6thfreedom
Topic Author
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Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 2:44 pm

VS services on LHR-HKG-SYD are underperforming... BIG TIME!

Will VS continue to operate the sector, or will they look to switch to:
a) another Australian port ie. BNE or MEL; or
b) change the intermediate point for SYD services.

The outlook for HKG-SYD is not great either.

- QF is 18pw, CX already 21pw.
- QF may well put the A380 on the sector in 2006-07.
- Dragonair may enter the route, and it has superior drawing power in mainland China than VS.
- Chinese carriers continue to increase direct services into SYD, meaning the pie for VS HKG traffic is further reduced.

What's the general view on this?
 
ctang
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 2:50 pm

I don't think the flights are going that badly. They are the cheapest airline flying this route. They are currently having a sale to HK for just $650. QF is $896. Besides they have an excellent product in all classes.
 
timetables
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 2:56 pm

It is a new route; you need to give it time to pick up; I'm sure they are doing heavy marketing to let customers know they fly the route...
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avek00
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 2:58 pm

"VS services on LHR-HKG-SYD are underperforming... BIG TIME!"

Define underperforming "big time". Is VS experiencing weak premium loads/yields, or poor cargo loads? Is the LHR-HKG flight doing well? If so, the profit generated from that flight could well cover any shortfalls from HKG-SYD.
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6thfreedom
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 3:08 pm

both loads are poor, as are premium pax loads.

HKG as a source market for SYD bound pax is difficult, as most premium pax are asia miles members, meaning they get excellent benefits with both CX and QF.

Quoting Avek00 (Reply 3):
Is the LHR-HKG flight doing well? If so, the profit generated from that flight could well cover any shortfalls from HKG-SYD.

If that's the case, why bother having the SYD extension if it isn't generating sufficient revenue/profits??

Quoting Ctang (Reply 1):
I don't think the flights are going that badly. They are the cheapest airline flying this route. They are currently having a sale to HK for just $650. QF is $896. Besides they have an excellent product in all classes.

VS does have excellent product, but the pulling power of the Qantas FF program is a strong marketing tool. Australian originating pax earn points on both CX and QF services. The influence of these programs shouldnt be underestimated.
 
jakob77
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 3:31 pm

Virgin is offering HK$6570 on its website for HKG-SYD.
QF is offering HK$4300.
CX was offering SYD fares as low as just under HK$4000 a few weeks ago.

CX and QF's combined schedule offers upto 4 daily flights between HKG-LHR and 6 daily flights between HKG-SYD. With Asia Miles and QF FFP both being oneworld, flights on either CX or QF earn miles in both programs. It's a no brainer that pax choose CX or QF over VS. KA is entering the market slated this summer and as 6thfreedom pointed out, KA has the mainland China feed and is also an Asia Miles member. It's an uphill battle for VS if they intend to stay.

VS is doing this route more for prestige then for "competition" or profits (perhaps loss if the performance of the route is as rumored). If VS quickly pulls out after, it'd be a big slap in the face for Branson.
 
airxliban
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 3:31 pm

I was @ SYD last week when VS was there and I remember seeing that VS had arrived from KUL.

I thought that was weird...'coz i know that it comes from HKG.
PARIS, FRANCE...THE BEIRUT OF EUROPE.
 
United Airline
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 3:36 pm

VS doesn't fly to KUL. They are codeshare flights

Give it sometime. I am sure VS will do well too on the HKG-SYD run.
 
antares
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 4:04 pm

6thfreedom,

There is no pulling power in the Qantas FFP program anymore other than of the type that is said to make one go blind.

The scheme has been murdered. Forget it.

The problem for VS is that HKG-LHR is about as full as it can get with people paying about as much at times as those flying all the way between SYD-LHR.

Until VS introduces a larger jet or gets more frequency any losses can be written off a development costs. And it is looking for more 744s.

Antares
 
scotron11
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 4:18 pm

How are VS doing on the LHR-HKG sector? If they are doing well, how much capacity can they offer UK-Australia without cutting into their HKG traffic?
 
bill142
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 5:22 pm

Quoting Scotron11 (Reply 9):
How are VS doing on the LHR-HKG sector?

As Antares said HKG-LHR is the problem. Most flights are full and it is quite difficult to get a SYD-LHR ticket with VS. If they start a price war on SYD-HKG they will get killed by CX and QF as they simply have more capacity and frequency on the route.
 
6thfreedom
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 6:01 pm

Quoting Antares (Reply 8):
Until VS introduces a larger jet or gets more frequency any losses can be written off a development costs. And it is looking for more 744s.

They are oprating a 388 seat A346 on the sector. Unless they put on an A380 'when' it is delivered, could they possibly add any more capacity?

As far as I'm concerned, they are going to bleed. Adding the SYD extension on LHR-HKG was a big mistake. As others have pointed out, LHR-HKG is full, so they always knew that they would have to rely on HKG-SYD. Why bother?

The UK-Australia bilateral is at capacity now (28pw), with BA 14 pw to SYD, daily to MEL, and VS daily to SYD.

My view is that VS should have looked harder at another intermediate point.
They may have needed a little negotiating, but PVG or India were perhaps options, or they could have gone into BKK prior to EK's announcement this year. Better still, VS should have considered Brisbane or Melbourne, as there is less competition. MEL in particular has a relatively big home market, has an excellent catchment area, and is relatively uncrowded compared to SYD for both LHR and HKG. In fact, QF's sole SIN-LHR service (QF9/10) operates at near full capacity year round.

I should point out that I have NO loyalties to another airline, it's just my point of view....
 
behramjee
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 6:15 pm

Usually such long haul routes need around 2 years to mature and show positive results...so give VS some time and knowing their reputation of always being the underdog on heavily contested long haul routes (LHR-JFK/IAD/LAX/SFO/BOS/NRT), they have the capability of turning their revenues around on this route and making a profit 2-4 years down the road.
 
EmiratesUK
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 6:20 pm

If I'm not mistaken, VS did say that they didn't expect the route to become profitable for around 3-4 years.....As for operating via India or PVG u.k passport holders would require transit visas regardless if they are leaving the aircraft or not. (China) not sure about India. Why operate via HKG? well SIN would be jumping in on SQ's market (not going to happen) and BKK would have been an even bigger risk as BKK is not currently in VS network which would mean even more marketing & the cost of opening two new bases the list goes on. Give VS time once they get the A380 which is in 4years time I'm sure things will be a little different. It just takes time.
EK A380 Private suite - Here I come!!
 
Spike
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 6:25 pm

This is the problem with HK. Every friggin airline (except VS) is Oneworld and thus they all pretty much operate as Oneairline in pricing. Why doesn't VS drop prices down and steal the market?
 
SQno1
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 6:27 pm

I thought once the codeshare agreement with Malaysian Airlines ends sometime soon, I believe that they are going to either move the sydney flight to KUL or do a second sydeny flight via KUL daily.
It would be a good idea as MH has the monopoly on both of the sectors.

With Regards,
SQno1
 
IntheKnow
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 6:35 pm

6thFreedom,

388 seats on our 346......wrong! Have done three 9 day SYD trips since launch and loads are picking up. Cargo is doing very well though.

ITK
 
VHXLR8
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 6:39 pm

I'm sure that when Lauda Air started flights to SYD and MEL there was similar thoughts as to the sustainability of the services, yet they are still flying between MEL/SYD and VIE today, and doing quite well.
Similarly, back when Emirates first started flying to MEL with A310s, people probably thought it'd never work, yet as we all know now.....
With possibly a little more media/advertising exposure, VS will go on to do quite well on their Australian services. AUS-UK is up there as one of the most lucrative in the world. I'm sure VS will benefit soon.
 
jakob77
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 6:39 pm

Quoting Spike (Reply 14):

As Bill142 said, CX and QF simply have tremendous amount of capacity and upto 6x daily frequency. Any price war started by VS will get themselves slaughtered. CX has all the feed it needs @ HKG and QF has its domestic network at the other end.
 
BestWestern
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 6:58 pm

This was only discussed last week. LHR HKG is a star performer for VS and every airline, resulting in no capacity for london originating passengers flying to SYD.

VS needs to go x2 daily to HKG, to free up capacity for SYD.
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CXoneworld
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 7:02 pm

Quoting SQNo1 (Reply 15):
I thought once the codeshare agreement with Malaysian Airlines ends sometime soon, I believe that they are going to either move the sydney flight to KUL or do a second sydeny flight via KUL daily.
It would be a good idea as MH has the monopoly on both of the sectors.

No, I'd rather see it as a complete withdrawal from KUL. To launch any new service via KUL will only mean more long haul airframes, which are indeed in great shortages at present. Keeping the codeshare with MH on the other hand adds strain to the SQ/VS equity partnership...

Anyway, much has been said about CX and QF's edge over VS by virtue of the oneworld FFP scheme, but don't VS customers accrue points to the Krisflyer too? Enlighten me please, SQ is kinda big Down Under...

[Edited 2005-03-21 11:04:12]
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bill142
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 8:12 pm

Quoting 6thfreedom (Reply 11):
My view is that VS should have looked harder at another intermediate point.

Your right in suggesting this. Qantas wanted to go through HKG to LHR for years but could never get the rights. Branson knew Qantas were close to getting rights to LHR and thought he could get them first. Essentially the decision to go through HKG was more bragging rights then business sense. Particularly when HKG-LHR is so booked up you cannot carry passenger through to LHR from SYD.

Quoting Jakob77 (Reply 18):
CX has all the feed it needs @ HKG and QF has its domestic network at the other end.

VS have DJ, although at the moment I'm not sure if their are any codeshares or collaboration going on. But when you can't carry the pax through to LHR whats the point unless they want to goto HKG.

Quoting CXoneWorld (Reply 20):
Anyway, much has been said about CX and QF's edge over VS by virtue of the oneworld FFP scheme, but don't VS customers accrue points to the Krisflyer too? Enlighten me please, SQ is kinda big Down Under...

I don't think this worries the price concious passenger. VS' hands are tied due to their lack of capacity and frequency. Virgin Atlantic are walking on egg shells, Qantas and Cathay Pacific can counter any move by VS to gain more of the market.
 
HB-IWC
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 8:38 pm

Do a search. Right from the very announcement of the route, there has been skepticism here on A.net. Virgin has basically put a tag onto a route where there was no need for such a tag as it was doing just fine on its own. What's even worse, Virgin has not accomodated this expansion by a single extra seat on the LHR-HKG route. All indications are that, as a result of lack of available seats for SYD-bound pax, the HKG-SYD runs are bleeding money.

I believe VS should have either put a B744 on the route -but apparently all of those aircraft are tied up on other routes- or picked a different transit point altogether. PVG or India would be undersirable candidates for visa requirements and because it would be hard to be obtain fifth freedom rights from those transit points. SIN would be unlikely because of the SQ/VS relationship. So that would leave us with BKK, or, even better KUL.

A new SYD route, via a new transit station KUL, would not have been such a crazy idea. VS' relationship with MH is coming to an end soon, the London-Malyasia market is strong, and BA is not currently operating the LHR-KUL route. Furthermore, KUL is very accomodating towards new airlines and fifth freedom rights wouldn't have been a problem.

I believe VS have lost a tremendous opportunity here. Instead of blindly focusing on being the first to serve the Kangaroo via Hongkong, they should have grabbed the opportunity to open up a completely new route, and beat BA by effectively taking over their role as the UK's national carrier at KUL. Meanwhile, the HKG station would have been performing just fine on its own.
 
cornish
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 8:43 pm

Quoting HB-IWC (Reply 22):
I believe VS have lost a tremendous opportunity here. Instead of blindly focusing on being the first to serve the Kangaroo via Hongkong, they should have grabbed the opportunity to open up a completely new route, and beat BA by effectively taking over their role as the UK's national carrier at KUL. Meanwhile, the HKG station would have been performing just fine on its own.

I suspect that Branson's image and desire for publicity got his way ahead of the VS planners on this one - not for the first time.

Branson has long coveted the Australia market, especially post-Virgin Blue, but it was nevcer going to work with such a limited frequency and a complete lack of seats left on the LHR-HKG sector for anyone going on to SYD. VS can't add any frequency to LHR-HKG-SYD so trying somewhere different would have been a wise move.

Having said that, perhaps KUL might have been a bit too close to SIN for SQs liking and they would have tried to block such a move.
Just when I thought I could see light at the end of the tunnel, it was some B*****d with a torch bringing me more work
 
antonovman
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 8:52 pm

its not the only VS route doing badly
i recently flew DEL - LHR on an A340 and there was a max of 40 pax onboard
Also the IFE was useless almost across the whole cabin
i changed seats 4 times before i got one of the tiny little screens to work
 
B747-437B
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 9:00 pm

Quoting HB-IWC (Reply 22):
India would be undersirable candidates for visa requirements and because it would be hard to be obtain fifth freedom rights from those transit points

India has NO transit visa requirements for passengers remaining in airside transit and the India-UK bilateral already grants designated UK carriers onward 5th freedom rights.
"The A340-300 may boast a long range, but the A340 is underpowered" -- Robert Milton, CEO - Air Canada
 
HB-IWC
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 9:07 pm

Quoting Cornish (Reply 23):
I suspect that Branson's image and desire for publicity got his way ahead of the VS planners on this one - not for the first time.

In other words, the ego of one man has prevailed over the common sense of his route planners and analysts. I expect that, when the route was first announced, there were quite a bit of people that were not ecstatic to say the least. I can't imagine that a person like VS' Hongkong sales manager was enchanted when he heard that he'd have to share an aircraft, which, until then, he could nicely fill on his own, with another station!

I like Branson's style, but I think he got it wrong this time. Anyway, it's not too late to bring about some change. There's no reason to gloat with the Kangaroo route via Hongkong anymore anyway, as also Qantas is now plying the same sector.
 
6thfreedom
Topic Author
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 9:10 pm

Quoting VHXLR8 (Reply 17):
I'm sure that when Lauda Air started flights to SYD and MEL there was similar thoughts as to the sustainability of the services, yet they are still flying between MEL/SYD and VIE today, and doing quite well.

Lauda commenced services in 1991 from memory (may have been 1995), in a totally operating environment, so let's compare apples with apples in today's environment.

Quoting VHXLR8 (Reply 17):
Similarly, back when Emirates first started flying to MEL with A310s, people probably thought it'd never work, yet as we all know now.....

My point exactly. Why do airlines persist on always serving the hub or the major city? EK took a well calculate risk, and it paid big dividends. 3 x A310 in 1996, 4 x B772 in 1997, daily B772 by 1998-99.... and 14pw by 2004! I don't think VS will experience this sort of growth over HKG.

Quoting SQNo1 (Reply 15):
I thought once the codeshare agreement with Malaysian Airlines ends sometime soon, I believe that they are going to either move the sydney flight to KUL or do a second sydeny flight via KUL daily.
It would be a good idea as MH has the monopoly on both of the sectors.

The agreement ends in about 3 months. 30 June 2005 if I'm not mistaken.
Also, KUL-SYD is not a monopoly as such, but has a lot less competition than HKG. OS operates 6pw VIE-KUL-SYD, and MH 14pw. OS serves MEL over SIN 3pw.

Quoting HB-IWC (Reply 22):
SIN would be unlikely because of the SQ/VS relationship.

True. But as stated in another thread (posted only a few days ago), SQ is rumoured to be seeking 4th LHR service. If this is true, and given VS' infrastructure at LGW, wouldn't it make sense to add a LGW-SIN-SYD service, with an SQ codeshare??

HB - I totally agree with the KUL or BKK option. Why? Well, although I dont have any hard and fast facts right now, I would assume that UK travellers would be amongst the most internet savvy, given all the UK-based LCC's. Therefore, KUL and BKK would have been good options, as UK travellers could book onward hops to places like Thailand, Indonesia, Singapore etc. Almost every aussie that I speak to travelling to the UK books the London fare thru an agent, and then has a number of European hops with LCC's. If airline execs haven't identified this as yet, there is something wrong.
 
chrisrad
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 11:14 pm

According to what I have read the MH/VS agreements will be in place until October while negotiations take place, for possible renewal of the codeshare
Welcome aboard Malaysia Airlines! Winner of Best Cabin Staff 2001,2002,2003,2004,2007,2009,2012
 
aa777jr
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 11:25 pm

This topic shows up about every 3-4 weeks like a bad rash It's still too early to tell if this is gonna make money for VS.

Regards.
A liberal is a man who is right most of the time, but he's right too soon.
 
Spike
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 11:34 pm

If VS has any sense, it would fly via Macau to SYD at half the cost for everyone. Plus twice the fun.
 
United Airline
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 11:39 pm

Heard that Virgin has plans to increase HKG-LHR to double daily. Perhaps they should do that. Or send a B 747-400 on that route so that they can carry more passengers on the HKG-SYD leg.

Give VS sometime!
 
cornish
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Mon Mar 21, 2005 11:45 pm

Quoting United Airline (Reply 31):
Heard that Virgin has plans to increase HKG-LHR to double daily.

Do they have the slots to do that at present? Especially as they will be increasing India services.
Just when I thought I could see light at the end of the tunnel, it was some B*****d with a torch bringing me more work
 
Spike
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Tue Mar 22, 2005 12:02 am

umm..india v. Australia: i think the oz flights may take some priority.
 
HB-IWC
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Tue Mar 22, 2005 12:07 am

Quoting B747-437B (Reply 25):
India has NO transit visa requirements for passengers remaining in airside transit and the India-UK bilateral already grants designated UK carriers onward 5th freedom rights.

That's an interesting note. I didn't know that. However, a LHR-BOM-SYD flight would suffer from the same problem as the current setup. LHR-BOM should be able to take care of the entire aircraft, without the necessity of an tag on.
 
cornish
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Tue Mar 22, 2005 12:18 am

Quoting Spike (Reply 33):
umm..india v. Australia: i think the oz flights may take some priority.

Actually the India flights have far more potential than Australia - both in terms of filling the seats and in terms of yields. VS have been crying out for more India flights for a long time.
Just when I thought I could see light at the end of the tunnel, it was some B*****d with a torch bringing me more work
 
vs25
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Tue Mar 22, 2005 5:50 am

Don't underestimate the selling power than Virgin Atlantic's partner, Virgin Holidays have at selling seats. OZ is a big destination for us Brits, and for the Ozzies coming over here. If you've ever tried to get a seat anywhere in the northern hemisphere winter to Oz, you'll appreciate how much more capacity is needed on this route.

VS have only been flying the route for a month or so now. Give them a chance. VS know how to make money. They are a profitable airline, which is more than can be said for many other carriers around the world.

From what I've heard VS would love to send 744s to HKG, but they don't have the planes. They have a very small, heavily utilised fleet. Most of the planes hit LHR, wait 2-3 hours (if they're on-time) and head off somewhere else.

Anyway, when I finally get 2 full weeks off, I'm off to Sydney with VS. HKG is worth a visit again, and I'd rather spend my 22 hours in the air at the bar onboard a VS plane than anywhere else  Smile
 
monkeyboi
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Tue Mar 22, 2005 6:44 am

I think SYD could be a problem for an airline with limited capacity.

Here's why: Fares on the route don't justify the costs. For example, a return LHR-HKG flights is not that much cheaper than a LHR-SYD flight. A LHR-HKG-SYD-HKG-LHR routing keeps a few aircraft busy permanently. Also it is difficult to keep costs low in the cabin. Due to the long sector times in-flight catering needs to be of a reasonable quantity. Add to this the fact that the crew rotation LHR-HKG-SYD-HKG-LHR is 9 days, therefore a whole 346 crew are 'out of the system' for that period.

Maybe they should have looked at increasing capacity on a trans atlantic route where they get higher utilisation. They could fly to JFK and back twice with one aircraft in the time it would take the same airctaft to get to sydney and turned around for it's return journey.

It is no secret that BA have toyed with the idea of axing their SYD-MEL services. They were considering terminating in SIN and letting QF carry on from there. BNE/PER/ADL/AKL are all gone. SYD and MEL in their own right do not generate profit on a year round basis, but are maintained as they 'add value' to the remaineder of the network (ie feed from and to many other profitable BA routes).

There are over 35 airlines flying either direct of in-direct from the UK to OZ. Some (such as EK) are very aggressive pricers with excess capacity allowing ever increasing schedules and destinations to OZ (now non-stop from DXB on the 345) and BA is much more concerned with the likes of EK than VS.

Although it would most likely never happen I believe that VS and BA should co-operate on the OZ route. 'Yeah right!' I hear you say. But think about it, it does make sense.
 
6thfreedom
Topic Author
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Tue Mar 22, 2005 6:56 am

Quoting Spike (Reply 30):
If VS has any sense, it would fly via Macau to SYD at half the cost for everyone. Plus twice the fun.

Spike... Macau?? Are u Richard Branson by any chance?? ; )

Quoting Vs25 (Reply 36):
Don't underestimate the selling power than Virgin Atlantic's partner, Virgin Holidays have at selling seats. OZ is a big destination for us Brits, and for the Ozzies coming over here.

Vs25. That's exactly my point. No matter how good Virgin Holidays is, there are very limited seats to sell LHR-SYD, as LHR-HKG is higher yield and the pax are there. That is the very reason I am saying that the service, relying on HKG-SYD traffic only, is both a) badly planned, and b) likely to be unprofitable for a long time.
 
bill142
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Tue Mar 22, 2005 7:15 am

Quoting Monkeyboi (Reply 37):
I think SYD could be a problem for an airline with limited capacity

Why? Lauda operate the route daily just like VS do and Lauda isn't doing to bad at all.

Perhaps VS should look at another port as Hong Kong in the long run, won't be profitable untill they can get a capacity increase. And whats to say that when a second LHR-HKG flight comes again its going have any room for LHR-SYD pax
 
6thfreedom
Topic Author
Posts: 2628
Joined: Thu Sep 30, 2004 11:09 am

RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Tue Mar 22, 2005 9:46 am

Quoting Bill142 (Reply 39):
Quoting Monkeyboi (Reply 37):
I think SYD could be a problem for an airline with limited capacity

Why? Lauda operate the route daily just like VS do and Lauda isn't doing to bad at all.

Bill, I think Monkey was referring to limited capacity on the LHR-HKG sector for Australia bound pax.

Lauda's position is quite different. On both their VIE-KUL-SYD & VIE-SIN-MEL services, over 80% of the traffic is moving end-to-end rather than stopping in Asia, or originating in Asia. This advice comes direct from Austrian's senior management. It is also demonstrated from their 'far from ideal' scheduling, with 0500-0600 departures ex-Asia to Australia.

So you really can't compare the 2 carriers.
 
bill142
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Tue Mar 22, 2005 11:32 am

I see you point 6thfreedom. The simple fact is if VS want to make SYD work they will either have to stop at a different port or increase capacity on HKG-LHR as there just isn't enough room for through traffic from SYD.
 
malb777
Posts: 443
Joined: Thu Jul 08, 2004 5:53 pm

RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Tue Mar 22, 2005 11:54 am

Any of you guys think price might be a factor.
I was looking for a flight Sydney - london return for 17/4/05 QF quoted me $1923.00+$446.92 tax =$2369.92 Via Hong Kong this includes a domestic Darwin To Sydney O/W

Virgin Via Hong kong was $2432.00+$238.06 Taxes (why the difference I dont know) =$2607.06 + $185.00 Darwin Sydney domestic O/W

So I chose Qf and for the fare diffence I had enough to pay for a 4 day stop over in Hong Kong on the way there .

Malcolm
thank god i was not born a bird. this type of flying is much better
 
The Coachman
Posts: 1192
Joined: Sun Apr 29, 2001 9:57 pm

RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Tue Mar 22, 2005 12:41 pm

Price is not the problem Malb777.

The problem is that HKG-LHR is often booked solid, so VS can't offer people in SYD flights to LHR.

So VS is basically trying to fight CX (3 daily) and QF (1 x daily; 2 x daily, 5x week) and has no choice but to go for cargo and also the cheapest of the Y fares. VS are known here in SYD for offering the cheapest Y fares of any of the 3 majors operating SYD-HKG non-stop - often at $100 below the lowest fare offered by QF (CX is always $20/30 more than QF). The thing is, the regular travellers between SYD and HKG are usually already part of the QF FF scheme or the AsiaMiles scheme - so flying VS is pointless unless QF and CX are booked solid.

Point earnings on QF and CX are reciprocally very good, so why bother, for an extra $100...

VS will have to undercut the competition by $200 before they make any headway. And they're often cheaper by $200 for last minute journeys - but there aren't many of those. And we're just talking Y class here; that's not where money is made - premium F and J pax fly QF and CX because their FF points earnings are reasonable in F and J (though QF's changes make this rather dubious...).

There's no point unless VS cuts fares by another $100 - which is ridiculous...because you can get $AUD670 fares for SYD-HKG return on VS. Imagine sub-$AUD600 fares on SYD-HKG...
M88, 722, 732, 733, 734, 73G, 73H, 742, 743, 744, 752, 762, 763, 772, 773, 77W, 320, 332, 333, 345, 388, DH8, SF3 - want
 
6thfreedom
Topic Author
Posts: 2628
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RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Tue Mar 22, 2005 1:03 pm

Quoting Malb777 (Reply 42):
Any of you guys think price might be a factor.
I was looking for a flight Sydney - london return for 17/4/05 QF quoted me $1923.00+$446.92 tax =$2369.92 Via Hong Kong this includes a domestic Darwin To Sydney O/W

Virgin Via Hong kong was $2432.00+$238.06 Taxes (why the difference I dont know) =$2607.06 + $185.00 Darwin Sydney domestic O/W

So I chose Qf and for the fare diffence I had enough to pay for a 4 day stop over in Hong Kong on the way there .

Malcolm... BINGO!
Your point confirms that while VS may have capacity SYD-HKG, there are not enough seats between HKG-LHR! Just had a quick look at prices HKG-LHR-HKG on the same day u r looking to travel. On VS website, fare was HK$16,459.00 or A$2687. Same fare on www.zuji.com. That being the case, why would VS sell that seat for anything less ex-Australia.

I'm no yield management expert, but it doesn't take a rocket scientist to work out where you would allocate your seats.
 
VHXLR8
Posts: 487
Joined: Wed Feb 09, 2005 6:58 pm

RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Tue Mar 22, 2005 6:37 pm

Quoting 6thfreedom (Reply 27):
so let's compare apples with apples in today's environment.

How about in 'today's environment' let's not be so condescending.
I was merely entering into a discussion over a particular topic; and yes, I do have quite some knowledge of the airline industry.

Quoting 6thfreedom (Reply 27):
Lauda commenced services in 1991 from memory (may have been 1995), in a totally operating environment

And what exactly is a 'totally operating environment'??
 
HB-IWC
Posts: 4033
Joined: Fri Sep 22, 2000 1:09 am

RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Tue Mar 22, 2005 8:40 pm

As said before, a solution to this obvious problem will only be found by either upgrading the aircraft to B744, adding an extra LHR-HKG flight (even if it were only with A343) and protecting enough seats on the existing LHR-HKG-SYD service for SYD-bound or originating passengers, or opening a new flight with a new transit point, with KUL as one of the obvious choices.

Any of these solutions, however, presupposes extra capacity and/or extra Heathrow slots, and I am unaware of the exact status of Virgin in both of these domains, but it seems to me that at least their aircraft are heavily utilized. So, there's quite some hurdles to overcome. You can be sure though that VS planners and analysts are following the route closely.
 
BestWestern
Posts: 7185
Joined: Fri Sep 08, 2000 8:46 pm

RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Tue Mar 22, 2005 8:56 pm

Why dont VS operate the route the other way round LHR LAX SYD.... if only they could get the stupid Transit situation at LAX sorted out, it could be a great way for VS to increase frequencies to LAX to compete against BA, and offer a Sydney service in a market where they are well known. In comparison to UA, the VS product is superb also.

Quoting HB-IWC (Reply 46):
a solution to this obvious problem will only be found by either upgrading the aircraft to B744

Nope - the 744 has less premium seats and LHR HKG is always full up front.
You are 100 times more likely to catch a cold on a flight than an average person!
 
The Coachman
Posts: 1192
Joined: Sun Apr 29, 2001 9:57 pm

RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Tue Mar 22, 2005 9:16 pm

Sorry, I should have clarified. The point about lack of seats on the SYD-HKG-LHR trip because of HKG-LHR demand *is* related to price...supply/demand and yield management issue etc.

Sorry Mal. Was typing too fast  Smile

I'm not sure about LHR-LAX-SYD. It's longer than LHR-HKG-SYD - costs would be higher and I'm not sure yields would be much better. Again, the problem of rights would arise - i'm not too sure about the situation there re: rights from LAX-SYD. Though with SQ hoping to fly that route and QF already moaning, QF would cry foul if VS went via LAX...
M88, 722, 732, 733, 734, 73G, 73H, 742, 743, 744, 752, 762, 763, 772, 773, 77W, 320, 332, 333, 345, 388, DH8, SF3 - want
 
cornish
Posts: 7651
Joined: Fri Feb 18, 2005 8:05 pm

RE: Virgin's LHR-HKG-SYD Services. Will They Last?

Tue Mar 22, 2005 10:00 pm

Quoting BestWestern (Reply 47):
Why dont VS operate the route the other way round LHR LAX SYD.... if only they could get the stupid Transit situation at LAX sorted out, it could be a great way for VS to increase frequencies to LAX to compete against BA, and offer a Sydney service in a market where they are well known. In comparison to UA, the VS product is superb also.

Interesting idea, but would the number of passengers on the LAX service mean that there still wouldn't be that many seats left for LHR-SYD passengers (having said that LAX flights ar eprobably less full than HKG flights for VS).

Also I imaigne there would be big issues with the Americans regarding carrying revenue passengers from LAX to SYD. I guess at present VS wouldn't have the freedom rights to do it.
Just when I thought I could see light at the end of the tunnel, it was some B*****d with a torch bringing me more work

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