Virgin Atlantic A340-600
Virgin Atlantic is pulling out of Australia in May when it drops its Hong Kong-Sydney service.
The airline will continue to operate between Hong Kong and London, but said that “increasing costs and a challenging economic environment” had adversely affected revenues on the Hong Kong-Sydney sector. “The route is no longer considered profitable,” the airline said in a statement.
Virgin Atlantic intends to operate the last flight from Hong Kong to Sydney May 4, with the final flight leaving Sydney for Hong Kong May 5. The airline will continue to operate its published schedule until then.
The decision will affect some staff based in Sydney and Hong Kong, and the airline has begun a consultation process with employees likely to be affected.
Virgin Atlantic CEO Craig Kreeger said: “Despite the best efforts of our employees, external factors such as increasing costs and a weakening Australian dollar have affected our profitability. These are still difficult times for the airline industry and as part of our strategy to operate more efficiently we need to deploy our aircraft to routes with the right level of demand to be financially viable.”
Virgin Atlantic already operates codeshare flights on the London-Sydney route with Singapore Airlines routing via Singapore.
Virgin founder Richard Branson is reported as saying he hopes the withdrawal from Australia is only a temporary measure. He told Dubai-based Arabian Business magazine: “Hopefully we’ll be back one day.” He said the airline had been losing about $10 million a year on the route and had perhaps kept the Hong Kong-Sydney route “going too long” in the “hope that next year will be better than the previous year.”