Virgin Australia CEO Paul Scurrah to step down after Bain takeover

  • Virgin Australia CEO Paul Scurrah to step down after Bain takeover

Virgin Australia CEO Paul Scurrah to step down after Bain takeover

Chief executive and managing director Paul Scurrah, who has held the position for 18 months, will be replaced by the former Jetstar chief once USA private equity firm Bain Capital takes over the carrier, the airline announced in a statement.

Bain still plans to keep Virgin's lounges and business-class offering in contrast to reports that it would become a budget carrier, though not as premium a level as that desired by Scurrah, one of the people said.

The move is expected to come in early November.

Scurrah is believed to have had concerns over the future direction of the carrier.

In a statement issued to the ASX on Thursday, Virgin Australia's administrators finally revealed that Paul Scurrah was indeed resigning from the airline he piloted for just 18 months, and would be replaced by the former boss of Jetstar.

Virgin Australia Group has been struggling under billions of dollars worth of debt and the impact of the pandemic on the passenger jet market, which has led to the near-collapse of worldwide travel and a huge slump in domestic markets.

Before the pandemic, Virgin had spent a decade transforming itself from a low-priced carrier to a full-service rival to Qantas.

Administrator Vaughan Strawbridge of Deloitte said he had reaffirmed with Bain that Australia's No.2 airline would not be repositioned as a low-priced carrier once Hrdlicka took over.

Hrdlicka had a tense relationship with unions in her previous roles at Jetstar and Qantas Airways Ltd.

"This will appeal to the full spectrum of travellers, from premium corporate through to more budget-focused customers", he said.

He said it has been a "great privilege" to have run the airline for the past 18 months, even through "the most hard time in aviation history".

Virgin was originally launched as a budget airline, but had spent years transforming itself into a full-service carrier. After a decade of financial losses, Mr Scurrah had worked to cut costs and transition the airline before it was smashed by the COVID-19 pandemic in March.

In addition to global border closures, a patchwork of state border restrictions during the pandemic has made things hard for Australia's airlines. If the plan and scope of the airline as outlined in August by Bain Capital has already been scrapped then this is a serious betrayal that must be addressed, ' he said.

He opposed further job cuts at Virgin and feared a shift to the low-priced market would give Qantas a monopoly of the corporate sector.

It was mostly a domestic carrier, but also flew to New Zealand, Bali, Fiji, Tokyo and Los Angeles.