Virgin Australia bidder Cyrus says Velocity points are safe
Cyrus Capital promises Velocity Points "will be protected and honoured" if it takes over Virgin Australia.
By David Flynn, June 23 2020
Cyrus Capital, one of the two bidders vying to take over Virgin Australia, says it will honour Velocity Frequent Flyer points held by the reward program's 10 million members if the New York-based investment firm is chosen to steer Virgin back into the skies.
Cyrus senior adviser Jonathan Peachey, writing to the Australian Federation of Travel Agents, noted that "rewarding customer loyalty is also important to Cyrus, especially at this time, and if Cyrus becomes the new owner of Virgin Australia, points held by members of the Velocity Frequent Flyer program will be protected and honoured."
Peachey also said that Cyrus would honour outstanding tickets booked and paid for by would-be Virgin Australia passengers “without hesitation”.
Bain Capital has made a similar pledge to the AFTA regarding those tickets, and Executive Traveller has approached Bain for an assurance that it would also honour Velocity Points should it be the choice of administrator Deloitte.
However, Bain is known to be eager to invest in Virgin's technology systems and bolster the analytics behind Velocity, making the loyalty program more closely integrate with the parent airline and potentially operating both through a single website and app.
Deloitte is expected to make its decision by June 30, with Vaughan Strawbridge, who is leading the team behind Virgin Australia's sale, saying that "both bidders are committed to seeing a strong, competitive and sustainable Virgin Australia operating into the future, employing many thousands of Australians, and supporting the tourism industry and state and national economies."
Virgin Australia is now allowing Velocity members to redeem their points on< flights across "popular domestic routes” for travel from September 1, 2020.
That move marked the first stage of the program’s ‘unfreezing’, after a blanket four-week ban on members using points in any way, although many of those restrictions – such as buying gift cards and transferring points to the KrisFlyer program of partner Singapore Airlines – remain in effect.
Read more: Virgin Australia's new owner to be chosen by next week
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.
23 Oct 2014
Total posts 235
For all the previous negative posts about Virgin and Velocity this will be fantastic news to their loyal customers, and as one I'm looking forward to exciting new benefits in the relaunch. Well done Virgin, this I feel is the launch of a new and exiting model of an airline in a new market post COVID and an economy in recession that will suit businesses looking to reduce their travel budget and self funded travelled the best value for their $$$ spent.
05 Oct 2011
Total posts 197
Slow down tiger..... they didn't say that it wouldn't cost a whole lot more points for the same rewards did they? Now that would have been a real revelation wouldn't it?
24 Aug 2011
Total posts 1209
Neither bidder could seriously consider writing off the Velocity points. Such a move would've destroyed goodwill in the VA business.
The situation with travel credits is much the same though the options here could potentially be a bit more nuanced such as every $ of travel credit is honoured for every extra dollar spent on new ticket. Bain is known to have spent considerable money surveying VA's customers so will know what is important to them in this regard; not sure if Cyrus has done similarly.
23 Aug 2016
Total posts 13
No mention, strangely, of travel bank or conditional credits.
Qantas - Qantas Frequent Flyer
07 Aug 2013
Total posts 249
Well not in this article but the Courier Mail is reporting that Velocity Points as well as travel credits are saved sourcing from the potential buyers themselves.
05 Oct 2011
Total posts 197
This was a typical PR announcement. I wouldn't read anything into it either way.
Qantas - Qantas Frequent Flyer
07 Aug 2013
Total posts 249
Not really - they are the shortlisted buyers who have outlined their plans so there's obviously weight behind their media statements. Literally weeks away now from knowing - It would be a PR disaster to come out and say we will honour then backtrack and say no we want you to fly our new VA 2.0 but guess what we won't warrant any of your existing velocity bookings and you will lose it. They'd lose a lot of customers at a time when they need most.
Velocity wouldn't change as it's a seperate run entity - Bain or Cyrus aren't buying velocity just saying they intend to honour existing velocity bookings and points which is in best interests as any major airlines needs a solid frequent flyer program. Even if they increase redemption bookings which I doubt caus they have historically always been lower then Qantas, I would also bet that to not damage the virgin brand further more that they will honour existing credits and current bookings.
05 Oct 2011
Total posts 197
VFF is a wholly owned subsidiary of Virgin Australia and is part of what they are bidding on.
Qantas - Qantas Frequent Flyer
07 Aug 2013
Total posts 249
I completely forgot virgin bought velocity back late last year - I thought the new owners were literally buying a debt ridden airline but thats an even better deal for Bain or Cyrus if they are to get full ownership of Velocity with their purchase of VA. They get an airline with a subsidary business which ET reported to Velocity FF to be valued at $2b aud in Sep 2019 in article "Virgin Australia to buy back full ownership of Velocity Frequent Flyer".
Whoever the new owner is will need to come out guns blazing after the sale is done to give strength and confidence back in Velocity and VA and to ensure their existing customer base and FFs remain. Also to get rid of all the hyperbole and speculation these last few months.
03 May 2013
Total posts 672
Nothing is certain till the buyer signs on the dotted line(and the fat lady sings).
Qantas - Qantas Frequent Flyer
07 Aug 2013
Total posts 249
Maybe in virgins case, its the flying lady that sings.
08 May 2020
Total posts 84
It could be interesting with a Bondholder Bailout. I would be interested to swap my 180000 velocity points into the 10 cent Virgin shares which could turn out a win win. or if it turns out a loss down the track i would not lose much.
29 Feb 2016
Total posts 28
Interesting to read above that Bain (at least) been vox popping VA customers. Wish they'd asked me , tho suspect my comments would be the same as most other regulars : the successful suitor needs to honour current paid & points bookings and those conditional credits taken out for cancelled flights. In full, no discount or weasel BOGOF tricks either..
Failure to do that will see an exodus of custom. VA's new owners will no doubt be expecting a feeble domestic mkt over 2H 2020, so you'd think they will be careful not to offend their most likely pax..
Virgin Australia - Velocity Rewards
30 Oct 2015
Total posts 61
If they won't be honouring travel credits, this VA Platinum will be walking away without a glance back. Must have been a very select few Velociry members who were targeted.
29 Feb 2016
Total posts 28
That wud be two Plats then....
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