Virgin Australia staff react to airline’s insolvency as Queensland tourism braces for turbulence


Updated

April 21, 2020 18:10:31

Pilot Daniel Lang was among the 80 per cent of staff stood down by Virgin Australia in late March, but already had another job when the company today announced it had entered voluntary administration.

After flying with Virgin for 12 years, he’s now stacking shelves at his local supermarket.

Key points:

  • Administrators Deloitte say more redundancies aren’t planned, but some staff aren’t waiting to find out
  • For some pilots, it’s a case of deja vu after Ansett’s failure
  • Tourism regions say they rely on low airfares from competition, and high capacity

Mr Lang said he updated his resume and drove around Brisbane in the hope of finding a new job and was grateful when a local Woolworths took him on for a few shifts each week.

“I never thought anything like that was beneath me. At the end of the day it gives me a purpose,” Mr Lang told ABC Radio Melbourne.

“I can put some food on the table for my family, and my two kids.”

Deloitte, the administrators appointed to Virgin Australia overnight, said there were “no plans to make any redundancies”, but that’s little comfort for those waiting to hear what happens next, or the 1,000 people already made redundant in recent weeks.

Mr Lang’s new duties include stacking shelves, working at the checkout and unloading pallets of items.

The pilot said staff at Virgin Australia knew the airline was struggling financially, despite the best efforts of a new management team installed last year.

The coronavirus pandemic was the straw that broke the camel’s back.

“No-one could foresee the severe impact this was going to have on the global economy, let alone Australia’s economy,” Mr Lang said.

“Unfortunately it will be the travelling public that pays for it, if there is a monopoly left in Australia.”

Mr Lang called on the Federal Government to help the airline to save 10,000 employees and a further 6,000 whose jobs were linked to the airline’s operation.

Pilot lost his job at Ansett and now Virgin

Virgin Australia pilot Andrew Backstrom previously worked at Ansett for eight years, then clocked up 19 years with his current employer.

“You really think about everyone around you — Ansett also had that family atmosphere,” he said.

“As a pilot I could pursue another career somewhere else, whereas ground handlers, people who’ve been there a long time, check-in staff, they didn’t have the options that we did, so you really feel for them.

“That’s very similar to what we’ve got now with Virgin — you worry for the other people in the family, as well as your own troubles.”

Mr Backstrom said he lost his job when Ansett shut down but at that time Virgin was hiring.

“It’s of great concern for us — if Virgin wasn’t to go ahead, [an alternative airline] is going to take a lot of years and the jobs would be slow in coming. A pie-in-the-sky thought to hang onto,” he said.

“You’d rather see Virgin continue as the airline that it is.

“We provide an integral part of the infrastructure that the rest of the country can thrive around.

“We’re part of a much bigger network that relies on us being in the market.”

Queensland tourism relies on airline

Development Minister Cameron Dick said regional Queensland needed two airlines.

“That is so critical, particularly to regional Queensland,” he said.

“Anyone who remembers what happened when Ansett disappeared knows how catastrophic it was for regional community in our country.”

Destination Gold Coast said the decision by Virgin Australia to go into voluntary administration was a devastating blow.

CEO Annaliese Battista said nearly 15 per cent of the Gold Coast’s domestic fly market relied on Virgin and she feared prices would skyrocket without a second airline.

However, Ms Battista also hoped going into voluntary administration could help the airline.

“It may well mean the airline can survive, albeit in a different format post-COVID-19, and we’ve advocated very strongly for two airlines to be operating at the end of this crisis,” Ms Battista said.

“We know that pre-COVID-19, 46 per cent of all travellers that flew to the Gold Coast from within Australia flew on a Virgin group airlines flight. That was worth $1.93 billion to the local economy — it was incredibly significant.”

Townsville Enterprise CEO Patricia O’Callaghan said exorbitant airfares could jeopardise a number of recovering industries.

“Trade, investment and the rebuild of our tourism market are relying on competitive tension in our air,” Ms O’Callaghan said.

“It could be some time before international airways are opened up again and we need to look at our domestic opportunities.”

Townsville Enterprise said Virgin Australia accounts for a third of the 1.7 million passengers that travel to the region annually.

“We also need to acknowledge that over 600 jobs are at the airport and a number of them rely on the supply chain through Virgin Australia,” Ms O’Callaghan said.

Cairns Mayor Bob Manning said more than 30 per cent of Cairns’ economy is tourism based and losses in the aviation industry would hit the region hard.

“This town is driven by tourism and by aviation,” he said.

“Australia has an incredibly vibrant and attractive tourism industry — airlines are the key to that.

“The possibility of Virgin having a serious haircut and coming back and fulfilling that [budget] role … I think offers the absolutely best prospects for regional Queensland.”

Topics:

air-transport,

covid-19,

business-economics-and-finance,

travel-and-tourism,

company-news,

tourism,

industry,

work,

community-and-society,

people,

human-interest,

brisbane-4000,

qld,

australia,

mackay-4740,

townsville-4810,

cairns-4870,

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First posted

April 21, 2020 17:09:46



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