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factsonly
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Is QF & EK Working?

Sat Jun 01, 2013 6:29 pm

Looking at the first reported figures for April 2013, you might start to wonder.......

Qantas - April 2013 Passengers - International: 463,000 -7.2%

In March 2013 Qantas reported - International Pax 490.000 -4.3%

Yes, it is only one month into the new cooperation, but is anyone else surprised at these results?

http://centreforaviation.com/news/qa...p-5-in-apr-2013-yields-down-234392
 
by738
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RE: Is QF & EK Working?

Sat Jun 01, 2013 6:40 pm

I thought id read somewhere that there had been a dramatic increase in loads on the shared routes since the coop. Maybe that was just Qantas marketing. Cant see why it wouldnt work though
BA are sure to feel the pinch on their UK-AUS links and connections
 
anstar
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RE: Is QF & EK Working?

Sat Jun 01, 2013 6:42 pm

I believe QF dropped

ADL-SIN
PER-HKG
and dropped PER-SIN from 2 daily to 1 daily with the timetable change so the drop in numbers probably reflects that capacity reduction rather than having anything to do with the EK tie up.
 
anstar
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RE: Is QF & EK Working?

Sat Jun 01, 2013 6:52 pm

Quoting by738 (Reply 1):
BA are sure to feel the pinch on their UK-AUS links and connections

Ive heard loads have dropped from high 90's down to 70's on other forums.

As the only EU carriers flying to Australia, I believe VS has the better route now. SYD-HKG will have a lot more O&D traffic than SYD-SIN that BA offer - not to mention the Virgin Australia codeshare on the route. I believe alot of the success of the route is being able to sell traffic on the second leg rather than LHR-SYD traffic.

I'd also think the reduction in FF points earnt by Qantas members on BA now will also push more QF FFers to QF/EK which is only bad news for BA.
 
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EK413
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RE: Is QF & EK Working?

Sat Jun 01, 2013 11:42 pm

I was always under the impression BA continues to do very well on the UK-Kangaroo route spite of the JSA with QF dropped.

As for the QF/EK Alliance I'd say its too early to judge. Perhaps we can compare once the venture has been operating for a full 12 months.

EK413

[Edited 2013-06-01 17:08:02]
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thegeek
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RE: Is QF & EK Working?

Sat Jun 01, 2013 11:52 pm

Quoting anstar (Reply 2):
I believe QF dropped

ADL-SIN
PER-HKG
and dropped PER-SIN from 2 daily to 1 daily with the timetable change so the drop in numbers probably reflects that capacity reduction rather than having anything to do with the EK tie up.

But the link states that the load factor on international has dropped. Not good to drop your load factor while shrinking ASKs.
 
Glasgow
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RE: Is QF & EK Working?

Sun Jun 02, 2013 12:15 am

How do the fares compare to before the agreement, particularly AUS-UK?

The flights I've been looking at appear to have taken a sharp rise in cost compared to last year.
 
vhebb
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RE: Is QF & EK Working?

Sun Jun 02, 2013 12:20 am

QF also dropped FRA.

QF also has a lot of extra Asia capacity to fill with a short lead in time for the new schedule which began to roll out from April 1st. My guess is this will effect the figures for April and May and even early June.

QF Intl CEO has said they now have allot of extra Asia capacity especially into SIN which will take some time to fill up.

Also remember A333s have replaced smaller A332s into ports like PVG, CGK, and MNL meaning more capacity than the previous periods.

As for the EK partnership I can only see it getting stronger...
 
cam747
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RE: Is QF & EK Working?

Sun Jun 02, 2013 12:41 am

All of the recent changes QF have made on their international network make logical sense to me, so I am a bit surprised by these figures. However, as per the QF media release:

"Qantas International’s revenue seat factor for the month of April 2013 was adversely impacted by reduced
selling on routes to Europe prior to the Australian Competition and Consumer Commission granting interim
approval of the Qantas Emirates partnership, as previously reported, as well as the withdrawal of Qantas’
Frankfurt service and changes to the Asian network"

So I think its far too soon to be judging the partnership on its first month. We don't know what the forward bookings look like, other than what we have been told by Alan Joyce, which is that they have improved significantly. Also a big benefit of the partnership should be reflected in QF's domestic numbers, as EK passengers take domestic connecting flights.

I don't think we'll see the full benefit of the partnership until we've seen a full year of company financials under the new arrangement.
 
thegeek
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RE: Is QF & EK Working?

Sun Jun 02, 2013 1:19 am

Quoting Glasgow (Reply 6):
How do the fares compare to before the agreement, particularly AUS-UK?

Link also states that yields have deteriorated. Perhaps that is due to external factors, perhaps not.

Quoting vhebb (Reply 7):
As for the EK partnership I can only see it getting stronger...

Perhaps, but the first set of numbers aren't encouraging. Quite discouraging actually.
 
Lufthansa
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RE: Is QF & EK Working?

Sun Jun 02, 2013 7:01 am

Firstly 2 things...

The EK network really is mostly about european travel. It compliments QF on some asian routes like BNE/MEL to SIN but other than that its largely about european passengers so judging the entire network by the EK alliance isn't appropriate to ask if the EK deal has worked.

Next.. advanced sales weren't allowed before the deal was approved

Next, as mentioned earlier there is a huge amount of seats particularly into singapore now freed up because they're no longer feeding london and frankfurt flights. There will be time for this to adjust. So I think its far too early to say if it's worked or not yet.
 
qf002
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RE: Is QF & EK Working?

Sun Jun 02, 2013 7:31 am

Firstly, these figures aren't solely in reference to Europe or Asia. They are network wide.

Secondly, QF has added seats to their A380s and 744s oer the past couple of years (a 6% increase for the A380s and a 21% increase for the 744s). On average, they are flying more seats per international flight today than they were year ago.

I'm waiting to see what QF has to say in their FY14 reports, which is when we've been promised that the turnaround will be complete and all the various impacts of cuts/new partnerships will start to become evident.

Quoting by738 (Reply 1):
I thought id read somewhere that there had been a dramatic increase in loads on the shared routes since the coop. Maybe that was just Qantas marketing.

QF/EK have been talking abut bookings, not loads. The impact of bookings won't be evident until we've seen how the partnership performs over the course of 12 months, including all the typical peaks/non-peak periods.

Quoting anstar (Reply 3):
As the only EU carriers flying to Australia, I believe VS has the better route now. SYD-HKG will have a lot more O&D traffic than SYD-SIN that BA offer - not to mention the Virgin Australia codeshare on the route. I believe alot of the success of the route is being able to sell traffic on the second leg rather than LHR-SYD traffic.

SIN-SYD is a bigger and more corporate market. It's also been rather let down by QF's recent changes (no evening flight out of SYD, and the loss of the newer A380 product), so I think that BA could have the opportunity to target OW flyers who aren't happy.

Comparatively, I don't see any opportunity for VS to do any better than they are today on the back of the last few months. The HKG-SYD market is already very well served by both CX/QF and VS offers nothing new/different to a market that is already completely stitched up by the two local carriers.

Quoting thegeek (Reply 10):
Link also states that yields have deteriorated. Perhaps that is due to external factors, perhaps not.

Nowhere does it say that yields are 'deterioirating'. It states that they were 'lower than the prior corresponding period'.

We also don't know just how much lower that yields were this year compared to last year. If load factor is down, and fares are steady, then it's fair to assume that yeild drops slightly. If this drop is beyond the drop in load factor then they need to be concerned, but if it's not then the issue will correct itself if they focus on filling their planes up a bit more.
 
thegeek
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RE: Is QF & EK Working?

Sun Jun 02, 2013 8:00 am

Quoting qf002 (Reply 12):
Nowhere does it say that yields are 'deterioirating'. It states that they were 'lower than the prior corresponding period'.

I don't understand the distinction.

And look at the stats: http://www.asx.com.au/asxpdf/20130530/pdf/42g6j9rlv9lxn0.pdf
Shows ASKs dropped by 3.5% for QF International.
 
SYDSpotter
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RE: Is QF & EK Working?

Sun Jun 02, 2013 11:20 am

Quoting qf002 (Reply 12):
Firstly, these figures aren't solely in reference to Europe or Asia. They are network wide.

  

Without further commentary, hard to tell if it is Europe, Nth America, Asia or Tasman which is the cause of the decrease.

It's only 1 month into a 10 yr partnership, lets give it a bit of time before we pass judgement.
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qf002
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RE: Is QF & EK Working?

Sun Jun 02, 2013 11:44 am

Quoting thegeek (Reply 13):
I don't understand the distinction.

Deteriorate would suggest a rather more dramatic/dire situation than what actually might be happening. I just felt that you were slightly overstating what the link was saying, given that the reduction could be minimal (and like I said, linked to increased core operating costs per seat due to lower loads).

Quoting thegeek (Reply 13):
Shows ASKs dropped by 3.5% for QF International.

Not sure what you're getting at here? The drop is ASKs is probably linked to the various cuts over the past 12 months (the biggest being SIN-FRA and AKL-LAX, which together account for ~200,000 seats per year on longish routes).

[Edited 2013-06-02 04:44:42]
 
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EK413
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RE: Is QF & EK Working?

Sun Jun 02, 2013 12:03 pm

Quoting SYDSpotter (Reply 14):
It's only 1 month into a 10 yr partnership, lets give it a bit of time before we pass judgement.

10 years is what QF/EK applied for however was granted 5 years.

EK413
Good evening, ladies and gentlemen. We are tonight’s entertainment!
 
Gemuser
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RE: Is QF & EK Working?

Sun Jun 02, 2013 12:42 pm

Quoting EK413 (Reply 16):
10 years is what QF/EK applied for however was granted 5 years.

As I understand it the QF/EK agreement has a term of 10 years, however it has only been approved by the ACCC for 5 years. They must apply for re-approval in 5 years. Doesn't mean the agreement between the airlines has changed.

Gemuser
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goosebayguy
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RE: Is QF & EK Working?

Sun Jun 02, 2013 6:46 pm

I still see this deal as only benefiting EK. QF have made a huge mistake sleeping with the devil. EK are increasing their market penetration of Australia and QF are losing. BA benefits from people not wanting to change planes at DXB a great Unique selling point these days.
 
rutankrd
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RE: Is QF & EK Working?

Sun Jun 02, 2013 7:04 pm

Quoting goosebayguy (Reply 18):
BA benefits from people not wanting to change planes at DXB a great Unique selling point these days

Only if your are O&D from/to London.

Anywhere else not so much.
 
ozglobal
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RE: Is QF & EK Working?

Sun Jun 02, 2013 8:38 pm

As a Platinum QF FF based in Paris, this alliance certainly isn't working for me. QF codeshare pricing on the EK flights is today still 30% (1200 - 1400 Euros) more for the same seat in J on EK to Oz. Surely they've had time to collaborate on pricing; otherwise why offer the codeshare??? I spend a good amount of my own money on J class travel CDG-Oz and I will continue to fly CX and am considering moving entirely to EK from QF membership: how's that Mr Joyce? Mission accomplished??
When all's said and done, there'll be more said than done.
 
thegeek
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RE: Is QF & EK Working?

Sun Jun 02, 2013 10:17 pm

Quoting qf002 (Reply 15):
Not sure what you're getting at here?

Just trying to put hard numbers against what you are stating here:

Quoting qf002 (Reply 12):
Secondly, QF has added seats to their A380s and 744s oer the past couple of years (a 6% increase for the A380s and a 21% increase for the 744s). On average, they are flying more seats per international flight today than they were year ago.

3.5% drop in ASK for QF Int with a further drop in load factors and yields is a pretty unpleasant combination. Perhaps we will see a J curve. It's certainly too early to rule that out.
 
BenSandilands
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RE: Is QF & EK Working?

Mon Jun 03, 2013 12:26 am

The problem as I see it is that loyal Qantas customers don't see boarding a code shared Emirates flight as being flying Qantas.

As mentioned elsewhere several times, Qantas has given many of its customers a reason to consider the alternatives, which include Emirates all the way anywhere, and competitors like Etihad, which I'm on at the moment on EY455.

Qantas needs to ask big brother for dual liveried jets and come up with new ways of keeping Qantas visible on the routes where the partnership comes into play. Waiting for 789s if the airline becomes profitable is a wait too long.

I strongly recommend a review of the April traffic figure filings to the ASX last Thursday. Read the paragraph about negative yields right across all operations, including the Jetstar input.

No one is going to wait a year for things to come right. This is a very dynamic industry. It's like saying don't eat my play lunch and going away for an hour.

What will cause fury in the finance sector is that Qantas has engineered itself into a disappearing act for no cash benefit.

Which would be a fair summary of colleague Steve Creedy's story in The Australian today.

Yes one month is not the end of the world for Qantas But it does focus, I hope, it's attention on what could otherwise turn into a really sad debacle.
 
Sydscott
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RE: Is QF & EK Working?

Mon Jun 03, 2013 1:14 am

Quoting BenSandilands (Reply 22):
The problem as I see it is that loyal Qantas customers don't see boarding a code shared Emirates flight as being flying Qantas.

Using that logic I suppose they wouldn't see a boarding coded LAN flight as flying Qantas, or an AA flight with a QF flight number on as flying Qantas, nor would they have seen a British Airways flight out of LHR with a QF code on as flying Qantas. Surely VA customers have the same "identity" problem when they fly SQ or EY or NZ?

Quoting BenSandilands (Reply 22):
Qantas needs to ask big brother for dual liveried jets and come up with new ways of keeping Qantas visible on the routes where the partnership comes into play. Waiting for 789s if the airline becomes profitable is a wait too long.

This doesn't seem to be a problem for VA. Nor was it a problem when QF dropped pax off at SIN to board Air France flight to CDG or at HKG when QF dropped pax off to board a CX flight to FCO. Why is it all of a sudden more of a problem now that they're at DXB with a proper partner than it was with the hodge podge of codeshares before? Why is this an EK/QF problem when it wasn't really an issue when it was BA/QF?

Here's what I really don't get in all of this. The "experts" and the "commentators" warned, whinged and wrote diatribe over the rise of the Middle East Carriers for years and on how uncompetitive LHR was as a hub for QF. Some even wrote about why QF didn't join with one of them to combat its structural disadvantage of being an end of line carrier. Now QF has executed a deal with the 10 pound gorilla in the room which at the stroke of a pen resolves all of its European network and hub problems and people are complaining about 1 months worth of traffic figures, at the beginning of an agreement, where QF couldn't book people through until it was approved, where they withdrew from FRA and where issues around codeshares and capacity allocations, (refer Italy IASC decision), are still being resolved and are basically calling it a crisis already?
 
BenSandilands
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RE: Is QF & EK Working?

Mon Jun 03, 2013 3:02 am

SydScott,

You make some very good points and I'd be among those who agree with most of them.

I think these developments are about how code share deals are done and executed rather than whether or not we need them. Customer behaviour is also often overlooked when the business cases are made. I fear this may be true in the case of the QF-EK deal.

QF-EK is unusual in that involves an attempted transfer of a large part of Australia from the Qantas customer base to that of a competitor. Which is of this day still selling for less than Qantas, judging from comments above.

Let me digress on so called experts. Many of them are analysts whose job is to sell shares or other financial services. If we keep that in mind I think they make a worthy contribution to the discussion, but you must I believe always ask, where are they coming from and what do they want?

The burning question for myself is not whether code sharing is good or bad or makes sense of doesn't, but whether it does what the proponent Qantas said it would do. I noticed Virgin Australia this morning announced expanded code shares with competing as well as complimentary stakeholders Etihad and Singapore Airlines. I've asked similar questions about this in a post made on descent into Abu Dhabi. (Incredibly fast internet on Etihad, must say.)

Having often been correctly described as an old school journalist, my role is not to provide PR solutions or offer corporate solutions to the airlines, but to ask questions.

Which is also one of the good things about this forum. What is really going on is often the best question we can ask.
 
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RyanairGuru
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RE: Is QF & EK Working?

Mon Jun 03, 2013 3:03 am

Quoting BenSandilands (Reply 22):
The problem as I see it is that loyal Qantas customers don't see boarding a code shared Emirates flight as being flying Qantas.

But unless you fly to Frankfurt, how has anything changed?

As a QF customer I much prefer being able to fly to MAN one-stop on EK than the pretty little jaunt through LHR that was previously necessary. That wasn't "flying Qantas", and I'm still not flying QF. BUT, and this - in my mind is the most important aspect - I now have much better options, more schedules, and more destinations than ever before. Therefore my Qantas FF status and loyalty is now IMHO more valuable than at any point. Ever.

Quoting goosebayguy (Reply 18):
BA benefits from people not wanting to change planes at DXB a great Unique selling point these days.

To be blunt, CX will benefit a lot more than BA. First, BA only fly to SYD and from MEL or BNE you need something like a 6-7 hour connection at HKG. Moreover, and as much as I have a soft spot for BA, their service is sub-par compared to just about every major competitor on the route (CX, SQ, EK, EY, QF etc)

Quoting goosebayguy (Reply 18):
EK are increasing their market penetration of Australia and QF are losing

Do you want to elaborate on this point?


CAN WE PLEASE HAVE SOME PERSPECTIVE: QF are NOT doing this to much a fortune "flying" to third-tier destinations in Europe on their previously biggest enemy. They are doing this to shore up their weak position in Europe in order to keep their [domestic] FFs loyal so that they fly QF on the money spinning domestic and North American networks, plus Asia. They probably wouldn't be too concerned if they never made a cent from the partnership, so long as it covered costs.

VA's "virtual" network via EY and SQ posed a real threat to QF: they could get you to places that QF couldn't. Therefore why fly QF at all? As we all know the Australian domestic market is the profit centre for QF. With VA biting at the bit in that market, trying to attract corporate contracts and high value J passengers, they had a very important selling point that QF didn't: a comprehensive international network. By remedying this situation QF hope to discourage their FFs from jumping ship to VA.

Are some FFs who fly to Europe as the predominant element of their travel patterns likely to look at alternatives? Quite probably. The sort of FF who flew to LHR every month might prefer other options (including BA and CX) that allow them to fly the longest segment into LHR so they can have a decent rest prior to arrival. But this flying is marginal at best for QF. Quite frankly if they had to choose between loosing the FF who flys to LHR every month and SYD-MEL every week, they would dump the former every day of the week and twice on saturdays. The latter FF now has better options, more destinations, and more flights for the one or two occasions each year when they do go to Europe, quite possibly on leisure which is unlikely to include the UK.
Worked Hard, Flew Right
 
koruman
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RE: Is QF & EK Working?

Mon Jun 03, 2013 3:25 am

The problem for Qantas frequent flyers is that this is an unequal marriage, and the loser is the Australian consumer.

A fully-integrated model would have required:

1) Emirates to deploy Premium Economy class on all codeshare servcies on the Kangaroo Route.
2) Both airlines to open up upgrade as well as award inventory to their partner airline.
3) Network-wide lounge access and points and status earning on both airlines.

Instead, the partnership is as flawed as the Virgin Australia / Etihad one, which I used precisely once before giving up. There are so many conditions, so many pitfalls, that it isn't worth taking the risk of buying a ticket. My most frustrating experiences as a passenger are often "that earns miles but no status credits" or "you can't upgrade that ticket because of the operating carrier". I avoid such dangers like the plague now.

Full integration would mean that a passenger flying BNE-DXB-LHR on all-EK metal but a QF ticket would have near-identical experiences to if he had flown SYD-DXB-LHR. But there is nothing whatsoever on BNE-DXB-LHR which has the slightest similarity to Qantas servcies.

But Qantas is just the tail that can't even wag the dog, so of course Emirates has made no effort whatsover to change anything.

So, in effect, Qantas has simply exited the Kangaroo Route from every city apart from Sydney and Melbourne, and the Emirates options are precisely what they were before the marriage.

The joint venture does have some great aspects: especially Emirates' reach into secondary European centres. But Qantas should have insisted upon Premium Economy class and proper integration of the loyalty programs (covering both upgrades and status earning on all of one another's networks) before inflicting this upon the public.
 
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RyanairGuru
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RE: Is QF & EK Working?

Mon Jun 03, 2013 5:46 am

Quoting koruman (Reply 25):
proper integration of the loyalty programs (covering both upgrades and status earning on all of one another's networks) before inflicting this upon the public.

While I agree with the general gist of your post, with regards to this point about FF EK have actually been a lot more generous than QF. With QF you only earn status credits, status bonus etc if the ticket is coded to QF. EK, in comparison, is systemwide on QF (except domestic). QF did this deliberately because if you buy an EK ticket on EK then they see no revenue from that purchase at all, whereas if it is bought from QF then they receive a commission on the sale. Therefore they want to push their FFs onto QF codeshares as opposed to booking with EK directly.

So long as FFs are fully informed of this (and to their credit I think that QF did a better job than VA did) then I'm not sure that it is a huge issue, as you earn status bonus, status credits, and cabin bonus at the same accrual rate as if it was a QF flight. The big issue is not being able to upgrade.
Worked Hard, Flew Right
 
Airvan00
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RE: Is QF & EK Working?

Mon Jun 03, 2013 6:00 am

I haven't found the lack of premium ecomony on EK a problem. I have found that instead of W via London, for about the same price I can go from sydney to Central Europe on an EK code share in J. Ok, I only do 2 legs on QF metal instead of the 4 via LHR, but I get to enjoy Qantas J ( on an EK flight number)

The point about keeping QF FF's happy is a good one, I use the points generated on my European excursions to up grade my domestic flying.
 
qf002
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RE: Is QF & EK Working?

Mon Jun 03, 2013 7:00 am

Quoting thegeek (Reply 20):
3.5% drop in ASK for QF Int with a further drop in load factors and yields is a pretty unpleasant combination

But that drop is accounted for by the fact that they have cut several pretty major flights. The fact is (and I can post a big rundown to prove it if you want me to), that they are flying more seats per international flight today than they were a year ago.

Adding capacity to each flight without adding more passengers will always result in a lower overall load. I don't dispute that their loads are lower than a year ago, but I do absolutely dispute the idea that it automatically means that passengers are abandoning QF and that QF's core business is 'deterioirating' and that QF is doomed.

It might well mean that, but it could also mean plenty of other things.

Quoting BenSandilands (Reply 21):
The problem as I see it is that loyal Qantas customers don't see boarding a code shared Emirates flight as being flying Qantas

Absolutely, flying EK is not flying QF. The issue for most QF customers is the frequent flyer points/status rather than a desire to experience the QF product. So long as the product is of a similar standard, I don't see it as being an issue (and it's certainly less of an issue than it was back with BA, who had a shocking product compared to QF).

Quoting BenSandilands (Reply 23):
QF-EK is unusual in that involves an attempted transfer of a large part of Australia from the Qantas customer base to that of a competitor.

But EK was already luring a lot of QF's customer base away from QF. The transfer had already been done, and this move was simply QF's way of ensuring that those customers were still linked to QF to try and retain their custom elsewhere in the network.

The talk from QF has always been about opening up Europe for their customers, but the partnership is as much about QF unlocking the customer base that EK has built in this country.
 
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EK413
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RE: Is QF & EK Working?

Mon Jun 03, 2013 7:46 am

Quoting gemuser (Reply 16):
As I understand it the QF/EK agreement has a term of 10 years, however it has only been approved by the ACCC for 5 years. They must apply for re-approval in 5 years. Doesn't mean the agreement between the airlines has changed.

Correct, QF/EK applied for 10 years but was given approval for 5 years. (both parties are satisfied with the 5 approval)

EK413
Good evening, ladies and gentlemen. We are tonight’s entertainment!
 
thegeek
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RE: Is QF & EK Working?

Mon Jun 03, 2013 9:56 am

Quoting qf002 (Reply 28):
But that drop is accounted for by the fact that they have cut several pretty major flights. The fact is (and I can post a big rundown to prove it if you want me to), that they are flying more seats per international flight today than they were a year ago.

I think I see your argument now. If the route cuts such as AKL-LAX and SIN-FRA account for more than 3.5% of the previous ASKs then they are actually flying more ASKs on the routes they are still flying as compared to previously so therefore a reduction in loads and yields is expected. A possibility.
 
n729pa
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RE: Is QF & EK Working?

Mon Jun 03, 2013 5:12 pm

I found the QF10 LHR-MEL to be a third+ empty going down a couple of weeks ago, had a row of seats to myself all the way down. Coming back the QF9 was packed.

Another thing to consider from the UK to Australia at the moment is the rate of exchange. The AUD is very very strong against the GBP at the moment, so it's making Australia very expensive to visit.

The Lions are touring at the moment, and the official UK tour agency were only offering package deals (flight/hotels/tours/tickets etc), but now they are selling tickets by themselves, so clearly the demand isn't there. In 2001 I believe the travelling fans numbered 40,000 from the UK, this time it's reckoned to be 30,000 so whilst the interest is high, the ROE and economy is hurting.

Got my tickets ready so roll on MEL/SYD, flying down again in 2 weeks on QF, returning on QF sorry I mean EK just to try them out.

Service on the QF9 MEL-LHR last week was not to usual QF standard on either sector which was disappointing. Some of the crew seemed very young and perhaps lacked a bit of experience. Hopefully just a poor flight, very unusual though. Hopefully my 30th QF flight on the 21st will be "normal service resumed".
 
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RyanairGuru
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RE: Is QF & EK Working?

Tue Jun 04, 2013 1:02 am

Quoting n729pa (Reply 31):
The AUD is very very strong against the GBP at the moment, so it's making Australia very expensive to visit

Very true, inbound tourism has fallen off a cliff in the last couple of years. The flipside, though, is that outbound tourism is growing strongly because of the "cheap" USD/GBP/EUR. The impact of this is that traffic has been fairly constant, if not up, although the Australian tourism industry is really hurting between fewer foreign tourists coming and more Australian tourists choosing to go abroad rather than Queensland.
Worked Hard, Flew Right
 
BenSandilands
Posts: 220
Joined: Sun Mar 10, 2013 10:04 am

RE: Is QF & EK Working?

Tue Jun 04, 2013 3:53 am

The cruel situation for Australian inbound tourism for the time being is that while there is good relief appearing from the high exchange rate, the traditionally productive economies generating visitations to Australia from Europe and the UK and the US are themselves in crisis or depressed.

So when estimates are made as to how quickly and in what volume Australian tourism will benefit they will have to be decoupled from any immediate or linear adjustment . It's going to take longer, and be harder to gain an advantage, although it will be worth it when it happens.

A 'less robust' AUD will also impact fuel costs, and capital raising costs in foreign currencies, but it will make Qantas and Virgin look much better (and more fairly so) in their labour costs and productivity comparisons.

There is also a hope in private circulated banking analysis that international trade improvements resulting from a lower AUD will generate more business traffic, but the question is just which airlines might benefit from this.
 
pa747sp
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RE: Is QF & EK Working?

Tue Jun 04, 2013 4:12 am

EK gets lots of advantages:
2 additional A380s a day from Australia within the existing bi-lateral
A lot more potential for the bi-lateral to allow for increased services
Access to market to QF FF membership
QF gets one vital benefit:
The ability to sell a huge network west of DXB with one stop, without having to actually fly planes to every city.
Australia is now EKs most important market segment, making up 24% of network revenue. The partnership with QF is a smart move for them, and a crucial move for QF.

The writing has been on the wall for QF for years. Being at the end of a huge market means that they cannot operate a hub-and-spoke network internationally. For carriers like EK, for every flight that leaves Australia they are effectively selling a flight to every city west or close by DXB. It only takes 10 pax on each flight who want to fly to 30 destinations to fill a plane. There's no way that QF could profitably offer pax flights to all the cities that EK operate to with their own aircraft.

Although Australians like to complain about QF service, or bad management, it really does just come down to geography. Compare QF international, which is widely reported as losing money, to their domestic, which makes money. On domestic they compete on a very level playing field. No airline gets any geographical advantage, and so they end up competing in a similar environment. Compare that to international, where in two of their three major market areas (Europe, South/North East Asia, Transpacific) they compete with other carriers who all have the geographical advantage of being able to operate hub-and-spoke networks.

All though we are all plane buffs, and like to think that things that are important to us are important to everyone, for most people the two factors are schedule and price. They want to get there as fast as possible, with as little incovenience as possible, at a good price. Good service is just the icing on the cake that convinces a person to spend $20 extra on a flight because they have heard that the airline provides good service.
Nothing seems as good since the VC10.
 
klinit
Posts: 63
Joined: Thu Jan 17, 2013 7:18 am

RE: Is QF & EK Working?

Tue Jun 04, 2013 9:28 am

Quoting goosebayguy (Reply 17):
BA benefits from people not wanting to change planes at DXB a great Unique selling point these days.

Hardly unique - there are several options that are not via DXB, many of which are better than flying BA.

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