About a week or so ago when journalists began sniffing around the business, the company was oddly silent. But this week, Koala Airlines COO Sally Spring finally sent out a media statement and revealed:
“At this stage, Koala Airlines is in the process of meeting regulatory requirements, finalising aircraft leasing agreements and conducting further planning. Given the complexity and ongoing nature of these preparations, it is premature for us to provide additional details beyond what is available on our website. We still have considerable work to complete.”
Intriguing!
While Koala claims to chart “a new flight path for Australian aviation”, with “a game changing strategy” under its belt, Tony Webber, CEO at Airline Intelligence Research, is skeptical.
“The only carrier I think would work in the Aussie domestic market is an ultra-low cost carrier, like a Ryanair, an Air Asia, Wizz Air, Spirit, Frontier, Volaris, etc. They need to come into the market at lower unit cost than Jetstar and scoop up the really price-sensitive passengers,” he explained to travelBulletin.
“But when they do come in, they have to come into the market at a reasonable scale, not with a handful of planes, [or] they won’t be able to compete with Jetstar on cost.”
Ram Chhabra, Group CEO at CVFR Travel Group also expressed his doubts.
As some industry experts have whispered, perhaps Koala can fill the gap that Rex has left behind. But what they’re forgetting is that the failed airline started their major metro flights post-Covid, when both Virgin and Qantas had not yet returned to their full pre-pandemic capacity, said travelBulletin mate, Ram.
Fast forward a couple of years later and Rex was squeezed out, as they didn’t have the frequency or slots required to compete as a strong alternative to either Qantas or Virgin, he added.
“Koala Airlines wants to enter the market at a time when Qantas and Virgin are back to full capacity and stronger than where they were pre-COVID. In fact, Virgin financially is in a much stronger position today than it has ever been. There is no room for a niche player in the domestic space. There is also no point in servicing small markets where Qantas and Virgin don’t fly because there is a commercial reason why they don’t fly there,” Ram said.
“I do believe there is room for another full domestic player, but it needs to have deep pockets and survive the first few years which will be the toughest,” he continued.
“They also need to play it differently and engage and work with the travel trade. If they do that, I believe the industry will support them because both Qantas and Virgin don’t want to play fair with travel agents when it comes to domestic travel.”
Those are fightin’ words!
It sounds like we might be waiting for some time to see Koala take off, but of course, the Travel Daily team will be watching very closely from the sidelines (and report back).
Moving on, earlier this week, we published a story about the rumours swirling around Qatar Airways potentially finalising a 20% stake in Virgin. No word on that just yet…
In other airline drama, we’ve been contacted by several frustrated agents, struggling with Turkish Airlines’ alleged poor customer service and involuntary seat reassignments. Travel Daily editor Adam Bishop followed it up with Melbourne-based TK GM Ahmet Halid Kutluoglu who said:
“Our revision work will be completed in a short time, and the grievance of our pax in this direction will be concluded,” he promised.
“Our most important business partners are undoubtedly the agencies we work with and our most sensitive point is…customer satisfaction.”
Meanwhile, our Cruise Weekly Editor Myles Stedman has been in Adelaide this week, reporting from the Australian Cruise Association’s conference. One of the top stories from the event included executives discussing Australia’s future cruise fuel problem and the launch of South Australia’s new Cruise Attraction Body. Meanwhile, Myles chatted with CEO Jill Abel about the need for a “whole-of-government” approach to the industry’s future.
Cruise Weekly also sent out a breaker this week, announcing Aurora’s expansion beyond expedition cruising and into small ship sailing to new destinations including Indonesia and Borneo.
I don’t know about you, but as we hurtle towards the end of the year, cruising around the sunny Asia-Pacific seems like a glorious idea to me right now! For the time being, I’ll have to settle for Sydney in spring.
Enjoy the weekend, Jo.
