TNT is making a major shift in its air carrier strategy in Australia by switching a large-scale contract for domestic airlift from Qantas to Virgin Australia.
From July, Virgin will transport TNT air freight shipments on its network of flights to 47 destinations across the country.
Confirming the contract, a TNT spokesman told CEP-Research: “Virgin Australia will be moving TNT's domestic air linehaul movements throughout Australia. The contract will come into effect from 1 July 2016.”
But he stressed: “Qantas remains a trusted partner of TNT. TNT Australia will continue to use Qantas for International and remote domestic freight movements.
The TNT spokesman declined to comment on the value of the contract, which was put by Australian media at about $575 million over five years. Virgin Australia executives have said they hope to generate up to $150 million in annual cargo revenues by 2017.
According to The Australian, Virgin Australia will carry the TNT volumes on three wet-leased small freighters as well as bellyhold on its passenger planes.
The TNT contract is a major boost for Virgin Australia’s cargo business after it lost its long-standing contract with Toll Group last year to Qantas, which also flies Australia Post’s air volumes. Toll, TNT and Australia Post are the three dominant customers for air cargo capacity within Australia.
