by Bonza’s future is in limbo as the fledgling budget airline enters voluntary administration – a well-trodden path in Australian aviation.
While Tuesday’s developments could be a blow to competition in an industry dominated by a duopoly, the sudden cancellation of services and seizure of planes will stir memories of the long history of fallen Australian carriers.
Related: Bonza enters voluntary administration after suddenly canceling all flights across Australia
Bonza carried more than 750,000 passengers across Australia in the 15 months between launch and sudden landing this week. In a highly competitive industry dominated by the Qantas and Virgin group, the decision was a shock for the airline.
In 2021 Bonza announced its plan to run low-cost, low-frequency flights between regional and holiday destinations not currently served by existing carriers, but had to wait until January 2023 to get regulatory approval and begin operations.
Its executives nurtured a brand it called the “bogan” airline, making headlines by offering budgie smugglers in its in-flight shop and eschewing traditional travel outlets to sell tickets only through its smartphone app.
The airline has been struggling with aircraft shortages and has been forced to cancel a number of routes over the past year, and as a result, has only garnered a 2% market share, according to the firm’s latest domestic aviation report watch the competition this year.
Bonza managed to grow from its Sunshine Coast base to operate out of larger airports such as Melbourne’s Marine Hill and the Gold Coast, eventually serving 35 routes, but was unable to gain access to the lucrative Sydney airport.
Breaking into the Australian aviation industry has always been tough. Government policy allowed only two airlines to serve routes between state capitals, and the laws that maintained the Qantas and Ansett duopoly were effectively repealed in 1990.
Tony Webber, CEO of aviation industry analyst firm Airline Intelligence & Research and former chief economist at Qantas, said that while Bonza’s business model was different and it was not looking to compete directly with the major airlines, it could be in an uphill battle to gain a foothold. in the Australian aviation market.
Furthermore, without access to Sydney airport, Bonza was unable to access a large portion of its potential market. Access to Sydney slots in particular remains a barrier to entry, with the government in February suggesting a crackdown on the current system and allegations of slot hoarding to stifle competition.
“The current carriers can be very competitive, especially Qantas which is hyper-competitive,” Webber said. “They understand that they have to get on the front foot with the competitor to preserve profitability.”
Webber noted that Qantas had about 65% market share; together with Virgin, both operate around 90% of the market.
“You have to be very different from the incumbents if you’re going to be successful. Just because an overseas market with a similar population can successfully run four or five carriers does not mean [that] will succeed here,” Webber said.
With Bonza’s future now up for grabs through the administration process, the carrier looks set to join a long list of airlines that have tried to shake off Qantas’ dominance and Australia’s aviation duopoly history.
Tiger Australia, 2007-2020
The latest major Australian airline to disappear from airport departure screens, Tigerair is positioned as a low-cost carrier. The past 13 years in Australia’s skies have seen domestic air fares between major cities drop to historic lows as the airline competes fiercely with Qantas-owned budget operator Jetstar.
Originally by its Singaporean parent company, the airline was acquired by Virgin Australia over several years, becoming fully owned by 2014.
All Tigerair flights were grounded due to the Covid pandemic, and the brand was phased out during the voluntary administration that saw Virgin Australia emerge as Australia’s second leaner, much smaller airline.
Air Australia, 2011-2012
Growing out of its earlier cargo-only operations and rebranding to Air Australia in August 2011, the low-cost carrier operated domestic and international flights with its fleet of four jets – an Airbus A330 and three A320 – from its base in Brisbane to cities with including Melbourne, Honolulu and Bali.
By February 2012, however, the airline’s owners placed Air Australia into voluntary administration. A fuel supplier refused to refuel its aircraft in Phuket because of unpaid payments and administration later discovered the airline owed up to $90m to creditors.
Around 4,000 passengers were stranded internationally and it went into voluntary administration in Australia. A month later, Air Australia went into liquidation.
Ozjet, 2005-2006
The airline launched with one business class seat in November 2005 with several daily services between Sydney and Melbourne. Although it had big expansion plans, the airline struggled to attract the domestic business market.
By March 2006, the airline announced that it would cease all scheduled services. It later pioneered charter flights and took over regular services between mainland Australia and Norfolk Island, but eventually abandoned its business-only scheduled service concept.
Related: ‘Keeping Ansett alive’: an airline reborn in hipster clothes and basketball
BackpackersXpress, 2003-2005
Although the story of BackpackersXress is eerily similar to Bonza’s “soft” branding and marketing push, this low-cost airline never took to the skies.
Announced in 2003, the idea for BackpackersXpress was an airline focused on cheap flights between Europe, Asia and Australia to ferry backpackers between continents. The airline had a deal to paint large VB logos on its engines, with advertising for the airline’s official brewer to fund its low-cost model, and Neighbors actor Ryan Moloney – best known as series lead ‘Toadie’ – signed up ” – as public. face.
The Australian-headquartered carrier had hoped to raise $80m, but lost its funding after applications for flight services to the UK were rejected on the basis that it had not proved it could actually operate the flights. The company folded by April 2005.
So, the pubs-in-the-sky feature of his Boeing 747 fitting failed to deliver.
Impulse, 2000-2001
Although Impulse had been a regional operator of smaller aircraft since 1992, its expansion into a major low-cost airline operating larger jet aircraft in 2000 was a major development for the aviation industry.
Together with the new-to-market Virgin Blue – the original name of Virgin Australia – it meant competition for the duopoly that became Qantas and Ansett. It even had a bright blue Boeing 717 with a cartoon cockatoo on its tail.
However, facing a bleak financial outlook after the funding was withdrawn, Impulse agreed a wet lease – where an airline provides its planes and crew – all of its services to Qantas, which later bought out and which absorbed the airline into QantasLink.
Ansett, 1936-2002
Ansett and the number of failed start-ups is a very different story, and Ansett was a mainstay of the Australian skyline in the 20th century, operating regionally, across the country and internationally.
But competition from Qantas and other budget enterprises, as well as expensive maintenance and wage bills, has left the airline bleeding cash and dealing to buy or rescue Virgin Australia.
The airline went into voluntary administration on 12 September 2001, and although its planes flew again after efforts to keep it in the air, Ansett ceased all flights in March 2002, leaving its position in the duopoly to Virgin Australia .
Compass, 1990-1991, 1992-1993
Australia’s first budget airline following deregulation of the country’s aviation industry laws, Compass launched flights between Melbourne, Sydney, Brisbane and Perth, and later Adelaide.
However, the airline collapsed in December 1991, twelve months after launch, due to intense competition and discounting from rivals and its failure to make money by carrying cargo in the belly of its planes.
The airline was revived in August 1992 when different owners chose to use the brand. However, ongoing price wars also hit Compass Mark II, and after reporting a half-year loss of $10.95m in the first six months it collapsed in March 1993. Its chairman was later convicted of false accounting related to the airline’s collapse.
