Bonza doomed to failure from the start, just like so many Australian airlines before it

by Admin
April 30, 2024

Former Qantas boss Geoff Dixon used to regale clients and investors with a standing joke every time another domestic airline went under.

The Australian market, he reckoned, was only big enough for one and a half airlines.

The one, obviously, was Qantas. And the half was whichever foolhardy group attempted to take on the goliath of the Australian skies with its not so discreet backing from the Australian government.

He had a point.

A quick look through Wikipedia reveals almost 300 defunct Australian airlines since we took to the skies last century.

Many were tiny regional operators, a few were amalgamated into bigger regional operators such as Rex — which has hung in there with thrifty management from its Singaporean owners — and a handful had grander ambitions that blew up in spectacular style.

Bonza, the latest upstart to come a cropper in one of the world’s most cutthroat aviation markets, never really stood a chance.

It hit turbulence early on, even in the ideas stage as the pandemic wreaked havoc with airlines globally and international travel ground to a halt.

Officially launched by former Virgin Blue executive Tim Jordan early last year, the new operation quickly became known as Bogan Air, and played up to the image with planes bearing monikers like Bazza and Shazza.

Bonza CEO Tim Jordan was previously an executive with Virgin Blue.(Supplied: Bonza)

Behind the scenes, even before it got off the ground, Bonza struggled to work its way through the regulatory maze, battled Qantas and Virgin for slots at airports and found it difficult to hire experienced staff.

Then there were the usual operational problems inherent with starting any new business. Luggage delays, flight cancellations and communication issues.

But perhaps its biggest obstacle was self-imposed. In a bid to differentiate itself from its bigger rivals, it forged a plan to service mostly regional centres that the others didn’t frequently service.

And, unlike Rex’s reliance on relatively low cost turboprops to service its regional routes, Bonza chose to do so using expensive, larger capacity jet airliners.

Mildura, Mackay, Port Macquarie direct from major centres like Melbourne sounded like a great idea. Clearly, it didn’t work in practice.

A mere 15 months since launch, reports began circulating that the operation wasn’t paying its way and that its American parent had delivered ownership of the airline’s 737 Max aircraft to its creditors.

Today, passengers arrived at airports across its network to discover all flights had been cancelled.

Bazza and Shazza join a not so exclusive party

Bonza’s short life in Australian skies isn’t unusual.

Three decades ago, Compass Airlines launched with all the hoopla you’d expect from a group attempting to become the third wheel in Australian aviation. It lasted a year.

The following year, it was relaunched. It failed soon after.

An Ansett jet takes off from Melbourne’s Tullamarine airport in September, 2001, shortly before the airline’s final collapse.(AAP: Julian Smith, file photo)

But then, in 2002, the seemingly unthinkable happened. Ansett Airlines, the second wheel in the Australian aviation industry collapsed. Founded by Reg Ansett, it had been around since 1936.

Ansett’s demise cemented Qantas’s position as the dominant player and two years later it took out another rival, Impulse, in a deal that embroiled one of the country’s best known stockbrokers, Rene Rivkin, in an insider trading case.

That left the field open for the launch of Virgin Blue. But even it struggled to survive. Years of heavy losses were borne by a well heeled group of foreign airline shareholders who needed a domestic carrier through which to funnel their foreign visitors.

The irony behind the sad history of Australian aviation is that the Sydney-Melbourne route is one of the most lucrative in the world and provides both Qantas and Virgin with more revenue than any other.

The COVID pandemic was the final straw for Virgin Australia, which fell into administration in April 2020, but has since been resurrected by American private equity group Bain. It now reportedly turns a profit but its return to the bourse has been delayed.

Along the way there were other collapses, such as Tiger Air — once funded by Singapore Airlines — and Strategic Air.

The writing may have been on the wall for Bogan Air from day one. But that probably won’t douse the ambition of some other budding entrepreneur donning the aviator glasses within a year or two.

If only you could make half an airline work.