Virgin CEO expects Bali to rebound after ash cloud clears

Virgin Australia chief executive John Borghetti says he expects travel to Bali will rebound once the disruption from the ash cloud from the Mount Rinjani volcano clears up.

Thousands of Australians have found themselves stranded in Bali in recent weeks, with both Virgin and Jetstar, as well as a number of other carriers, cancelling flights for safety reasons.

While the backlog of passengers is slowly being cleared with the improvement in flying conditions, the two Australian carriers are still monitoring conditions closely and have offered those booked to travel to Bali the option of changing their holiday destination without paying additional fees.

Borghetti said it was “normal human practice” for people to hold back on booking flights while the ash cloud situation was ongoing. However, the Virgin chief executive noted the Bali market had not suffered any long-term effects in response to the July ash cloud from Mount Raung that disrupted flights.

“It was almost like as soon as it stopped the world got back to normal and I don’t see any difference here,” Borghetti told reporters after Wednesday’s annual general meeting in Brisbane.

“I do believe Bali will bounce back very quickly. It has in the past and it will again.”

Mount Rinjani has not deterred Virgin’s plan for its wholly-owned low-cost unit Tigerair Australia to begin international flights from March 2016.

Tigerair is scheduled to take over Virgin’s Perth-Bali, Adelaide-Bali and Melbourne-Bali routes with Boeing 737-800s and Borghetti said bookings on the those routes were very strong.

“We are quite excited. The forward sales for Tiger are looking very good. In fact they are looking ahead of our expectations,” Borghetti said.

While Borghetti did concede the Bali disruptions was costing the airline money, the Virgin chief executive declined to put a dollar figure on the financial impact given the situation was ongoing.

Jetstar said on Wednesday it planned to operate a “modified schedule” on Thursday, with only daytime services planned.

“Due to the unpredictability of the Mount Rinjani volcano and the ash cloud’s movement, our senior pilots are not satisfied it is safe to re-introduce night time operations at this stage,” Jetstar said on its website.

“We are looking to re-introduce night time services from Friday, subject to further assessment from our senior pilots and operational experts on Thursday.”

Virgin said it planned to operate a full schedule from Bali to Australia on Wednesday, while Thursday’s scheduled services both to and from the popular Indonesian tourist destination were expected to go ahead at this stage.

While Virgin had cancelled scheduled flights from Australia to Bali, preferring instead to ferry empty aircraft to Bali and bring stranded travellers home, Thursday’s scheduled services will carry outbound Australian passengers.

“We would like to thank all of our guests for their patience,” Virgin said.

“We continue to monitor the situation closely and we will keep you updated if new information becomes available.”