Virgin Australia to relaunch with 56 Boeing 737s

The rescued and rebooted airline maps out the size of its streamlined domestic fleet.

By David Flynn , September 9 2020
Virgin Australia to relaunch with 56 Boeing 737s

Virgin Australia will return to the skies under new owners Bain Capital with a pared-back fleet of 56 Boeing 737 jets flying to an equally slimmed-down domestic network.

The airline’s workhorse Boeing 737 fleet numbered 85 before it collapsed into administration on April 21.

However, when demand lifts to pre-COVID levels, the airline aims to have more than 75 Boeing 737s parked in its hangars.

A ‘fleet and network update’ email sent by Virgin Australia Chief Operations Officer Stuart Aggs to all airline staff, and sighted by Executive Traveller, advises that the airline "has been successful in renegotiating the terms on 54 737-800 and two 737-700 aircraft, taking our total fleet size to 56 when we exit administration."

This "equates to roughly 75% of our pre-COVID domestic Boeing 737 capacity," Aggs noted, which "allows us to have a solid ramp-up plan when demand returns."

Room for growth

Aggs reiterated "we intend to grow the fleet to 75+ aircraft in the longer term", but said this expansion would be done on a "demand-led" basis "in order to effectively compete when demand returns."

"To do this, we’ll be taking advantage of the current aircraft market for used 737s. We expect to see opportunities to secure additional aircraft over the coming months when demand returns and we will actively monitor this."

Of the strategy to rebuild using pre-loved Boeing 737s, Aggs said it would "reduce the costs to the business, will make us more competitive and sustainable, and means we avoid holding costs of keeping the aircraft on the ground when we’re not using them."

A spokesman for the airline confirmed to Executive Traveller that "Virgin Australia will relaunch operations with 56 Boeing 737 aircraft as it exits administration, with the intention to grow its fleet to more than 75 aircraft once demand recovers."

Meanwhile, some of Virgin's former leased Boeing 737s – along with some former Virgin Boeing 737 pilots, flight attendants and engineers – are reportedly being scooped by up regional airline Rex as it presses ahead with plans to launch Boeing 737 flights between Sydney, Melbourne and Brisbane.

Read more: Rex set to challenge Qantas, Virgin for capital city flights

As part of Bain’s restructure, Virgin has ditched other aircraft including its regional ATR-72 turboprops – which has resulted in several country routes being scrapped – along with the larger Airbus A330 and Boeing 777-300ER jets.

Aggs also said that Virgin Australia remains “in regular discussions” with Boeing about the troubled 737 MAX, for which the airline holds 48 orders with the first slated to arrive in July 2021.

“Given the circumstances we have been in regular discussions with Boeing about this order, and those discussions continue. We will keep you updated as these progress and plans are finalised.”

Also read: How Bain Capital will reshape Virgin Australia

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.

is there a significant cost difference between operating a B737-800 & -700 ?

Same engines ?

IIRC, a F70 is cheaper to operate than a F100, but the latter is cheaper per seat, so I guess in the case of these Fokkers, if can get a decent yield on more than 80 seats per flight, then better to operate the larger aircraft.

31 Mar 2014

Total posts 333

I think it is because those two 700's are owned. With no real chance of selling them off, better to hang on to them. 

Grannular that makes sense.

Would Virgin be better using these 2 x -700s on thin or leisure routes in 1 class ?

Such as to Fiji or Dunedin ?

A -700 in 1 class must almost be able to have same number of seats as a 2 class -800. (149 seats vs 176 seats in a Virgin 738)

A -700 could surely do SYD/ABX &/or BNE/ABX being roughly the same size as a -300, which can get in & out of ABX.

24 Aug 2011

Total posts 749

 The problem is that a jet on a shortish sector like SYD-ABX has much higher operating costs than a prop like a Dash 8 or ATR but not much quicker.  A 73G is also a lot of capacity for a route like this being about double the size of the ATRs that used to serve the route.

As Grannualar points out, the 73Gs are owned and very hard to sell in current environment so best to keep them.  Their per seat cost is higher than the 73Hs but they can still be useful on routes into smaller ports.  They also are often used as subs on the WA FIFO routes.  The 73G does have slightly greater range than the 73Hs but this is not really a benefit for VA as they have no routes where the 73Hs are really stretched though MEL-DPS is pretty close.

As long as they don’t fly the B737 MAX I’ll still fly with Virgin.

Virgin won't be buying any Maxs anytime soon, when good, relatively new B738s with same engines as Virgins, are so cheap to buy or lease.

11 Jun 2020

Total posts 4

I'm a big fan of the 737 & I'm really happy that Bain will keep em flying but you will never get me or my family on the MAX, not in a million years. If they buy them I'll fly QF no matter the price. 

Qantas - Qantas Frequent Flyer

28 Jul 2011

Total posts 47

Going to be a bit awkward if both Virgin and Qantas fly them hey? 

11 Jul 2020

Total posts 34

It will be good to see Virgin Australia return to the air. I flew on a Boeing 737 Max with Southwest and I'm here which is good. I think you will find the Max will not re-enter service anywhere in the world until its signed off and certified to fly by the FAA in the USA.

Qantas - Qantas Frequent Flyer

28 Jul 2011

Total posts 47

Where did the -700s fly before? I don't remember seeing them on the main east coast routes. 

24 Aug 2011

Total posts 749

Pretty much all over including MEL-SYD.  They also have spent blocks of time in WA doing FIFO type routes.  

Back in Virgin Blue days, the 700s were about 1/3 of the fleet so getting one of them was commonplace.  Recently they have been more of a novelty.

Qantas - Qantas Frequent Flyer

28 Jul 2011

Total posts 47

Yeah, I remember them 'back in the day' but just had't seen any in ages. 

Thanks! 

fly MEL/BNE on a -700 a few years back. It was a Saturday afternoon, so quiet time of the week.

Qantas - Qantas Frequent Flyer

05 Jun 2014

Total posts 174

Frequented ADL-CBR-OOL

What Ozpeke777 said. Granted, the MAX got off to a bad start - & yes, people lost their lives. That's a tragedy for sure. But all the paranoid Chicken-Lickens out there who swear they'll never fly on one do sound pretty stupid, to be honest. Or maybe 'stupid' is too harsh, but certainly ignorant. Does it not occur to anyone that if/when the MAX finally returns to service, it will most likely be one of the - if not THE safest aircraft in commercial service, after all the scrutiny it will have endured? I'd be hard pressed to think of a single aircraft type that has come under the microscope to the same extent that the MAX has. Boeing & the FAA simply have to - & will - get it right. Otherwise it won't fly. The end.

Well I suppose it's like saying if one goes to a restaurant and has bad food poisoning, will they go back there regardless of food hygiene improvements or not 

Qantas - Qantas Frequent Flyer

10 Mar 2014

Total posts 22

I was hoping not to respond but have to... it’s super clear to all in aviation that if the Max went through complete certification as a new aircraft it would fail the present FAA & EASA standards.  Boeing has done a doggy on the airline industry with the Max - poor decisions, rushed to compete production, 1908’s computers with software patches, wings too low for the size engines on the aircraft which is why the engines are placed forward and up on the wing.  The ultimate questions is to look at the architecture of the 787 (a brilliant aircraft even if it has some production issues atm) and compare the computers, tech, safety systems, warning priorities for pilots, synthetic air speed, stick shaker, fly by wire and avionics to see how Boeing wanted to squeeze the 737 too far.  The NG is a great aircraft, the Max is not and never will be.  Will it fly again - yes but it will be a very short production run.  Boeing has dropped close to 1,000 orders for the aircraft so far this year - yes COVID has had an impact or just made it easier for airlines to dump their orders. 

09 Aug 2015

Total posts 43

I don't even expect to see all 56 of these aircraft flying, Virgin will probably keep many in the hangar so they can scale up their flights as state borders open and in response to demand. If they schedule all 56 for the end of October for example, as that's when Bain officially takes over, they will have no room for growth.

NZ

13 Aug 2016

Total posts 59

Maybe if the Tasman isn’t re-open by Christmas, sending 5-10 of the 738s over to New Zealand to make the most of the Domestic Peak during December/ January.

While they made all the cabin crew / pilots redundant, they still have all the ground resources to make it happen in AKL,WLG,CHC,ZQN,DUD.

NZ is currently operating AKL-ZQN, up to 10x daily with an mix of a320/321s.

There is currently plenty of lesusire demand with in New Zealand current. 

26 May 2016

Total posts 14

RE 737MAX

The combination of Virgin operating a young fleet of 737NG with more favourable lease terms puts them in a position to skip the MAX in anticipation of Boeings NMA rumoured to be released soon for deliveries around 2030.

Boeing playing hard ball with the MAX deposit is fanciful considering their non performance but for the sake of maintaining the relationship, Virgin should try and have that deposit transferred to the NMA. Considering QANTAS look like going down the Airbus path in terms of narrow body fleet renewal this would be a good opportunity for Virgin to get first in line and for Boeing to keep their footprint in Australia.

24 Aug 2011

Total posts 749

...except it's a bit hard to transfer a deposit that at this stage doesn't exist.  Boeing cannot accept deposits for an aircraft that their board has not authorised the company to sell.

26 May 2016

Total posts 14

The deposit definitely exists. Virgin Australia paid a deposit on a 2012 order for the MAX (www.executivetraveller.com/news/virgin-australia-boeing-737-max-order)

Qantas - Qantas Frequent Flyer

07 Aug 2013

Total posts 174

Peoples - why all the fuss there won't be a max anymore, it will be known simply as the B737-7,,8,9,10 ;)

Previous virgin strategy was to get a business product on a narrow body that could be competitive to Qantas a330 product. Lower cost to run and maintains a competitive edge without going head to head with a widebody aircraft. Thinking JetBlue here and how they have success against the big 3 US carriers. Perhaps the 737-10 still has a future at VA... maybe not soon but if they did pursue then they carve their own niche out of a smaller business market with a competitive offering.

Qantas - Qantas Frequent Flyer

10 Mar 2014

Total posts 22

You don’t need a Max 10 for a better single aisle domestic business class - there’s examples all over the world on 737-800’s.

24 Aug 2011

Total posts 749

I think Bain will be pretty hard-nosed when it comes to deciding about a lie-flat business class seat.  If 8 recliners are replaced by 6 lie-flats, the total revenue needs to be the same or better otherwise it is a no-go.

13 Apr 2020

Total posts 15

Aussie100, the Max-10 is not just for business class. It's to hold more pax in general for peak runs, eg: SYD-MEL. Could also see it on PER-AKL etc... Time will tell soon what they want to do with their order. This could involve altering it completely for B787s for example.


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