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The big changes in Virgin Australia’s domestic fare restructure

From 07-Sep-2016 Virgin Australia introduced a revised fare structure called ‘Fares For You’, to offer more choice during the booking process. But with this came the removal of a true fully flexible fare class, replaced by a more restrictive Freedom fare, and the erosion in benefits and status earned for the new Getaway fare class (previously encompassed by the Saver type).

The below is an update provided to CAPA by 4th Dimension Business Travel Consulting.

Fare map comparing previous and current fare types

Booking Class Old Fare Type New Fare Type
J Business Business
C Business Business
D Business Business
I Business Sale Business Saver
Y Fully Flexible Freedom
B Fully Flexible Freedom
H Flexi Freedom
K Flexi Freedom
L Flexi Freedom
E Saver Elevate 
N Saver Elevate
V Saver Elevate
Q Saver Elevate
T Saver Getaway

The changes also mean that passengers booking strategic sale buckets, or the least flexible fare classes, will have significantly more difficulty obtaining status. Similarly to the conditions of frequent flyer programmes elsewhere in the world, the adjustment to Virgin's Velocity scheme are designed towards better rewards for passengers travelling in higher-value fare classes.

Whereas on both Flexi and Fully Flexible fares changes after a no-show (if not checked in) were previously permitted up to 24hrs after scheduled departure time, this benefit is no longer available under the Freedom class. A no-show now results in 100% loss of fare, though Virgin continues to permit flight changes prior to departure with a difference in fare; and if the change is made less than 30 days out from departure there is an additional fee.

Refund without fee – which was a previous benefit of Fully Flexible fares – has also been removed from the Freedom class. Instead, Freedom has inherited the Flexi rule of full refund plus an $80 refund fee. Saver fares in the Q, V, N, E buckets – now known as Elevate – are slightly more flexible than their precursors, now allowing changes on the day of travel, but they may not be held in credit on the day of travel.

The change fee has also been lowered from $80 to $50, while changes less than 30 days out are free.

After initial confusion surrounding the continuing availability of Fly Ahead without fee, Virgin Australia clarified that the benefit remains available to all Gold and Platinum members across all fare classes – with the exception of Getaway fares.

Virgin Australia published fares between Sydney and Melbourne (Mar-2016 vs Sep-2016, pre/post-fare change)

Mar-2016 Sep-2016 Difference
Booking Class Fare Name Pub. Fare* Booking Class Fare Name Pub. Fare* Difference ($) Difference (%)
J Business $1,089.00 J Business $1,139.00 $50.00 4.59%
C Business $879.00 C Business $899 $20.00 2.28%
D Business $750.00 D Business $750 $0.00 0.00%
Y Fully Flexible $704.00 I Business Saver $709 $0.00 0.00%
B Fully Flexible $725.00 Y Freedom $699 -$5.00 -0.71%
H Flexi $635.00 B Freedom $649 -$76.00 -10.48%
K Flexi $429.00 H Freedom $499 -$136.00 -21.42%
L Flexi $395.00 K Freedom $439 $10.00 2.33%
E Saver $329.00 L Freedom $399 $4.00 1.01%
N  Saver  $289.00 Elevate $335 $6.01 1.83% 
V  Saver  $245.00 Elevate $289 $0.00  0.00% 
Q  Saver  $195.00 Elevate $245 $0.00  0.00% 
T  Saver  $155.00 Elevate $195 $0.00  0.00% 
      Getaway $-6.00   -3.87%  

The revised published fare table provides significantly more flexibility in ‘steps’ between fare classes, and while the largest ‘gap’ is at $240 between J and C, steps between lower fare classes have narrowed, providing additional pricing flexibility.

In this example B and H classes have undergone the largest movements, at 10.5% and 21.4% respectively, as B has moved out of the Fully Flexible bracket, while H has been realigned to provide a more gradual step against K. The lead-in non-tactical T class fare has been reduced by 4%, while small movements of between 1% and 5% were noted elsewhere.

Accompanying the fare changes came an adjustment to status credit and points earned for members of the Velocity Frequent Flyer programme, with the Getaway fare offering as few as five status credits on short haul domestic routes such as Sydney to Melbourne. The Saver fare currently offers 10 status credits, as does the Qantas fare in its comparable fare class.

As a back of the envelope calculation, this means travelling in the cheapest fare bracket makes achieving and retaining Velocity status more difficult than it would using the Qantas equivalent. The threshold for Gold is 400 status credits on Virgin Australia, against 700 on Qantas, meaning that if one flew only Sydney-Melbourne in the cheapest fare class (Getaway vs Sale), 80 flights would be required to reach Gold on Virgin vs. 70 on Qantas. This would equal an average expenditure of $11,920 on Virgin Australia or $11,340 on Qantas – based on current published fare tables.

When travel is in higher fare classes – for example in Y class – Virgin status is better value however: at 16 flights against 35, or an average expenditure of $11,184 on Virgin or $26,215 on Qantas to achieve Gold.

Finding value where it matters for travellers and their organisations remains essential in travel purchasing; for some, Virgin’s adjustments will make obtaining status considerably easier. For others, the adjustments may remove much-needed flexibility.

Virgin Australia domestic frequent flyer status credit earning table (effective 30 January 2017)

Cabin Economy Business
Fare Name Getaway Elevate Freedom Business Saver Business
Booking Class M,S,T Q,V,N,E L,K,H,B,Y I D,C,J
Zone Miles  
1 0-750 5 15 25 50 55
2 751-1,500 10 20 30 60 70
3 1,501+ 15 30 45 90 105

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