Virgin Velocity: Major Program Updates Including New International Lounges, Changing KrisFlyer Conversion Rate & New Carrier Surcharge

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Virgin Australia Velocity has informed members today that the program will undergo a few major changes that comprehensively could make an impact on the members decision if they want to continue collecting with the program (or to become a new member).

Changes include the introduction of new international lounges from select Australian and New Zealand origins, a new carrier charge after 1 January 2019 as well as changing status credits per flight.

Velocity usually isn’t much of a focus for members outside the Austral-Pacific region but since they introduced more flights through their worldwide network we decided to cover the most important topics and promotions for the program.

You can access the Velocity website outlining all current changes here.

Major improvement for eligible customers will be that Virgin Australia is launching a new international lounge network, which will be rolling out from Sunday 28 October 2018.

The new lounges will be located across Australia (Sydney and Melbourne) and New Zealand (Auckland, Christchurch and Queenstown), welcoming guests travelling on international flights operated by Virgin Australia or one of the carriers listed below. Platinum and Gold Velocity members and Virgin Australia Lounge Members (plus one guest and two children) will have access to the lounges, as well as Virgin Australia Business Class guests.

New lounges are always nice even though until now Virgin Australia customers have always been taken care of in the form of a contracted partner lounge which in case of Air New Zealand was a very decent option. Paying another carrier per passenger might get expensive with the time depending on how many passengers are going through there daily so for sure they did the math plus the Air New Zealand partnership is going to end soon either way.

Beginning December 1st 2018 a new status credit earning update will go active in the chart.

From 1 December 2018, when you travel on a domestic Virgin Australia Getaway fare, you will earn a minimum of seven Status Credits for a one-way flight, compared to the previous five Status Credits.

In addition to this, from 1 December 2018 Velocity members flying on an Air Canada operated flight with a Virgin Australia flight number between Los Angeles and Vancouver, Calgary, Montreal and Toronto will earn Status Credits.

From 1 August 20182 for travel on or after 28 October 2018 domestic flights flown as part of:

– Trans Tasman or International Short Haul journey will earn at the same rate as domestic standalone journeys.

– International long haul flights will earn based on the fare class and number of miles flown.

For flights purchased before 1 August 2018 for travel on or after 28 October 2018 and any flight for travel before 28 October 2018, domestic flights flown as part of an International journey will earn based on the fare class and number of miles flown.

This is an actual improvement as well. The code share flight eligibility will make a huge difference as it’s extremely annoying when code share marketed flights aren’t racking up any mileage credits (members of Delta Skymiles can attest to that when it came to Korean Air flights).

Air New Zealand is out! As mentioned before the partnership between Virgin Australia and Air New Zealand come to an end this October:

On 6 April 2018, we advised Velocity members that Virgin Australia and Air New Zealand would not be continuing their alliance on Trans-Tasman routes. As a result, Air New Zealand will depart the Velocity Frequent Flyer program as an Airline Partner on 28 October 2018.

Velocity members travelling on Air New Zealand flights booked prior to 6 April 2018, for travel after 27 October 2018 will still be eligible for Velocity Points and Status Credit earn up until the end of April 2019. However, for Platinum, Gold and Silver Velocity members, status membership benefits2 will no longer apply when travelling on Air New Zealand after 27 October 2018.

When Virgin Australia was founded this was a good fit to stand against the almighty Qantas but now that both airlines are established and maintain a decent fleet it’s probably not rewarding anymore for either one of them. Too bad because Air New Zealand was always a nice airline to fly on (and to be honest I’d rather buy an Air NZ ticket than Virgin).

Carrier Charges on Virgin Australia-Operated Flights! Boom, fees are back and this time it’s quite substantial, especially for long haul flights:

To cover ongoing associated costs of Velocity Reward Seats, a carrier charge will be introduced for bookings made on or after 1 January 2019, on all Virgin Australia operated flights; and Delta Air Lines operated and marketed flights between Sydney and Los Angeles. This is in line with local industry practice and Velocity still remains very competitive and well below the price charged by our competitors. The carrier charge can be paid with Points or a combination of Points and cash and will be applied during the booking process.

To say it mildly: This is a bunch of BS! “Ongoing associated costs of Velocity Reward Seats”? That’s called cost of doing business like any other airline/frequent flyer program has it as well.

Yes it’s indeed industry practice for many but definitely not all programs to rip the customer off with the “airline surcharge” which was previously known as “fuel surcharge” until many countries outlawed it and fuel prices dropped so low that it couldn’t be justified to declare the costs as fuel extra anymore. This is going to be a big blow for most folks because Virgin Velocity awards are overpriced (in miles) already.

Last but not least Velocity dilutes the exchange ratio to KrisFlyer miles which has been a steady program perk for the last four years:

From 1 January 2019 Velocity Frequent Flyer members will convert their Points to KrisFlyer Miles at a rate of 1.55 Velocity Points to 1.00 KrisFlyer Mile5. The change in conversion rate reflects the differing reward program currencies within which each airline program operates and transacts.

Until now the conversion rate has been 1.35 Velocity Points to 1.00 KrisFlyer Mile.

I know many friends who open up Velocity credit cards in Australia and then move the points to KrisFlyer in order to book valuable awards. Mind you KrisFlyer doesn’t apply the high surcharges anymore on SQ flights which makes it very affordable.

Conclusion

I’ve never been a big fan of Velocity but these changes are mostly negative as one could expect whenever a program announces a major facelift. The real nail in the coffin are the award surcharges and people should reconsider if Virgin/Velocity is still a good fit for them.

When I lived in Sydney back in 2010 I participated in their status match promotion and played around with the program for a little while. It constantly struck me as quite useless and hasn’t gotten better since. The competition in Australia and South Pacific is limited so one has to carefully outweigh if Qantas or at least another oneWorld program such as British Airways Executive Club suits one better and then jump ship.

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