Qatar Airways is hoping to sidestep the Australian government’s refusal to grant it additional flying rights to the country’s four largest cities by taking a significant 25% minority stake in Virgin Australia.
The minority stake will allow Virgin Australia to resume a ‘measured entry’ back into long-haul flying by adding flights from Brisbane, Melbourne, Perth, and Sydney to Doha from next year.
And because Virgin Australia doesn’t currently have any long-haul planes, the airline will need to initially hire planes and crew from another airline. Perhaps unsurprisingly, this so-called ‘wetlease agreement’ will be operated by Qatar Airways.
Qatar Airways has been desperate to operate more flights from its Doha hub to Australia’s major gateway cities, but the existing bilateral flying services agreement between the Persian Gulf state and Australia limits the airline to operating just 28 weekly flights between Doha and Brisbane, Melbourne, Perth, and Sydney.
Last year, Qatar Airways pleaded with Transport Minister Catherine King to be granted an additional 21 weekly flights, but the airline was dealt an insulting snub by King, who refused the request, citing an embarrassing and highly controversial incident in 2020 when innocent women were pulled off Qatar Airways planes at Doha Hamad Airport and subjected to forced vaginal exams.
Undeterred, Qatar Airways set about finding potential loopholes, including exploring a long-rumored deal with British Airways to operate flights to Melbourne via Doha.
That loophole never materialized, but Qatar Airways was able to add some additional flights to cities like Melbourne by adding tag flights to unrestricted airports like Adelaide.
However, this solution isn’t without controversy and the service between Melbourne and Adelaide has been described as a ‘ghost flight’ because so few passengers actually fly it.
Then, in June, it emerged that Qatar Airways was eyeing a minority stake in Virgin Australia with the intention of getting the airline to resume long-haul flights. On Tuesday, the deal was finally announced.
Qatar Airways says it intends to acquire a 25% stake in Virgin Australia from US-based investment company Bain Capital, which bought the struggling airline during the pandemic. In return, Virgin Australia will launch long-haul flights to Doha from mid-2025 and will lease planes and crew from Qatar Airways to do so.
The two carriers have had a codeshare agreement since 2022, but this deal is a significant deepening of the relationship between Virgin Australia and Qatar Airways.
Making the announcement, Qatar Airways said the investment would “drive increased competition in Australian aviation” – a possible nod to the fact that Qatar Airways has had an uneasy relationship with its fellow Oneworld alliance member airline Qantas.
“The investment further demonstrates our strategic alignment with Virgin Australia and our collective ambition to deliver the best possible service and value to Australian passengers,” commented Qatar Airways CEO Eng. Badr Mohammed Al-Meer on Tuesday.
“Not only that, we believe competition in aviation is a good thing and it helps raise the bar, ultimately benefiting customers. This agreement will also help support Australian jobs, businesses and the wider economy,” Al-Meer continued.
The plan to launch long-haul flights to Doha is, however, subject to regulatory approval, although Virgin Australia CEO Jayne Hrdlicka says the airline has already prepared submissions detailing how the flights will add billions of dollars to the Australian economy over the next few years.
