Virgin Australia CEO calls for airline to focus on domestic network

Virgin Australia CEO Paul Scurrah has revealed the best way forward for the embattled airline, which went into voluntary administration last month with debts of $6.8 billion.

VIRGIN Australia’s future could hinge on it becoming a domestic airline with a fleet of Boeing 737s and a strong frequent-flyer program.

CEO Paul Scurrah has held three-hour presentations to two of the bidders for the embattled airline, which went into voluntary administration in April with debts of $6.8 billion.

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Virgin Australia CEO Paul Scurrah has presented to two of the embattled airline’s bidders. Picture: Joel Carrett

Mr Scurrah, as reported by The Australian, said the airline could prosper if it ditched its current fleet of aircraft in favour of a line-up of Boeing 737s.

He also called for the domestic network to be rebuilt from scratch, instead focusing on high-demand lucrative routes.

Savings could be made via negotiating costly contracts with Wi-Fi providers and caterers, The Australian reports.

Meanwhile, Deloitte has held a meeting with 35 creditor representatives including unions, airports, banks, bondholders and suppliers.

It revealed that urgent funding was needed if Virgin Australia was to keep flying and keep pace with rival Qantas.

Government subsidies end on June 11 with an existing $100m in cash expected to see the airline through till the end of July.

The meeting heard administrators were eyeing up to $238m in restricted cash, tied up against hedging and in merchant and credit card facilities, The Australian reports.

Originally published as Virgin Australia CEO calls for airline to focus on domestic network