[Greg Hyde]

Virgin Australia slashes Tigerair fleet as coronavirus bites

Virgin Australia will drastically shrink its budget arm Tigerair's fleet and is preparing steep capacity cuts across its entire network as the coronavirus outbreak stunts efforts to lift out of its financial woes.

Australia’s number two airline on Wednesday reported a statutory net loss of $97 million for the six months to December 31, a swing from a $55 million profit in the same half a year earlier.

Virgin said it would cut seven A320 aircraft from Tigerair by October which, with the transfer of two 737 from its Virgin operations, will reduce the budget carrier's fleet from 13 to eight aircraft. That means Tigerair's fleet will have more than halved over two years.

Virgin chief executive Paul Scurrah said the coronavirus outbreak was having a "significant effect" on the travel industry, and would cost the airline up to $75 million in the second half from lower domestic and international demand.

“We are responding to this with immediate steps to minimise impact to the group’s financial position," Mr Scurrah said.

The airline earlier this month dropped Hong Kong from its international network, with the coronavirus the final straw for the loss-making route.

Virgin on Wednesday said its capacity will fall by 3 per cent in the second half of the year and by up to 5 per cent next year.

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https://www.smh.com.au/business/comp...26-p544eh.html