The long-standing partnership between Etihad Airways and Virgin Australia, which has been in place since 2010, will come to an end on June 1, 2025. This significant development marks a strategic shift for both airlines as they realign their business goals and partnerships in the increasingly competitive aviation landscape.

A Decade of Collaboration

Since its inception, the partnership between Etihad Airways and Virgin Australia has been mutually beneficial, allowing both airlines to expand their global reach. Etihad leveraged Virgin Australia’s domestic network to provide seamless connectivity for passengers traveling to and from Australia, while Virgin Australia tapped into Etihad’s extensive network across the Middle East, Europe, and Africa. The collaboration also extended to frequent flyer programs, with passengers able to earn and redeem miles across both airlines.

Reasons Behind the Termination

The termination of this partnership comes as part of Etihad and Virgin Australia’s evolving strategic priorities. Virgin Australia is forging a new alliance with Qatar Airways, involving a proposed 25% investment from the Qatari carrier. Under this partnership, Qatar Airways will become Virgin Australia’s exclusive interline, codeshare, and loyalty partner in key regions, including the Middle East, Europe, and Africa. This move reflects Virgin Australia’s intent to consolidate its network and loyalty offerings under a single strategic partner in these regions.

For Etihad, the decision to end its relationship with Virgin Australia allows the airline to focus on its broader global strategy. Despite the conclusion of this partnership, Etihad has reiterated its commitment to the Australian market, which remains a key region for the carrier. The airline plans to increase its services to Sydney and Melbourne in the summer of 2025, enhancing its direct connections to Abu Dhabi and beyond.

Impact on Travelers

Travelers who have already booked itineraries involving both airlines will not experience any changes to their bookings up to the termination date. However, after June 1, 2025, Etihad Guest members will no longer be able to earn or redeem miles on Virgin Australia-operated flights. Similarly, Virgin Australia’s Velocity Frequent Flyer members will lose the ability to earn and redeem points on Etihad-operated flights.

The dissolution of this partnership could require frequent travelers to adjust their travel and loyalty strategies, especially those accustomed to benefiting from the seamless connectivity and perks offered by the collaboration.

The Road Ahead for Both Airlines

Virgin Australia’s pivot toward Qatar Airways underscores its strategy to strengthen its network with a single, exclusive partner in key regions. This new alliance promises expanded benefits for travelers, particularly through Qatar Airways’ extensive network and global reputation for service excellence.

Meanwhile, Etihad’s decision to increase capacity on its Australian routes demonstrates its ongoing commitment to the market. The carrier’s focus on enhancing direct connections from Australia to Abu Dhabi positions it to compete effectively with other Middle Eastern carriers, such as Qatar Airways and Emirates.