Your profile stats you work in finance but im seriously wondering what kind of finance? It would certainy appear that it is not economics. (for your information i have BEcon and LLB)
Qantas may have gernerated that amount in US sales, but lets examin what actually happened to that money.
First of all, lets consider what happened to the profit.
-1/2 of the funds distributed to shareholders would have directly gone overseas. In reality more if you consider the effect of Australian based funds etc that foreign investers have interests in.
Now the rest of the revenue.
-Also, a huge amount went to oversees banks and lessors for lease payments on aircraft.
-then, another huge amount went to boeing for spares
-an equally huge amount went to both GE
, as well as honeywell etc for other components.
- another 1/3 or so went to overseas oil companies to pay for jet A-1
And clearly already before considering anything else, the vast majority of the money is flowing out of the country.
So the question begs then, what is the real value to the Australian economy? And it is exactly what the media identified here... the value of the money the tourists spend while here and the multiplier effect of that. So the volume of visitors becomes the single most important fact. Let me tell you now, that is a hell of a lot more moeny than 1.6 billion dollars your talking about, afterall, a new hotel on the gold coast can easily cost half a billion dollars. And it's also a hell of a lot more jobs than the crews of those 747s flying across the pacific.
To put things in perspective, the tiny town of Richmond in North Queensland generated about $500 million in livestock exports last financial year. And its barely a dot on the map. I don't know if you could fill two 747s with their population.
Tell all those kids in tasmania that may have a job if more tourists where there, they don't deserve one because Qantas wants to limit capacity across the pacific. Tourism is Australia's biggest export industry(unfortunately, i think this is a rather sad fact... id like to say it was hi tech products), and whole cities like Cairns and The Gold Coast are completely dependent on it. This is one of the reason why the NZ
government stepped in to bail out AirNZ. Its economy would have been stuffed without sufficient capacity for tourism and they'd go under.
Also id like to point out that this statement of yours is clearly displaying an underlying assumption that Qantas is the "chosen instrument" of Australian foreign policy.
Your stupid and dangerous attitude of just letting any airline including many Government owned airlines to cherry pick QF's most profitable air routes with no trade off for Qantas is ridiculous
The problem here is, that bilateral agreements are for the Australian government and Thus Australian people, not Automatically Qantas, and any local airline has the right to apply for them... even something like Alliance, or REX. Afterall, even Virginblue is possibily more Australian than Qantas. Yes that's right! Now the last big chunck has been floated on the Australian stock exchange, combined with Patrick Corp's large shareholding, well, that easily far exceeds half of the company's stock.... and 49% of QF
is foreign owned. So basically, i can't see any economic arguement for this. The only reason i can possibily see, is the protection and promotion of QF
shareholder's assests. And in a democracy, we don't play favourites, and use state policy to protect select private groups interests above others.
This is merely a case of supply and demand. The cheaper people can get to Australia, the more ppl will demand of it, and the more money will be spent in the country. It really is, as simple as that. I believe access economics generated something similiar along those lines not all that long ago.... not my favourite firm because i feel they have demonstrated a clear labour Party bias over the years, but never the less, if even the socialists agree on this point, with the more free market capitalists, its difficult to contest.
I really want to know mr QFpower, why DOES QF
deserve special protection?