Virgin Australia, Air New Zealand to forge new partnership

Has to be a matter of time.  With SQ/ANA/UA/NZ/AC all partners you'd hope they would encourage membership.

Star Alliance will always be interested in getting VA as a member, but it's not up to them, it's up to VA. Alliance membership would be a huge win for Virgin, both in terms of making Velocity much more appealing and also powering up a really global international network including lounge access, BUT it's also very expensive, so unless Bain decides they can see an undeniable 'business case' for this in terms of driving revenue to offset the cost of alliance membership, I can't see this happening, at least until after the planned IPO next year. Also if Qatar Airways became an investor in Virgin I don't reckon it would allow Star Alliance membership to go ahead. And NO, Qatar is not about to leave OneWorld and join Star Alliance itself.

Also keeping in mind applying for Star Alliance is a very long process (and isn't a simple "you're in" after approval from members).  This process also requires spending CapEx to upgrade computers to match with the Star Alliance network alongside some signage changes, plus the (ongoing) membership fees which can be expensive depending on an airlines' circumstances. This process would likely take between 18 months to 2 years from the initial application. 

I can't see Bain spending the CapEx on alliance membership, pre-IPO and will most likely move the Airline Alliance issue to whoever the incoming part-owner may be post-IPO.  Although I'd agree if Qatar Airways ends up with a stake in Virgin post-IPO, it's probably safe to say Alliance membership would be off the cards for the foreseeable future under a hypothetical QR part-ownership.

You raise some really interesting logistical issues DanV, that I'd have not considered on my own.  Thinking thru some of them, wouldn't the 'computer cost' be limited to software licensing fees (if any)?  From memory, most counter-top hardware is a Windows-based box, not a proprietary operating system unique to the airline industry (but I'm relying on memory here, so a big '?' needs to be added).  Signage (hard and soft) would be a real cost, that's true.  

As for Qatar, I'm sure they'd always be benchmarking the cost-reward benefits of OW v the SA (and, perhaps, SkyTeam) alternatives and, if the outcome and partnership benefits shifted away from OW, they'd be ready to shift 'with haste'.   Even if Qatar did have a seat at the VA Board table, it might be to their strategic benefit (i.e. useful competitive tension with OW) if they didn't block VA joining SA?  Or have I over simplified it somewhat? 

100% agree with LostInTransit. Unless VA plans to have an extensive hub-and-spoke network with significantly more international routes, joining Star will simply make VA another Czech Airlines.

Were VA to join Star, and it remains just a rumour and nothing more, it would be of mutual benefit even though it is highly unlikely VA has much interest in ever returning to long-haul international routes.  

For VA, it would mean they could offer their customers a more consistent product globally overcoming the recognition their status pax often have in far-flung places where the existing bilateral partnerships are sometimes not immediately known.  

For Star generally, the benefit would be to fill in a big hole in their global network.  Star are dominant in Europe, has a great presence in Asia, America and Africa but has no domestic coverage in Australia. and hasn't since AN went under in 2001.  Most Star carriers flying to AU have got around this by setting up a bilateral partnership with VA but it is not the same

The Star entry and annual fees remain a sticking point and, correctly, you point out it is something that will wait until the VA ownership situation changes but I doubt Qatar would be perturbed providing they retain their preferred status within VA.

Considering Qatar's situation is currently unique from the others (i.e the Bilateral rights) and it shows no signs of slowing down, this is despite the long serving CEO (Al Baker) deciding to 'move on' elsewhere in the Qatar Government.  

I would assume Qatar would be keeping all allowable options open, and that includes investigating taking a stake into VA to get around the current Qatar-Australia bilateral, although it would mean QR having to lease out WB aircraft to VA to operate those services under a hypothetical damp-lease arrangement (would assume the pilots are from QR but the FAs are from VA).

I imagine the competition authorities will pretty much wave it through.  It is hard to see anyone coming up with a reasonable reason for rejection given it does not decrease competition on the Tasman in any way

There's usually a period where submissions are asked for, to cover any objections usually, but even if Qantas objected I can't imagine that carrying much weight. But with Christmas only a few weeks away I don't expect a decision would be made until Jan or even Feb next year.

Yes but, at the moment, apart from Queenstown, there are no Virgin routes to New Zealand anyway.

It will be interesting to see if the airlines to allow VA pax heading elsewhere, such as Fiji or Bali, to access the NZ Lounges in Australian terminals.  It is really a fee for service arrangement so will be determined if VA is willing to pay NZ a fee for each VA pax that enters.

Happy for it to be a fee for service when not flying on ANZ metals, but assume ANZ would limit the offer to Golds and Plats.  After all, the added usage would only deliver economies of scale and better operating hours to ANZ's BNE/MEL/SYD lounges and bring in more potential flyers 'next time'.  

I find the Qatar x Virgin x Qantas/One World a bit confusing but working in my favour! I flew Qatar earlier this year and added my Velocity number as I needed a top up there to maintain FF status, and flying Qatar again in January and require a top up on my Qantas FF status - so win win!

Qatar has a fee for service arrangement to use Air NZ's lounges in Australia.  They pay NZ a fixed per passenger entry.  This is not uncommon.  Even if Qatar used QF's lounges, which if they didn't dislike each other so much would be the more expected, Qatar would still pay QF a fee just like MH, CX etc already do.

Yes indeed, you're good.  Now, about the winning numbers in the $433 million USA Power Lotto - share.     :-)

I backed 20 horse in the Melbourne Cup and still didn’t get the trifecta!!!!!  That being said reading the market is easy.

Second paragraph: "The arrangement would see VA flight numbers attached to Air New Zealand flights between Australia and Auckland, Wellington and Christchurch." So you could fly SYD-AKL-LAX with Air New Zealand but only the SYD-AKL leg would be on a VA codeshare and elegible for earning status credits.

Thats a strange take. Different airline, different times. And Luxon got out with at least some of their original holding.

This is a great move and addresses a major frustration with being a Velocity Platinum but having no viable option on Tasman flights. Let's hope this whizzes through.... before Christmas? Would that be possible? And would it apply to already booked flights?

And BTW, Bain, once you sell VA, LIfetime tier holders will going to be the new owner’s problem, not yours, and there will not be that many people able to get enough credits to get LT tiers within 24 months anyway

Hey Mate, She selling her Australian real estate, what does that tell you?

Sitting at Tokyo Airport at the moment and they won’t even put priority tags on my luggage “your not Star Alliance Gold”

That’s News to me, but not necessarily good news for Bain in terms of finding a new buyer unless they find someone who have enough clout to reinvigorate VA if/when she goes, without the usual running in period of 12-24 months for the new CEO’s actions to match the vision…. Unless the buyers already have plans to install their own candidate, just like Bain themselves did when they bought VA

And the pizza shop

"The Cow" rules.

Unlikely at this stage.  This deal is a unilateral arrangement, ie VA buying seats on NZ services and selling them to VA passengers with lounge access on a Fee For Service arrangement. NZ will not use VA at all under this arrangement, and thus it's VA basically paying NZ for seats and lounge access for passengers booking to AKL, CHC and WLG.

Yep that is th eis sue I find. When VA and Delta were Doug that it was cheaper to buy a delta ticket get points and status that way (you would actually get a lot more than normal VA flight). Only thing I couldn’t do was upgrade flights or access lounges- however didn’t care the status credits were awesome for economy