Qatar Airways eyes 25% stake in Virgin Australia

Qatar Airways is poised to significantly strengthen its partnership with Virgin Australia through a proposed 25% equity stake. It’s a bold, strategic move that could upheave the Australian aviation market, but there are also a few regulatory hurdles both airlines will need to overcome.

New ‘Virgin Australia’ flights to Doha?

As part of this expanded relationship, Virgin Australia plans to introduce new ‘wet lease’ flights from Brisbane, Melbourne, Perth, and Sydney, to Doha. Qatar Airways would supply the necessary aircraft and crew, while Virgin Australia would sell the flights and likely manage the soft product onboard, including dining.

It’s no coincidence that Virgin Australia name-checks these four cities. Qatar Airways unsuccessfully applied to increase its capacity on those routes back in 2023. Its oneworld-partner-but-otherwise-adversary, Qantas, was one of the key impediments. With the benefit of hindsight, it may very well be a move that Qantas will regret.

If Qatar and Virgin’s partnership and wet lease flights go ahead, it will tick multiple boxes with one take-off. Qatar Airways would benefit from a fresh wave of connecting flights through Doha, while Virgin Australia could enjoy a relatively ‘risk-free’ opportunity to dip its toes back into long-haul international flying.

Qatar Airways is already flying three ex-Virgin Australia Boeing 777s, complete with the airline’s popular ‘the Business’ seats and inflight bar. Don’t rule out a cheeky return of these jets to the Virgin Australia network.

Jayne Hrdlicka, CEO of Virgin Australia, is excited about the partnership, noting, “This investment by the world’s best airline will deepen our already strong partnership, bringing critical scale and expertise to support our long-term competitiveness.” She emphasizes the anticipated economic impact, stating that the new long-haul routes could generate around ‘A$3 billion in benefits to the Australian economy over the next five years’.

Qatar Airways Group CEO Eng. Badr Mohammed Al-Meer underscores the mutual benefits of this partnership, stating, “This agreement will also help support Australian jobs, businesses, and the wider economy.”

Velocity Frequent Flyer members could benefit

With this investment, Virgin Australia and Qatar Airways also open the door for further cooperation in areas like loyalty programs and expanded codeshare agreements. Virgin Australia specifically floats ‘increased earn and redemption opportunities for members of Velocity and Qatar Airways’ Privilege Club’ as a focus.

For context, Qatar Airways already prioritises premium cabin reward seat availability for Velocity Frequent Flyer members, while Qantas members are left saddled with mainly Economy rewards. But whilst it’s too early to speculate, there are a few lingering questions to consider as the two airlines progress through the acquisition.

Could Velocity Frequent Flyer adopt Avios, just like Qatar Airways and Finnair? Will Qatar Airways look to leave oneworld? Would a successful acquisition affect Virgin Australia’s relationship with Star Alliance partner, Singapore Airlines, and its unique transfer facility between Velocity and KrisFlyer? Time will tell.

At face value, Qatar Airways and Virgin Australia getting closer should be a boon for travellers.