Bonza Airlines came a cropper due to ‘maverick’ backer
Stephanie Gardiner |
Bonza Airlines proved there is strong demand for competition and regional travel in Australia, before the budget carrier fell victim to a “maverick” investor, its former chief executive says.
Tim Jordan has told a Senate inquiry he dreamt up the airline while sitting on his verandah on the NSW north coast and watching a Qantas plane fly overhead.
He went on to establish the Queensland-based airline, which carried nearly a million customers to 22 destinations over 15 months before its sudden collapse in April 2024.
During its first year, Bonza recorded $100 million in revenue and sold more than one million seats, largely flying to regions not serviced by Qantas or Virgin, Mr Jordan told the inquiry.
The Senate committee is examining the financial sustainability of regional aviation after Bonza collapsed and Rex fell into administration soon after.
Mr Jordan said Bonza proved Australian travellers wanted more than what was offered by the major airlines.
“It is no longer debatable whether there is a market … we know that, we showed that,” he told the inquiry sitting in Albury on Wednesday.
“It’s now how we execute that and it would be wrong of us not to execute that as a country.”
Bonza was wholly reliant on its sole investor 777 Partners, which “abruptly” repossessed its aircraft on April 30, 2024, Mr Jordan said.
More than a year later, the American private investment firm’s co-founder was charged with a string of fraud offences.
Mr Jordan said the firm, which went through the Foreign Investment Review Board process, was buying aircraft and sporting clubs right before Bonza’s collapse.
“They were different,” Mr Jordan said of the investors.
“I used to describe them as maverick and I still would.
“Obviously, their world imploded and we were one of the first dominoes to fall over in that world.”
The inquiry has previously been told rising fuel and security costs and airport charges are major challenges in regional aviation.
That is only being exacerbated by the volatile oil market, Regional Aviation Association of Australia chief executive Rob Walker told the inquiry.
One regional airline’s fuel bill increased by $2 million in March, Mr Walker said.
The regional sector was not directly consulted on the government’s National Fuel Security Plan, which is designed to keep businesses and the community updated on availability.
“We have a number of members that provide medical emergency transfer and also rescue, as well as organ transplant, where time criticality is the difference,” he said.
“It is literally life and death.”
AAP