Virgin Australia: What the CEO changes will mean for Velocity members

With rumours on what Virgin Australia will look like following the resignation of the airline’s CEO, the big changes are causing panic among frequent flyers.

Big changes at Virgin are causing panic among frequent flyers.

This week, we’ve seen Virgin CEO Paul Scurrah step down, to be replaced by former Jetstar head Jayne Hrdlicka.

That alone suggests an airline which will be a lot more focused on budget travel than on extras like lounges and rewards flights.

For much of 2020, members of Virgin’s Velocity frequent flyer scheme haven’t been able to redeem their points for either flights or goods because of the airline being in administration.

Rewards flights resumed in July, though only for domestic destinations. That wasn’t particularly appealing when the longest flights (such as to and from Perth) were off limits because of pandemic travel restrictions between states.

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Virgin Australia CEO Paul Scurrah resigned from the airline this week. Picture: Lyndon Mechielsen

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For higher-status members, the lack of lounge access has also made flying less appealing, even as pandemic restrictions have eased slightly and flight regularity has slowly increased.

The Velocity Rewards Store reopened in September, but with a smaller range of options than before.

And using points to buy a coffee machine is still one of the lowest-value choices.

Another recent change is triggering concern for points enthusiasts.

Velocity members will no longer earn points when travelling on flights with Virgin’s international partner airlines, such as Singapore, Delta and Etihad.

Flights which have a VA code (regularly used when flying with a partner airline) won’t be eligible to earn any Velocity Points.

That’s not a huge practical concern right now, given that flying out of Australia requires explicit government approval and a willingness to endure 14 days of paid quarantine on return.

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Velocity still isn’t allowing redemptions through its international partners. Picture: Gaye Gerard/NCA Newswire

But if that rule stays in place in 2021, then booking to fly with partner airlines through Virgin won’t seem so appealing, and passengers might opt for other alternatives. That in turn makes the partnerships less valuable overall.

Velocity still isn’t allowing redemptions through its international partners.

Historically, those have been the best-value and most-sought-after offers.

A first-class reward flight with Etihad or Singapore, while tough to score, could offer $70 or more in value for every 1000 points you spent.

Velocity is trying to entice customers to spend their points domestically, with a current deal offering 30 per cent off the points needed for redemptions in Australia.

Most Velocity members use their points for upgrades, such as Economy to Premium Economy. Picture: Virgin Australia

That’s definitely worth considering if you’re thinking about travel soon (and are confident your journey will be feasible despite border restrictions).

Domestic flights don’t offer as much bang for buck as international ones, but are still much better value than Rewards Store redemptions.

Virgin’s new owner Bain Capital has said it will continue running Velocity and maintain all points balances.

But while the only flight options are domestic and with the threat of a more Jetstar-like experience, the value of those points remains up in the air.

Angus Kidman is the editor-in-chief and travel guru for Finder