Ethics of airline bailouts in spotlight with Virgin-Qantas feud

Qantas planes are seen at Kingsford Smith International Airport, following the coronavirus outbreak, in Sydney, Australia, March 18, 2020. - Reuters

SYDNEY: An ugly feud is escalating between Qantas Airways Ltd. and its closest Australian competitor over the ethics of state aid, just as airlines facing collapse around the world race to secure bailouts.

With demand all but gone, Qantas is hunkering down to weather the coronavirus crisis after a run of record profits. It has furloughed most staff and used planes as collateral to swell its cash reserves to A$3 billion ($1.8 billion). Meanwhile Virgin Australia Holdings Ltd., unprofitable for seven years, has asked for a A$1.4 billion government loan that would convert into equity if unpaid.