Virgin Australia CEO reveals airline will stop flying Gold Coast to Perth route
Virgin Australia has made the shock decision to axe one of its routes from the Gold Coast as part of a cost-cutting drive that will also see 750 jobs lost.
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VIRGIN Australia has made the shock decision to axe its Gold Coast to Perth route as part of swingeing cutbacks at the struggling airline.
The loss-making carrier will stop flying the route from January 19, shareholders at a meeting in Brisbane today were told.
Virgin will also retire five aircraft and reduce its carrying capacity by 2 per cent as it battles to return to profitability.
The company’s Melbourne to Hong Kong route has also been cut.
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“Flying to the right destinations, with the right customer demand, and the right-sized fleet will improve our financial performance,” Group CEO Paul Scurrah told shareholders.
Virgin Australia is also slashing 750 jobs from the airline and reviewing supplier arrangements
after delivering a “disappointing” $315.4 million statutory loss for the 2019 financial year.
Gold Coast Airport Executive General Manager of Business Development and Marketing Adam Rowe said the airport would “continue to work closely” with Virgin.
“This Virgin Gold Coast to Perth service was a seasonal school holiday service launched in December 2018,” Mr Rowe said.
“Jetstar continues to operate a year-round Gold Coast to Perth service, with up to daily services. The Jetstar service started in 2011.
“Virgin is one of our key airline partners. We continue to work closely with Virgin and all our airline partners.”
Mr Scurrah, in his first annual general meeting with Virgin, declined to provide an earnings guidance or financial outlook for the company and cited “elements that are outside our control” such as fuel headwinds as reason for not providing the guidance.
“We’ll make sure all of the measures we can control are in far better shape next year and drives us towards profitability,” Mr Scurrah said.
Pushed by a shareholder on when the airline would return to profit, group chairman Elizabeth Bryan declined to provide details.
“We can’t give you timelines and we can’t give you estimates,” she said.
Mr Scurrah said the 2 per cent network capacity reduction showed the company was acting to remove costs.
“Capacity management and cap constraint is a very important profit lever in the organisation,” he said.
Virgin’s lack of earnings guidance is in contrast to Qantas, which in September recorded a periodic revenue increase of 1.8 per cent to $4.56 million.
Originally published as Virgin Australia CEO reveals airline will stop flying Gold Coast to Perth route
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