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Pentaprism
Posts: 52
Joined: Mon Mar 11, 2019 1:12 pm

Re: Virgin Australia to enter voluntary administration

Wed Jun 10, 2020 10:15 pm

Short List of Bidders getting Shorter?

https://www.theguardian.com/business/20 ... er-support

I was a bit surprised about the number of "keen" bidders for VA. I assumed once they all did their due diligence they would come to the conclusion the Company is worthless and walk away. Pretty much how it eventually played out with Ansett.

But their Playbook is a little different, they are aware the Government is under a lot of pressure not to let Virgin fail and they are speculating they may get enough Government Funding to make the figures work.

Very interesting to see what happens from here, Branson is still in the picture, and apparently consulting closely with both Bidders, but not making many commitments about injecting his own cash. I see this as a bit of a stumbling block to the Government offering any funding, the debate in the LNP on what to do is always going to come back to the point that he is a current (part) Owner and wants to be a future (part) Owner so let him burn his cash before we start throwing away the tax payers hard earned pennies.

The Government has always said they want Australia to have 2 Airlines but I don't think they necessarily need to save Virgin for this to happen. Geoff Dixon once remarked there is always somebody trying to start an Airline and this will surely be the case if Virgin disappear. The Market is too big to be ignored and there are probably a lot of people already planning to start a new Carrier if Virgin Liquidates. Given the debt Virgin has racked up this might be a better outcome. Whether we get a new Carrier or a revived Virgin there is no guarantee either will be successful and that we won't be back where we are now in a few years. But the Tax Payer will be happier if his money wasn't wasted trying to prop up this very high risk industry.
 
anstar
Posts: 3262
Joined: Sun Nov 23, 2003 3:49 am

Re: Virgin Australia to enter voluntary administration

Wed Jun 10, 2020 11:27 pm

Rex have said they are exploring getting 10 Jets and would make a decision. by the end of June I think it was. Also what is not to say that the other bidders who have pulled out didn't just join the race to get a look into their books. See what is working and whats not and start from scratch with a smaller investment required.
 
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CraigAnderson
Posts: 539
Joined: Fri Jan 05, 2018 12:28 am

Re: Virgin Australia to enter voluntary administration

Mon Jun 15, 2020 5:52 am

Seems that Cyrus held media interviews over the weekend, mounting a bit of a media blitz jut like Bain did before the bidding closed.

Summary: Cyrus wants the new Virgin Australia to be smaller, mid-market and more like Virgin America; would keep 'Virgin' brand but drop Tiger; focus on a smaller all-737 network; not chase the top end of the corporate market, so maybe goodbye to The Club.

https://www.executivetraveller.com/news ... alia-cyrus
 
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vhtje
Posts: 1181
Joined: Sat Jan 10, 2009 12:40 pm

Re: Virgin Australia to enter voluntary administration

Mon Jun 15, 2020 11:06 am

CraigAnderson wrote:
Seems that Cyrus held media interviews over the weekend, mounting a bit of a media blitz jut like Bain did before the bidding closed.

Summary: Cyrus wants the new Virgin Australia to be smaller, mid-market and more like Virgin America; would keep 'Virgin' brand but drop Tiger; focus on a smaller all-737 network; not chase the top end of the corporate market, so maybe goodbye to The Club.

https://www.executivetraveller.com/news ... alia-cyrus


Surely the logic of keeping the Virgin brand is flawed? I left Australia in 2004, when DJ was still the new upstart, so I freely admit I am out of touch, but has Virgin developed have the same brand loyalty in Australia that, say, Ansett did? (I am NOT advocating that whatever VA becomes, that it assumes the AN name)

It seems to me sending licensing fees to the Virgin Group is a waste of money; besides, presumably the current administration has tarnished the VA brand. Therefore, it seems a good opportunity to take the bones of the VA organisation and turn into something else, something fresh - and something that does not involve royalty payments to Virgin Group.

(There has been studies done in the UK, and the 'Virgin' brand is not perceived by Millennials as an industry disruptor in the way that is is/was by Gen-Xers and Baby Boomers; instead it is seen as mainstream. I assume that it is the same in Australia?)

Or - am I wrong, and is the VA brand highly valued in Australia?
I only turn left when boarding aircraft. Well, mostly. All right, sometimes. OH OKAY - rarely.
 
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eta unknown
Posts: 2803
Joined: Wed Jun 13, 2001 5:03 am

Re: Virgin Australia to enter voluntary administration

Mon Jun 15, 2020 12:18 pm

The only value is to someone who prefers not to deal with QF/JQ. AN was far better than VA, but those were different times. Anyway, this drawn out saga might be over in 2 weeks if the cash runs out and liquidation becomes the default option.
 
xiaotung
Posts: 1071
Joined: Fri Jan 06, 2006 7:58 pm

Re: Virgin Australia to enter voluntary administration

Mon Jun 15, 2020 2:13 pm

vhtje wrote:
CraigAnderson wrote:
Seems that Cyrus held media interviews over the weekend, mounting a bit of a media blitz jut like Bain did before the bidding closed.

Summary: Cyrus wants the new Virgin Australia to be smaller, mid-market and more like Virgin America; would keep 'Virgin' brand but drop Tiger; focus on a smaller all-737 network; not chase the top end of the corporate market, so maybe goodbye to The Club.

https://www.executivetraveller.com/news ... alia-cyrus


Surely the logic of keeping the Virgin brand is flawed? I left Australia in 2004, when DJ was still the new upstart, so I freely admit I am out of touch, but has Virgin developed have the same brand loyalty in Australia that, say, Ansett did? (I am NOT advocating that whatever VA becomes, that it assumes the AN name)

It seems to me sending licensing fees to the Virgin Group is a waste of money; besides, presumably the current administration has tarnished the VA brand. Therefore, it seems a good opportunity to take the bones of the VA organisation and turn into something else, something fresh - and something that does not involve royalty payments to Virgin Group.

(There has been studies done in the UK, and the 'Virgin' brand is not perceived by Millennials as an industry disruptor in the way that is is/was by Gen-Xers and Baby Boomers; instead it is seen as mainstream. I assume that it is the same in Australia?)

Or - am I wrong, and is the VA brand highly valued in Australia?


I think the Virgin brand has very little value in the minds of Australian consumers nowadays. They will not travel VA any more or less if they rebrand tomorrow. My guess is Brandson has made a deal with the bidders. Perhaps he will chip in some money or maybe he has agreed to waive royalty for a few years. Plus rebranding is expensive and it's a no brainer to retain the brand for the time being for the new owner.
 
airhansa
Posts: 380
Joined: Wed Jan 08, 2020 3:18 pm

Re: Virgin Australia to enter voluntary administration

Mon Jun 15, 2020 4:16 pm

Virgin is worthless as a brand. It's appeal in the UK was buoyed by it successful operation of semi-high-speed train routes just at the right time when they were introduced, but it's just a name associated with the British Virgin Isles everywhere else. But does Australia really need a second airline when everyone else is getting rid of their's?
 
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VirginFlyer
Posts: 5574
Joined: Sun Sep 10, 2000 12:27 pm

Re: Virgin Australia to enter voluntary administration

Mon Jun 15, 2020 5:32 pm

airhansa wrote:
Virgin is worthless as a brand. It's appeal in the UK was buoyed by it successful operation of semi-high-speed train routes just at the right time when they were introduced, but it's just a name associated with the British Virgin Isles everywhere else. But does Australia really need a second airline when everyone else is getting rid of their's?

I don’t live in the UK, and In the 25-odd years I’ve been aware of the Virgin brand, not once have I associated it the British Virgin Islands, nor have I heard others do so. As for trains, my understanding was that Virgin’s appeal was much earlier buoyed by its record business and setting up an airline which generated a lot of publicity, but as I said, I don’t live in the UK so maybe that’s just an outsider’s point of view and the trains are really the main part of the Virgin brand’s appeal...?

V/F
It is not for him to pride himself who loveth his own country, but rather for him who loveth the whole world. The earth is but one country, and mankind its citizens. —Bahá'u'lláh
 
airhansa
Posts: 380
Joined: Wed Jan 08, 2020 3:18 pm

Re: Virgin Australia to enter voluntary administration

Mon Jun 15, 2020 5:46 pm

VirginFlyer wrote:
airhansa wrote:
Virgin is worthless as a brand. It's appeal in the UK was buoyed by it successful operation of semi-high-speed train routes just at the right time when they were introduced, but it's just a name associated with the British Virgin Isles everywhere else. But does Australia really need a second airline when everyone else is getting rid of their's?

I don’t live in the UK, and In the 25-odd years I’ve been aware of the Virgin brand, not once have I associated it the British Virgin Islands, nor have I heard others do so. As for trains, my understanding was that Virgin’s appeal was much earlier buoyed by its record business and setting up an airline which generated a lot of publicity, but as I said, I don’t live in the UK so maybe that’s just an outsider’s point of view and the trains are really the main part of the Virgin brand’s appeal...?

V/F


When the Virgin Trains venture came to Miami, the first think that I thought of was the British Virgin Islands. The founder even has a home/domicile in the Virgin Islands. But I admit it might not be true everywhere else.

I admit I don't know much about the UK operations, but I remember that I was recommended to travel on Virgin Trains many years ago because it was the best way to get to Scotland. Never once I have been told to travel on Virgin Atlantic nor has Virgin Records been around during my lifetime.
 
gaystudpilot
Posts: 249
Joined: Sat Dec 08, 2007 10:55 pm

Re: Virgin Australia to enter voluntary administration

Mon Jun 15, 2020 7:20 pm

My partner and I have flown VA in business class several times. The service was outstanding every time.

I’m not a marketing expert, but the Virgin brand, in its early years at least, stood for young, hip, stylish and imagining what could be. That made a lot of sense when Virgin Atlantic began flying. As time went on and the Virgin Group entered new businesses that held true to some degree.

From a commercial aviation perspective in 2020, does that kind of brand compete in the marketplace — i.e., are those elements relevant to consumers and presented in a way that’s differentiated in the marketplace? And most importantly, is that brand offered with a network that profitable consumers demand?

I’d hate to see the brand go away. But I also know that QF and NZ offer great service and I’d fly them US-AU/NZ, hands down before DL, UA or AA (in order).
 
travelhound
Posts: 2008
Joined: Fri May 23, 2008 9:13 pm

Re: Virgin Australia to enter voluntary administration

Mon Jun 15, 2020 10:31 pm

The Virgin brand is fairly old and as such people of an older generation probably relate to the brand (and its ethos) than people of younger generations.

Still, I think it is fair to say the Virgin name has very high brand awareness and regardless of the administration of VA is still seen as a credible brand for consumers when making buying decisions.

In the scheme of things, the $15m license agreement for a business that is turning over $4.5+ billion represents less than 0.5% of sales. On the same point, I suspect there are other Virgin Group management contracts that we don't know about, so a reorganisation of the business could result in the Virgin Group receiving a lot less income than what they were previously.

Interestingly, the Virgin America franchise was unique in that it adopted a hybrid carrier model. I suspect this business model, as an alternative to the Full Service Carrier model adopted by QANTAS could be a worthy alternative as passenger demographics change.

I think we have to remember, to date the Australian consumer has only ever had the either/or option of FSC or LCC!

As we have seen in the car industry, where consumer perceptions of cars largely revolved around the either/or option of a Ford or Holden, changing market conditions resulted in a situation where both manufacturers became almost irrelevant by the consumer over a very short period of time.

As such, the buy-out of Virgin Australia could be a good opportunity to revitalise the Virgin brand around the emerging markets associated with younger generations of consumers.

I think the Virgin brand still has a considerable amount of value.
 
redroo
Posts: 570
Joined: Tue Jun 07, 2016 10:28 pm

Re: Virgin Australia to enter voluntary administration

Mon Jun 15, 2020 10:57 pm

Ditching the brand now would be a folly to spend money on rebranding and aircraft repainting when you can even pay your bills.

Saying that though... the brand is like your drunk auntie cracking onto to your 18 year old mates at a BBQ... not classy and a bit tragic.

But that’s just my opinion and I was a Virgin Atlantic gold for many years.
 
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qf2220
Posts: 1946
Joined: Fri Aug 16, 2013 9:16 pm

Re: Virgin Australia to enter voluntary administration

Tue Jun 16, 2020 12:22 pm

eta unknown wrote:
The only value is to someone who prefers not to deal with QF/JQ. AN was far better than VA, but those were different times. Anyway, this drawn out saga might be over in 2 weeks if the cash runs out and liquidation becomes the default option.


Agreed. If it were possible the name that the new airline should have is 'NotQantas' as that is really what VA (and possibly Ansett before it) was really known as given our dupoloistic market.
 
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allrite
Posts: 2610
Joined: Wed Aug 08, 2007 11:28 pm

Re: Virgin Australia to enter voluntary administration

Wed Jun 17, 2020 2:03 am

qf2220 wrote:
eta unknown wrote:
The only value is to someone who prefers not to deal with QF/JQ. AN was far better than VA, but those were different times. Anyway, this drawn out saga might be over in 2 weeks if the cash runs out and liquidation becomes the default option.


Agreed. If it were possible the name that the new airline should have is 'NotQantas' as that is really what VA (and possibly Ansett before it) was really known as given our dupoloistic market.


The fact is that you simply can't have Virgin Mark II. You don't get a second chance. The new brand should be Experienced Air.
I like artificial banana essence!
 
Ishrion
Posts: 2662
Joined: Mon Feb 04, 2019 6:17 am

Re: Virgin Australia to enter voluntary administration

Fri Jun 26, 2020 1:16 am

Bain Capital takes over Virgin Australia:

https://www.executivetraveller.com/news ... -australia
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