Qatar Airways and Virgin Australia announced back in October (read more here) that the Doha-based airline is taking a 25% stake in Virgin Australia, pending government approval.
Virgin Australia is leasing airplanes and crews from Qatar Airways to provide service between various Australian cities and Doha (essentially a backdoor for Qatar Airways to launch more frequent services to Australia).
You can access Qatar Airways here and Virgin Australia here.
Virgin Australia plans to place 20 captains and 40 cabin crew members in Doha by the end of the year. Crew members from Virgin Australia would also be entirely responsible for future service expansions.
Qatar Airways Airline Investments:
25.5% stake in IAG that owns airlines such as British Airways, Iberia, Vueling, and Aer Lingus
9.9% stake in Cathay Pacific
10% stake in LATAM
49% pending stake in RwandAir
25% stake in AirLink
25% stake in Virgin Australia
Virgin Australia’s press release:
Virgin Australia and Qatar Airways partnership takes off
- Australian Government approves Qatar Airways Group’s minority 25% stake in Virgin Australia, unlocking new areas of cooperation with one of the world’s leading airlines.
- Virgin Australia’s long-haul flights to Doha commencing from June1, placing downward pressure on airfares.
- Australian consumers to benefit from more choice and greater value when travelling to Europe, the Middle East and Africa.
- Significant boost for the Australian visitor economy, including tourism, with an estimated $3 billion boost over the next five years.
- High levels of interest for secondment opportunities for Virgin Australia pilot and cabin crew with Qatar Airways, supporting continued jobs growth in Virgin Australia.
27 February 2025: Australian travellers are set to benefit after a deeper strategic partnership between Virgin Australia and Qatar Airways Group was given the green light by the Australian Government.
Qatar Airways Group’s minority 25 per cent investment in Virgin Australia has now received Foreign Investment Review Board (FIRB) approval following the Federal Treasurer’s announcement today. This follows the Australian Competition and Consumer Commission’s (ACCC) Draft Determination on 18 February indicating its intention to authorise the airlines’ integrated alliance, with final approval expected in March/April 2025. Together, they help open the door to the airline’s return to long-haul international flying.
Virgin Australia now awaits a decision from the International Air Services Commission (IASC) on what is an uncontested allocation of air rights for services between Australia and Qatar, due to commence in June.
Equity investment
Qatar Airways Group’s 25 per cent stake will provide Virgin Australia with access to the scale and expertise of a world-leading global airline, strengthening its ability to compete domestically and internationally and driving increased competition in Australian aviation.
Bain Capital, Virgin Group, and Queensland Investment Corporation will retain shareholdings in Virgin Australia.
Long-haul flying and integrated alliance
Subject to IASC approval, Virgin Australia will return to long-haul flying in June 2025, with flights from Sydney, Brisbane, and Perth to Doha. Flights from Melbourne to Doha are scheduled to commence in December 2025. These flights will be operated utilising aircraft wet-leased from Qatar Airways. As well as enhancing competition and placing downward pressure on international airfares, these flights will provide a significant boost to the Australian visitor economy, including the tourism sector, generating an estimated $3 billion in economic value over the next five years.
Thanks to the airlines’ integrated alliance, customers on Virgin Australia’s new Doha flights will be able to connect seamlessly to Qatar Airways’ global network, including more than 100 new connecting itineraries across Europe, the Middle East and Africa. The expanded codeshare and collaboration arrangement will also provide access to increased points earn and redemption opportunities for members of Velocity and Qatar Airways’ Privilege Club.
Following consultation with unions and relevant cabin crew and pilot communities, there has been an overwhelming response to the expressions of interest for secondment opportunities for Virgin Australia pilot and cabin crew with Qatar Airways. This will also provide promotional opportunities for other team members and new hires through the backfilling of seconded staff.
Other areas of cooperation
Virgin Australia and Qatar Airways signed a Memorandum of Understanding (MoU) to collaborate on a range of sustainability initiatives in October 2024. Areas of focus under the MoU include aiming to advance the use of Sustainable Aviation Fuel, environmental management including waste and energy management, sustainable procurement, and aviation workforce development.
Commentary from Virgin Australia Group CEO Jayne Hrdlicka:
“Today we welcome a new era for Virgin Australia. Qatar Airways’ investment is a huge vote of confidence in our business and Australian aviation more broadly. It sets us up for long-term success and adds fuel to our bold transformation agenda,” Ms Hrdlicka said.
“This is a major win for Australian consumers, who are already benefiting from more choice and greater value when travelling to Europe, the Middle East and Africa since our flights went on sale in December. Domestically, we are competing well and performing stronger than at any other point in our 24 year history. Being backed by one of the world’s largest airlines now gives us the scale and access to industry expertise which will support continued growth in line with the market domestically, improve our ability to compete for key segments of the market and add momentum to our margin ambitions.
“Today is an incredibly proud day for everyone in the Virgin Australia team. Each of our 8,000 team members has played an important role in getting us to this point. Many of our people are personally excited about the secondment opportunities, and we have seen this through the extraordinary response to the expressions of interest for pilot and cabin crew roles with Qatar Airways. Virgin Australia has a bright future, and we will continue to go from strength to strength with Qatar Airways by our side.
“We thank the Federal Treasurer for his decision, and join him in recognising the positive outcome for competition, consumers and jobs growth. Today is great news for the many stakeholders that rely on Virgin Australia’s success.”
Commentary from Qatar Airways Group Chief Executive Officer, Engr. Badr Mohammed Al-Meer:
“This latest development is a significant step towards solidifying the strong and enduring relationship that continues to evolve between Qatar Airways Group and Virgin Australia. It is also a huge boost to our shared ambition to create even greater choice and value for all Australian passengers, with healthy competition and world-class service at the very core of our collective offering.
“We are confident in our ability to deliver an alliance between our two airlines that will provide immense benefit to customers, Australian businesses, Australian jobs and the wider economy.”
Commentary from Bain Capital Partner Mike Murphy:
“We’re delighted to welcome Qatar Airways Group as a partner in Virgin Australia.
“Virgin Australia has emerged as a strong and profitable company with an attractive market position, a loyal customer base, and an exciting growth trajectory. Now, through our partnership with Qatar Airways, we’re unlocking new areas of cooperation with one of the world’s leading airlines.
“Bain Capital remains the majority shareholder and is committed to Virgin Australia’s long-term success.”
1 Subject to final regulatory approvals.
Conclusion
The Qatar Airways deal to take a stake in Virgin Australia essentially allows it to offer more frequencies between Doha and various Australian cities when Virgin Australia leases planes and crew from Qatar to operate these services.
Qantas had essentially lobbied against allowing Qatar Airways to offer more services to Australia because of its alliance with Emirates and its own long-haul flights.
This is almost déjà vu to what happened previously between Etihad and Virgin Australia. Etihad owned close to a quarter of Virgin Australia, and Virgin Australia flew a few frequencies to Abu Dhabi, where passengers could connect to Etihad’s services. Etihad’s ownership stake was nullified when Virgin Australia fell into receivership in 2020.
Overall, this is a very clever move by Qatar Airways, which now has much better access to expand its services to Australia by wet leasing planes and crews to an airline of which it owns 25%.
