"Vanuatu"

Liquidators for Air Vanuatu have reported receiving interest from various parties wanting to take over the airline’s business or acquire some of its assets.

The exact number of offers and the details of the interested parties have not been disclosed. However, the liquidators comments suggested interest in Air Vanuatu’s assets including valuable international airport slots in major cities like Brisbane, Melbourne, and Sydney.

“We have received interest from a range of parties seeking to resume Air Vanuatu’s operations,” liquidator Morgan Kelly of Ernst and Young said this week.

Air Vanuatu entered liquidation on 9 May 2024 and Morgan Kelly, Andrew Hanson and Justin Walsh of EY were then appointed as joint liquidators for the operation.

Air Vanuatu: A Brief History

Established in 1994, Air Vanuatu served as a vital link for tourism, cargo transportation, and overall economic activity in Vanuatu.

The airline operated domestic flights within the archipelago and international services to destinations in Australia, New Zealand, Fiji, and New Caledonia.

Despite its significance, Air Vanuatu faced financial difficulties for several years. The reasons for these challenges were complex and likely involved a combination of factors.

Factors like high operational costs, fierce competition from regional airlines, and the impact of global events have left their mark on the industry.

Liquidation and Uncertainty

The official announcement of Air Vanuatu’s liquidation in May cast a shadow over the airline’s future and the broader Vanuatu travel industry.

The airline’s sizable debt burden, estimated to be over $110 million, ultimately led to this decision.

With grounded planes and halted operations, the economic impact on Vanuatu was significant, particularly for tourism-dependent businesses.

Expressions of Interest Spark Hope

Recent news reports offer a sense of a potential lifeline for Air Vanuatu. Liquidators appointed to oversee the airline’s affairs have revealed that they received expressions of interest from various parties.

Speculatively, these parties are likely a mix of existing airlines, investment groups, or even new entrants seeking to capitalize on the opportunity.

The details surrounding these expressions of interest remain confidential. The exact number of interested parties and the nature of their proposals haven’t been disclosed.

However, the news itself is a positive development, suggesting potential buyers see value in reviving Air Vanuatu’s operations.

Valuable Assets Attract Interest

One factor likely attracting potential buyers is Air Vanuatu’s valuable asset portfolio. This includes landing rights, also known as airport slots.

These are held at key international airports in Brisbane, Melbourne, Sydney, Auckland, Noumea (New Caledonia), and Nadi (Fiji).

The slots grant airlines permission to take off and land at specific times, and securing them can be a costly and challenging process, especially at major hubs.

Owning these slots provides a significant advantage for any airline looking to establish a presence in the region.

Additionally, Air Vanuatu likely possesses other assets like operational equipment, spare parts, and potentially even owned or leased aircraft.

A Cause for Optimism, But Questions Remain

While the expressions of interest offer a hopeful sign, there’s still a long way to go before Air Vanuatu takes to the skies again, if at all.

The news of potential interest in Air Vanuatu is undoubtedly positive. It suggests that the airline’s valuable assets and the crucial role it plays in Vanuatu’s economy haven’t gone unnoticed. However, several questions remain unanswered.

Who are the interested parties, and what are their plans for reviving Air Vanuatu? Will the airline retain its previous routes and branding, or will it undergo a significant transformation?

Most importantly, can a new owner overcome the financial challenges that led to the airline’s initial downfall?

Only time will tell what the future holds for Air Vanuatu. However, the recent developments offer a glimmer of hope for the airline’s revival and its continued role in connecting Vanuatu to the world.

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Hundreds of passengers have found themselves stranded in Vanuatu after the national flag carrier Air Vanuatu placed its sole Boeing 737 aircraft out of service.

Statement by the airline confirmed that it is now operating on reduced international capacity via its partnership with Solomon Airways while its sole Boeing 737 aircraft is out of service.

Aircraft on Ground Brisbane

The airline has confirmed that services will be affected until mid-next week. The cause of these disruptions is unscheduled technical work that is required on the aircraft.

The aircraft is currently grounded in Brisbane and is understood to be awaiting the arrival of a spare part.

In a statement on their website, Air Vanuatu said that it appreciated that this break down is causing disruption to the travel plans of guests. The airline emphasised that it “recognizes the paramount importance of passenger safety and the integrity of its operations.”

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“The airline will resume flights when all required engineering works and checks are completed and has made statements to assure industry partners that they are focused on getting all guests back in the air and safely returned to their destinations,” the statement continued.

“Once the work is completed, they are confident these ongoing disruptions will be minimised. In line with its policy, Air Vanuatu is covering the cost of accommodation and meals for those guests whose flights are affected.

Whilst Air Vanuatu currently operates codesharing partnerships with other regional operators including Solomon Airways and Fiji Airways, it currently only operates the one aircraft for its international operations.

The carrier saw a similar grounding late last year, with tourists stranded just prior to Christmas as a result of maintenance issues.

About Air Vanuatu

Air Vanuatu is the national flag carrier of Vanuatu, operating to Australia, New Zealand, New Caledonia and points in the South Pacific. Its main base is Bauerfield International Airport, Port Vila.

Air Vanuatu was established in early 1981 after Vanuatu gained independence from the United Kingdom and France the previous year.

The airline was initially owned by the government of Vanuatu, but was privatized in 2013.

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Two South Pacific airlines – Solomon Airlines and Air Vanuatu – have now taken their cooperation to the next level by stepping up their mutual cooperation.

This is being achieved by establishing a wet lease or ACMI contract as the airlines are now realizing the growth of the post-pandemic era. The two carriers are now working in synergy on their scheduled operations. 

Increased services

As of the 5th of June 2023, Solomon Airlines will start additional operations between Port Vila and Auckland on behalf of Air Vanuatu.

The additional flight will depart Port Vila to Auckland on Mondays with a return flight from the New Zealand city of Auckland to Port Vila operating on Tuesdays. This will be in addition to Air Vanuatu’s already existing flight services on Wednesdays and Saturdays. 

New schedule 

The schedule allows travellers from Solomon Island and New Zealand to travel seamlessly between their countries. Flights from Honiara to Auckland via Port Vila will effectively restart Solomon Airlines’ re-entry to New Zealand via the Auckland Airport hub.

Respectively, Solomon Airlines and Air Vanuatu reiterate that the two airlines will codeshare the operation. 

Moreover, under the inked agreement, Air Vanuatu will also be returning to the Australian city of Brisbane from Santo in Vanuatu every Thursday. The new route will also be flown by Solomon Airlines.  

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New services – more benefits

Air Vanuatu CEO, Mr. Joseph Laloyer commented positively on the new agreement stating that the new resurrect cross-border services will bring great benefits to both economies, ranging from economic to social dimensions. 

Importantly, Vanuatu’s Tourism Industry has been severely hampered by the covid-19 pandemic, and is much looking forward to a full-scale recovery. 

Air Vanuatu’s CEO stated: “Developing aviation and tourism in our region, does not need to be a unique and stand-alone mission”

He commented on being interdependent on other airlines:  “We are national carriers with similar responsibilities and aims, we are of similar corporate size, and we are experiencing the same challenges to sustain our operations.”

“With the learnings of the COVID pandemic, the realization is even greater, that cooperation in our region is crucial to the survival of both airlines.”

“At Air Vanuatu, we are very encouraged to embark on this new venture with Solomon Airlines and to build on the long-established collaboration and friendship between us.”

“Engaging each other to support more robust and efficient operations is a very sound strategy and is in fact vital in the new operating environment.” 

He also mentioned that the domestic fleet is already supporting international partners: “Already the addition of Solomon Airlines Twin Otter and crew to support our domestic network is working well, and we are now extending our partnership to international operations.”  

Solomon Airlines CEO Mr. Gus Kraus agreed to the statement made by his counterpart, saying: “There is a strong synergy between Solomon Airlines and Air Vanuatu that extends from fleet to operations, to distribution systems.”

“This new agreement paves the way for us to help each other, whilst still maintaining the independence of each country’s national carrier. We are helping our neighbors and we’re both benefitting, it is only the beginning of opportunities that we can create by leveraging each other’s capabilities.” 

If everything goes according to plan, the new service will be on sale through both Air Vanuatu and Solomon Airlines distribution channels from May 2023. 

Why does this partnership matter? 

Both Solomon Airlines and Air Vanuatu are relatively ‘small’ airlines, as national carriers. The distance between the two islands is 975 kilometers with both nations heavily reliant on the economic activity of New Zealand and Australia.

Hence, this makes the two flag carriers heavily reliant on flights to Australia and New Zealand, meaning they act as competitors which may result in price wars.

Price wars may in the short term increase the load factor, but do not produce healthy financial flow to both carriers, therefore this partnership, shares which airline does best.

This is a trend we see for small airlines joining hands together to avoid unnecessary price wars.

It has been revealed in the last hour that Qantas & Jetstar will launch flights to Port Vila in Vanuatu from Brisbane and Sydney.

Both carriers have laid out their plans to launch flights to the Pacific island.

Without further ado, let’s get into it…

The New Port Vila Flights from Brisbane & Sydney with Qantas & Jetstar…

It is understood that Qantas will launch flights between Brisbane and Port Vila on September 10.

Services will start initially on a three times per week basis and will eventually increase to five per week.

As for Jetstar, they will launch flights between Sydney & Port Vila on December 12 on a four times per week basis.

It is understood these flights in total will provide a capacity of 150,000 seats every year between Australia & Vanuatu.

Qantas will utilise the Boeing 737 whilst Jetstar will be using their Airbus A321neoLR aircraft.

Both CEOs: Building on The International Network…

Commenting on the new flights between Brisbane & Port Vila was Qantas International CEO, Cam Wallace:

“We’re thrilled to offer our customers direct flights between Brisbane and Vanuatu and build on this important route which will maintain essential connectivity for leisure and business travel.

“We’ve long served Vanuatu through our codeshare partnership and this new route ensures our customers have more choice and consistent service to the island destination we know they enjoy.”

Adding to this was Jetstar Group CEO, Stephanie Tully:

“Ahead of the arrival of our 13th A321neo LR next month and more new aircraft on the way, we’re continuing to grow our international network with the launch of low fares seats between Sydney and Port Vila.

“We’re excited to be able to offer more Australians great value holiday options to one of our nearest and most beautiful pacific island destinations.”

Overall…

In conclusion, this is big news for the market in Vanuatu thanks to Qantas & Jetstar.

Furthermore, these new flights to Port Vila from Sydney & Brisbane will provide strong links to the island.

With 150,000 seats on offer by both airlines collectively, it will be interesting to see what demand looks like.

But for now, all eyes will be on launch day in September and December respectively.

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The Australian Competition and Consumer Commission (ACCC) has approved a codeshare agreement between Virgin Australia and Air New Zealand.

This now offers travellers more options and potentially lower fares when flying between Australia and New Zealand (trans-Tasman routes).

Green Light for Trans-Tasman Codeshare

This decision follows the ACCC’s draft determination in May, which received broad public support.

Under the agreement, Virgin Australia can place its code on Air New Zealand flights operating on trans-Tasman routes originating in Australia (VA-coded services).

However, Air New Zealand will have the authority to set the fares that Virgin Australia can offer.

“This collaboration between airlines is expected to bring significant benefits to consumers by increasing competition and offering a wider variety of ticketing and pricing options,” said ACCC Deputy Chair Mick Keogh.

The agreement also allows Virgin Australia and Air New Zealand to jointly provide discounts and marketing initiatives for businesses.

Additionally, eligible Virgin Australia Velocity Frequent Flyer members will enjoy program benefits and access to international lounges on qualifying flights.

It’s important to note that this codeshare arrangement excludes routes where Virgin Australia currently operates or plans to operate its own services in direct competition with Air New Zealand.

“The ACCC believes these conditions effectively mitigate the risk of anti-competitive behavior arising from this agreement,” added Mr. Keogh.

Background Information

Virgin Australia primarily focuses on domestic and short-haul international flights within Australia and neighbouring regions.

Their current international destinations include Queenstown (New Zealand), Tokyo (Japan), Nadi (Fiji), Denpasar (Indonesia), Port Vila (Vanuatu), and Apia (Samoa).

Virgin Australia also has existing codeshare agreements with several airlines for long-haul international flights.

These agreements allow Virgin Australia to market and sell seats on flights operated by partner airlines, with the partner airlines setting the fares.

Air New Zealand, the national carrier of New Zealand, operates flights across the Pacific, Asia, and North America, in addition to its trans-Tasman services.

They are part of a larger airline alliance involving Star Alliance and 26 other international airlines, including United Airlines and Cathay Pacific.

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oneworld, the leading airline alliance, has welcomed Fiji Airways as its 15th full member.

For the past five years, Fiji Airways has been a valuable oneworld connect partner, fostering strong connections with all member airlines.

This transition to full membership recognizes Fiji Airways’ commitment to exceptional service and global connectivity.

Warm Bula from oneworld CEO

Nat Pieper, CEO of oneworld, enthusiastically welcomes Fiji Airways. He highlights their impressive growth, award-winning offerings, and seamless integration within the alliance.

“It’s a very warm bula, or hello, to Fiji Airways as we welcome them as our 15th full member airline in the oneworld alliance.”

“Fiji Airways is already part of the oneworld family, as we have had a highly successful relationship since the airline joined as a oneworld connect partner five years ago.”

“We will strengthen our position as the premier airline alliance for international global travellers.”

Fiji Airways CEO Comments

Andre Viljoen, Managing Director and CEO of Fiji Airways, expresses pride in their full membership. “It marks a significant step in our commitment to providing unparalleled service and connectivity,” he said.

“As a full member airline, we are excited to enhance the travel experience for oneworld alliance frequent flyers.”

“It offers greater accessibility to Fiji and the South Pacific, and ensuring seamless connections and memorable journeys for Fiji Airways customers across the alliance network.”

Expanding Network with Fiji Link

Fiji Airways, with its hub at Nadi International Airport, serves 26 destinations in 15 countries. Its wholly-owned subsidiary, Fiji Link, further expands the alliance’s reach.

Fiji Link offers domestic flights to Suva, Nadi, Labasa, Taveuni, and Kadavu, and regional connections to Tonga, Samoa, Tuvalu, and Vanuatu.

Record-Breaking Growth and Award Recognition

Fiji Airways boasts record-breaking 2023 profits and revenues, carrying 2.2 million passengers. The national carrier marked a recent fleet upgrade featuring state-of-the-art Airbus A350 widebody aircraft.

The airline is well-positioned for continued growth as a full oneworld member, offering more flights and new routes to meet increasing customer demand.

Full Suite of oneworld Benefits

As a full member, Fiji Airways offers oneworld Emerald, Sapphire, and Ruby members a complete suite of benefits.

These include earning and redeeming miles, accumulating status points, priority check-in and boarding, and lounge access.

Similarly, Fiji Airways’ top-tier customers gain access to oneworld’s extensive network of nearly 700 business and First-class lounges worldwide. This includes the newly opened lounges in Amsterdam’s Schiphol and Seoul’s Incheon Airports.

Conclusion

Established in 1951, the airline boasts a fleet of 21 modern aircraft, including Airbus A350s, A330s, and Boeing 737s.

Their commitment to excellence is reflected in their 2023 Skytrax Awards: Best Airline, Best Airline Staff, and Best Airline Services in Australia & the Pacific.

They also ranked 15th globally, 12th for cabin crew, and 16th for cleanliness.

2024 notably marks 25 years for the oneworld alliance, originally founded by American Airlines, British Airways, Cathay Pacific, and Qantas.

Later this year, Oman Air will join as the 14th member, alongside Alaska Airlines, American Airlines, British Airways, Cathay Pacific Airways, Finnair, Iberia, Japan Airlines, Malaysia Airlines, Qantas, Qatar Airways, Royal Air Maroc, Royal Jordanian, and SriLankan Airlines.

In a move towards modernizing its fleet, Fiji Airways has announced the addition of its latest acquisition, an Airbus A350-900XWB which has been affectionately named the Island of Beqa.

This new widebody aircraft marks the third A350 to grace the Fiji Airways fleet, propelling the national carrier to the forefront of long-range flight innovations.

Under the leadership of Managing Director and CEO, Mr. Andre Viljoen, Fiji Airways has steadfastly pursued a strategy of fleet evolution through the integration of ‘new generation’ aircraft like the Airbus A350.

A Game Changer in Modern Aviation

The Airbus A350 is not just an aircraft; it’s a game-changer in the world of modern aviation. With its superior cabin design, remarkable fuel efficiency, and impressive cargo capacity, the A350 has rapidly become the pride of Fiji Airways and the delight of its passengers.

“The Island of Beqa is brand new, having been put into storage immediately after manufacturing. We were able to negotiate a lucrative deal to acquire it,” said Mr Viljoen.

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At its core, the A350 embodies a blend of cutting-edge aerodynamics, state-of-the-art engines, and lightweight materials. This convergence results in a groundbreaking 25% improvement in fuel efficiency, carbon dioxide emissions, and operational costs when compared to previous aircraft generations.

Mr. Viljoen emphasizes that this innovation positions Fiji Airways to venture into new horizons, enhancing its global presence while contributing to the island nation’s economic growth.

Tourism and Connectivity

Fiji Airways stands as a vital pillar for the Oceania nation, handling 70% of all visitors to Fiji. This responsibility goes beyond being a mere connector between nations; it also encompasses nurturing the tourism industry.

Tourism is a major economic drawcard for the picturesque island nation – it constitutes 45% of Fiji’s Gross Domestic Product and serves as the nation’s largest employment provider.

The airline’s role extends to not only linking Fiji with the world but also fostering tourism growth by exploring uncharted destinations with high tourism potential.

A New Realm of Possibilities

The introduction of state-of-the-art long haul aircraft like the A350 XWB (Extra Wide Body) opens up a realm of possibilities for Fiji Airways. With enhanced capabilities, the A350 can traverse longer distances, allowing the airline to delve deeper into destinations such as the United States, Canada, and beyond.

As part of its forward-looking strategy, Fiji Airways envisions potential routes to cities like Dallas, Seattle, Beijing, Shanghai, Seoul, Noumea, Wallis, Rarotonga, Port Moresby, and additional destinations across Australia.

Elevating Source Markets and Beyond

The Island of Beqa, with its remarkable capacity, reinforces Fiji Airways’ dominance in crucial source markets such as Australia and New Zealand.

Additionally, it bolsters North American long-haul flights to San Francisco and Vancouver, while Hong Kong continues to serve as the airline’s gateway to China. With the Island of Beqa supplementing its fleet, Fiji Airways is poised to offer enhanced connectivity and unparalleled travel experiences to its passengers.

Fiji Airways is the national airline of Fiji. It is headquartered in Nadi, Fiji, and operates scheduled international services from its hubs in Nadi and Suva to 15 countries and 27 cities.

Nations served include Australia, New Zealand, Samoa, Tonga, Tuvalu, Kiribati, Vanuatu and Solomon Islands, Hong Kong, Japan, Singapore, Canada and the United States.

The carrier was founded in 1947 as Air Pacific. It was renamed Fiji Airways in 2013. Fiji Airways is a member of the Oneworld alliance.

This means that Fiji Airways passengers can earn and redeem frequent flyer miles on other Oneworld airlines, such as American Airlines, British Airways, and Qantas.

It has been recognized for its excellent service and has won several awards, notably including the Skytrax Award for Best Airline in the South Pacific.

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