Virgin axes flights, dealing new blow to tourism
Stapleton, John.
Weekend Australian [Canberra, A.C.T] 14 June 2008: 9.
Abstract
TOURISM in Queensland was dealt another blow yesterday with Virgin Blue's announcement that it would cut its weekly flight from Sydney to Proserpine in the Whitsundays.
Virgin Blue's Whitsundays flight cut was part of a $50 million package of savings across the airline's Australian operations, including a reduction in the size of its fleet and increased ticket prices in response to soaring fuel costs.
With direct flights from Sydney cancelled, holidaymakers will now have to fly via Brisbane to get to the Whitsundays. Virgin Blue will also cease its three-times-a-week Darwin-to-Melbourne service by August.
Full Text
The latest cut comes in the wake of Qantas's announcement a week earlier that it would chop seven Jetstar flights from Cairns to Japan each week, leading tourist operators to warn that 1200 jobs could be lost.
The Queensland and federal governments launched an $8 million campaign this week to boost the troubled industry.
Virgin Blue's Whitsundays flight cut was part of a $50 million package of savings across the airline's Australian operations, including a reduction in the size of its fleet and increased ticket prices in response to soaring fuel costs.
Virgin Blue fares are expected to rise by an average of $5 across more than half of its domestic routes. Four aircraft will be removed from service.
With direct flights from Sydney cancelled, holidaymakers will now have to fly via Brisbane to get to the Whitsundays. Virgin Blue will also cease its three-times-a-week Darwin-to-Melbourne service by August.
The cuts come amid speculation that at least one Australian airline could go out of business.
In recent days, Qantas has announced a series of cuts to its services, China Airlines has declared a reduction of 100 flights a month and Air New Zealand has said it will raise fares for the second time in a month.
Virgin Blue chief executive Brett Godfrey said that among the saving measures was a one-year management salary freeze.
Mr Godfrey said the airline's fuel bill in the current financial year would be more than $500 million, an increase of 21 per cent on the previous year. Global jet fuel prices now comprised 35 per cent of the company's costs.
He said the viability of airlines around the world was becoming a serious issue amid soaring fuel costs. Every airline in the world was looking not just at its own profitability but at whether it could survive.
Credit: John Stapleton
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