Virgin Australia sues as BP attempts to end partnership

By Chris Chamberlin, May 11 2017

Virgin Australia’s Velocity Frequent Flyer arm is taking BP Australia to court as the petrol giant moves to align itself with the competing Woolworths Rewards loyalty program: and by extension, the Qantas Frequent Flyer scheme, in what Velocity claims is a breach of contract.

In documents filed with Queensland’s Supreme Court [PDF, 707kb], it’s claimed that BP’s exclusive partnership with Velocity is contracted to continue until at least April 15 2018 – yet BP is hoping to wind this up much earlier on June 30 2017, or by January 1 2018 at the latest if certain exclusivity clauses are waived.

BP is yet to file its defence, although court papers reveal that the company was displeased with Velocity’s new Flybuys partnership – which allows members to earn Velocity points at participating Coles Express/Shell service stations – and issued Velocity with a ‘notice of default’ that Velocity disputes.

Terminating the partnership would bring an end to earning Velocity points on fuel and convenience purchases at BP service stations, and to using Velocity points to pay for the same items.

The Woolworths Rewards scheme which BP is planning to join provides the equivalent of just 0.435 Qantas Points per dollar spent at petrol stations – 0.5655 Qantas Points per litre of fuel when priced at $1.30/litre – compared to a much more generous two Velocity points per litre on fuel and two Velocity points per dollar spent in-store as currently offered.

Chris Chamberlin

Chris Chamberlin is the Associate Editor of Executive Traveller and lives by the motto that a journey of a thousand miles begins with a single step, a great latte, a theatre ticket and a glass of wine!

Virgin Australia - Velocity Rewards

08 Jun 2014

Total posts 222

BP will lose my business, I'm always between the two (Shell and BP) as Shell is earn SC's with VA via the flybuys and then earn double points earn with Amex at any fuel station. 

Status credits can only be earned via Flybuys at Coles, Coles Online, First Choice Liquor and Liquorland - no status credits on petrol at Coles Express/Shell, unfortunately.

Virgin Australia - Velocity Rewards

08 Jun 2014

Total posts 222

I was under the impression that earning $100 a month on your flybuys equates to receiving a SC... hrmmmmm

Virgin Australia - Velocity Rewards

19 Feb 2016

Total posts 12

Are you sure you can earn SC with Shell fuel? I can't seem to find it anywhere...
Read above - not possible

06 May 2013

Total posts 11

See you later BP!

Qantas - Qantas Frequent Flyer

13 Jul 2012

Total posts 116

Yep!

Although I wonder whether the departure of BP from the partnership is going to reduce the incentives for Shell to offer 8 flybuy points per litre (4 Virgin points when redeemed during routine 15% bonus offers)

That would suck...

Qantas - Qantas Frequent Flyer

21 Jan 2014

Total posts 225

I didn't think I would use it much but I have been going to BP for a while now because of the VA deal, I found it an easy way to keep my VA points activity, the QF earn is poor so wouldn't bother with that one considering I have other options closer.

Qantas - Qantas Frequent Flyer

20 Mar 2014

Total posts 131

this is great news! Hello BP!!!

27 Apr 2017

Total posts 39

Should the source of your story be noted? As with many stories here, this material is ripped from Australian Frequent Flyer. At least attribute like a responsible journalist.

"This material is ripped from Australian Frequent Flyer"

Actually, it's not - our story is based purely on the court documents filed by Velocity Frequent Flyer which are available to journalists (and others) online as a matter of public record.

We also note that The Australian Financial Review has run its own story on this as well, based on those same documents. As "responsible journalists", we're not interested in any rumours, discussion or third-party commentary such as found on frequent flyer forums: only reportable facts which come from direct and reliable sources, such as the offices of Queensland's Supreme Court in relation to the upcoming case.

"Should the source of your story be noted?"

You'll find that it is, at the beginning of the second paragraph. In that paragraph, we've also given readers a direct link to those court documents where they can learn more about the case if they're interested.


Now that that's covered, it's time to bring the discussion back to the topic of the article, in line with our long-standing comment policy.

Virgin Australia - Velocity Rewards

18 Jan 2017

Total posts 10

And that is why I love this site and the reporting, thank you.

Qantas - Qantas Frequent Flyer

28 Jul 2016

Total posts 108

Yay! I will definitely saying hello to BP for my points with QF. Not that generous, but at least I don't have to try find a Caltex that is the Woolworths one, not Starmart

QF

11 Jul 2014

Total posts 298

BP is crazy doing that, no more BP for me I will keep driving past. WOW Petrol deal with Qantas is just crap.

23 Oct 2014

Total posts 108

Crazy BP!, that was a fantastic partnership. 

14 Jul 2011

Total posts 5

Notwithstanding the impending divorce, this landed in my inbox this afternoon...??!!



Qantas - Qantas Frequent Flyer

25 May 2012

Total posts 582

I received this offer today as well, and family members have recently received offers for their next 2 refills covering a bonus 150pts for fuel + 50pts for an in-store purchase per refill, so up to 400 bonus points.

Qantas - Qantas Frequent Flyer

27 Jun 2013

Total posts 11

I got those offers from BP as well. I've simply been using them to get VA points activity, as my main FF program is with QF. This deal has been mooted since the deal was done by Caltex to buy out all BP stations, so not a surprise. But it's very poor earnings on the QFF program!

Zac
Zac

Virgin Australia - Velocity Rewards

23 May 2014

Total posts 129

This would stop me filling up exclusively  at BP - lots of choice where I live

Qantas - Qantas Frequent Flyer

12 May 2017

Total posts 1

I am in the norhtern rivers area, BP here was cheap before they hooked up with Virgin, now the cost of fuel in all BP service stations here negates whatever points they offer.

Singapore Airlines - KrisFlyer

12 Apr 2017

Total posts 12

I have only just started to use BP because of flybuys. No reason to continue as they always seem more expensive

24 Apr 2015

Total posts 129

Velocity is so much better than very dodgy Qantas ff program, when using point to go to USA. I wish I could exchange my millions of Qantas points for Virign points.

23 Nov 2012

Total posts 24

Sad if the BP-VA partnership ends.  Although expensive, I believe BP is quality fuel and the velocity points were a bonus.  I'll shop around in future.

Thai Airways International - Royal Orchid Plus

15 Jan 2013

Total posts 279

I live near two BP IN MY AREA and there's one on the rare occassions I drive to work.This partnership was a great way to get extra points when I don't fly or get the car serviced at Midas.Will be taking my business elsewhere in the future such as Liberty or Caltex should this happen.

Qantas - Qantas Frequent Flyer

27 Jul 2013

Total posts 6

The inability to earn points at BP when using a charge card such as motorpass see's me preferenceing to spend my 2 to 300 a week on diesel at Shell using my shellcard. The rate isnt great but some flybuys is better than the N/A that BP offered.

QF

11 Jul 2014

Total posts 298

Can you earn Flybuys with Shell cards????

Qantas - Qantas Frequent Flyer

27 Jul 2013

Total posts 6

Definitely. Im using a co. Shellcard. Ie my employer pays for the fuel.  And i earn the flybuy points. 

Qantas - Qantas Frequent Flyer

11 Oct 2014

Total posts 492

This could become an expensive 'bun-fight' for one or multiple partners. BP signs an exclusive deal with Velocity, which is in turn linked to Coles / Flybuys, allowing Velocity members to earn points through the Shell / Flybuys scheme. Not quite as 'exclusive' as originally thought.

BP then buys Caltex assets (with the blessing of FIRB and ACCC) exclusively aligned with owner Woolworths, thereby generating Woolworths Dollars and ultimately QFF points for members.

My take is that the question at the heart of this is: What defines 'exclusivity' and how the involvement and interaction of third parties - ie: Coles and Flybuys, affects the deal. Lack of due diligence on one or more parties' side?

Interesting mine-field. Bets on a court-ordered settlement .. or an out-of-court 'gentlemen's agreement'?

Virgin Australia - Velocity Rewards

08 May 2017

Total posts 13

Well I guess Virgin now knows how it feels to be double crossed by supposedly loyal business associates. The recent changes to our Virgin Money cards reward points combined with the introduction of Economy X has been a real kick in the guts for regular users of VA.

Virgin Australia - Velocity Rewards

16 Jul 2012

Total posts 4

I have been frequenting BP when possible to earn points, I think this is short sighted of BP.

Maybe Velocity can do a deal with another vendor ?


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