Jobs will be at risk, flight prices may soar and regional areas will be under-serviced if the aviation industry doesn’t get more help, Virgin Australia warns.
Jobs will be at risk, flight prices may soar and regional areas will be under-serviced if the aviation industry doesn’t get more help, Virgin Australia warns.

Virgin warns of dire risks if support cut

More jobs are at risk of being axed at Virgin Australia with government support for the airline set end in March.

The airline, which went into voluntary administration in April and was then bought by US private equity firm Bain Capital, this week confirmed 350 corporate and head office staff would be sacked in coming months.

They form just part of 3000 workers - a third of Virgin Australia's staff - let go under a restructure announced in August.

But Virgin Australia chief executive Jayne Hrdlicka said there was "a risk" more jobs could be on the line if support for the aviation industry, including JobKeeper, was not extended beyond March.

"It will be devastating," Ms Hrdlicka told a Senate committee on Friday.

"We continue to feel the deep and ongoing impact of the pandemic, driven by border volatility.

"Over the summer period with borders opening and closing and reopening over the span of three to six weeks, the importance of that flexibility enabled by JobKeeper couldn't be more clear."

Ms Hrdlicka warned the cost of airfares would soar and regional routes would suffer if the airline was unable to quickly ramp up and ramp down its staffing levels in response to "extreme demand swings".

Virgin Australia chief executive Jayne Hrdlicka said the airline was trying to think of creative ways not to cut jobs if support isn’t extended. Picture: Britta Campion/The Australian
Virgin Australia chief executive Jayne Hrdlicka said the airline was trying to think of creative ways not to cut jobs if support isn’t extended. Picture: Britta Campion/The Australian

"Yesterday's announcements to begin border openings to NSW caused sales to double in a day," she said, adding that a national approach to borders was needed to maintain consumer confidence.

Virgin Australia has asked the federal government to extend a raft of "invaluable" aviation-specific supports, as a safeguard to ongoing border volatility.

She said until there was a vaccine and outbreaks were under control, it was not feasible for the airline to bear the costs of keeping staff on standby.

"Post JobKeeper, the aviation industry is going to continue to need some form of support that will enable our technically-trained work groups including pilots, cabin crew, ground crew, engineers and operations control people to remain connected to the business, even if working limited or no hours," Ms Hrdlicka said.

About 3000 staff are currently working for Virgin Australia.

The airline had about 9500 staff at the start of the pandemic and after letting go 3000, hopes to support at least 6000 when domestic and international borders have reopened.

Aside from JobKeeper, Virgin Australia has benefited from more than $35 million in security fee and fuel excise waivers.

Originally published as Virgin warns of dire risks if support cut