09 July 2009

Virgin, Delta seek Pacific joint venture

BRISBANE - Virgin Blue and Delta airlines plan to seek regulatory approval to form a joint venture that will expand both carriers’ reach between the United States and Australia and the South Pacific.

The alliance will allow Delta and the Virgin Blue group to compete more effectively in those markets by collaborating on route and product planning, codesharing on their respective networks and extending frequent flyer programme benefits and lounge access to customers of both airlines.

Competition across the Pacific has intensified after Delta and V Australia launched services to challenge the Qantas and United duopoly.

Aviation analysts have speculated that in tough economic times there may not be enough business on the route to support four airlines.

Glen Hauenstein, Delta’s executive vice president for network and revenue, said that together Delta and the Virgin Blue Airlines group would be a stronger and more effective competitor by offering consumers greater choice of destinations, frequencies and schedules.

"For Delta, this agreement is a significant milestone in the expansion of our global network in the Australia and South Pacific region."

Virgin Blue CEO Brett Godfrey said the alliance of two new entrant operators would ensure that vital competition was sustained on the trans-Pacific route.

In advance of their joint venture, the carriers are moving to implement codesharing, frequent flyer program reciprocity and lounge exchange privileges.

Delta began daily nonstop service between Los Angeles and Sydney on July 1.

V Australia, a Virgin Blue Group airline, operates a daily nonstop Boeing 777 service between Los Angeles and Sydney, and a service three times weekly between Los Angeles and Brisbane.

A new, three times weekly service between Los Angeles and Melbourne is planned for September 2009.

TAILNOTE: V Australia has become the first Australian airline to offer chauffeured limousine door to door transport for top tier Business Flexi fare paying guests travelling in International Business Class.