen!

Virgin Australia - Velocity Rewards

07 Dec 2015

Total posts 47

Agree with all the comments re the Cairns lounge. It was a really nice space and my favourite of all the lounges. I never saw it packed to the gills but definitely ‘busy’ every time I went through.

Virgin Australia - Velocity Rewards

12 Jun 2018

Total posts 3

"Inflight WiFi and inflight entertainment, both of which remain switched off on Virgin's Boeing 737s, are also "under review".

Not True - IFE is on, been on 3 Adelaide ~ Sydney return trips in the last couple of months and watched movies quite happily.

Virgin Australia - Velocity Rewards

06 Mar 2015

Total posts 188

David.

Am I reading it correctly from ET's article about "VA dropping free meals etc. in Economy " where the article also states that Business Class meals will stay as they are until 2021? Does that mean that it's " snack boxes " for a gourmet meal until then ???

I that's so then it will be a very poor standard of service it looks like I will get on my Business Class Brisbane- Perth on Dec. 15th!

Should have gone QF.

Virgin Australia - Velocity Rewards

24 Jan 2018

Total posts 370

It's not too late to change, RodH.  Perhaps Calamity Jayne will get the message ??

Virgin Australia - Velocity Rewards

06 Mar 2015

Total posts 188

If I could get a refund of my money paid then I would change to QF but that is not an option , only Credit Bank.

Virgin Australia - Velocity Rewards

20 Dec 2016

Total posts 13

I actually believe that this is more in line with my expectations and given that the airline industry has been decimated worldwide to see some of the prior comments think that some people have been hiding under a rock as they are bloody stupid. Virgin is based on service that is why the cabin crew won so many awards and if I only get a drink with a smile and excellent service at a reasonable price I will continue to fly Virgin, lounge access is a bonus and whilst that is great I am more interested in flying to my destination and enjoying the trip which has no been a while due to the long lockdown in Vic.

Qantas - Qantas Frequent Flyer

11 Oct 2014

Total posts 556

Given that the "announcement" seems to be full of "under review" items, I'd wager a bet that the genius factor at Bain & Co are still - like the rest of us - trying to work out what a HYBRID carrier actually is (if, indeed, it is a thing at all?). 

Perhaps it's the opposite of the equally nebulous "New World" carrier which was introduced, misunderstood and dropped just as quickly?  

Frankly, it's still sounding very LCC to me. Why is there no mention of basics such as luggage allowances / costs, for instance? With the opening of borders by Christmas, perhaps Virgin 2.0 thinks we should all lay our trust in them while they 'wing it' for a few months?

I'd happily forgive a new startup - like REX - with a new entry into operating jets on trunk routes for a few months, but this level of unprofessional launch from Virgin 2.0 who have had some 7 months to factor out an operational plan is more than a little poor. Especially when you've had the vision of the bankruptcy administrator and the expertise of a Bain partner who incidentally, happens to be an ex-QF executive and the ex-head of their discount LCC. 

25 Jan 2012

Total posts 29

Virgin really needed to come out swinging on this official day 1 release to show strong leadership and give not only the FF/passengers but the market in general confidence. Yet all they've basically released is the equivalent of "ah.. yeah.. changes? yeah we're ah working on them - oh oh yeah we're removing free food and shit from economy". That's pretty pathetic, especially given they've had months to work on this and make decisions on which direction to go.

I understand there's so much uncertainty in the market at present with COVID, and state border closures etc, but they would have been far better releasing a solid plan, then making it subject to the recovering market as to when the changes would be made. That would give them the appearance of having a confident solid plan whilst still giving them the wiggle room to make changes as required.

I mean for a company that has minimal cash - why talk about refreshing the lounges?? Seriously?? They're not even 100% certain which will remain open and what the post covid market will look like.

Virgin Australia - Velocity Rewards

24 Jan 2018

Total posts 370

Honestly, what has "newly-minted CEO Jayne Hrdlicka" been doing these past few months?  She's had ample time to get the Business Class experience sorted, but to tell me I have to wait until next year?  She's lost her marbles, because I'll be giving QFA my business until I can see whether it's worthwhile staying Platinum at VA.  

This is nothing short of 'bloody amateur hour' at Bain/Virgin.  A bucket of horse manure if ever there was one.  Calamity Jayne at her best?  I suspect it was.

Virgin Australia - Velocity Rewards

10 Aug 2016

Total posts 9

Like Tracie, I am also Velocity Platinum but seriously wonder why I should bother from now on.  Jayne Hrdlicka's 'revelations' about VA 2.0 are almost entirely corporate spin and waffle.  Dismal.  Amazingly, the Virgin Lounge's future in Canberra is "under review".  Seriously?!  Contrary to popular opinion, plenty of air travel in and out of Canberra is in the leisure and small business markets, NOT just by public servants.  How much longer will Velocity Gold and Platinum members endure Ms Hrdlicka's obfuscation and shenanigans before defecting permanently to Qantas?  Many of us already have the Qatar/OneWorld status match.

Back in April when Alan Joyce made his crass comments about Virgin's "bad management", I felt great sympathy for Paul Scurrah and VA.  But now, Joyce could be vindicated as we lurch into 2021, and smiling at the prospect of winning over top-tier Velocity members.  Who could blame him?

16 Dec 2016

Total posts 45

What a confused announcement which doesn’t bode well for VA’s future. They are promising to be everything to everyone but don’t explain how. I appreciate the crew go a long way but it just can’t compare to Qantas’ Lounge network and offering, aircraft network and subsequently flight frequency and the value of its Frequent Flyer status. 

What an embarrassing launch when this has been their key focus for months. Once they have an airline to fully run I fear the customers are going to be forgotten. 

I’m going back to Qantas. 

Amt
Amt

12 Nov 2018

Total posts 13

Hybrid carrier is just double talk for a low cost carrier with some extra marketing, a bit of brand image and some extra service, perks available for additional fees and charges. 

Virgin Australia - Velocity Rewards

06 Mar 2015

Total posts 188

Wow , what an incredible surprise, it would appear that William Shakespeare has been reincarnated.

This must be so because we are now witnessing a new adaption of his play " Much ado about nothing " but this time written under the pseudonym of Jane  H#############.

This release by her confirms that it is indeed a sequel to the Play.

Nice to see Bill is still around but I would wager he is very doubtful about flying Business Class or even economy with VA given the confusion at Fort Fumble!

Virgin Australia - Velocity Rewards

14 Mar 2017

Total posts 152

While on the one hand this looks quite waffly and vague, on the other if I were inheriting Virgin at this point, I'd probably be holding my cards pretty close to my chest till I saw what a post-COVID travel industry looked like. I don't expect his is the final word from Bain. In fact, I'd put money on a rebrand and relaunch once travel opens up again.

Virgin Australia - Velocity Rewards

18 Nov 2020

Total posts 1

Hey Lady Jayne

Hope you "wood ducks' dont stuff it up.  

Cause i know what you "seppos" do with synergies - it is almighty dollar and stuff the great people you had at Virgin.

Looks like under Jayne it will become Jetstar with some trashy purple lipstick from another comment 

Virgin Australia - Velocity Rewards

06 Mar 2015

Total posts 188

Xtfer

Bain and Co. have had months to work this out properly .

They should have put together a comprehensive statement of what they will provide. This scrappy half hearted load of crap only antagonises the once loyal customers. This is an appalling start to try and get VA fully operational again.

It does not give any traveller any confidence in the Management if this is an example of what they are capable of.

Surely given  the experience these executives  proclaim to have they could have done one hell of a better PR job than this disaster!!!!!

26 Jul 2015

Total posts 58

A lounge to relax in pre-flight, a comfortable seat, preferably in business where a nice FA will be courteous and polite (I like being called my first name some of the time), provide me with a couple of drinks on a 1 hour flight, maybe something edible to eat, a pilot that knows how to fly and where he's going and a reasonable expectation of departing and arriving on time at a price I'm comfortable with and I'm happy. Its not rocket science. It doesn't need dozens of committees or focus groups, follow the basic rules and flyers will be happy (well, a reasonable number of them anyway from the comments here and around other places).

Velocity

19 Jun 2013

Total posts 53

A “mid-market” carrier? Hmm. There used to be such a beast, except back in the early “noughties” it was called a “hybrid “ carrier. It went by the name of Virgin Blue, and it was a pleasure to fly with them. Then along came   (the ex-Roo...) Mr Boghetti, and proceeded to pretty much - as the Americans would say - “screwed the pooch” by trying to be QF. No surprise, but it knocked all the VB fun atmosphere out of both staff & pax. 

Have I got that all right, in words of a few syllables? Meh! That was in a past life for me. Now retired, and simply hoping that my Velocity points will still get my backside into an SQ business seat, if/whenever we are released from our lovely prison without needing an exit visa.

Have a nice evening, Comrades. 

Qantas - Qantas Frequent Flyer

26 Feb 2020

Total posts 13

The CBR Lounge “under review” has me intrigued. It’s a busy route from SYD and MEL albeit with peaks and troughs. Is this an aircraft driven decision? I.e no more ATR’s ..?

16 Oct 2012

Total posts 21

I’ve been VA Platinum for years. Always fly Business. IMO the pre Covid Virgin Business was streets ahead of QF. 

That said, I’ve entirely lost patience with VA. Tired of getting snack boxes and health bars as meals in business class. And tired of being kept in the dark about when or if things might ever return to something that might be considered normal business class service. 

I’m not prepared to fly around in VAs sub-par product for heaven know a how many more months. 

I’ve already been in touch with QF FF who are welcoming me with open arms. Indeed, as I write this I’m sitting in a QF Business lounge. 

Virgin had every chance to keep me, but ones patience only lasts so long. 

Virgin Australia - Velocity Rewards

30 Oct 2015

Total posts 61

What did QF offer you??? They offered me Gold as long as I got 200SC in 3 months, but didn't include flights already booked. Am only 1 return flight away from Gold already, so told them to review my recent travel, no response.


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