Virgin, SIA strike key alliance

Singapore Airlines and Virgin Australia have signed an agreement which will enable them to establish a long-term alliance.

Under the agreement, which is subject to Australian Competition and Consumer Commission (ACCC) approval, the two airlines plan to code share on each other's international and domestic flights; integrate their frequent flyer programmes and co-ordinate schedules between Singapore and Australia and beyond.

The two airlines will also develop joint sales, marketing and distribution activities.

The announcement came a day after Malaysian Airlines revealed its decision to join oneworld, the same global marketing alliance as Qantas.

The SIA-Virgin alliance will connect Singapore Airlines' international network with Virgin Australia's Australian and Pacific destinations.

From August 1, Singapore Airlines customers will be able to interline on Virgin Australia's domestic network, allowing them to travel through to a range of destinations with one ticket, through-checked baggage, terminal transfers and inclusive meals.

Members of Singapore Airlines' KrisFlyer frequent flyer programme will be able to earn and redeem miles on Virgin Australia flights, while Virgin Australia's Velocity members will be able to earn and redeem miles on Singapore Airlines-operated flights.

Virgin has already formed joint venture arrangements with Middle Eastern airline Etihad, US carrier Delta and Air New Zealand.

Singapore Airlines owns 49 per cent of British airline Virgin Atlantic. The remainder is held by Sir Richard Branson's Virgin Group, which is the largest shareholder in Virgin Australia.