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qfvhoqa
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QF Separates International & Domestic Ops

Tue May 22, 2012 3:28 am

According to the Sydney Morning Herald, QF will split QF international and QF domestic into two separate "businesses". Whether this means they will be separately listed remains to be seen.

Quote:
"Formally separating the management of Qantas International and Qantas Domestic will ensure that we can independently run each business according to its specific priorities and market conditions," Mr Joyce said in a statement.

Full article: http://www.smh.com.au/business/qanta...national-wings-20120522-1z25o.html

The Qantas Sale Act will prevent QF from doing the same as VA did when it split into separate companies. Any airline operating under the Qantas name needs to be majority Australian owned. This seems to just be creating extra costs by duplicating a lot of management roles.
 
Jackbr
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 4:35 am

Leading on from a thread I started earlier - could this mean the complete removal of LH Cabin Crew from any domestic flights?
 
Legs
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 4:46 am

Quoting QFVHOQA (Thread starter):
creating extra costs by duplicating a lot of management roles.

Not only that, but how will Qantas International restructure in order to arrest their loss making ways of recent years?
 
smi0006
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 6:38 am

I conceded I have minimal business understanding of these complexities but a few questions stand out for me; How will this impact international aircraft operating domestically? How will these resources be shared between the two business? What percentage of domestic flights are operated by internationally configured A330s and 747s?

How can two business that are very much intertwined be operated independently?

Qantas have stated that they only want to invest in the profitable growth areas of the business, whilst this has previously been JQ, as domestic seems to be preforming very well- can we now see as previously rumoured 787s going to domestic sooner?

Interesting development regardless! Shall be watching to see if this has an impact. I do hope it does.
 
ozglobal
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 7:02 am

Would this help Joyce to portray QF international as a loss maker and lobby for a sell off to a foreign investor? There are already assertions that the accounting in the Group favours JQ in terms of costs.
When all's said and done, there'll be more said than done.
 
peanuts
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 7:17 am

I'm sure this all makes sense to Mr. Joyce somehow. For others it's just more shuffling of deck chairs...
 
strangr
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 7:35 am

QF International to become Jetstar?

This would then mean it can bypass the 50% Australian ownership rules, no?
 
RyanairGuru
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 7:40 am

Quoting OzGlobal (Reply 4):
lobby for a sell off to a foreign investor?

I'm sure that he would like to do that, but...

Quoting QFVHOQA (Thread starter):
The Qantas Sale Act will prevent QF from doing the same as VA did when it split into separate companies. Any airline operating under the Qantas name needs to be majority Australian owned.

It isn't possible.



(any allegations of creative accounting in JQ's favour are just that: allegations)

Quoting peanuts (Reply 5):
I'm sure this all makes sense to Mr. Joyce somehow. For others it's just more shuffling of deck chairs...

I agree. There must be some kind of internal logic, but from the outside there doesn't appear to be any at all.

As others have already said, the two parts of the business are too inextricably linked. Indeed right now we have a thread about LH crews operating SH. Further they've just announced that they will be re-adding the 747 on SYD-PER. That would have to be operated by LH crews and using an international aircraft, even if they were able to separate the rest the operations into PMTN and PMQF.

[Edited 2012-05-22 00:43:43]

[Edited 2012-05-22 00:49:57]
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AirNiugini
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 7:41 am

Isn't Virgin Australia doing something like this to bypass ownership regulations?

Hopefully QF international can start pulling some decent figures to ensure it's survival.

Quoting smi0006 (Reply 3):
How can two business that are very much intertwined be operated independently?

It might just be in a managerial sense. Operationally speaking, I'm sure not too much will change.
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FlyboyOz
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 7:48 am

Quoting strangr (Reply 6):
QF International to become Jetstar?

I hope NOT! or ...QF international to become RedQ?
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AirNiugini
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 7:52 am

Quoting FlyboyOz (Reply 9):

I reckon... Hopefully they fight hard for the international sides survival... I think the small international footprint could not possibly get any smaller, I hope we see some growth in mainline QF international services soon.
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Jackbr
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 7:55 am

It could be just like TAA again...
 
qf002
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 8:16 am

Quoting smi0006 (Reply 3):
How will this impact international aircraft operating domestically?
Quoting smi0006 (Reply 3):
How will these resources be shared between the two business?
Quoting smi0006 (Reply 3):
What percentage of domestic flights are operated by internationally configured A330s and 747s?
Quoting smi0006 (Reply 3):
How can two business that are very much intertwined be operated independently?

I expect that there will be virtually no change to how things are run today. The only changes are that the group is now officially appointing a CEO for the International/Domestic arms and there will be two sets of figures in the Annual Reports where there used to be one.

Quoting OzGlobal (Reply 4):
Would this help Joyce to portray QF international as a loss maker and lobby for a sell off to a foreign investor? There are already assertions that the accounting in the Group favours JQ in terms of costs.

Any Australian International airline has to remain Australian owned. It's the domestic arm that VA has opened up to foreign ownership. So this move cannot be designed to flog off the foreign arm...

In any case, as RyanairGuru pointed out, the QF Sales Act restricts QF from using the same ownership laws as VA.

Quoting peanuts (Reply 5):
For others it's just more shuffling of deck chairs...

I find myself leaning towards this view. This is about creating a clear accountability for different parts of the business and setting up a more structured corporate structure.

Hopefully having dedicated arms will allow the respective businesses to better focus on their market/business as an independent entity, without having every single decision negotiated with the respective executives. This should create better results...
 
AusA380
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 8:35 am

It will be really interesting to see how corporate costs and IT etc are allocated to the different "portfolio entities".
 
RyanairGuru
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 8:43 am

Quoting qf002 (Reply 12):
The only changes are that the group is now officially appointing a CEO for the International/Domestic arms and there will be two sets of figures in the Annual Reports where there used to be one.

I'm leaning towards this view, but I have to question how they will split costs on the balance sheet.

Will QFD nominally "lease" the international 747s, 330s and 767s used on domestic routes from QFI? Or will QFD collect the revenue and QFI pick up the tab? If it's the latter then that is clearly an attempt to inflate QFD's profits and QFI's losses.

The same applies to QFI crew on QFD aircraft - all the 767 pilots are LH, and some SH aircraft operating domestic flights are crewed by LH FAs. Does QFD pay QFI to "contract" that labour? Again, if not then that is passing the labour costs to QFI but keeping all the revenue in QFD.

I guess it does go both ways: QFD aircraft are used on the Tasman routes (albeit crewed by JetConnect) and Noumea - but those two markets are still sufficiently small that there will be a net "loss" for QFI if there isn't some form of leasing/contract agreement.
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qf002
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 9:15 am

Quoting RyanairGuru (Reply 14):

I imagine the splitting of costs will occur in the same way as they do internally today -- QF already reports separate domestic/international profit figures, so they must be splitting the costs somehow in their financing as it is.

It will be really interesting to read through the first financial reports next February, hopefully we will be able to get some idea of the processes QF uses... It would be very interesting if there was a substantial change in the profit distribution (ie showing that QF has been unfairly attributing costs to International).
 
strangr
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 9:21 am

I think as it stands at the moment the sale act is preventing Qantas being a profitable business. This act was struck if i am not mistaken when TAA was sold (a government owner) to a private company.

The only way I can see QF becoming profitable at present is for them to sell something. Other then that i believe the aim is to run them lower and lower until something switches, they could have a sale act that states certain things like Must remain Qantas Name, Must remain with the Flying Roo, must have x employees from australia.
 
RyanairGuru
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 9:25 am

Quoting strangr (Reply 16):
This act was struck if i am not mistaken when TAA was sold (a government owner) to a private company.

TAA and Qantas were both government owned. The government merged their two entities and sold the resulting company (which - as we all know - maintained the QF name)


Re qf002 - true, I'd forgotten that they already give profit figures for both halves of the business. I guess this dispels my questions since splitting the company would make it harder to hide cross-subsidisation.
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qf002
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 9:55 am

Quoting strangr (Reply 16):
I think as it stands at the moment the sale act is preventing Qantas being a profitable business.

   It's ridiculous that a private company can be so heavily restricted by the government in the supposedly open/free market that the rest of the industry enjoys.
 
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vhtje
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 10:05 am

Quoting qf002 (Reply 18):
It's ridiculous that a private company can be so heavily restricted by the government in the supposedly open/free market that the rest of the industry enjoys.

Fine. You get elected parliament and be the politician brave enough to introduce an amendment to the Qantas Sale Act that allows Qantas to be majority foreign-owned. Or be the politician brave enough to scupper the Qantas Sale Act in its entirety.

Look - I am not saying you're wrong, nor am I saying that the Qantas Sale Act is fair and doesn't hinder Qantas' performance - I'm just pointing out that no politician will ever allow it to be changed. Can you imagine the public outcry and consequential political fallout if was changed?

Public opinion may change in the future, who knows, but the time certainly isn't now.
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NZ107
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 10:15 am

Quoting strangr (Reply 16):
I think as it stands at the moment the sale act is preventing Qantas being a profitable business.

What does the ability to sell a higher percentage of an airline to foreigners have in common with being a profitable business?
It's all about the destination AND the journey.
 
qf002
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 10:29 am

Quoting vhtje (Reply 19):
I'm just pointing out that no politician will ever allow it to be changed. Can you imagine the public outcry and consequential political fallout if was changed?

100% agree.

Quoting NZ107 (Reply 20):
What does the ability to sell a higher percentage of an airline to foreigners have in common with being a profitable business?

The QF Sales Act goes much, much further than foreign ownership... It also dictates restrictions on things like the location of "the principal operational centre for Qantas" (the majority of facilities that facilitate international services -- things like mx, catering etc -- have to be in Australia), the nationality of it's directors, the location of the HQ etc.

It really does restrict their ability to cut costs in the same way other airlines.
 
Gemuser
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 10:53 am

Quoting NZ107 (Reply 20):
What does the ability to sell a higher percentage of an airline to foreigners have in common with being a profitable business?

The problem is the small size of the Australian capital markets. QF can't effectively make a share issue, which it should, because of this. In any share issue it has to make sure that only 50% goes to non Australians, very difficult in practice and the Australian probably couldn't absorb a $500 million capital raising now or in the near future.

This lack of capital, as opposed to debt is why QF has deferred the A380s and they haven't ordered more A330 etc. It is a major problem for all large Australian companies, but especially for QF with the ownership restriction other companies don't have.

IMHO QF should make a large capital raising that is under written by the Commonwealth Government, because they are preventing QF from doing it. That way if any shares are not sold on the market are paid for by the government and can be sold back on to the market slowly over time.

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aerokiwi
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 11:43 am

Quoting FlyboyOz (Reply 9):
QF international to become RedQ?

RedQ operated by... Jetstar? Maybe QFI could simple contract out its operations to JQ (in QF guise) and lease them the aircraft, thereby generating lease revenue while lowering costs fairly substantially.

Convoluted sure, but possible?
 
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par13del
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 12:07 pm

Quoting qf002 (Reply 12):

I expect that there will be virtually no change to how things are run today. The only changes are that the group is now officially appointing a CEO for the International/Domestic arms and there will be two sets of figures in the Annual Reports where there used to be one.

In my opinion the decision is about money, if everything is going to remain the same the cost will also. I expect the international arm to start having more non-Australian Staff working at lower wages, more a/c being based outside of Australia effectively making Australian runs visit versus a return to home, a/c spend more time outside of Australia where cost may be lower, and how knows, eventually all cabin crew will be non-Australian based quite likely also at lower wages.
Does the Qantas act also state that the majority of staff be Australian?
 
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qfvhoqa
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 12:21 pm

Quoting gemuser (Reply 22):
This lack of capital, as opposed to debt is why QF has deferred the A380s and they haven't ordered more A330 etc. It is a major problem for all large Australian companies, but especially for QF with the ownership restriction other companies don't have.

I think this is the largest issue with the QF Sale Act. The inability to raise capital on foreign markets, where Asutralia is viewed as a high interest investment, greatly limits QF's ability to acquire newer aircraft. Maybe once the Australian public are faced with a choice of either a foreign owned QF or no QF international, maybe this piece or law will go out the window. Until then, Australians will continue to bash QF.

Quoting par13del (Reply 24):
I expect the international arm to start having more non-Australian Staff working at lower wages, more a/c being based outside of Australia effectively making Australian runs visit versus a return to home, a/c spend more time outside of Australia where cost may be lower, and how knows, eventually all cabin crew will be non-Australian based quite likely also at lower wages.

It would probably be cheaper for QF to have LAX based crew than SYD based crew on SYD-LAX flights. Australian wages are so high compared to other parts of the world they may go down this route eventually. HKG wages are lower too.
 
RyanairGuru
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 12:46 pm

Quoting par13del (Reply 24):
Does the Qantas act also state that the majority of staff be Australian?

Bizarrely no.

The act does state that 66% of Directors must be Australian citizens, the company cannot be incorporated outside of Australia, and the facilities (taken in aggregate) used to support international flights must be primarily located in Australia, but there is nothing about employees.

The relevant provision of the Act is Section 7:




The articles of association of Qantas [i.e. the company constitution] must...

(a) impose restrictions on the issue, transfer and ownership (including joint ownership) of shares in Qantas so as to prevent foreign persons having relevant interests in shares in Qantas that represent, in total, more than 35% of the total value of the issued share capital of Qantas; and

(b) impose restrictions on the issue, transfer and ownership (including joint ownership) of shares in Qantas so as to prevent an individual foreign person having relevant interests in shares in Qantas that represent more than 25% of the total value of the issued share capital of Qantas; and

(e) prohibit Qantas from taking any action to bring about a change of its company name to a name that does not include the expression "Qantas"; and

(f) prohibit Qantas from conducting scheduled international air transport passenger services under a name other than:
(i) its company name; or
(ii) a registered business name that includes the expression"Qantas"; and

(g) require that the head office of Qantas always be located in Australia; and

(h) require that of the facilities, taken in aggregate, which are used by Qantas in the provision of scheduled international air transport services (for example, facilities for the maintenance and housing of aircraft, catering, flight operations, training and administration), the facilities located in Australia, when compared with those located in any other country, must represent the principal operational centre for Qantas ; and

(i) require that, at all times, at least two-thirds of the directors of Qantas are to be Australian citizens; and

(j) require that, at a meeting of the board of directors of Qantas, the director presiding at the meeting (however described) must be an Australian citizen; and

(k) prohibit Qantas, at all times, from taking any action to become incorporated outside Australia.




Note the bit about foreign ownership: it is 35% not 50%

For anyone interested the full statute can be found here: http://www.comlaw.gov.au/Details/C2004A04487
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par13del
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 12:55 pm

Quoting RyanairGuru (Reply 26):
(for example, facilities for the maintenance and housing of aircraft, catering, flight operations, training and administration), the facilities located in Australia, when compared with those located in any other country, must represent the principal operational centre for Qantas

Thanks for the info, not being a lawyer I'm thinking that the word "compared" is what management might have used to get a lot of out-sourced maintenance out of the primary company. As long as they keep some services in Australia they should be ok, so no catering both ends of the flight inbound to Australia, making the dumping of lavs and possible increasing turns to allow an additional 30mins cleaning time should do the trick, one could also make some line maintenance inspections mandatory during the turn time, increasing the workload for one or two staff per turn to be in legal compliance is much cheaper than having full blown maintenance done overnight.

The next few months should bring more details to light as they need to commence getting financial gains from the change, so keep eyes open.
 
qf002
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 1:30 pm

Quoting RyanairGuru (Reply 26):
Note the bit about foreign ownership: it is 35% not 50%

The legislation you linked to is the original form -- there have been multiple ammendments since 1992. The legislation as it stands today can be found here.

See Part 7(a)  

I find Part 7 (aa), added in 1995 from what I can tell, more interesting -- no foreign airline can own more than 35% of the company.

Quoting par13del (Reply 27):

I would suggest that the wording implies that the majority of QF's operating business must take place in Australia. So it makes sense for QF to eventually do the cheaper 51% of the stuff here and send the more expensive 49% of the work overseas.

I wonder if these restrictions will apply to the Group as a whole, or individually to the specific divisions? For example, could Domestic be a 100% Australian operation and International a 98% foreign operation? And does this restriction also apply to wholly owned QF subsidiaries, such as JQ?
 
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aerorobnz
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 4:08 pm

Quoting RyanairGuru (Reply 14):
I guess it does go both ways: QFD aircraft are used on the Tasman routes

No, Jetconnect aircraft trans tasman are ZK-ZQx series. They are not domestic at all as they are NZ based.
Flown to 120 Airports in 44 Countries on 73 Operators. Visited 55 Countries and counting. Wanderlust is like Syphilis, once you have the itch it's too late for treatment.
 
boeing773er
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 6:09 pm

This is so strange, a few weeks ago I was going to make a post on here about the idea having two separate companies with the same brand name (one being the international, one being domestic)

I have no idea how this is going to play out for QF, I hope this solves all their problems.
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strangr
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RE: QF Separates International & Domestic Ops

Tue May 22, 2012 11:24 pm

we are seeing it at the moment with Telstra...

Wholesale and Retail Divisions, this was I believe a FORCED separation. I can understand that the government has a reasonable concern that they do not want the Australian Airline dissolved and become a misspelled Quantas "an american airlines group airline" for example

In saying that though, QF can not continue to be run the way it is, the world has changed in 20 years, the airline industry has changed much more then anyone in 1992 would have expected there was next to no real competition in 1992 (Ansett and Qantas competed but with in reason)

Now you have an aggressive VA which can do some of these things because of cheaper labor agreements. newer fleets, and the ability to have foreign money pumped into it.
 
JQflightie
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RE: QF Separates International & Domestic Ops

Wed May 23, 2012 4:45 am

Quoting aerokiwi (Reply 23):

Very possible, they already do this with Cobham, operating as QantasLink on B717 aircraft.
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Zkpilot
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RE: QF Separates International & Domestic Ops

Wed May 23, 2012 5:51 am

Looks like just another accounting trick to make Intl appear to be performing badly.
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qf002
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RE: QF Separates International & Domestic Ops

Wed May 23, 2012 6:09 am

Quoting Zkpilot (Reply 33):
Looks like just another accounting trick to make Intl appear to be performing badly.

If anything, quite the opposite. We will now be able to see inside all the finances for both parts of the business which will make it very hard for QF to hide domestic costs in the international column...
 
bill142
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RE: QF Separates International & Domestic Ops

Wed May 23, 2012 8:41 am

Quoting qf002 (Reply 34):
If anything, quite the opposite. We will now be able to see inside all the finances for both parts of the business which will make it very hard for QF to hide domestic costs in the international column...

Or Jetstars costs.
 
LHRFlyer
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RE: QF Separates International & Domestic Ops

Wed May 23, 2012 9:05 am

Quoting Boeing773ER (Reply 30):
I have no idea how this is going to play out for QF, I hope this solves all their problems.

Unless this is groundwork for a very radical restructuring I can't see how it will change anything.

The constraints of geography, fleet, regulation, and cost will all remain.
 
travelhound
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RE: QF Separates International & Domestic Ops

Wed May 23, 2012 11:08 am

Quoting LHRFlyer (Reply 36):

My thoughts as well. With JQ, frequent flyers and their transport arm currently representing a fair proportion of QF's total turnover, it could be time for a new corporate structure. If we throw in JQ's operations in Japan and Hong Kong and RedQ into the mix than QF in 2020 could be a very different operation to what it is today.

I'd suggest we will see a further separation of QF corporate and it's operating entities in the years to come. Exciting times for QF!
 
aerokiwi
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RE: QF Separates International & Domestic Ops

Wed May 23, 2012 11:37 am

Quoting Zkpilot (Reply 33):
Looks like just another accounting trick to make Intl appear to be performing badly.

I'm not sure publicly traded companies can employ, and get away with, accounting "tricks". Surely someone with a bit of nous would have obtained the relevant data to prove this by now, no?
 
Ditzyboy
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RE: QF Separates International & Domestic Ops

Wed May 23, 2012 12:01 pm

Erroneous post. Sorry.

[Edited 2012-05-23 05:04:34]
 
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qfvhoqa
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RE: QF Separates International & Domestic Ops

Wed May 23, 2012 12:03 pm

Quoting aerokiwi (Reply 38):
I'm not sure publicly traded companies can employ, and get away with, accounting "tricks". Surely someone with a bit of nous would have obtained the relevant data to prove this by now, no?

Public companies can get away with all sorts of accounting tricks, even if they are audited. Enron is a huge example, and its auditors Arthur Andersen went out of business for overseeing Enron's lies.
 
Ditzyboy
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RE: QF Separates International & Domestic Ops

Wed May 23, 2012 12:06 pm

Quoting RyanairGuru (Reply 14):
QFD aircraft are used on the Tasman routes (albeit crewed by JetConnect)

Tasman flights using VH-registered aircraft (of which there are many) are operated by QAL pilots and cabin crew.
 
ozglobal
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RE: QF Separates International & Domestic Ops

Wed May 23, 2012 12:11 pm

Quoting qf002 (Reply 12):
Quoting OzGlobal (Reply 4):
Would this help Joyce to portray QF international as a loss maker and lobby for a sell off to a foreign investor? There are already assertions that the accounting in the Group favours JQ in terms of costs.

Any Australian International airline has to remain Australian owned. It's the domestic arm that VA has opened up to foreign ownership. So this move cannot be designed to flog off the foreign arm...

I said "Lobby" (i.e. the government remove obstacles) to sell to a foreign interest.

Joyce ONLY knows and therefore enjoys running an LCC. QF international is not his game and as a non-Australian probably has no sentimental or cutural attachement to the brand. Succeeding at what he knows means sooner or later, getting QF international of his plate...
When all's said and done, there'll be more said than done.
 
RyanairGuru
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RE: QF Separates International & Domestic Ops

Wed May 23, 2012 12:39 pm

Quoting ditzyboy (Reply 41):
Tasman flights using VH-registered aircraft (of which there are many) are operated by QAL pilots and cabin crew.

Oh really? I didn't realise that, sorry
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qf002
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RE: QF Separates International & Domestic Ops

Wed May 23, 2012 12:56 pm

Quoting ditzyboy (Reply 41):
Tasman flights using VH-registered aircraft (of which there are many) are operated by QAL pilots and cabin crew.

It's actually very rare to see VH aircraft on the Tasman, aside from those few flights that are actually operated by QF rather than Jetconnect. As it stands, QF121 SYD-ZQN is still operated by QF, so uses VH aircraft and QF141 (used to be tied into the A332) has continued to be operated by QF, using VH aircraft. If Jetconnect gets another 738 then I'd expect both these flights to be transferred to NZ operation.

But as it stands, there are only 9 (out of 110+) weekly Tasman flights operated by VH aircraft.

There has only been 1 flight this month where a VH aircraft has operated where a ZK plane usually would. A cursory glance through April tells a very similar story.

Quoting OzGlobal (Reply 42):
Joyce ONLY knows and therefore enjoys running an LCC. QF international is not his game and as a non-Australian probably has no sentimental or cutural attachement to the brand. Succeeding at what he knows means sooner or later, getting QF international of his plate...

Can I ask where this AJ = LCC attitude comes from (not just you, OzGlobal -- a lot of people bring it up)?

He worked for EI in the period 1988-1996, long before it became a LCC.

He worked for both AN and QF from 1996 till 2003, neither of which can be described as LCC's. From what I can tell, his only association with LCC's is his 5 year stint as CEO of JQ.

How, therefore, can it be said that he only knows and enjoys running LCC's? In his 24 year career in the industry, only 5 have been in a role within a LCC.

I would consider myself to have a very strong sentimental and cultural attachment to the QF brand, and I moved to this country from the UK in the same year as AJ. We even became Australian citizens in the same year -- 2003.

If AJ wanted to shut down QF International, then he would just do it. He's shown that he's willing to do radical things for the overall benefit of the company in the past, so why not just cancel orders, sell planes and shut it all down?

Quoting OzGlobal (Reply 42):
I said "Lobby" (i.e. the government remove obstacles) to sell to a foreign interest.

My apologies. To answer this specific question, not at all. Even if the QF Sales Act was to be thrown out (also not going to happen), the Corporations Act 2001 has heavy guidelines around foreign ownership (these laws also apply to VA and any other Australian company).
 
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ADent
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RE: QF Separates International & Domestic Ops

Wed May 23, 2012 6:17 pm

Quoting aerokiwi (Reply 38):
I'm not sure publicly traded companies can employ, and get away with, accounting "tricks". Surely someone with a bit of nous would have obtained the relevant data to prove this by now, no?

Huh???

It is said every company keeps 3 sets of books. 1 maximizing profits and shown to the investors. 1 maximizing losses to shown to the tax authorities. And the 3rd that shows the real results and shown to management.

There are many fully legal ways to shift costs around and many, many rules on what is proper.



Say you have a maintenance facility that services narrow body and wide body aircraft how do you divide up the overhead costs - building repair/upgrades, lights, power, IT, property taxes, mail room, etc.

- If you have 80 NB visits and 20 WB visits maybe the overhead should be divided up 80/20.
- But the floor space is divided up 50/50, so maybe the overhead should be 50/50.
- The labor hours are split 60/40 - so split costs that way.
- Or how about we set up the facility as a separate company and make the WB cost plus - WB is too critical to outsource - and make the NB cost competitive to win and keep the work. NB runs a loss, but since WB is cost plus those costs go up.
- Sell the facility and lease it back. The sale proceeds go to profits. Facility items like A/C replacement - switching lighting to LED, a new roof - go from capital costs to operating costs.
 
Ditzyboy
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Joined: Thu Feb 28, 2008 5:15 am

RE: QF Separates International & Domestic Ops

Wed May 23, 2012 9:35 pm

Quoting qf002 (Reply 44):
But as it stands, there are only 9 (out of 110+) weekly Tasman flights operated by VH aircraft

Perhaps I was forward thinking, but I suggest you look at the planned flying from June.
 
Ditzyboy
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Joined: Thu Feb 28, 2008 5:15 am

RE: QF Separates International & Domestic Ops

Wed May 23, 2012 9:37 pm

Quoting qf002 (Reply 44):
But as it stands, there are only 9 (out of 110+) weekly Tasman flights operated by VH aircraft

Perhaps I was forward thinking, but I suggest you look at the planned flying from June.
 
brons2
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RE: QF Separates International & Domestic Ops

Wed May 23, 2012 10:17 pm

Why hasn't AJ been fired yet? All he seems to cause is turmoil. At some point, I'd think people would realize that he is the problem, not the solution.
Firings, if well done, are good for employee morale.
 
Gemuser
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Joined: Mon Nov 24, 2003 12:07 pm

RE: QF Separates International & Domestic Ops

Wed May 23, 2012 10:30 pm

Quoting brons2 (Reply 48):
Why hasn't AJ been fired yet? All he seems to cause is turmoil. At some point, I'd think people would realize that he is the problem, not the solution.

Because the Board of Directors disagree with you! They (and the rest of the local financial community) like what he is doing.

Gemuser
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