COVID-19: Virgin Australia to survive, but in what form - and name?

Virgin Australia's decision to enter voluntary administration has thrown the future of the carrier up in the air. However, this process should eventually yield a more viable roadmap for a major player in the Australian market.

The intention of Virgin and the administrator is to relaunch with as much of the airline intact as possible, but the ultimate shape of the carrier will also depend on its new ownership.

Virgin was driven to its knees by the COVID-19 pandemic, which has destroyed demand. This occurred at a bad time for Virgin, as its new CEO was embedding strategic changes aimed at improving its financial performance.

Now it has been forced to put its plans at the mercy of an administrator, creditors and potential new owners. Virgin's management has proposed its existing business plan as the best way forward, but there is no guarantee that this approach will be accepted.

Of course, many other airlines around the world are also facing the need to restructure for a post-COVID demand environment, and are scrambling to refinance. The difference with Virgin is that much of the control over the transformation process has been taken out of its hands - although the Australian government has inserted a prominent banker to act as a sort of guardian of the national interest.