Qatar Airways Seeks to Take 25% Stake in Virgin Australia

Skift Take

Qatar’s stake in Virgin Australia could revive international flying for the carrier and increase competition in the Australian market.

Meghna Maharishi

Qatar Airways announced that it intends to acquire a 25% stake in Virgin Australia as part of a deal that could drive more competition in the Australian market.

The deal is currently pending regulatory approval from the Australian Competition and Consumer Commission. Qatar said the deal would allow Virgin Australia to launch flights from Sydney, Perth, Brisbane and Melbourne to Doha through a wet-lease program. Flights between Australia and Doha could start by mid-2025. 

A wet-lease allows airlines to loan aircraft and at least one crew member to another carrier, according to the Federal Aviation Administration. Qatar said the agreement would give Virgin the opportunity to “assess the longer-term merits and viability of wide-body aircraft flying.”

Virgin Australia is Australia’s second-largest airline and primarily operates domestic routes. The carrier paused international flying during the pandemic and, more recently, scrapped its Tokyo route due to low demand. 

Qatar Airways Tries Again, but With Virgin Australia

Qatar previously tried sought approval from the Australian government to increase its flights to Sydney, but the government rejected the bid, saying it would have gone “against Australia’s national interests.”

Qantas, Australia’s largest carrier, was opposed to Qatar increasing its presence in the country and had lobbied the government to not grant the request. 

Outgoing Virgin Australia CEO Jayne Hrdlicka said she expected the deal to generate around A$3 billion “through incremental visitor flows throughout the year.”

“It will further strengthen Virgin Australia’s ability to  compete over the long term, which will inevitably translate into more choice and even better value  airfares for consumers as well as additional Australian aviation jobs,” Hrdlicka said in a statement.