VIRGIN TAKES OFF WITH ETIHAD

Written on the 5 October 2010

VIRGIN TAKES OFF WITH ETIHAD

AFTER knocking back Virgin Blue Limited’s (VBA) ambitions in New Zealand, the Australian Competition and Consumer Commission (ACCC) has today given the Brisbane-based airline something to cheer about.

The ACCC granted interim authorisation to Virgin today for its proposed alliance with Etihad, which means flights to Abu Dhabi will take off in October.

ACCC chairman Graeme Samuel says the decision was made because there is no existing competition between the two airlines, while the alliance will boost capacity on the long-haul route.

“In granting interim authorisation the ACCC has taken into account the fact that Virgin Blue and Etihad currently do not operate any competing services, as well as the lead time required to market and sell tickets before the commencement of long-haul services,” he says.

Virgin CEO John Borghetti told the ASX the company will run flights to Abu Dhabi from Melbourne, Sydney and Brisbane, starting October 1.

“The Virgin Blue Group of airlines will now be able to an alternative and competitive network to the Middle East, Europe, United Kingdom and beyond,” he said in a statement.

“This is an important milestone as we create a global international network, greater competition on the international landscape and benefit our guests with great value fares, better scheduling and more choice.”

Meanwhile Samuel says Virgin should not be surprised by the decision by the ACCC to deny the NZ link.

“In a sense they should not have been surprised because the trans-Tasman market has been examined very carefully over a long period of time, particularly going back to 2003, 2004 when we looked at the issue of QANTAS,” he says.

“What they need to do is read carefully the detailed reasons that we have given for not approving the Air New Zealand link-up an address those issues.”


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