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When Victoria's second COVID-19 outbreak began on June 17, with health authorities revealing more than 20 new cases in a day for the first time since early May, it struck John MacCleod with an acute sense of déjà vu
"It's almost like the start of COVID," the Virgin Australia executive tells AFR Weekend.
Virgin and Qantas – buoyed by what were declining active case numbers across most of the country – had cautiously begun restarting flights to take advantage of several states reopening their borders ahead of school holidays in July. But what little demand there had been for flights out of Melbourne dried up almost overnight.
Since then the situation has spiralled, with 370 new cases recorded on Thursday and a record 428 new cases on Friday. Other states have baulked at fully opening up their borders, stunned and afraid by the size of Victoria's second wave.
As a result, one of the most profitable air travel corridors has all but shut down.
The news could not be worse for the airlines as they try to capitalise on the limited markets they still have access to in the coronavirus era. With the destruction of international demand, domestic flying remains the next best source of business. But returning mothballed operations to the sky is incredibly complicated, even without navigating virus outbreaks.
Qantas chief executive Alan Joyce predicted there would be no substantial return to international flying until July next year at the earliest, due to strict border control measures to stop the virus. As of writing, it has infected 13.7 million people and killed more than 586,000 worldwide, according to Johns Hopkins University.
The airline's domestic boss, Andrew David, whose division accounted for more than half of Qantas' overall earnings last financial year, will now be responsible for propping up the company even further while the crisis plays out.
This article first appeared on www.afr.com
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