Australian Aviation Thread # 115

EK413 · Thu Feb 12, 2015 9:45 am

Quoting Enobar (Reply 42):
Qantas announced to the sharemarket today that S & P have revised their credit rating to BB+ Stable which if i'm not mistaken lifts them (barely) back into investment grade.

The good news keeps rolling out of QF these days... It would seem that this is fairly good timing with rumours abound of an incoming 787 order - it should make financing them a bit more comfortable for them.

Hopefully this means QF is a step closer to placing a firm B789 order.

EK413

6thfreedom · Thu Feb 12, 2015 11:12 am

Quoting BNE (Reply 37):

Going, going, gone.

Qantas PER-SIN speculation killed again.

QANTAS during mid-day Wednesday local time (11FEB15) has removed proposed schedule for Perth – Singapore service, which would see the oneWorld member operating Boeing 737-800 aircraft on daily basis, from 13JUN15. QF last operated this route in July 2014 with A330-200/-300 aircraft.

I can understand why it would be pulled.... as I can't understand how this could possibly be successful.

Yes, the QF B738 is an efficient aircraft, but it also has high cost per seat.

who would fly on a QF B738 if they could:
1. take a wide body economy seat on SQ
2. take a bizsccot seat (much the same as business on QF B738) on a scoot B787
3. take a cheaper economy seat on Jetstar
4. fly to PER-SIN when the QF long haul network has moved to DXB?

it just doesn't make sense.

even a VA B738 flying into SIN would be marginal.

bwwt · Thu Feb 12, 2015 11:44 am

Quoting 6thfreedom (Reply 51):
who would fly on a QF B738 if they could:
1. take a wide body economy seat on SQ
2. take a bizsccot seat (much the same as business on QF B738) on a scoot B787
3. take a cheaper economy seat on Jetstar
4. fly to PER-SIN when the QF long haul network has moved to DXB?

1-3. Loyalty? I only really see them restarting the route to appease their FFs.
4. Yep. Because everyone from Perth wants to go to Europe... Singapore is still a popular destination out of Perth!

Bluebird191 · Thu Feb 12, 2015 11:53 am

Quoting EK413 (Reply 50):
Hopefully this means QF is closer to placing a firm B789 order.

Or are they? As much as I want them to and as much as general concensus on here is, it's not entirely a given that QF would order any new aircraft widebody aircraft that would essentially replace the fleet of A330's and allow for international expansion. As much as I know informaton about the topic, I'm not letting it sway my opinion of what I think should happen - order the 788 to cover the A332 replacement, 789 to cover the A333 replacement and order more for expansion, maybe even the 781 for routes where more seats are required than the 789 without the required range. The 788 and 789 would both offer better operating economics than the A332 and A333 when configured with the same amount of seats.

And the A330 fleet is having an interior makeover as well, which costs quite a far bit, so QF management may have decided that they want to keep that product flying for a while to come, but I'm waiting for due process to happen and the announcements to be made at the right time.

Then comes the need to replace the ageing 747 fleet which is getting more and more urgent by the day - am keeping my fingers crossed for an order for the 748.

Quoting 6thfreedom (Reply 51):
4. fly to PER-SIN when the QF long jail network has moved to DXB?

it just doesn't make sense.

There is still feed available to QF at SIN. My contacts within QF have no knowledge of this potential restarting of PER-SIN - I think there would be a good chance of QF making a serious go at this route and potentially being profitable. Fewer seats means you don't need to discount as much to fill them, QF has a better yielding option on the route and a full service carrier vs a group budget carrier, and some feed at SIN. There is the feed from BA to LHR, 3K to a plethora of destinations, potetial of feed from JL, and other feed from wherever they can manage to get it from.

bwwt · Thu Feb 12, 2015 11:59 am

Quoting Bluebird191 (Reply 53):
As much as I know informaton about the topic, I'm not letting it sway my opinion of what I think should happen

Possible A350 order? Wasn't there a rumour a few months back about this?

SYDSpotter · Thu Feb 12, 2015 12:24 pm

Quoting bwwt (Reply 54):
Possible A350 order? Wasn't there a rumour a few months back about this?

I would be a bit surprised if they did order the A350 which would effectively mean they would cancel the B787 options (I don't see both in the fleet). The general consensus is that QF got some pretty sharp pricing on the 787's so it would take a very attractive offer from Airbus for QF to switch, and I don't think Airbus are in a position where they need to offer generous discounts to get the A350 program kicking along.

The A350 doesn't bring anything new to the table that the B787 doesn't already (let's skip the talk about whether the 787 or A350 is the more efficient platform). The only aircraft which would compel QF to switch over would be the A350-1000 (which the B787 cannot match in terms of range/capacity). If the A350-1000 is what QF are looking for, then we start getting into the debate about the good old 777 (77W, 777X) and why/why not it is suitable for QF

TN486 · Thu Feb 12, 2015 1:40 pm

Quoting Bluebird191 (Reply 53):
am keeping my fingers crossed for an order for the 748.

What would be the rationale for QF to order the 748i?

bwwt · Thu Feb 12, 2015 2:21 pm

Quoting SYDSpotter (Reply 55):
I would be a bit surprised if they did order the A350 which would effectively mean they would cancel the B787 options (I don't see both in the fleet). The general consensus is that QF got some pretty sharp pricing on the 787's so it would take a very attractive offer from Airbus for QF to switch, and I don't think Airbus are in a position where they need to offer generous discounts to get the A350 program kicking along.

I would be very surprised too! Bluebirds comments don't leave too many other options though. Unless there will be no new orders?

mariner · Thu Feb 12, 2015 7:38 pm

Quoting Enobar (Reply 47):
Ah you could be right. Ah well... its a least still a step in the right direction for them, even if not a huge one.

Absolutely good news, with the possibility of being raised back to investment grade within a year or 18 months.

http://www.smh.com.au/business/aviat...credit-rating-20150211-13bj8k.html

"Standard & Poor's brightens outlook for Qantas credit rating

Qantas has received a boost to its credit rating outlook due to the end of a damaging capacity fight with Virgin Australia and the sharp decline in the oil price, but it is not expected to regain its prized investment-grade rating for at least another year."

Perhaps the most crucial (financial) thing Qantas could do - in p.r. terms - would be to declare a dividend, at which point many - but not all - of the recent negatives about Qantas/ AJ would disappear. Already, we don't hear much negative talk about "lines in the sand" these days.

I doubt that AJ will ever live down the grounding in the minds of some but to me AJ was a force that had to happen - a bull in a china shop full of egos. The grounding was a defining action that dramatically changed the relationship with the unions - as long as AJ is around. The moment AJ leaves, whether that be sooner or later, I would expect some muscle flexing by the unions.

It will be most interesting to see what happens with the fleet, but given AJ's oft-stated love affair with the 787, I assume some formal order is likely - if not necessarily carved in granite.

The aviation world has changed since the original 787 order and Qantas has changed and the aircraft types available have changed, especially with the variations of the A330. Personally, I don't see a place for the 748i in the fleet, unless Boeing offered a dozen aircraft at five quid each, and even then I'd raise an eyebrow.

Still, the 787 is the obvious front runner, but the financial commentators are expecting him to move quite conservatively, as in the linked article:

"Mr Ferguson said depending on market conditions, Qantas had the ability to cut capital spending by decelerating its fleet investment plans or conversely accelerating those plans. The airline will need to decide by the end of this year whether to exercise the first options over Boeing 787-9 aircraft. Mr Ferguson said if Qantas did expand its fleet, he believed the airline would do so in a "measured and conservative fashion."

All this is based on the profit numbers reaching expectations and some expectations are a bit unrealistic. We live in interesting times.

mariner

Bluebird191 · Thu Feb 12, 2015 10:04 pm

Quoting TN486 (Reply 56):
What would be the rationale for QF to order the 748i?

There would be an aircraft with better operating economics than the 744, offer more capacity for flights to JNB amongst others (I know that loads to SCL and QF15/16 are quite healthy), not being so much of a capacity gap between the A333 (297 seats) vs the A380 (484 seats), and dare I say better commonality. I know the loads on QF15/16 are quite healthy and at certain times of the year both go out chockers.

Sydscott · Thu Feb 12, 2015 10:28 pm

Quoting mariner (Reply 58):
"Mr Ferguson said depending on market conditions, Qantas had the ability to cut capital spending by decelerating its fleet investment plans or conversely accelerating those plans. The airline will need to decide by the end of this year whether to exercise the first options over Boeing 787-9 aircraft. Mr Ferguson said if Qantas did expand its fleet, he believed the airline would do so in a "measured and conservative fashion."

I find that comment curious. Now that the 738's have finished being delivered the major fleet investment plans are the new configs for the A330's and the re-configuration to add more seats to the 738's. I don't see how either of those being delayed would be a good thing for QF. And since they have no major aircraft on order for QF its hard to decelerate fleet investment plans! (I'm not counting the A320NEO's)

mariner · Thu Feb 12, 2015 10:37 pm

Quoting Sydscott (Reply 60):
I find that comment curious. Now that the 738's have finished being delivered the major fleet investment plans are the new configs for the A330's and the re-configuration to add more seats to the 738's.

I assumed it includes the options for the 787 as part of the "major fleet investment plans" and perhaps the deferred A380s.

But that's just an assumption.

mariner

qf2220 · Thu Feb 12, 2015 10:37 pm

Quoting Bluebird191 (Reply 59):
SCL

If they want more capacity to SCL they still have 3 frequencies/week to make it a daily. Plus the Chile bilaterial needs renegotiation I think as this is a restriction.

SYDSpotter · Thu Feb 12, 2015 11:05 pm

Quoting mariner (Reply 61):
I assumed it includes the options for the 787 as part of the "major fleet investment plans" and perhaps the deferred A380s.

Agreed, I think the comment is referring to investment in new aircraft rather than hinting at the possibility of 'decelerating' capex on fleet refurbishment. In this instance, 'decelerate' = further defer/push out/cancel exercising of the 787/A380 options; 'accelerate' = take up the options.

SCL767 · Thu Feb 12, 2015 11:21 pm

Quoting Qf2220 (Reply 62):

When QF launched the SYD-SCL route the airline indicated that the first step was to increase frequency from 3x weekly to 5x weekly with the possibility of a daily service:
Qantas elige a Chile como base en la región tras dejar Argentina

Thus far, the fifth frequency only operated for two weeks last December. It will be interesting to see how QF reacts to the increase in flights between South America and Oceania considering that LAN will fly SCL-AKL-SYD 10x weekly with the 787-9 by the end of the year and NZ will launch its AKL-EZE service.

mariner · Fri Feb 13, 2015 12:14 am

Quoting SCL767 (Reply 64):
It will be interesting to see how QF reacts to the increase in flights between South America and Oceania considering that LAN will fly SCL-AKL-SYD 10x weekly with the 787-9 by the end of the year and NZ will launch its AKL-EZE service.

My word, yes.

Of all the things that Qantas and Air NZ are doing, and may do, South America is probably the most interesting to me.

mariner

qfvhoqa · Fri Feb 13, 2015 3:13 am

UL have loaded a possible CMB-MEL flight into the GDS. AS we saw with QF's PER-SIN disappearing, this flight may not come about, but it is an interesting sign.

SriLankan Airlines S15/W15 Operation Changes as of 13FEB15

Quote:
Colombo – Melbourne UL proposes 4 weekly A330-300 service from 02NOV15. This filing is only listed in the OAG, therefore reservation is not available
UL601 CMB0100 – 1630MEL 333 x237
UL602 MEL1800 – 2300CMB 333 x237

UL has also announced they will now codeshare on the following 3K routes out of SIN:
Singapore – Bangkok
Singapore – Darwin
Singapore – Ho Chi Minh City
Singapore – Kuala Lumpur
Singapore – Perth
Singapore – Phuket

qf2220 · Fri Feb 13, 2015 3:26 am

Quoting qfvhoqa (Reply 66):

The timing isn't great into CMB for it, but what sort of traffic might be interested in using CMB into India and QF codesharing on UL from CMB? This might help QF compete against SQ into India?

SCL767 · Fri Feb 13, 2015 4:51 am

Quoting mariner (Reply 65):

Quoting SCL767 (Reply 64):
It will be interesting to see how QF reacts to the increase in flights between South America and Oceania considering that LAN will fly SCL-AKL-SYD 10x weekly with the 787-9 by the end of the year and NZ will launch its AKL-EZE service.

My word, yes.

Of all the things that Qantas and Air NZ are doing, and may do, South America is probably the most interesting to me.

I concur as well. Exciting times ahead for pax traveling between Australia/New Zealand and South America and the 6 new frequencies coming online later this year will further increase connectivity between Oceania and South America. It is amazing that LAN will be able to offer 13 weekly flights between SCL and SYD later this year, (LAN will remove its code from QF's Friday departure starting next week). Perhaps QF will finally add that fifth frequency on the route year-round later this year. Also, QF really needs to improve its OTP on the SYD-SCL route. According to Chile's Junta Aeronáutica Civil, of all the carriers operating into SCL during 2014, QF's OTP was an abysmal 50,6%, (right behind Aerolíneas' OTP of 55.4%)!

SYDSpotter · Fri Feb 13, 2015 5:15 am

Quoting SCL767 (Reply 68):
Also, QF really needs to improve its OTP on the SYD-SCL route. According to Chile's Junta Aeronáutica Civil, of all the carriers operating into SCL during 2014, QF's OTP was an abysmal 50,6%, (right behind Aerolíneas' OTP of 55.4%)!

What's the criteria for OTP? There aren't usually too many delays out of SYD (traffic/weather) for QF's departure slot of 12.50pm, so I wonder what's causing the poor OTP?

qf2220 · Fri Feb 13, 2015 5:26 am

Quoting SCL767 (Reply 68):
I concur as well. Exciting times ahead for pax traveling between Australia/New Zealand and South America and the 6 new frequencies coming online later this year will further increase connectivity between Oceania and South America. It is amazing that LAN will be able to offer 13 weekly flights between SCL and SYD later this year, (LAN will remove its code from QF's Friday departure starting next week). Perhaps QF will finally add that fifth frequency on the route year-round later this year. Also, QF really needs to improve its OTP on the SYD-SCL route. According to Chile's Junta Aeronáutica Civil, of all the carriers operating into SCL during 2014, QF's OTP was an abysmal 50,6%, (right behind Aerolíneas' OTP of 55.4%)!

In the interest of disclosure, are you a LAN employee? I think it would be beneficial for this to be known as your writing here is very pro LAN (almost sales like) and it may need some context for other readers. I don't know, there may be a perfectly valid reason why the QF OTP is not the best. Perhaps the unpredictability of the winds in the deep south (a route not used by many carriers, so less data to use in calcs) leads to difficulty in making accurate estimates?

I guess im saying, lets be balanced here, or if there is bias, let it be known so that all readers can make up their own minds.

SCL767 · Fri Feb 13, 2015 5:47 am

Quoting SYDSpotter (Reply 69):
What's the criteria for OTP?

The industry standard which considers a flight to be on time that leaves or arrives within 15 minutes indicated by the airline's schedule.

Quoting SYDSpotter (Reply 69):
There aren't usually too many delays out of SYD (traffic/weather) for QF's departure slot of 12.50pm, so I wonder what's causing the poor OTP?

Late departures out of SCL.

Quoting Qf2220 (Reply 70):
I don't know, there may be a perfectly valid reason why the QF OTP is not the best. Perhaps the unpredictability of the winds in the deep south (a route not used by many carriers, so less data to use in calcs) leads to difficulty in making accurate estimates?

This information is published by the Chile's JAC.

Quoting Qf2220 (Reply 70):
I guess im saying, lets be balanced here, or if there is bias, let it be known so that all readers can make up their own minds.

I'm simply reiterating facts that have been published by numerous reliable sources that are readily accessible via different outlets. To each their own I guess...

aerokiwi · Fri Feb 13, 2015 5:48 am

Quoting Qf2220 (Reply 70):
I guess im saying, lets be balanced here, or if there is bias, let it be known so that all readers can make up their own minds.

Or just relax and accept what are, apparently, official figures for OTP, no bias required.

SCL767 is the resident enthusiast from Chile providing updates on LAN's impressive growth in the southwest pacific - works for me.

Meanwhile, QF's "remarkable" turnaround from just last year when the taxpayer was being asked to back the airline's debt because the airline was on the verge of cataclysm - how iiiiinteresting, yet goes by almost unquestioned, lost in the public relations fed story of this magnificent management team pulling one out of the hat.

[Edited 2015-02-12 21:57:53]

SCL767 · Fri Feb 13, 2015 5:59 am

Quoting Qf2220 (Reply 70):
I don't know, there may be a perfectly valid reason why the QF OTP is not the best. Perhaps the unpredictability of the winds in the deep south (a route not used by many carriers, so less data to use in calcs) leads to difficulty in making accurate estimates?

I should have mentioned that during 2013, QF's OTP on the SYD-SCL route was 71.2% Thus with a 20% decline compared to the previous year the sharp decline was a bit surprising since 51.1% of QF's flights departed late from SCL.

qf2220 · Fri Feb 13, 2015 6:03 am

Quoting aerokiwi (Reply 72):
official figures for OTP, no bias required.

Quoting SCL767 (Reply 68):
According to Chile's Junta Aeronáutica Civil, of all the carriers operating into SCL during 2014, QF's OTP was an abysmal 50,6%, (right behind Aerolíneas' OTP of 55.4%)!

Quoting SCL767 (Reply 71):
I'm simply reiterating facts that have been published by numerous reliable sources that are readily accessible via different outlets. To each their own I guess...

The use of the word abysmal and the placing of the number next to Aerolineas may taint the neutrality of the raw facts presented, regardless of how neutral or objective the source of the numbers is.

Quoting SCL767 (Reply 71):
Quoting SYDSpotter (Reply 69):There aren't usually too many delays out of SYD (traffic/weather) for QF's departure slot of 12.50pm, so I wonder what's causing the poor OTP?

Late departures out of SCL.

Are any of these caused by late arrival by LAN flights, where QF intentionally holds the aircraft for late LA flights so as not to inconvenience the pax any further than LA has done? I can speak for two occasions when this has happened to me, and I know this is not conclusive proof, but I'm sure there are others.

SYDSpotter · Fri Feb 13, 2015 6:07 am

Quoting SCL767 (Reply 71):
The industry standard which considers a flight to be on time that leaves or arrives within 15 minutes indicated by the airline's schedule.

Quoting SCL767 (Reply 71):
Late departures out of SCL.

Hmm I guess given it is their only flight into/out of SCL, there's not going to be a significant population. Half of your flights not arriving/departing within 15 mins is not ideal, but if the delays are only typically 20-30mins (as opposed to > 1 hr), it shouldn't be a massive issue given it is a long-haul flight.

Are there any SCL specific issues that you can think of that might be causing QF to depart late out of SCL (waiting on connecting pax, congestion etc)?

SCL767 · Fri Feb 13, 2015 6:41 am

Quoting Qf2220 (Reply 74):
The use of the word abysmal and the placing of the number next to Aerolineas may taint the neutrality of the raw facts presented, regardless of how neutral or objective the source of the numbers is.

This information is available via Chile's Civil Aeronautics Board (CAB) website. According to the CAB QF ranked the lowest followed by Aerolíneas and Austral. Sorry if you feel that the CAB "tainted the neutrality of the raw facts presented" by placing QF after both AR and AU.

Quoting Qf2220 (Reply 74):
Are any of these caused by late arrival by LAN flights, where QF intentionally holds the aircraft for late LA flights so as not to inconvenience the pax any further than LA has done?

That could be the case. Also, QF may have had mechanical issues which inconvenienced many LAN and TAM passengers as well. LATAM's OTP for 2014 was 83% and if QF decides delay its departure due to late flights, mechanical reasons, bad weather, etc. that is their decision; not LAN's. LAN operates multiple daily flights between SCL to/from other regional destinations that offers pax multiple flights to connect onto QF's service form destinations, i.e. BUE, GIG, GRU, LIM, etc. Also, note that the codeshare agreement whereby QF placed its code on LA's regional flights went into effect during the fourth quarter of 2014.

qf2220 · Fri Feb 13, 2015 7:19 am

Quoting SCL767 (Reply 76):

Sorry, im not continuing this discussion, im not sure you see my points.

SCL767 · Fri Feb 13, 2015 7:30 am

Quoting Qf2220 (Reply 77):
Sorry, im not continuing this discussion, im not sure you see my points.

That's fine with me. I was just going to publish the schedules of the two new daily LATAM operated flights that are being added to/from Brazil which would further enhance connections onto QF flights. However it's pointless since QF does not have a codeshare agreement with TAM.

aerokiwi · Fri Feb 13, 2015 7:52 am

Quoting Qf2220 (Reply 77):
Sorry, im not continuing this discussion, im not sure you see my points.

Good. I'm not sure anyone does.

On another subject, is it true that Network's Fokker fleet is being repainted in QF colours? If so, is there a timetable for the first rollout? I always thought the QF colours would look great on the F100.

QF762 · Fri Feb 13, 2015 8:40 am

The actual questions with regards to QF's poor on-time performance between SCL and SYD is actually what their OTP is for arrival, as that reflects better inconvenience for pax. I'd guess it's better than their OPT departure percentage?

mariner · Fri Feb 13, 2015 9:14 am

Quoting aerokiwi (Reply 72):
Meanwhile, QF's "remarkable" turnaround from just last year when the taxpayer was being asked to back the airline's debt because the airline was on the verge of cataclysm - how iiiiinteresting, yet goes by almost unquestioned, lost in the public relations fed story of this magnificent management team pulling one out of the hat.

Fair suck of the sav - that's standard negotiating practise in my industry. Always ask for much more than you know you're going to get and settle for what you actually want.

Qantas asked for the moon and settled for changes to the QSA. Fairly sensibly, AJ let Tony Abbott do the heavy lifting.

It is not dissimilar to the tactics used by Hollywood for "The Hobbit" - the "cataclysmic" threat not to film in NZ. Among other things, Warner Brothers wanted changes to NZ labor laws - and it got 'em.

mariner

[Edited 2015-02-13 01:15:37]

Airvan00 · Fri Feb 13, 2015 10:17 am

The OTP for departures is totally meaningless. The only figure that matters is the arrival OTP.
On transpacific flights qantas regularly delay departures but manage to achieve an on time arrival. There is a lot of slack in the schedules to take into account the large variations in average winds over the season.

ZuluAlpha · Fri Feb 13, 2015 2:54 pm

On the whole OTP debate for the QF flights into SCL, I would ask if the information includes or does not include the QF codeshare operated by LA (e.g. do the figures only show say SYD/SLC delays?)

The reason for my questioning, when seeing the number of call outs to customers for delayed flight to SCL, the QF321/322 (LA ops) seem significantly greater in both number of call outs and the amount of time of the delay seems to be far greater on the LA ops aircraft than the QF ops aircraft.

I have seen delays on the QF321 in particular, as an example, the pax have had to both overnight in AKL and in SCL from their initial point of origin to their final destination due to some of the delays on the QF321

ZuluAlpha · Fri Feb 13, 2015 3:04 pm

Quoting aerokiwi (Reply 79):
On another subject, is it true that Network's Fokker fleet is being repainted in QF colours? If so, is there a timetable for the first rollout? I always thought the QF colours would look great on the F100.

I can possibly understand if some (maybe all?) will be painted when Network Aviation take over (at least) the PER GET and PER LEA QFLink DH4 services from mid - late March15.

ben175 · Fri Feb 13, 2015 3:43 pm

VH-EBA is now back in service - I believe the third 332 to be reconfigured after EBV and EBI. Looks like EBQ has headed off to BNE today for the reconfiguration.

qf002 · Fri Feb 13, 2015 3:56 pm

Quoting ben175 (Reply 85):
VH-EBA is now back in service - I believe the third 332 to be reconfigured after EBV and EBI. Looks like EBQ has headed off to BNE today for the reconfiguration.

-EBI hasn't been reconfigured yet, just -EBV and -EBA (plus -QPA).

descl · Fri Feb 13, 2015 4:11 pm

Quoting ZuluAlpha (Reply 83):
On the whole OTP debate for the QF flights into SCL, I would ask if the information includes or does not include the QF codeshare operated by LA (e.g. do the figures only show say SYD/SLC delays?)

Nop...Flights operated by QF, only.

http://www.jac-chile.cl/santiago

Here you can see performance of all airlines flying to SCL.

For example, last trimester, QF operated 48 flights out of SCL, of those only 37,5% were on time.
The average was 85% and the best Air France with 96,7%.

As you can see, it's only for departures, not arrivals.

PoleHillSid · Fri Feb 13, 2015 9:40 pm

QF94 VH-OQK LAX-MEL coming into SYD.

aerokiwi · Fri Feb 13, 2015 11:17 pm

Quoting mariner (Reply 81):
Fair suck of the sav - that's standard negotiating practise in my industry. Always ask for much more than you know you're going to get and settle for what you actually want.

Qantas asked for the moon and settled for changes to the QSA. Fairly sensibly, AJ let Tony Abbott do the heavy lifting.

It is not dissimilar to the tactics used by Hollywood for "The Hobbit" - the "cataclysmic" threat not to film in NZ. Among other things, Warner Brothers wanted changes to NZ labor laws - and it got 'em.

Yeah, and it sucks.

Throw in a few accounting tricks that stun should-be-informed analysts and we have a "remarkable turnaround story". Not to mention the emphasis on QF's "underlying profit" (which I think VA promotes as well), whatever the hell that means. Effectively, as a shareholder, you'd have to wonder what the hell is going on. And as an employee, why would you trust anything coming out of your boss's mouth? Sorry folks, no payrise (or job) any time soon because we've been jimmying the numbers in a game of cat and mouse with the government - you understand, I'm sure.

Quoting Airvan00 (Reply 82):
The OTP for departures is totally meaningless. The only figure that matters is the arrival OTP.

I have heard that back when only departure time was used as a measure, pilots would take off one of the breaks which triggers the computer system that determines "departure" and qualifies as having left the gate.

Quoting Airvan00 (Reply 82):
On transpacific flights qantas regularly delay departures but manage to achieve an on time arrival. There is a lot of slack in the schedules to take into account the large variations in average winds over the season.

Except building in a lot of slack is an old trick to jip the OTP measures - JQ do it in New Zealand by scheduling an extra five minutes into their flight times. Also, that's anecdotal. And...

Quoting DESCL (Reply 87):
For example, last trimester, QF operated 48 flights out of SCL, of those only 37,5% were on time.
The average was 85% and the best Air France with 96,7%.

That would seem to be an awfully large variance from the average. And if LA is able to perform better at departure (are they?), well... what's QF's problem? Equipment, maybe?

CBRboy · Fri Feb 13, 2015 11:23 pm

Quoting polehillsid (Reply 88):

The Qantas website shows that it spent 48 minutes on the ground in Sydney before going on to Melbourne. A medical emergency?

SYDSpotter · Fri Feb 13, 2015 11:36 pm

Quoting DESCL (Reply 87):
Nop...Flights operated by QF, only.

http://www.jac-chile.cl/santiago

Here you can see performance of all airlines flying to SCL.

For example, last trimester, QF operated 48 flights out of SCL, of those only 37,5% were on time.
The average was 85% and the best Air France with 96,7%.

As you can see, it's only for departures, not arrivals.

Thanks for the link, I don't know any Spanish, but if you have a look at the Oct-Dec 2014 performance, but looking at OTP by destination rather than airline, you will see that AKL services (i.e. LAN) had a 50% OTP rate and QF SYD services a 37.5%.

The performance for the other 2014 quarters show a similar pattern:

Jul-Sep 2014:
AKL: 48.9%
SYD: 47.5%

Mar-Jun 2014:
AKL: 55.4%
SYD: 79.1%

Jan-Mar 2014:
AKL: 38.2%
SYD: 41.5%

So looking at the above, its look like all transpacific ops out of SCL (whether it be LAN or QF) are regularly departing late, this suggests that the late departures is due to aircraft waiting for connecting pax. So not sure this is a QF specific thing.

mariner · Fri Feb 13, 2015 11:54 pm

Quoting aerokiwi (Reply 89):
Yeah, and it sucks.

That's a very subjective view. On a very much smaller scale, that negotiating tactic has just worked very well for me. Donald Trump describes it as "the art of the deal"

Quoting aerokiwi (Reply 89):
Throw in a few accounting tricks that stun should-be-informed analysts and we have a "remarkable turnaround story". Not to mention the emphasis on QF's "underlying profit" (which I think VA promotes as well), whatever the hell that means.

We agree about "underlying profit," which drives me doollaley. I prefer the simple American terminology of "operating (gross) profit" and "net income."

But any Australian analyst should understand "underlying profit" and it has been used in NZ, too - although the (NZ) Auditor General didn't seem best pleased about it, at least in connection with the SOE's who were using it:

http://www.oag.govt.nz/2012/central-govt-volume-2/part3.htm

"Reporting alternative performance measures such as "underlying profit"

But I don't agree that it is a "remarkable turnaround" at Qantas. I think it's good, but I don't think it is remarkable. As I've been saying for yonks, I think AJ was simply doing what he had to do and he was following a well-trodden path by some overseas airlines.

If people want to describe this as "remarkable" perhaps they didn't understand what they were seeing, or what AJ was doing, or were members of the "bash Qantas" set or preferred the John Borghetti silken tongue. Or maybe they preconceived ideas about what Qantas should be doing.

There was a time there when AJ couldn't anything right in some people's estimation ("Joyce Must Go") and that's still true for some, I guess.

mariner

AirNiugini · Sat Feb 14, 2015 12:36 am

Quoting Qf2220 (Reply 74):
Are any of these caused by late arrival by LAN flights, where QF intentionally holds the aircraft for late LA flights so as not to inconvenience the pax any further than LA has done? I can speak for two occasions when this has happened to me, and I know this is not conclusive proof, but I'm sure there are others.

Quoting aerokiwi (Reply 89):
That would seem to be an awfully large variance from the average. And if LA is able to perform better at departure (are they?), well... what's QF's problem? Equipment, maybe?

There is nothing wrong with the equipment that QF operate into SCL.

QF2220, that is pretty much my experience with this route too. While the 30% or so OTP rate is not good, I think it is perfectly acceptable if the delay is to ensure all connecting passengers are on that flight. An hour or so delay, maybe cheaper for QF (and more customer friendly) then having to organise hotels and re-book passengers onto another flight.

It has been a while since I have been on AR, so I am not too sure about their OTP these days. Given this, it would be an interesting comparison to see Air NZ OTP when it opens EZE when partnering with AR. With only 3 flights a week to EZE, no doubt it would be a no brainer to also hold the departure if there are connecting passengers delayed.

qf2220 · Sat Feb 14, 2015 1:25 am

Quoting aerokiwi (Reply 89):
Not to mention the emphasis on QF's "underlying profit"

Quoting mariner (Reply 92):
We agree about "underlying profit," which drives me doollaley. I prefer the simple American terminology of "operating (gross) profit" and "net income."

The regulators hate underlying, and many underlying profits are to a large extent stripping out one offs to show to the market some sort of 'normalised' profit, as if the one offs shouldn't count. It comes very close to being an extraordinary item which was allowed under the old Australian Accounting Rules, but when the International Standards came in, was banned.

One aspect though of QF's I agree with is the hedging adjustments. The rules used to make companies test the effectiveness of their hedges, and if they were outside of an 80%-125% effectiveness range, they were deemed ineffective and expensed to the P&L. So, if your actual fuel cost was 100 different to planned, but the hedge instrument you were using to offset this future variability was only 75 different to planned, the whole 75 was taken to the P&L. In QF's case, these hedges ran over multiple years and you could see a hedge being called innefective in one year, for it to be effective the next, and ultimately overall effective (or a range of possibilities that involved at least one period of ineffectiveness). This is probably an anomaly in the accounting standards which lead to things being done that shouldn't be, and I think it has changed. QF used to split these out and show the impact of this, creating in my mind a result that was more meaningful. This was especially the case when they were making low profits and the swings due to hedging could be a huge difference. It worked both ways for QF too, sometimes they made the adjustment even if the statutory result was worsened. So in this case, I would say underlying was a more reliable measure than statutory.

qf2220 · Sat Feb 14, 2015 1:28 am

Quoting AirNiugini (Reply 93):
QF2220, that is pretty much my experience with this route too. While the 30% or so OTP rate is not good, I think it is perfectly acceptable if the delay is to ensure all connecting passengers are on that flight. An hour or so delay, maybe cheaper for QF (and more customer friendly) then having to organise hotels and re-book passengers onto another flight.

Good info. Plus, when you add in that the LA flight takes off almost at midnight, whereas QF is around 1pm, it is very possible that QF has more chance of a delay due to late arriving connections than LA, who are probably waiting for less flights.

aerokiwi · Sat Feb 14, 2015 2:27 pm

Quoting Qf2220 (Reply 94):
The regulators hate underlying, and many underlying profits are to a large extent stripping out one offs to show to the market some sort of 'normalised' profit, as if the one offs shouldn't count. It comes very close to being an extraordinary item which was allowed under the old Australian Accounting Rules, but when the International Standards came in, was banned.

Interesting.

The thing I don't get is why any reference to "underlying profit" isn't banned outright. That kind of communication from the airline to the market probably does impact on share price (for retail investors anyway - the institutions surely know better), so it should probably come under whatever regs govern listed companies' reporting requirements.

I would have thought that underlying profit is pretty damn close to misleading the market.

qf2220 · Sat Feb 14, 2015 11:21 pm

Quoting aerokiwi (Reply 96):

This sort of disclosure is a non statutory disclosure, and banning it could be seen as a restriction of free speech.

ASIC does however have a detailed Regulatory Guide (#230), detailing how non statutory and statutory information should be presented. I don't work for BDO but here is their webpage describing the RG

http://www.bdo.com.au/resources/news...ing-non-ifrs-financial-information

Quote:
In this regard, the guide specifies that the following would not be relevant to an understanding of the entity’s financial performance and may not be shown as subtotal information (RG 230.30): Continuing the statement of comprehensive income to remove certain items from IFRS profit to arrive at an alternative profit (This guideline makes sense)

This notes that disclosing an underlying measure in the primary financial statements is essentially not allowed. A disclosure in the notes to the financial statement is allowed if an underlying measure is used. Qantas and Virgin both comply with this part of the RG.

I think that the RG goes some way, if not substantially or all the way, to reducing the ability of companies to mislead the market.

Of note, there is another anomaly in the accounting standards where the segment note is to be presented how the chief operating decision maker sees the results and makes decisions (which could be a board, CEO, executive committee etc, as defined by the entitiy). So, if an entity presents underlying information to its CODM (eg through the monthly management reports used by an exco to allocate resources), they are seemingly compelled to include it in the annual report. Then, that needs to be reconciled to the statutory results presented. If anyone is interested, both QF and VA seem do this in their segment note.

a345b727 · Sun Feb 15, 2015 4:50 am

Quoting mariner (Reply 81):
Fair suck of the sav

Had to LOL at that one, haven't heard that phrase in a loooooooong time. You nearly got your respected user rating upped to 85, only stopped by a thought that it should only be for airliner-related respect, not colloquialism-related respect..................

mariner · Sun Feb 15, 2015 9:57 am

Quoting a345b727 (Reply 98):
Quoting mariner (Reply 81):
Fair suck of the sav

Had to LOL at that one, haven't heard that phrase in a loooooooong time.

Old Australian slang has served me very well in my work. But try getting "fair suck of the sav" past the spell-checker. For about five minutes it read "fair suck of the save."

mariner

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