The airline gained a large amount of momentum by acquiring the airport terminals and many of the customers of the failed Ansett.
Virgin focuses on providing cheap transport by eliminating costs such as included in-flight meals and printed tickets in favor of selling food at above-retail price on-board and using telephone and Internet transactions to sell their services rather than traditional over-the-counter ticket sales. They also have cut costs by limiting the number of airports they service and only operating one type of aircraft, the Boeing 737.
Virgin suffered a setback when it was not able to acquire a permanent terminal in Sydney Airport relying instead on a temporary terminal, however this issue has been resolved, making Virgin Blue the principal competitor to Qantas in Australian domestic aviation.
In September of 2003, Virgin Blue announced that its wholly-owned subsidiary, Pacific Blue, would offer a similar cheaper service between New Zealand and mainland Australia. Pacific Blue's launch date is late January, 2004. Pacific Blue aims to position itself as a competitor to Air New Zealand and Qantas, both of which have been criticised for having fairly expensive fares.