According to a report by The Australian Financial Review, Bonza co-founder and chief operating officer Peter McNally has left the start-up airline just five months after being appointed to the position, with McNally’s departure regarded as possibly putting the airline’s planned mid-year launch in serious jeopardy.
McNally formerly a senior operational manager for Virgin Blue, former Swissport vice-president of airports and commercial, previously COO of Airnorth in Darwin, chief advisor for operations for Indian LCC IndiGo, and, vice-president for network operations at Qatar Airways, was formally appointed as Bonza’s COO in October and founded the budget start-up carrier alongside ex-colleagues Tim Jordan and Rick Howell, with his exit considered by analysts to not only unsettle the market but also potentially Bonza’s backers US private investment firm 777 Partners.
Bonza recently announced the details of its initial network offering of 25 routes to 16 destinations, including Cairns, Mildura, Newcastle and Whitsunday Coast, choosing Sunshine Coast Airport as its home base, with two planes and the company’s headquarters located there and two of Bonza’s Boeing 737 MAX planes will operate at Melbourne Airport, making it the airline’s second airport base.
Eighty per cent of the new routes announced are not currently served by any airlines, making them a first for low-cost carriers.
A Bonza spokesperson confirmed to the Financial Review that McNally had “parted ways” with the upcoming airline, saying, “He leaves behind a very capable team who have been, and will continue to be, leading our regulatory application process”.
The circumstances of his exit currently remain unknown, with the spokesperson also reportedly downplaying speculation that McNally’s exit from the company will likely result in a delay to Bonza’s ability to secure its Air Operators Certificate from the Australian aviation safety regulator.
Bonza CEO Tim Jordan told Australian Aviation last month that his airline is on track to secure its AOC from the Civil Aviation Safety Authority (CASA) and launch its first domestic flights in mid-2022, with Bonza claiming to embrace a “point to point” model for leisure travellers, servicing routes ignored by incumbent rivals at low frequency, in a business model similar to other low-cost carriers across the US and Europe.
Virgin Australia CEO Jayne Hrdlicka told The Australian she had concerns about upcoming start-up carrier Bonza’s business strategy, arguing that the low-cost, low-frequency leisure travel model that functions overseas may not translate into Australia, saying, “If you’re connecting two cities that have never seen a connection before if you’re flying it twice a week, it’s very hard to build an underlying presence in that marketplace,” and, “The way that’s done in Europe and in the US and Canada, it’s a huge market with millions and millions of people and you can approach that with group tours and things like that which don’t really exist in the same way in Australia,” Hrdlicka called Bonza’s strategy an “interesting idea” and “a different approach”, adding, “We’ll just see how it plays out”.
In November, Rex Airlines deputy chairman John Sharp questioned which routes Bonza could introduce that would both be presently unserved by Qantas, Rex or Virgin, and have adequate demand to sustain a new market entrant, saying, “That’s a mystery to us … what are those markets”, adding, If they are worth servicing, Qantas, Virgin or Rex would be in there doing it.”
Qantas CEO Alan Joyce warned that the airline will “defend our turf” against new entrant Bonza, and similarly cast doubt on whether there are any remaining domestic or regional leisure routes that remain untouched by Qantas, adding, “We’ve started nearly 50 new domestic routes [since 2020]”, and “So, I would have thought we have most of them covered, but maybe we don’t”, and
“So that’s great if they find a unique value proposition that they can make money on”, and “Fantastic, fill your boots upon it, and shame on us if we’ve missed it.”
Despite these criticisms Australian Aviation says, Bonza CEO Tim Jordan has remained confident that Bonza will deliver on its promise to connect direct regional and leisure destinations for far cheaper than its competitors, saying. “The rest of the world gives us that confidence,” adding, “We’re not trying to do anything particularly smart and clever, or unique. We’re actually just trying to replicate [a model that] has already been successfully executed elsewhere in the world”, and “So that gives us that confidence.”
We shall just have to wait and see!
Written by: John Alwyn-Jones
