In their seemingly never-ending competition, airlines Virgin Australia Holdings Ltd (ASX: VAH) is now going to war with arch-rival Qantas Airways Limited (ASX: QAN) over food.
Virgin will begin to offer free food and checked baggage to every passenger on all of its domestic services. The airline had previously only offered complimentary food on flights between Australia's East coast capital cities, Brisbane, Melbourne and Sydney, or to and from Perth from the East coast.
Mark Hassall, head of Virgin's customer service said, "We're delighted to announce that the Virgin Australia product offering now includes complimentary food and drink, checked baggage on all flights, as well as entertainment across our domestic network."
"The rollout of free food and checked baggage, to complement our wireless in-flight entertainment, is an important part of our ability to deliver a consistent, premium service across our network."
According to reports, Virgin will also offer free wine, beer and soft drinks on flights between 5 pm and 7pm on weekdays.
The move will boost the airline's head to head competition with Qantas, as Virgin increasingly moves further up-market and allows its budget airline, TigerAir Australia to go toe-to-toe with Qantas' budget offshoot, Jetstar. Qantas already offers checked baggage at no extra cost, as well as meals on flights.
Virgin has been increasingly targeting Qantas in several areas, trying to entice corporate customers and business flyers to switch over, and now takes another step to entice passengers to pick Virgin ahead of Qantas.
These new services could see Virgin take some of Qantas' domestic market share – at least that's what Virgin will be hoping. But it will come at a cost to Virgin – it will lose the income it had previously received from passengers paying for baggage and food.
