Virgin founder Sir Richard Branson is demanding government support for his ailing businesses. Photo / AP
Virgin founder Sir Richard Branson is demanding government support for his ailing businesses. Photo / AP
British billionaire and Virgin founder Sir Richard Branson has written a lengthy open letter demanding government support for his ailing businesses while warning Australia's skies could look very different if Qantas was the only airliner in charge.
The letter, which was published just hours after reports Virgin Australia will go into voluntary administration after failing to find a way to keep the company afloat during the coronavirus pandemic, was addressed to the Virgin "family".
There are more than 70,000 people in 35 countries working in Virgin companies, says Branson. In Australia, Virgin employs about 10,000 people directly and supports another 6000 jobs indirectly.
An open letter to our Virgin family. For 50 years I have been humbled by the incredible pride our people take in working for Virgin. Here are the facts about Virgin businesses: https://t.co/Nv1RLBhp3jpic.twitter.com/BneE0mZ0Zg
"It is the people across all our businesses, and the hundreds of thousands of people who have worked with us over the years, that make this company so special."
Virgin Australia is 90 per cent foreign-owned, with Singapore Airlines, Etihad Airways and Chinese conglomerates HNA Group and Hanshan owning 80 per cent between them, while Richard Branson's Virgin Group still owns 10 per cent.
It's understood Virgin Australia's board held crisis meetings Monday afternoon in a bid to save the beleaguered airline.
An official announcement over the airline's future is expected today following the NSW and Queensland governments' failure to come up with enough cash to bail out the grounded airline.
"Over the five decades I have been in business, this is the most challenging time we have ever faced," Branson said in his missive to staff.
"It is hard to find the words to convey what a devastating impact this pandemic continues to have on so many communities, businesses and people around the world.
"From a business perspective, the damage to many is unprecedented and the length of the disruption remains worryingly unknown."
In Australia, the company is struggling to overcome $5 billion in debt from the Covid-19 pandemic. Sources have told media outlets the company was unable to secure further assistance from the federal government, despite repeated efforts.
Branson said he was "working day and night to look after our people and protect as many jobs as possible", despite working in one of the "hardest hit sectors, including aviation, leisure, hotels and cruises".
"We're doing all we can to keep those businesses afloat and I am so thankful to all of you who have continued to work so hard in these difficult times," he said, announcing Virgin had already committed a quarter of a million dollars to protect businesses and jobs.
"We will continue to invest all we can.
"The reality of this unprecedented crisis is that many airlines around the world need government support and many have already received it. Without it there won't be any competition left and hundreds of thousands more jobs will be lost, along with critical connectivity and huge economic value."
Branson made the case that Virgin provided "real competition" in the aviation market and without them, customers could suffer due to monopoly of the skies.
"Virgin Atlantic started with one plane 36 years ago. Over those years it has created real competition for British Airways, which must remain fierce for the benefit of our wonderful customers and the public at large," he said.
"The same is true in Australia, where the brilliant Virgin Australia team is fighting to survive and need support to get through this catastrophic global crisis.
"We are hopeful that Virgin Australia can emerge stronger than ever, as a more sustainable, financially viable airline.
"If Virgin Australia disappears, Qantas would effectively have a monopoly of the Australian skies. We all know what that would lead to."
Prime Minister Scott Morrison earlier said the government would not budge on independent financial support for the airline, and that any assistance will be provided on a sector-wide basis.
On Monday, Virgin staff also begged the government to step in.
"We cannot collapse, we beg you to help Virgin," one staff member at a media conference at Melbourne Airport said.
Another emotional employee, Tony Smith, said, "Virgin is my home away from home. They are my brother, my sister, my mum and dads, my grandfather."
Branson, worth an estimated AU$6.91 billion before the coronavirus pandemic, also defended his decision to live on Necker Island, a luxury retreat in the British Virgin Islands where he regularly entertains celebrities.
"As with other Virgin assets, our team will raise as much money against the island as possible to save as many jobs as possible around the Group," he said.
Branson touched on issues surrounding rumours over wage reductions for Virgin Atlantic staff, thanked teams delivering medical cargo flights in the UK and "brave frontline employees" working for Virgin Care, under the UK's National Health Service (NHS).
But he ended by saying "it really breaks my heart to see the impact this pandemic is having across people's lives and businesses around the world".
"When this crisis passes, as it eventually will, the world will be very different to the one we are used to. I know we will come out stronger and kinder to each other as a result."
The Transport Workers' Union tonight urged the federal government to save thousands of jobs and work with administrators.
"This is a terrifying moment for thousands of Virgin workers," TWU National Secretary Michael Kaine told news.com.au.
"The airline has two decades of providing decent jobs, a safe working environment and excellent service for the travelling public.
"It is a viable and much needed business and without it Australia will struggle to get its economy back on track once the crisis abates."
THE FINAL LIFELINE?
The airline could have been thrown a lifeline by the NSW Government if it gave up its Brisbane headquarters and moved to western Sydney.
NSW Treasurer Dominic Perrottet revealed on Sunday that the State Government and the airline had conducted "significant discussions" around financial assistance to keep Virgin in the sky.
Speaking to Sky News' Sharri Markson, Perrottet said a move to western Sydney from headquarters in Brisbane was part of the discussion, and that the government had a "strong interest" in keeping the industry competitive.
But Queensland State Development Minister Cameron Dick hit back at the comments on Monday, telling the NSW Government to "back off" and that he would "fight any attempt by New South Wales to steal Virgin Australia from Queensland to Sydney".
Virgin and Qantas have so far received assistance in the form of a $165 million injection from the government to support them running domestic services for the next eight weeks.
On Sunday, the Queensland government put $200 million on the table to assist the airline, but said other states would need to chip in to save the company.
Australian airlines around the world have copped a battering during the coronavirus crisis, with Virgin already suspending all but one domestic route. The airline has also stood down 8000 workers and had its credit rating downgraded. Qantas has stood down 20,000 employees.
Currently, Virgin Australia has just one plane in the air each day, leaving 129 grounded.
