Branson tells Qantas: You’ve caused the mess
Virgin founder Richard Branson has urged the Australian government to be wary of backing Qantas in its dispute with Virgin Australia.
In a blog picked up by the UK media, Sir Richard said: “Government should encourage competition, not prop up the weak when the going gets tough.”
Branson’s Virgin Group has a 10% stake in Virgin Australia, the main domestic rival to Qantas which is lobbying politicians over what it claims is an uneven playing field in Australian skies.
But Branson urged the Australian government to resist intervention, saying Qantas’ management and service were to blame for its financial woes.
He added: “If Qantas was better managed and offered the public a decent service it would not be in the financial mess it is currently claiming it is in.”
Virgin Australia is going ahead with a $350 million capital raising after the move received the green light this week from the Australian Takeovers Panel.
Qantas claims Virgin Australia, which is now majority-owned by state-backed carriers Singapore Airlines, Air New Zealand and Abu Dhabi-based Etihad, is using its foreign owners’ financial clout to set uncompetitively low prices to win customers.
A Qantas spokesperson said: “Qantas thrives on competition, but everyone except Virgin now recognises that the playing field is tipped in their favour.
“Their battler status is far behind them, thanks to the backing of three government-owned foreign airlines covering their losses.
"We’re not interested in a slanging match, we’re interested in a serious debate about the true nature of the Australian aviation.”
Ian Jarrett
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