Fears Virgin Australia could survive coronavirus but be put out of business by Qantas

Competition experts have warned that the biggest risk for a recapitalised Virgin Australia will be its competitor, Qantas, which could potentially flood the domestic market with capacity in the face of much diminished demand for air travel in the foreseeable future. Creditors will meet next Thursday, when the accounting firm Deloitte’s appointment as administrators could face challenge from bondholders owed A$1.8b who fear they will receive a minimal return. Recovery will depend not just on the Australian govt’s timetable to relax restrictions on travel but also on how the rest of the world tackles the pandemic. International travel could be stalled for two years or more. This raises questions about whether either Virgin Mark 2 or Qantas could withstand a prolonged downturn in the industry without govt support. <br/>