Virgin beats Qantas on domestic routes

Virgin Australia carried more domestic passengers than its rival Qantas over the 12 months to the end of May - a first for the industry's traditional number two.

Virgin carried 1.42 million domestic passengers in May, it said on Wednesday, which compared to 1.37 million passengers who flew with Qantas Domestic.

It is not the first time Virgin's domestic operations have carried more passengers than Qantas in a single month, but Virgin has for the first time out-performed Qantas over a 12-month period.

In the year to May 31, Virgin carried 15.53 million domestic passengers, compared to Qantas' 15.49 million domestic passengers.

The Qantas figures do not include passengers who flew with its fully-owned subsidiary Jetstar, which carried 830,000 passengers in May and 9.84 million passengers in the year to May.

Nor do they include the 4.76 million passengers who flew with QantasLink in the year to May.

CBA analyst Matt Crowe said the numbers were a likely reflection of Qantas' increased focus on Jetstar's domestic routes.

"Qantas is moving a lot of passengers from domestic to Jetstar, over that period of time Qantas Domestic has become relatively smaller to Jetstar," he told AAP.

Virgin's move away from being a low-cost carrier to a corporate flyer may also have contributed to its rise in passenger numbers, Mr Crowe said.

"It wouldn't be purely business (passengers) but that has been the main initiative that Virgin's been pursuing in the last 12 months," he said.

Also a factor was Qantas' fleet grounding in October, which contributed to an 11 per cent drop in domestic passenger numbers in that month.

The number of kilometres travelled by paying Virgin customers remained lower than that of Qantas, but they have grown at a much stronger rate.

Virgin flew 17.63 million revenue passenger kilometres (RPKs) in the year to May, up 7.7 per cent on the previous 12 months.

Qantas flew 22.83 million RPKs in the year to May, which was flat compared to the previous 12 months.

Meanwhile, Virgin's international business posted a 0.3 per cent drop in passenger numbers in the month of May, and in the year to May international passengers dropped 6.2 per cent from the previous year to 2.43 million.

On a total group basis, Virgin Australia carried 17.8 million people in the year to the end of May, compared to Qantas' 43 million.

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