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Fight’s on – Virgin Australia calls in the lawyers

written by WOFA | November 20, 2013

photo - Rob Finlayson
photo – Rob Finlayson

The war of words between Virgin Australia and Qantas over the former’s $350 rights issue has taken a new turn with Virgin Australia chairman Neil Chatfield revealing today that his company is considering legal action against Qantas.

“While I am not going to waste any more of our shareholders’ time today by giving their [Qantas’s] false accusations further air time, let me assure you that we have instructed legal advisors to act for us in dealing with this matter,” Chatfield said in his chairman’s address to Virgin Australia’s annual general meeting in Brisbane today.

In a subsequent media telephone briefing, Virgin Australia chief executive John Borghetti declined to elaborate on the details of any defamation proceedings against Qantas, but he earlier rejected Qantas claims that Virgin was being run deliberately at a loss to competitively disadvantage Qantas as “absurd”.

Borghetti told the AGM: “To say that Virgin Australia is driven by a strategy of uncompetitively low prices and irrational behaviour is offensive and absurd. The airline is run rationally with good management and a view to creating a long-term sustainable and profitable business. It is our superior cost position that enables us to bring lower fares to the market.”

He continued, “When you bring competition to a monopoly, prices do go down, if this is affecting our competitor’s bottom line, I am not going to apologise.”

Air New Zealand, Etihad Airways and Singapore Airlines, as well as Sir Richard Branson’s Virgin Group have all participated in Virgin Australia’s rights issue, which, thanks to the non-participation of some smaller investors has seen Virgin Australia’s level of foreign ownership rise to just under 80 per cent.

“These people are here to make money, they’re not here to give it away,” Borghetti said of his three keystone airline investors’ participation in the rights issue.


Yesterday Qantas launched an online petition calling on the federal government to block the effective increase in foreign ownership in Virgin following the rights raising. Qantas is also arguing that the restrictions of the Qantas Sale Act should be eased.


  • R jensen


    I must say it is like 2 kids fighting in a school yard. AJ u should shut up and deal with your own problems at Qantas insteed of whining about what Virgin is doing. in a fight i bet JB to win

  • Kim


    In AFL speak – Qantas is accusing Virgin Australia of “tanking”. Not very nice.

  • Dee


    I’ll bet Emirates would love to see QF being able to bring in over 50% foreign ownership, but don’t think the Government or Unions would allow it.
    Would also like to know how J.B. would have run QF if he had received the nod when Dixon left? Could make an interesting article for next AA Issue.

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