Virgin Australia stands down 8000 workers as tensions with Qantas escalate

Virgin Australia boss Paul Scurrah.

Virgin Australia has announced it will stand down the majority of its workforce and slash domestic flight capacity as it battles to stay afloat during the coronavirus pandemic.

About 8000 of its 10,000 workers have been told to stand down until at least the end of May after the embattled carrier suspended all Tigerair Australia flights and said its domestic schedule would now be cut by 90 per cent, from last week’s 50 per cent reduction.

“There has never been a travel environment in Australia as restricted as the one we see today and the extraordinary steps we’ve taken have been in response to the federal and state governments’ latest travel advice,” Virgin Australia CEO Paul Scurrah said.

“We are now facing what will be the biggest grounding of aircraft in this country’s history.

“From the end of this week, we will begin repositioning and grounding more than 125 aircraft in our fleet, suspending almost all our domestic and international flying until at least the middle of June.

“I know our people have been working tirelessly to help guests get home ahead of the various state travel restrictions and their efforts should be applauded as they adapt to a rapidly changing environment.”

Virgin Australia is currently involved in a bitter spat with rival Qantas over comments made by the Qantas executive team regarding Virgin’s financial woes.

“Virgin Australia has seen widespread reporting of public comments from Qantas and its executive team questioning directly or indirectly Virgin Australia’s financial viability and encouraging [the] government to refrain from extending any government support for the aviation industry to Virgin Australia,” Scurrah said in a letter to Australian Competition and Consumer Commission (ACCC).

“We have received reports of Qantas briefing journalists on the false pretence that Virgin Australia cash reserves are running out within days and that Virgin Australia has appointed administrators.

“We are aware of social media reports that Qantas has sought to promote a campaign that the government exclude Virgin Australia from any COVID-19 financial support package and have urged their staff to write to their local Member of Parliament to support this exclusion.

“We are gathering together a range of examples of this conduct to send to you.”

The Federal Government announced a $715 million relief package for the local aviation industry last week.

But Qantas chief executive Alan Joyce told Sky News Australia it would be “completely unfair” for financial assistance to be given to one company over another and that the government should not “look after the badly managed companies, that have been badly managed for 10 years”.

ACCC chairman Rod Sims confirmed he would investigate Virgin’s complaint and said he was “surprised and disappointed” by Joyce’s “very unhelpful” comments.