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Virgin CEO Paul Scurrah resigns

Virgin Australia chief executive Paul Scurrah has resigned just months after the airline's new owner Bain Capital declared it was "behind him and his team".

Administrator Vaughan Strawbridge said he had "reaffirmed" the airline's direction with Bain after Virgin's numerous trade unions said they feared the group would look to renege on promises to relaunch the airline as a mid-market offering when it exits voluntary administration.

"Virgin Australia will not be repositioned as a low-cost carrier. Virgin Australia will be a hybrid airline, offering great value to customers by delivering a distinctive Virgin experience at competitive prices.

"This will appeal to the full spectrum of travellers, from premium corporate through to more budget-focused customers," he said.

Unions are also concerned about the installation of Hrdlicka – who has a reputation for driving a hard bargain with workers – as Mr Scurrah's replacement.

A source close to the takeover told The Australian Financial Review the conflicts between Mr Scurrah and Bain arose over the size of Virgin 2.0's international network and the number of lounges it would retain.

Mr Scurrah was also said to be pushing to keep the airline's options open to launch a low-cost offshoot down the road.

Bain managing director Mike Murphy told the Financial Review in June he was "behind him [Scurrah] and his team and if everything goes well and everything's great that would be nice".

Mr Murphy, a former Olympic diver, also said the airline would keep around 5000 to 6000 employees on its books. Before the airline was put into administration, this number was closer to 9000.

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He committed to running 60 to 70 aircraft at full capacity, said it would operate as a "hybrid" model and called fears Ms Hrdlicka would take over "unfounded".

"Paul has provided the leadership to enable Virgin Australia toemerge from voluntary administration as a well-capitalised, best in class carrier," Mr Murphy said on Thursday.

"His personal commitment and determination to lead Virgin Australia through such a turbulent period is a credit to him."

Yesterday, seven unions wrote to Prime Minister Scott Morrison and to Bain seeking action and urgent clarification on the future of Mr Scurrah.

"Is there any shift in the commitments Bain Capital announced in August ahead of Virgin’s sale, namely a commitment to retaining 6,000 workers, retaining regional operation Vara, tiered cabin classes, airport lounges and the airline’s international arm?" the unions asked of Bain.

They also sought to clarify the number of planes Bain planned for Virgin 2.0 to run. While past assurances have been given to run about 70 planes, the unions say only 56 are ready for flying.

The unions – led by the Transport Workers Union – have yet to get a reply from Bain.

Meanwhile, in their letter to the Prime Minister, they said: "This is a clear breach of the deal to get Virgin back to flying as a strong second airline in Australia."

"It will see Virgin scrap for business and it will lower standards on service and safety. It will result in the loss of many more jobs and could herald the demise of Virgin."

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