Virgin Australia seeking federal government rescue package

Virgin Australia has confirmed it is seeking financial help. Picture: Dion Georgopoulos
Virgin Australia has confirmed it is seeking financial help. Picture: Dion Georgopoulos

More than 200 pilots will lose their jobs on Friday as a result of the fallout from the coronavirus pandemic, the aviation union says.

The Australian Federation of Air Pilots says all TigerAir pilots will be made redundant by the end of the week.

TigerAir's parent company, Virgin Australia, is seeking financial support from the federal government to survive.

The carrier, the second biggest after Qantas, wants a rescue package of up to $1.4 billion.

Virgin Australia told the share market it is seeking the funds from what it anticipates would be support for the wider industry.

It could involve the government becoming a part-owner.

Virgin Australia reportedly considered making TigerAir pilots redundant by the end of April, but it appears to have been brought forward.

"As recently as last Tuesday, TigerAir pilots were in discussions with the company about a stand-down arrangement similar to their counterparts at other ai rlines," AFAP senior industrial officer James Lauchland said.

Virgin Australia has been approached for comment.

Qantas has told the government it expects a $4.2 billion loan if Virgin Australia is bailed out, according to the Sydney Morning Herald newspaper.

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Treasurer Josh Frydenberg declined to comment on any specifics, saying: "We support strongly the aviation industry.

"I've been in close contact with leaders of the business community including the aviation sector's (Virgin boss) Paul Scurrah and (Qantas chief) Alan Joyce," he told ABC radio.

"But we have already illustrated our commitment to having a viable, sustainable aviation sector, with more than $700 million in fees being waived."

Mr Frydenberg said the transport of freight and people was important to the economy.

"We'll continue that dialogue with key stakeholders," he said.

The airline recently cut its workforce by 80 per cent and its capacity by 90 per cent.

Global credit rating agency Fitch on Monday put Virgin Australia on rating watch negative, citing a drop in demand in the aviation market from the coronavirus.

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This story Virgin Australia seeks govt rescue package first appeared on The Canberra Times.