Australia’s second largest carrier, Virgin Australia, confirmed that it has entered voluntary administration. The airline is now Australia’s first large corporate casualty of COVID-19.
The carrier is part owned a number of entities including Etihad Airways, Singapore airlines, HNA, Nanshan Group and Sir Richard Branson’s Virgin Group.
The airline has 16,000 employees overall through both direct and ancillary businesses and will be seeking to find a new buyer after failing to secure a loan from the Australian government.
A team of administrators from Deloitte have been appointed to restructure the company’s debt and find a buyer.
Virgin Australia held around 31% of the market for domestic flights within Australia whereas, the largest carrier in Australia, Qantas, controlled 58%. Unless the airline is saved, Qantas will control the Australian market which has raised concerns from consumer groups and local politicians.
It’s been a troubling week for Sir Richard Branson and his Virgin Group. Virgin Atlantic is also in trouble with Branson recently offering Necker Island as collateral to secure a bailout from the UK government.
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Other relevant blogs:
Virgin Australia to enter voluntary administration
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The budget airline has announced that it plans to keep middle seats empty to allow for social distancing once lockdown rules are lifted.