Proposal for Virgin Australia and Virgin Atlantic cooperation

Company News

by Rachael Jones

The ACCC has issued a draft determination proposing to authorise Virgin Australia (ASX:VAH) to more closely cooperate with Virgin Atlantic on flights between Australia and the UK and Ireland, via Hong Kong, Los Angeles and any other future mutual connecting points.

Virgin Australia and Virgin Atlantic are separate businesses that do not operate overlapping services on any routes and are unlikely to do so in the future.

They already have a codeshare arrangement, which allows each to market flights on planes flown by the other.

Authorisation will allow the two airlines to coordinate on a wide range of matters, such as jointly managing prices, inventory, and marketing strategies, which are not currently permitted in their existing arm’s length commercial codeshare and loyalty arrangements.

Shares in Virgin Australia (ASX:VAH) are trading flat at $0.16.