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Kashmon
Posts: 642
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RE: Jetstar Hong Kong Denied Licence

Sun Jun 28, 2015 1:09 am

Quoting EK413 (Reply 68):

yes CX does feel threatened
because of Jetstar won

then EK,SQ etc with their unlimited well of money
could set up airlines at HKG and use HKG rights and limit CX or any other HK airline from using HK rights!

something CX cannot do in other countries

so yes
CX does feel threatened and rightly so....
 
infinit
Posts: 1058
Joined: Thu Jul 31, 2008 1:12 am

RE: Jetstar Hong Kong Denied Licence

Sun Jun 28, 2015 4:06 am

Quoting Kashmon (Reply 100):

SQ has an unlimited well of money? Howcome they haven't added a single new route in the last 5 years then?  

The Singapore government has never protected SQ which was the most profitable international airline by market cap for over 2 decades. Heck the Singapore government was initially even against the formation of SQ back in the day of Malaysia-Singapore Airlines. It was JY Pillai and his team who convinced the government they could run an airline profitably in a liberal aviation hub by offering a value-added product.. despite competition.

What about the SIN-based Jetstar Asia? It didn't kill SQ despite flying to many former SQ-cashcow routes like PEN.

SIN has let a whole lot of LCCs in and even premium carriers are given 5th freedom flights- KL flies to Bali from SIN and Air France to Jakarta among, EK and EY have 5th freedom's from SIN to Australia. These routes are the heart of SQ's bread-and-butter (which btw is a much older airline than EK which virtually copied SQ's business model). Despite that SQ is doing reasonably well. SQ posted a profit of nearly $400 million last year- when their southeast asian contemporaries TG and GA bled.

As a consumer in SIN, I like it. I personally prefer SQ because I value their soft and hard product but I have a lot more choice. If I decide to fly to BKK I can also take Jetstar, Tiger and even Cathay Pacific
 
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zeke
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RE: Jetstar Hong Kong Denied Licence

Sun Jun 28, 2015 5:19 am

Quoting jupiter2 (Reply 98):
Beyond rights ex Australia for Hong Kong based airlines through Australia give them New Zealand and at a stretch South America, where else do you think they would go ?

I dont know, why not let the market work it out ?

Quoting jupiter2 (Reply 98):
I'm pretty sure that CX if it chose could operate to New Zealand through Australia.

Sure they could, but I think that market to too low yielding for CX to consider.

Quoting jupiter2 (Reply 98):
Hong Kong based airlines get the stop over points between Australia and Hong Kong and the ability to carry Australia originating passengers beyond Hong Kong on a single ticket (7th freedoms ?) an extremely valuable commodity.

No sure what you are saying here, no flights originate in Australia and terminate beyond, and there are no stop over flights to Australia.

Quoting jupiter2 (Reply 98):
How many actually include HKG as a stop though ? HKG is hardly a stop over point to Vietnam, Taiwan, Philippines, etc from Australia.

Had a look at Thailand, Japan, and Korea agreements, they specifically mention HKG as a permitted point, Indonesia and the Philippines say any point. Could not find the agreement for Taiwan.

Quoting jupiter2 (Reply 98):
So a great number of those 230 routes that they may have applied for, may, or may not be covered by previous bilaterals and may, or may not require the flight to originate or conclude in Australia. Well that seems like a good basis for an open skies agreement.

The only one I saw that required the flight to originate in Australia without an aircraft swap was the US agreement. Guam however could be operated today eg CNS-GUM-HKG by JQ.

Quoting jupiter2 (Reply 98):
But they have great locations, if they didn't they'd still be small fishing towns.

SIN is not that good location, what exactly is it in the center of ?

Quoting Kashmon (Reply 100):
then EK,SQ etc with their unlimited well of money
could set up airlines at HKG and use HKG rights and limit CX or any other HK airline from using HK rights!

I think the implied statement there is that current HKG carriers somehow are inefficient or uncompetitive. I think EK and SQ would know the routes that they compete on directly with CX are very competitive. Unlike those airlines, CX does not have government backing.

Quoting infinit (Reply 101):
SQ has an unlimited well of money? Howcome they haven't added a single new route in the last 5 years then?

Nor does CX, no goverment history, unlike QF, SQ, zTG, GA, MH, EK, EY.
Human rights lawyers are "ambulance chasers of the very worst kind.'" - Sky News
 
jupiter2
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RE: Jetstar Hong Kong Denied Licence

Sun Jun 28, 2015 7:03 am

Quoting zeke (Reply 102):
SIN is not that good location, what exactly is it in the center of ?

Well it's a damn site better location as a hub than anywhere in Australia isn't it ! Not as good as HKG or DXB for some destinations, but better than either of those for others.

Quoting zeke (Reply 102):
I dont know, why not let the market work it out ?
Quoting zeke (Reply 102):
Sure they could, but I think that market to too low yielding for CX to consider.

So the only real natural beyond rights that CX could have, if they don't already, is considered by yourself, too low yielding for CX to consider. I suppose you want to see CX operate HKG/SYD/LAX ,another one of those natural, lets not deviate several thousand miles out of our way routings
 
Quoting zeke (Reply 102):
No sure what you are saying here, no flights originate in Australia and terminate beyond, and there are no stop over flights to Australia.

Forget about that, I re-read the details and what I thought it was, isn't   my bad.

Quoting zeke (Reply 102):
Had a look at Thailand, Japan, and Korea agreements, they specifically mention HKG as a permitted point, Indonesia and the Philippines say any point. Could not find the agreement for Taiwan.

But is it worded specifically that an Australian airline could operate HKG/MNL, without the flight originating, or terminating in Australia ?. The ones you mentioned have routings which could be continuations from Australia or as intermediate points.

Quoting zeke (Reply 102):
Nor does CX, no goverment history

Can you say that with a straight face when Swire was a huge British company in a British Colony for so long
  
 
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zeke
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RE: Jetstar Hong Kong Denied Licence

Sun Jun 28, 2015 7:31 am

Quoting jupiter2 (Reply 103):
So the only real natural beyond rights that CX could have, if they don't already, is considered by yourself, too low yielding for CX to consider. I suppose you want to see CX operate HKG/SYD/LAX ,another one of those natural, lets not deviate several thousand miles out of our way routings

I dont know, why not just let the market work it out ?

How many times have HKG accused of being protectionist ? why limit the beyond right to anywhere ? Make it truly open for the market to decide. In the Indonesian and Philippines agreements there is no limits with Australia, so it is not like it has not been done before.

Or are you one of these closet protectionist, that want everything for yourself, and give nothing in return ? All HKG has wanted is a mirror, what Australia grants HKG, HKG grants Australia. Open skies would eliminate everything, and leaves it up to the market to determine.

Quoting jupiter2 (Reply 103):
The ones you mentioned have routings which could be continuations from Australia or as intermediate points.

I dont read it that way, see it no different to the way QF say moves a passenger from the BNE flight onto the LHR via HKG. QF can pickup and drop off passengers on any sector.

Quoting jupiter2 (Reply 103):
Can you say that with a straight face when Swire was a huge British company in a British Colony for so long



Swire is not the government, as you said, it is still a family owned British trading company that setup a HKG subsidiary, Swire Pacific. Swire Pacific is a large company across Asia.
Human rights lawyers are "ambulance chasers of the very worst kind.'" - Sky News
 
jupiter2
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RE: Jetstar Hong Kong Denied Licence

Sun Jun 28, 2015 7:48 am

Quoting zeke (Reply 104):
I dont read it that way, see it no different to the way QF say moves a passenger from the BNE flight onto the LHR via HKG. QF can pickup and drop off passengers on any sector.

Not arguing that point, my question is, would QF/JQ/VA be able to operate a purely stand alone flight, HKG/MNL/HKG ? No connection to any flight operating or terminating in Australia.

Quoting zeke (Reply 104):
Or are you one of these closet protectionist, that want everything for yourself, and give nothing in return ? All HKG has wanted is a mirror, what Australia grants HKG, HKG grants Australia. Open skies would eliminate everything, and leaves it up to the market to determine.

Far from it, but I'm not sure what else Australia can give Hong Kong. Australian airlines don't need more rights into HKG itself, so what exactly will Australian airlines gain by giving Hong Kong based airlines more rights ?

True open skies has to mean it is open skies everywhere. It is pointless for Australia to have open skies with Hong Kong, if Australia isn't able to operate from HKG to China because there isn't a similar agreement between Australia and China.

Quoting zeke (Reply 104):

Swire is not the government, as you said, it is still a family owned British trading company that setup a HKG subsidiary, Swire Pacific. Swire Pacific is a large company across Asia.

Of course they didn't have any influence on politicians or public servants in Hong Kong or London did they  
 
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zeke
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RE: Jetstar Hong Kong Denied Licence

Sun Jun 28, 2015 8:09 am

Quoting jupiter2 (Reply 105):
No connection to any flight operating or terminating in Australia.

The aircraft needs to get to HKG some how, I fail to see how there cannot be any connection.

Quoting jupiter2 (Reply 105):
Far from it, but I'm not sure what else Australia can give Hong Kong. Australian airlines don't need more rights into HKG itself, so what exactly will Australian airlines gain by giving Hong Kong based airlines more rights ?

This is the typical attitude which HKG has faced for years, Australia carriers want to have all rights, and give nothing in return. Australia has open skies with Singapore, it benefited Australia economy greatly with additional tourism.

Hong Kong carriers also benefit the Australian economy, that is the benefit for Australia. When so many carriers dumped Cairns as a tourist destination, CX continued to bring tourists into that market.

Quoting jupiter2 (Reply 105):
. It is pointless for Australia to have open skies with Hong Kong,

It is not pointless if Australian carriers want unlimited beyond rights, the application from Jetstar for around 250 routes out of HKG is very strong evidence that Australian carriers want a great deal from Hong Kong. It is very obvious that HKG is a strategic hub in their view.

Quoting jupiter2 (Reply 105):
if Australia isn't able to operate from HKG to China because there isn't a similar agreement between Australia and China.

Wasn't that just sorted out recently with the free trade agreement ?

Quoting jupiter2 (Reply 105):
Of course they didn't have any influence on politicians or public servants in Hong Kong or London did they

Now you are just clutching at straws, you have just made an allegation that the government here is corrupt. Well done.
Human rights lawyers are "ambulance chasers of the very worst kind.'" - Sky News
 
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zeke
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RE: Jetstar Hong Kong Denied Licence

Sun Jun 28, 2015 9:03 am

Quoting travelhound (Reply 53):

An interesting comparison can be drawn on how HKG went about to determine the principle place of business and the US Supreme Court when Hertz tried to dodge litigation in one state by saying its principle place of business was in a different state, seems the HKG decision used many similar tests applied in an airline environment.

So in the U.S. Saying that an office is your principle place of business will not stack up in the courts if they can show effective control, coordination, and activity is elsewhere.


""The Supreme Court's "nerve center" test will provide welcome uniformity for determinations of corporate citizenship for federal diversity jurisdiction. For those considering how best to apply this test, Hertz provides some additional guidance:
The principal place of business should be a single place within a state, and is not determined based on a level of activity within a state as a whole.
A mere statement in a document, such as an SEC Form 10-K, listing a corporation's "principal executive offices" is not, without more, sufficient proof of a corporation's principal place of business.
The courts will look past any manipulative attempts to define a corporation's principal place of business and take as the "nerve center" the place of actual direction, control and coordination. For example, neither a mail drop box, a "bare office with a computer, nor the location of an annual executive retreat" will qualify as a corporation's "nerve center."

The test is designed to "point[] courts in a single direction, towards the center of overall direction, control, and coordination."


From http://www.cgsh.com/supreme_court_de...or_federal_diversity_jurisdiction/
Human rights lawyers are "ambulance chasers of the very worst kind.'" - Sky News
 
bill142
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RE: Jetstar Hong Kong Denied Licence

Sun Jun 28, 2015 10:00 am

Quoting zeke (Reply 106):
This is the typical attitude which HKG has faced for years

And you, and Hong Kong have to build a bridge and get over it. Allowing foreign airlines to operate domestic routes in Australia isn't in our interest. If we did allow it every other country would be asking the same thing. If CX wants to come and set up a domestic carrier to feed their operations out of Australia they're more than welcome.
 
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zkojq
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RE: Jetstar Hong Kong Denied Licence

Sun Jun 28, 2015 1:30 pm

Time for Qantas Group to find a better Asia strategy than 'where can we next setup a Jetstar franchise?'

Quoting EK413 (Reply 62):
JQ would've brought what the travelling public benefits affordable airfares.

Irrelevant, if it wasn't compliant with the relevant law that governs the startup of airlines in HK.

Quoting zeke (Reply 69):
the licence was denied because it was not a Hong Kong managed airline. You have just confirmed what the licencing authority put in print. It was not a HKG entity trying to setup an airline, it was QF/JQ.

  
How many times does this have to be repeated before others get it?

Quoting VH-BZF (Reply 72):
Jetstar HK was all about bringing LC competition to HKG.

Oh please. Its raison d'etre was to make profits for its owners, the Qantas Group (and later China Eastern and the Ho family).

Quoting BestWestern (Reply 88):
It was all about making profits for Qantas.

  

Quoting RyanairGuru (Reply 92):
With all due respect to Zeke, he isn't a constitutional lawyer.

Maybe not, but pretty much everything he has said in this thread is spot on.
First to fly the 787-9
 
Nouflyer
Posts: 315
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RE: Jetstar Hong Kong Denied Licence

Sun Jun 28, 2015 2:12 pm

There is an awful lot of "taking your bat home" in this thread.

The people who back the losing side seem to have resorted to saying:

"Hong Kong's loss" - er, no, they still have plenty of LCC services.

"They should have flouted their own laws to allow Qantas to control an LCC out of Hongkers." Er, why?

"Hong Kong is a worse market than we thought anyway." How so?

Lots and lots of sour grapes here!
 
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zeke
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RE: Jetstar Hong Kong Denied Licence

Sun Jun 28, 2015 4:23 pm

Quoting bill142 (Reply 108):
Allowing foreign airlines to operate domestic routes in Australia isn't in our interest.

Actually the current prime minister has suggested the very same very recently, the context was opening up northern Australia to foreign airlines for domestic travel/freight. With the reduction of 767s domestically northern Australia is being taken advantage of particularly with freight. QF and VA are frantically trying to cover with dedicated 737 freighter aircraft.

DRW residents are already paying the price of decision made by QF in SYD.

Seems the current domestic player are taking the puss.




Quoting Nouflyer (Reply 110):
Lots and lots of sour grapes here!

Yep, and to actually suggest to open the markets with open skies and let the market decide, sorry no advantage to Australia.

All take no give.
Human rights lawyers are "ambulance chasers of the very worst kind.'" - Sky News
 
timtam
Posts: 310
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RE: Jetstar Hong Kong Denied Licence

Sun Jun 28, 2015 4:42 pm

Quoting Nouflyer (Reply 110):
There is an awful lot of "taking your bat home" in this thread.

Its business and not a sporting match.

The point being made by some is that Jetstar HK would have brought economic and financial benefits to Hong Kong and Hong Kong will now miss out on those benefits. No sour grapes, these are facts and its up to Hong Kong to make its own decisions.

The other point being made is that the decision to setup Jetstar HK was made almost 4 years ago. A lot of things have changed since then. The market has changed. Qantas has changed. The economics of Jetstar HK have changed. What was, on balance, a good strategic decision 4 years ago is not looking such a good strategic decision in current times in the opinion of some. The Qantas group is becoming more focused on other markets.

Its more important for Jetstar to continue building on the success of Jetstar in Japan and to consolidate that business rather than start-up another venture that would probably have lost money for the first 3-5 years.

As a business, why would you invest a few hundred million dollars establishing a new high risk business in a jurisdiction where the administration doesnt want it? Qantas/Jestar is best off pursuing other ventures in jurisdictions where they are welcomed. Call that taking your bat and ball home if you like, but I would just call it common business sense.
 
Nouflyer
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RE: Jetstar Hong Kong Denied Licence

Sun Jun 28, 2015 9:09 pm

But Timtam, what economic benefits would the airline bring?

There are already far more LCCs in Hong Kong than Australia. Jetstar was highly unlikely to reduce prices, rather it wanted to cannibalise other companies' markets.

And in addition, there is already enough controversy in Hong Kong about the number of mainland visitors due to the behaviour of some of them. If the "economic benefit" was bringing in more mainland visitors, that would have similar public support in Hong Kong to a hypothetical Aussie public's response to Garuda being allowed to operate extra services to Australia to bring in additional asylum seekers, refugees and economic migrants without scrutiny of their visa status.

I simply do not buy the notion that Jetstar was trying to do Hong Kong a favour. Clearly Qantas just saw an opportunity to take part of the Chinese market, and assumed that Hong Kong would buy the same blatant lies about local control that Singapore did.
 
RickNRoll
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RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 12:18 am

O'Leary doesn't even understand internent investment 101.

1. Get license to operate.
2. ?????????
3. Make $$$$$$$
 
timtam
Posts: 310
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RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 1:36 am

Quoting Nouflyer (Reply 113):
But Timtam, what economic benefits would the airline bring?

There are already far more LCCs in Hong Kong than Australia. Jetstar was highly unlikely to reduce prices, rather it wanted to cannibalise other companies' markets.

Is this a serious question or just a wind up?

If its a serious question then I can only suggest you need to skill yourself up a little more on commerce and economics and the basics of how markets work.
 
timtam
Posts: 310
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RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 1:51 am

Quoting Nouflyer (Reply 113):
And in addition, there is already enough controversy in Hong Kong about the number of mainland visitors due to the behaviour of some of them. If the "economic benefit" was bringing in more mainland visitors, that would have similar public support in Hong Kong to a hypothetical Aussie public's response to Garuda being allowed to operate extra services to Australia to bring in additional asylum seekers, refugees and economic migrants without scrutiny of their visa status.

So your suggesting that Chinese visitors to Hong Kong are the equivalent of asylum seekers and refugees. The crux of your discussion here suggests that Hong Kong is becoming xenophobic.



Quoting Nouflyer (Reply 113):
I simply do not buy the notion that Jetstar was trying to do Hong Kong a favour. Clearly Qantas just saw an opportunity to take part of the Chinese market, and assumed that Hong Kong would buy the same blatant lies about local control that Singapore did.

Qantas is a business, not a charity. Of course it was pursuing Jetstar HK for its own commercial benefit. No one would expect otherwise. But its investment in Jetstar HK provides economic benefits to HK. It employs locals, it increases competition, it reduces prices, it provides more choices, it opens new routes, it stimulates more demand etc. Thats the way the whole world works, thats why countries encourage local and foreign investment in their economies.

Lots of jumping at shadows going on here.
 
bbbb
Posts: 63
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RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 2:07 am

CAPA have weighed in with quite a few interesting points:

Quote:
The battle of semantics over the issue of Jetstar Hong Kong's compliance with an esoteric and highly subjective definition of the words "principal place of business" appears to be over. As Hong Kong's licensing authority rejected Jetstar Hong Kong's licence application on 25-Jun-2015, Cathay Pacific had successfully defended its market dominance with arguments more befitting of a scene from Alice in Wonderland. It is a precious victory over longstanding foe Qantas, which recently attacked Hong Kong's bilateral access to the Australian market as making no "concession to the legitimate interests of Australian airlines in establishing reciprocal hub opportunities in Hong Kong."

Ironically, the principal place of business test was established to circumvent the fact that Cathay was actually a foreign owned airline operating under a local AOC; consequently it could not be accommodated under typical bilateral air services agreements which required "substantial ownership and effective control" to reside in Hong Kong. For decades, the world made a special exception for Cathay. Today, even though it is based in Hong Kong, nearly two thirds of Cathay's voting rights reside in London with the Swire Group. And 30% of the airline is owned by Air China. It is also a common assertion that Hong Kong Airlines, another opponent to Jetstar's entry, is controlled by mainland-based HNA.
http://centreforaviation.com/analysi...nd-of-protectionism-in-asia-206546
 
timtam
Posts: 310
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RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 2:15 am

From CAPA:

Hong Kong here had the opportunity to show the way for foreign regulators grappling with similar issues. If regulators took the wider view of supporting the public interest and not narrow, arcane interpretations (which happened to support vested interests, the decision would have clearly and quickly been in Jetstar Hong Kong's favour.

Hong Kong is struggling to position itself in a wider and changing world. In aviation it is falling behind, as seen with the lengthy third runway approval. Given the length of the construction period, it is probably time to start planning for what is after a third runway. There is no shortage of hubs around Asia that are emerging or seeking to claim a wider market. Hong Kong is already missing out on a lot of that growth. Jetstar Hong Kong would have been one tool to continue the hub's evolution and to perpetuate the appearance of an open and forward looking marketplace.

It is inevitable Hong Kong in coming years will feel the repercussions of underwhelming planning and policy. Survival, Charles Darwin said, is granted not to the strongest or smartest but those who can adapt to change. It appears here that Hong Kong is content with its old ways. This is no recipe for the future, especially when on the doorstep of innovative hubs itching for growth, having realised the economic gains resulting from a sophisticated and liberal aviation policy.


http://centreforaviation.com/analysi...nd-of-protectionism-in-asia-206546
 
Kashmon
Posts: 642
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RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 3:51 am

Quoting timtam (Reply 118):

this is CAPA
they predicted SWIRE would be out of CX by now...
they have been predicting the demise of CX for years now
and they continually support government funded/owned airlines

guess what
CX is just becoming stronger and stronger

I mean Cathay decisions are made in Hong Kong

Jetstar decisions are made in Australia...

CAPA knows zilch
or as CX insiders now call it
copy and paste aviation....
 
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zeke
Posts: 15145
Joined: Thu Dec 14, 2006 1:42 pm

RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 5:07 am

Quoting timtam (Reply 116):
Of course it was pursuing Jetstar HK for its own commercial benefit. No one would expect otherwise.

If you have been following their Jetstar Japan operation, they is currently making a loss of approximately AUD$7 million a month.

Quoting timtam (Reply 116):
But its investment in Jetstar HK provides economic benefits to HK. It employs locals, it increases competition, it reduces prices, it provides more choices, it opens new routes, it stimulates more demand etc.

I agree that investment provides economic benefit, however JQ could be operating in and out of HKG today as an Australian airline, however it chooses not to. I am not convinced that it will reduce prices, there is shortage of people working at the airport, Jetstar would have to compete with over 100 airlines to attract staff, negotiate ground service contracts etc. As Jetstar would not have the volume of many of the airlines serving HKG (eg SQ), one would assume its pricing would not the most competitive.

Quoting timtam (Reply 116):
Thats the way the whole world works, thats why countries encourage local and foreign investment in their economies.

Except Australia, they have limited HKG access to the market haven't they.

Quoting bbbb (Reply 117):
Today, even though it is based in Hong Kong, nearly two thirds of Cathay's voting rights reside in London with the Swire Group.

That is a little misleading, the shareholders they are talking about are Swire Pacific Limited, and John Swire & Sons Limited, both of which are large Hong Kong companies, Cathay is not majority foreign owned. Swire Pacific Limited is a listed company on the HKEX. You have to go back a couple of levels in the shareholder companies get to the London connection. The way the information was presented was the shares are directly owned in London.

Quoting bbbb (Reply 117):
And 30% of the airline is owned by Air China.

And they dont mention that Cathay owns 25% of Air China Cargo, and 20% of Air China.

Quoting bbbb (Reply 117):
The battle of semantics over the issue of Jetstar Hong Kong's compliance with an esoteric and highly subjective definition of the words "principal place of business" appears to be over.

The legal term principle place of business is not an uncommon legal term, it is used internationally as I have shown in reply 107 above.

Quoting timtam (Reply 118):
Hong Kong is struggling to position itself in a wider and changing world. In aviation it is falling behind, as seen with the lengthy third runway approval.

I agree the 3rd runway has taken a long time to get approved, buy significantly faster than say the second runway for BNE, PER, and SYD.

Quoting Kashmon (Reply 119):
CAPA knows zilch
or as CX insiders now call it
copy and paste aviation....

I actually think CAPA in the main is one of the best industry publications around, they have missed the mark a little with this article.
Human rights lawyers are "ambulance chasers of the very worst kind.'" - Sky News
 
lutfi
Posts: 888
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RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 5:17 am

Swire Pacific own 44% of the share in Cathay, and there are no A/ B shares with different votes. Not sure how CAPA get from 44% to "two thirds".
 
BestWestern
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RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 5:32 am

Quoting zeke (Reply 120):

CAPA is by far the best aviation analysis organisation - with thoughtful analysis and insight.

Hong Kong deserves a proper low cost carrier - and hopefully a proper application will allow that one day soon. Fares from here are higher than other cities, and CX's RASK is higher than SQs for the reason that proper competition is subdued.

Singapore is a premium service destination for Cathay, and the onboard service offer is better than similar or longer segment flights such as KUL or DPS - so CX is competiting on more than fares alone against LCCs. The CAPA article mention of scoot being the reason is off the mark - their flight times are the chief reason why that is not succeeding - rather than CX reducing fares.

At KUL CX against air Asia with lower fares and lower service offering for point to point pax for example.
Greetings from Hong Kong.... a subsidiary of China Inc.
 
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777Jet
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RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 5:49 am

Quoting zeke (Reply 120):
I agree the 3rd runway has taken a long time to get approved, buy significantly faster than say the second runway for BNE, PER, and SYD.

Or LHR.

Oh, wait...
DC10-10/30,MD82/88/90, 717,727,732/3/4/5/7/8/9ER,742/4,752/3,763/ER,772/E/L/3/W,788/9, 306,320,321,332/3,346,359,388
 
timtam
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RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 6:47 am

Quoting Kashmon (Reply 119):
CAPA knows zilch

You may not agree with them but to say they know zilch just serves to discredit all your other statements. Probably not what you intended.

Quoting BestWestern (Reply 122):
CAPA is by far the best aviation analysis organisation - with thoughtful analysis and insight.
Quoting zeke (Reply 120):
I actually think CAPA in the main is one of the best industry publications around, they have missed the mark a little with this article.

Balanced response.

Quoting zeke (Reply 120):
If you have been following their Jetstar Japan operation, they is currently making a loss of approximately AUD$7 million a month.

Its a start-up business, revenue is increasing, loads are increasing, losses are decreasing and eventually it could end up being the biggest operation in the Jetstar business. They key measure is that the owners have fielded offers from third parties seeking to purchase Jetstar Japan at prices well above what has been invested in the business. Jetstar Japan is a long term investment with great potential.

Jetstar HK would be no different. The investors in the business would have faced several years of losses, initially quite heavy losses as they built the business from scratch. Would Jetstar HK be as successful as Jetstar Japan? We will never know now but many have their doubts.

Jetstar Japan, along with the other LCC's, have been credited with growing the aviation market in Japan after years of stagnation. They have stimulated new demand for aviation services.

Quoting zeke (Reply 120):
Except Australia, they have limited HKG access to the market haven't they.

Cathay are welcome to establish a domestic carrier in Australia right now. Australia would welcome them with open arms. We would welcome their investment, we would welcome them establishing their local operations, we would welcome the jobs they create, the local pilots and cabin staff they would employ, the local maintenance staff, the service providers they would pay, we would welcome them with open arms. There is nothing preventing them opening up as a domestic carrier in Australia.

I am sure if Cathay went to the Australian Government with a plan which involved establishing local operations, employing local staff, local pilots, local cabin crew, local maintenance staff, basing aircraft in Australia then they would be welcomed with open arms and they could setup the Virgin International structure for international flights.

But this is not about Australia. This discussion is about Hong Kong and its rejection of a new venture willing to make a substantial investment to establish a new airline business in Hong Kong.

Hong Kong is perfectly within its rights to do so and, at least I think, we agree that the new venture would have brought economic benefits to Hong Kong.

Certain staff at Swire in London were sipping french champagne over the weekend at the expense of Hong Kong consumers.
 
LJ
Posts: 5352
Joined: Wed Nov 17, 1999 8:28 pm

RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 7:24 am

Quoting bbbb (Reply 117):
Today, even though it is based in Hong Kong, nearly two thirds of Cathay's voting rights reside in London with the Swire Group. And 30% of the airline is owned by Air China. It is also a common assertion that Hong Kong Airlines, another opponent to Jetstar's entry, is controlled by mainland-based HNA.

It seems that CAPA, which I highly respects, fails to comprehend the concept of "effective control". If you look at Europe, where effective control is more important than the actual shareholding,.one can have 60% of the shares and still not have effective control (though one has to demonstrate this as it's assumed you have it if you've 50% or more of an airline) of have 10% and do have effective control. As Hong Kong follows almost the same logic as in the EU, the discussion should be around the concept, not if CX is owned by a foreign entity.
 
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zeke
Posts: 15145
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RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 7:34 am

Quoting lutfi (Reply 121):

Swire Pacific own 44% of the share in Cathay, and there are no A/ B shares with different votes. Not sure how CAPA get from 44% to "two thirds".

They are correct, the shares they are talking about are owned by Swire Pacific Limited and John Swire & Sons Limited both of which are Hong Kong companies.

Quoting BestWestern (Reply 122):
Fares from here are higher than other cities, and CX's RASK is higher than SQs for the reason that proper competition is subdued.

There are not that many airports in the world where over 100 airlines compete on international routes like HKG, that basic premise be repeated on this thread is highly inaccurate. HKG also already sees something like 20 LCCs.

CX chooses to employ its assets on routes that deliver the best return in investment. I am not disagreeing that more routes could be flown from HKG, those routes however probably would not generate the same yield. CX does not have government backing, its expansion is self funded.

SQ started off with its massive expansion with the aid of the sovereign wealth (remember that large order for 747s in the 1970s ?) that was a major shareholder in the whole aviation sector in Singapore, like the ME, they had a vertical development from ticket sales, ground handling, maintenance, catering, airport, and the regulator with the same backing. They were able to provide services to/from Europe one stop in direct competition with European airlines. One by one, these European airlines closed or stopped operating route to Australia and Asia. SQ took market share that way, and also at the expense of Australian carriers.

Over the past 10 years in particular, their Kangaroo route operations have had significant competition from middle east carriers offering more one stop flights to Europe, the SQ market share has taken a significant slide, the profitable passengers are moving to other carriers.

Over the same time frame, the CX market share has basically stayed at 5% the whole time.

Quoting BestWestern (Reply 122):
Singapore is a premium service destination for Cathay, and the onboard service offer is better than similar or longer segment flights such as KUL or DPS - so CX is competiting on more than fares alone against LCCs.

Singapore is one of the few regional destinations where CX sells first class tickets on selected frequencies, there are 4 Singaporean carriers on the route, 3 of them being LCCs. Singapore Airlines and United also sells first class tickets on the route. The prices for fares varies considerably during the day, there is some real value if passengers are willing to travel when its quieter. Of the 20+ frequencies a day, passengers have a lot of choice on price and service.

DPS is a low yielding holiday destination, KUL yields are low partially due to some mainland Chinese passengers that were originally booked on MH wanted to travel on another carrier, CX being their oneworld partner have facilitated this.

Quoting timtam (Reply 124):
We would welcome their investment,

No they dont, look at the rejection to sell domestic tickets already, and the rejection to fly more tourists and business people into Australia.

Quoting timtam (Reply 124):
the local pilots
CX already is the second largest employer of international pilots in Australia. CX has pilots based in CNS, BNE, SYD, MEL, ADL, and PER, employed under Australian laws, paying Australian tax. No other foreign airline I know of does this.

Quoting timtam (Reply 124):
the local maintenance staff,

Outside QF/VA, CX would have one of the largest engineering presences in Australia (they are locally employed), there are more mechanics employed by CX in Australia than what they have employed in HKG. CX provides engineering services for numerous airlines.

CX also has one it large data centers in Sydney employing Australians in IT roles.

[Edited 2015-06-29 00:37:11]
Human rights lawyers are "ambulance chasers of the very worst kind.'" - Sky News
 
lutfi
Posts: 888
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RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 8:05 am

Quoting zeke (Reply 126):
They are correct, the shares they are talking about are owned by Swire Pacific Limited and John Swire & Sons Limited both of which are Hong Kong companies.

No, they do not own 2/3 of the voting.


http://www.cathaypacific.com/cx/en_H...bout-us/press-room/fact-sheet.html



Major Shareholders
..
Swire Pacific Limited

45%


CITIC Pacific Limited

1.98%

Air China Limited

29.99%

[Edited 2015-06-29 01:07:01]
 
timtam
Posts: 310
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RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 8:05 am

Quoting zeke (Reply 126):

No they dont, look at the rejection to sell domestic tickets already, and the rejection to fly more tourists and business people into Australia.

Open an Australian based airline, come under Australian regulations and CX can sell domestic tickets. The choice belongs to CX. There is nothing preventing them doing so.

Quoting zeke (Reply 126):
CX already is the second largest employer of international pilots in Australia. CX has pilots based in CNS, BNE, SYD, MEL, ADL, and PER, employed under Australian laws, paying Australian tax. No other foreign airline I know of does this.

Excellent, makes it even easier for CX to establish their Australian based airline. Nothing is preventing them, the decision is theirs.

Quoting zeke (Reply 126):
Outside QF/VA, CX would have one of the largest engineering presences in Australia (they are locally employed), there are more mechanics employed by CX in Australia than what they have employed in HKG. CX provides engineering services for numerous airlines.

Excellent, even easier again for CX. The door is open to CX and we would welcome them.

Still going on about Australia rather than Hong Kong......
 
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zeke
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RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 8:26 am

Quoting lutfi (Reply 127):

No, they do not own 2/3 of the voting.

The original article said voting, which I was saying is correct. Swire Pacific representing approximately 48.83% of the issued capital and approximately 60.91% of the voting rights.

Quoting timtam (Reply 128):
Excellent, makes it even easier for CX to establish their Australian based airline. Nothing is preventing them, the decision is theirs.

So let me get this straight, Australia would welcome with open arms a foreign carrier coming in with 100% foreign ownership, with an Australian shelf company, all relevant decisions made in Hong Kong to have an approval to operate 250 international routes from Australia ?

Naturally print some business cards up that show that an Australian is CEO of the Airline, that would pass all the tests that the Australian government would apply ?

Let me know where we can sign up, CX and SQ have asked the question before.

Quoting timtam (Reply 128):
Still going on about Australia rather than Hong Kong......

No it is about an Australian company trying to setup a sham airline in Hong Kong that did not comply with the law, under the false and misleading premise that there is no competition in HKG, when it is in fact more competitive than Australia.

If CX is so noncompetitive, why all the noise to stop them flying more tourists and business people into Australia, wouldn't the market not buy the tickets if they are not competitive ?
Human rights lawyers are "ambulance chasers of the very worst kind.'" - Sky News
 
jacobchoi
Posts: 126
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RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 8:32 am

What will JQ bring more of if they were allowed to operate in HK?
http://www.huffingtonpost.com/2014/1...ourists-blacklisted_n_6323314.html
 
lutfi
Posts: 888
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RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 8:54 am

Quoting zeke (Reply 129):
The original article said voting, which I was saying is correct. Swire Pacific representing approximately 48.83% of the issued capital and approximately 60.91% of the voting rights.

Where is this stated? Cathay website says 45%. Cathay shares are one share one vote.

You may be confusing with Swire Pacific. Swire (London) hold 48.8% of that, with 61% of the voting rights, because there are A shares and B shares with different voting rights
 
jupiter2
Posts: 1739
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RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 10:13 am

Quoting zeke (Reply 106):
The aircraft needs to get to HKG some how, I fail to see how there cannot be any connection.

I am responding to these,

Quoting zeke (Reply 86):
Hong Kong is more than happy to have an open skies agreement with Australia, unlimited flights between, and unlimited beyond rights as well. Naturally Qantas only wants a one way agreement, unlimited beyond rights from HKG for Australian carriers, no beyond rights for HKG airlines from Australia, and no open skies between HKG-Australia, restrict access to the Australian market by HKG carriers.
Quoting zeke (Reply 90):
JQ could operate out of HKG on the routes proposed by Jetstar HKG under their existing Australian AOC without the need to setup a franchise.

You have said under an Open Skies Agreement between Hong and Australia, Australian airlines could operate all the routes that Jetstar Hong Kong was requesting. I want to know how that is going to be possible if the 3rd party countries don't have rights for Australian airlines to operate such routes without the flights either originating or terminating in Australia.

Quoting zeke (Reply 129):
No it is about an Australian company trying to setup a sham airline in Hong Kong that did not comply with the law, under the false and misleading premise that there is no competition in HKG, when it is in fact more competitive than Australia.

Jetstar didn't say that, they said they would bring increased competition to Hong Kong.

Quoting zeke (Reply 106):
This is the typical attitude which HKG has faced for years, Australia carriers want to have all rights, and give nothing in return. Australia has open skies with Singapore, it benefited Australia economy greatly with additional tourism.

What else can Australia give Hong Kong ? CX operates 10, 11 frequencies a day to Australia ?, with as big as aircraft as they want, while Australian airlines operate 3 flights a day. Sure that is the Australian airlines problem for not operating more flights, however, there is the slight difference of not being able to on carry passengers to more than a hand full of destinations, none of which are economically viable at present. While CX gets to carry their Australian passengers to every other destination they fly too.

Quoting zeke (Reply 126):

No they dont, look at the rejection to sell domestic tickets already, and the rejection to fly more tourists and business people into Australia.

What you want is Cabotage and no country in the world offers it.

Reading the CAPA article, 60% of CX's business is 6th Freedom traffic, which is still actually against IATA rules, just that no one enforces anymore. I was alluding to this earlier and while no country would, or should for that matter, this traffic could be stopped in an extreme situation.

Quoting zeke (Reply 129):

So let me get this straight, Australia would welcome with open arms a foreign carrier coming in with 100% foreign ownership, with an Australian shelf company, all relevant decisions made in Hong Kong to have an approval to operate 250 international routes from Australia ?

As has been said ad nausea, anybody can start a domestic airline in Australia. CX can do it an feed their existing flights to HKG and intermediate points and points beyond if they wish. But the airline to fly international routes in it's own right has to be majority Australian owned.

Quoting zeke (Reply 120):
JQ could be operating in and out of HKG today as an Australian airline, however it chooses not to.

But only on flight originating or terminating in Australia.

Quoting zeke (Reply 120):
I actually think CAPA in the main is one of the best industry publications around, they have missed the mark a little with this article.

Except when they don't agree with your opinion, then they are "off the mark".

Quoting zeke (Reply 120):
Quoting timtam (Reply 116):Of course it was pursuing Jetstar HK for its own commercial benefit. No one would expect otherwise.
If you have been following their Jetstar Japan operation, they is currently making a loss of approximately AUD$7 million a month.

Of course you have access to Jetstar Japans books to confirm that. Actually far more likely to get that information than getting any real information from CX or the Commission that made this decision it seems, at least according to the CAPA article.

Quoting zeke (Reply 120):
Quoting bbbb (Reply 117):And 30% of the airline is owned by Air China.
And they dont mention that Cathay owns 25% of Air China Cargo, and 20% of Air China.

Probably because it is irrelevant to this decision.

Quoting zeke (Reply 126):
CX already is the second largest employer of international pilots in Australia. CX has pilots based in CNS, BNE, SYD, MEL, ADL, and PER, employed under Australian laws, paying Australian tax. No other foreign airline I know of does this.
Quoting zeke (Reply 126):
Outside QF/VA, CX would have one of the largest engineering presences in Australia (they are locally employed), there are more mechanics employed by CX in Australia than what they have employed in HKG. CX provides engineering services for numerous airlines.

CX also has one it large data centers in Sydney employing Australians in IT roles.

So maybe an inquiry should be held into CX's principal place of business ? It seems a lot is being outsourced to other countries and along with the less than transparent ownership structure...... oh but then again, Cathay Pacific was never really a Hong Kong airline, it has just operated out of there.

Quoting zeke (Reply 126):
CX already is the second largest employer of international pilots in Australia. CX has pilots based in CNS, BNE, SYD, MEL, ADL, and PER, employed under Australian laws, paying Australian tax. No other foreign airline I know of does this.

Now CX of course are doing this as a good corporate citizen in Australia, nothing of course to do with that it is cheaper to do it in Australia than Hong Kong.

Quoting timtam (Reply 128):
Still going on about Australia rather than Hong Kong......

It is simpler to that, than to realise that CX do damn well out of Australia and that CX needs Australia a lot more than what Australia needs CX.
 
BestWestern
Posts: 8358
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RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 11:12 am

Quoting zeke (Reply 126):
Singapore is one of the few regional destinations where CX sells first class tickets on selected frequencies, there are 4 Singaporean carriers on the route, 3 of them being LCCs. Singapore Airlines and United also sells first class tickets on the route.

What I was saying (not clear enough) is that CX have a premium service on these flights - In Y class for example SIN gets Ice Cream and an additional post dinner drinks run in comparison to CX KUL or DPS. This is also offered to Shanghai.

Quoting timtam (Reply 124):
Certain staff at Swire in London were sipping french champagne over the weekend at the
expense of Hong Kong consumers.

And sour Bulgarian grapes for QF shareholders in London too. Maybe next time the investors submits a proper, compliante submission first time around. HK needs home based competition by a strong second carrier. Every major city has two strong home carriers. HK has one. Toyko, Seoul, Taipei, KL, Singapore, etc have two strong home carriers.

Quoting timtam (Reply 124):
Hong Kong is perfectly within its rights to do so and, at least I think, we agree that the new venture would have brought economic benefits to Hong Kong.

Competition always brings about economic benefits -
Greetings from Hong Kong.... a subsidiary of China Inc.
 
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zeke
Posts: 15145
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RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 5:16 pm

Quoting lutfi (Reply 131):
Where is this stated?

That comes from the annual report filed with the HKEX.

Quoting jupiter2 (Reply 132):
I want to know how that is going to be possible if the 3rd party countries don't have rights for Australian airlines to operate such routes without the flights either originating or terminating in Australia.

The only ASA I am aware of that has such as restriction with Australia is the USA, and Guam is the only proposed destination. It would be an easy 4 hr hop from CNS.

Quoting jupiter2 (Reply 132):
Sure that is the Australian airlines problem for not operating more flights, however, there is the slight difference of not being able to on carry passengers to more than a hand full of destinations, none of which are economically viable at present. While CX gets to carry their Australian passengers to every other destination they fly too.

Even more incentive then for Australia to get unlimited beyond rights, for the same in return.

Quoting jupiter2 (Reply 132):
just that no one enforces anymore.

It is enforced, you cannot but a ticket on Air Canada from the USA via Canada back to the USA. The reason it is permitted is it is in the air service agreements. It is totally legal, airlines have been offering round the world tickets for longer than I can remember. Those tickets have restrictions.

As for foreign airlines operating domestic sectors, have a look at Europe and South America.

Quoting jupiter2 (Reply 132):
But the airline to fly international routes in it's own right has to be majority Australian owned.

Hang on, you mean the structure that Jetstar HKG would not be allowed in Australia ?

Pot calling the kettle black.

Quoting jupiter2 (Reply 132):
But only on flight originating or terminating in Australia.

Not true, otherwise QF could not sell BNE-HKG-LHR.

Quoting jupiter2 (Reply 132):
Except when they don't agree with your opinion, then they are "off the mark".

I was not the only person who had that opinion.

Quoting jupiter2 (Reply 132):
Of course you have access to Jetstar Japans books to confirm that.

It was in the press, do the math "$160 million at current exchange rates since Jetstar Japan was formed in 2011"

http://www.brisbanetimes.com.au/busi...into-jetstar-japan-20150628-ghy64i

Quoting jupiter2 (Reply 132):
Probably because it is irrelevant to this decision.

If you they were to present a balanced report, they could have started that CX owns as much of Air China as Air China owns of CX.

Quoting jupiter2 (Reply 132):
So maybe an inquiry should be held into CX's principal place of business ? It seems a lot is being outsourced to other countries and along with the less than transparent ownership structure...... oh but then again, Cathay Pacific was never really a Hong Kong airline, it has just operated out of there.

Please bring it on. Have a think about what you are typing, how is having your own ground staff, mechanics, and pilots employed by an Australian subsidiary outsourcing ?

Outsourcing is like the agreement CX has with a training organisation in ADL to provide initial pilot training to CX cadet pilots.

Quoting jupiter2 (Reply 132):
Now CX of course are doing this as a good corporate citizen in Australia, nothing of course to do with that it is cheaper to do it in Australia than Hong Kong.

CX employs over 1000 Australian pilots, there has always been a strong desire from that demographic for their families to grow up around extended family and attend Australian schools. They are employed in Australia, and pay tax like any other Australian, get long service leave etc. The airline has bases in other countries as well for the same reason.

This is very different to the way those Australian pilots employed under contract with other airlines based in Australia, they pay no income tax in Australia, and the employer pays no payroll tax as they have a certificate issued by a country with a double taxation agreement with Australia.

Quoting BestWestern (Reply 133):
What I was saying (not clear enough) is that CX have a premium service on these flights - In Y class for example SIN gets Ice Cream and an additional post dinner drinks run in comparison to CX KUL or DPS. This is also offered to Shanghai.

I dont know the answer to that question, I get the same meal either sector   All I know is there are many destinations in Asia that first class is not sold.
Human rights lawyers are "ambulance chasers of the very worst kind.'" - Sky News
 
strfyr51
Posts: 5030
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RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 6:25 pm

Quoting timtam (Reply 39):

[quote=timtam,reply=39]The other positive from the decision from a Jetstar perspective is that it effectively locks out the other Asian LCC's out of Hong Kong. So Qantas/Jetstar can deploy its capital and resources elsewhere knowing full well that none of the Jestar competitors will be able to get first mover advantage in HK.
********************************************************************************************************************************************************
Amazing !! And people WONDER why the USA3 are "pulling in their wagons" . They're looking at all of this and saying If they can do it? Then So can WE, and we'll Block whomever we please. Not such a hot idea... Once you stat down that road?
Then it's pretty damn HARD to turn around. Pretty soon? We'l have given up EVERY gain we got From De-Regulation lo these many years ago.
 
jetblue1965
Posts: 5050
Joined: Wed Mar 19, 2014 1:28 pm

RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 7:00 pm

Quoting BestWestern (Reply 133):
Competition always brings about economic benefits -

Only up to a certain point. Once you cross the point of diminishing returns, every new market entrant will only add to the downward spiral and deterioration of the market's economics.
 
chrisp390
Posts: 722
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RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 9:38 pm

I think the CAPA article makes a very strong case that the HK government is clearly being protectionist to CX. People can rap on about the basic law says this and that but clearly from the article it was CX and their government connections/lobbying that drove the final decision, not facts. I have nothing against CX but I think it is unfortunate to see HK go backwards in aviation.
 
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enzo011
Posts: 1905
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RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 10:57 pm

Quoting chrisp390 (Reply 137):
I think the CAPA article makes a very strong case that the HK government is clearly being protectionist to CX. People can rap on about the basic law says this and that but clearly from the article it was CX and their government connections/lobbying that drove the final decision, not facts. I have nothing against CX but I think it is unfortunate to see HK go backwards in aviation.

I don't think anyone will dispute the current laws are there to protect the local airlines. The solution would be to set up a local airline, not a sham and pass it on as a local airline. It was quite clear that there was no way that Melbourne was giving up on the major decisions for Jetstar HK and have it run counter to their strategy. It was also quite clear for them to set up the new airline that this was what they needed to do. Seems as though they didn't give them any reason to find differently.
 
jetblue1965
Posts: 5050
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RE: Jetstar Hong Kong Denied Licence

Mon Jun 29, 2015 11:04 pm

Quoting chrisp390 (Reply 137):

CAPA also their bias in their views - namely, extreme interpretation of laissez faire, and favoring growth at all costs.
 
timtam
Posts: 310
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RE: Jetstar Hong Kong Denied Licence

Tue Jun 30, 2015 9:34 am

Quoting jetblue1965 (Reply 139):

Allegedly CX have lodged a complaint against CAPA with the Hong Kong Government after, in CX's opinion, CAPA had misinterpreted the Basic Law. It is seeking to have CAPA's Hong Kong based analyst deported. The complaint has been handed to the Transport and Housing Bureau who need to determine if CAPA's analyst is a local. Whilst he is a Hong Kong permanent resident, lives in Hong Kong, works in Hong Kong and is paid in Hong Kong, CX have argued that he is in fact a foreigner because he reports back to CAPA's office in London. According to CX the ultimate control of the analyst's thinking is driven by London and therefore he cannot possibly be regarded as a local. A decision is expected in August 2018.

Only in jest of course 
 
jupiter2
Posts: 1739
Joined: Tue Jan 02, 2001 11:30 am

RE: Jetstar Hong Kong Denied Licence

Tue Jun 30, 2015 9:51 am

Quoting zeke (Reply 134):
The only ASA I am aware of that has such as restriction with Australia is the USA, and Guam is the only proposed destination. It would be an easy 4 hr hop from CNS.

So you're saying that QF/JQ/VA would be able to set up Ops in Hong Kong and operate unlimited flights to China, if Australia and Hong Kong had an Open Skies Agreement ?

Quoting zeke (Reply 134):
Even more incentive then for Australia to get unlimited beyond rights, for the same in return.

Or is it now "Beyond Rights" where the flights need to originate terminate in Australia.

The problem with unlimited beyond rights from Hong Kong, is that Australian airlines don't need them. The only modern market they would like them to is China and Australia is moving more and more to direct services to China. Hong Kong as a transit point to China will wane as the Chinese airlines grow and their product improves.

Quoting zeke (Reply 134):
As for foreign airlines operating domestic sectors, have a look at Europe and South America.

Europe is a "Single Market" to airlines based there, airlines from out side Europe can't operate domestic sectors, or if they do, it is without traffic rights. Which airlines operate domestic services in South America in a country other than the one they are from ?

Quoting zeke (Reply 134):
Hang on, you mean the structure that Jetstar HKG would not be allowed in Australia ?

Pot calling the kettle black.

Far from it, the ownership structure that Jetstar Hong Kong was presenting, would not only be above requirements for a Domestic Airline, but would also allow it to operate International flights as an Australian carrier. There was 51% local ownership, 24.5% Qantas and 24.5% China Eastern. I haven't read the report, but does it state anywhere that the ownership structure did not meet local laws ?

Quoting zeke (Reply 134):
Not true, otherwise QF could not sell BNE-HKG-LHR.

Ummm, last time I checked BNE (Brisbane) was still in Australia.

Quoting zeke (Reply 134):
I was not the only person who had that opinion.

The only other person I could see dismissing the CAPA report was "Kashmon" and his views are far from balanced. Most have called it a "Balanced Report".

Quoting zeke (Reply 134):
It was in the press, do the math "$160 million at current exchange rates since Jetstar Japan was formed in 2011"

http://www.brisbanetimes.com.au/busi...hy64i

The article doesn't give a total figure for losses, just the 11.1 billion yen for last financial year (doesn't specify who's or which financial year, assume Australian). So it would be the 2013-14 financial year, a loss of 11.1 billion Yen, works out at about $9.7 million a month. However, since then Jetstar Japan has opened up a second base in Osaka and aircraft utilisation has increased substantially. We should have a better idea how it is performing in the next couple of months when Qantas reports it's financials for 2014-15 and somebody wades through it to get the Jetstar figures.

Quoting zeke (Reply 134):
If you they were to present a balanced report, they could have started that CX owns as much of Air China as Air China owns of CX.

Ok. mentioning the CX holding in CA would've made it "more" balanced. Pretty sure it was mentioned only to show that CX has a large share portion held by a Chinese airline, just as Jetstar Hong Kong does..... or would have.

Quoting zeke (Reply 134):

CX employs over 1000 Australian pilots, there has always been a strong desire from that demographic for their families to grow up around extended family and attend Australian schools. They are employed in Australia, and pay tax like any other Australian, get long service leave etc. The airline has bases in other countries as well for the same reason.

This is very different to the way those Australian pilots employed under contract with other airlines based in Australia, they pay no income tax in Australia, and the employer pays no payroll tax as they have a certificate issued by a country with a double taxation agreement with Australia.

Are you trying to say that CX does this out of the goodness of it's collective heart ? CX does it because it's cheaper and easier for it to do it.

So CX offer similar remuneration to it's British based pilots ? Americans ? Canadians ? Because it's also cheaper for CX than having them in Hong Kong.

Those Australian pilots if they weren't based in Australia and still wanted to work for CX would be based wherever CX wanted them. You make it sound like CX are making special exemptions for Australian pilots (and Australia), they do it because it suits the CX business model and is cheaper and more affective for them. Everyone of those pilots would be working elsewhere and dealing with whatever their employer gave them. It is their choice to accept the CX terms because it suits them as well. I'd work for a bit less and stay in my home country, rather than be based in certain places around the world. Please tell me you're not trying to imply that CX are doing this just to be nice to their Australian pilots ?

As for ground staff, many airlines have ground staff in foreign countries, as long as it remains cost effective. As soon as it isn't, it will get out sourced and half of the original staff will end up doing the same jobs for less, just working for the agent. CX don't handle their cargo in Australia, it is done by an agent company (Toll Dnata ?). Mechanics are the same, as the volume of work justifies their own staff that's great, as soon as it is no longer cost effective, it will be out sourced. The mechanics working for CX would only be doing the smaller line jobs, anything heavy will get passed onto (QF etc) and the CX mechanic sign off on it, as long as they are qualified too of course.

Quoting zeke (Reply 106):
Now you are just clutching at straws, you have just made an allegation that the government here is corrupt. Well done.

Forgot about this little gem last time. I'm not implying that anyone in Public Office in Hong Kong at present is corrupt, possible yes, but far less likely than during Colonial rule. However, if you are trying to suggest that there has never been "favours" done previously, you are being naïve to the extreme.
 
jupiter2
Posts: 1739
Joined: Tue Jan 02, 2001 11:30 am

RE: Jetstar Hong Kong Denied Licence

Tue Jun 30, 2015 9:55 am

Quoting timtam (Reply 140):

Allegedly CX have lodged a complaint against CAPA with the Hong Kong Government after, in CX's opinion, CAPA had misinterpreted the Basic Law. It is seeking to have CAPA's Hong Kong based analyst deported. The complaint has been handed to the Transport and Housing Bureau who need to determine if CAPA's analyst is a local. Whilst he is a Hong Kong permanent resident, lives in Hong Kong, works in Hong Kong and is paid in Hong Kong, CX have argued that he is in fact a foreigner because he reports back to CAPA's office in London. According to CX the ultimate control of the analyst's thinking is driven by London and therefore he cannot possibly be regarded as a local. A decision is expected in August 2018.

Only in jest of course

Thank you.......
    
 
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zeke
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RE: Jetstar Hong Kong Denied Licence

Tue Jun 30, 2015 10:23 am

Quoting timtam (Reply 140):

Just for kicks have a look at the CAPA contact us link.
Human rights lawyers are "ambulance chasers of the very worst kind.'" - Sky News
 
Andy33
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RE: Jetstar Hong Kong Denied Licence

Tue Jun 30, 2015 10:57 am

Quoting jupiter2 (Reply 132):
What you want is Cabotage and no country in the world offers it.

Apart of course from the 31 countries that are members of the EU/EEA which allow cabotage to all airlines based in those 31 countries. That's a market of well over half a billion people.
That includes Luxemburg of course, a country which has only one airport with scheduled services (sound familiar?). Should it wish to, Luxair is quite entitled to operate domestic flights in the other 30 countries, or flights between them, or flights from any of them to anywhere with an openskies treaty with the EU/EEA.
 
jupiter2
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RE: Jetstar Hong Kong Denied Licence

Wed Jul 01, 2015 7:06 am

Quoting Andy33 (Reply 144):
Apart of course from the 31 countries that are members of the EU/EEA which allow cabotage to all airlines based in those 31 countries. That's a market of well over half a billion people.
That includes Luxemburg of course, a country which has only one airport with scheduled services (sound familiar?). Should it wish to, Luxair is quite entitled to operate domestic flights in the other 30 countries, or flights between them, or flights from any of them to anywhere with an openskies treaty with the EU/EEA.

See below.....

Quoting jupiter2 (Reply 141):
Europe is a "Single Market" to airlines based there, airlines from out side Europe can't operate domestic sectors, or if they do, it is without traffic rights.

But thanks for the info anyway   

Quoting zeke (Reply 143):
Just for kicks have a look at the CAPA contact us link.

Ummmm....

Quoting timtam (Reply 140):
Only in jest of course
 
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zeke
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RE: Jetstar Hong Kong Denied Licence

Wed Jul 01, 2015 7:50 am

Quoting jupiter2 (Reply 145):

For kicks why don't you go and read the ATLA decision, reply 141 Indicated you had not read it. So many posts on this thread about the ATLA decision without even bothering to read it.
Human rights lawyers are "ambulance chasers of the very worst kind.'" - Sky News
 
Andy33
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RE: Jetstar Hong Kong Denied Licence

Wed Jul 01, 2015 8:03 am

Quoting jupiter2 (Reply 141):

Europe is a "Single Market" to airlines based there, airlines from out side Europe can't operate domestic sectors, or if they do, it is without traffic rights

What happened to the rights that PanAm and TWA had to operate domestic sectors in Germany as long as one end of the route was in Berlin? or the LHR-MAN flights that Qantas operated (admittedly as an LHR slot sitter?)

I did know that the EU/EEA (not the same at all as Europe, as it doesn't include sizeable countries that are physically inside Europe, but does include various French territories in the Caribbean and other places) is a single aviation market, after all I live inside it. It does show first that each member of the 31 countries permits cabotage by the other 30 members, not all of which have any domestic air services at all. There's absolutely nothing to stop any other pair or group of countries in the world setting up a similar agreement if they wish to, other than nationalism and protectionism
 
jupiter2
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RE: Jetstar Hong Kong Denied Licence

Wed Jul 01, 2015 10:33 am

Quoting Andy33 (Reply 147):

What happened to the rights that PanAm and TWA had to operate domestic sectors in Germany as long as one end of the route was in Berlin? or the LHR-MAN flights that Qantas operated (admittedly as an LHR slot sitter?)

Well Germany at the time was not exactly your usual domestic market with half of Berlin sitting in a "foreign" country with a wall separating it..

As for the QF LHR/MAN flight, QF didn't have any rights on the flight to carry local traffic, just connecting. The same as they do now with LAX/JFK, they can carry connecting QF traffic, they can also carry QF stop over traffic, but cannot pick up local traffic.

For most of it's existence, Qantas didn't even have domestic rights in Australia, it was purely an international carrier and all flights between Australian cities were extensions of international flights. Ansett and T.A.A. were the Australian domestic carriers back then.

Quoting zeke (Reply 146):
For kicks why don't you go and read the ATLA decision, reply 141 Indicated you had not read it. So many posts on this thread about the ATLA decision without even bothering to read it.

Nope, haven't read it and don't intend too either. There is no point reading something that isn't going to be changed and now is academic anyway.
Whilst you continually bring up all the "facts" about how an "Open Skies Treaty" with Australia would be so beneficial, you refuse to show how it would be so for Australian airlines, great for CX yes, but next to worthless for Australian airlines.

What is there that Hong Kong can grant Australian airlines that should warrant Australia giving Hong Kong airlines more flights ?

You continually twist things to support your argument, such as how great CX is to Australian pilots and how it is a big employer in Australia. But you don't bother to mention that CX does it purely and simply because it suits their business model and is obviously more cost effective that way. CX is in the business to make money, if they could base you in Bangkok because it was more cost effective and you agreed to it, then that's where you would be.
 
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zeke
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RE: Jetstar Hong Kong Denied Licence

Wed Jul 01, 2015 12:35 pm

Quoting jupiter2 (Reply 148):

It is impossible to have a rational debate with someone who refuses to read the facts that the thread is based upon.

Air service agreements are between countries, for the benifit of the country, not individual companies. The recent free trade agreement between Australia and China was not for the benifit of one particular company, it was for the benifit of each nation.

Hong Kong rejecting the application is sending a clear message to any country including Australia , if you want to do business with Hong Kong, do it above board. None of these sham arrangements. Hong Kong would welcome a genuine open skies agreement, even if it cuts into the market share of existing airlines. Hong Kong would benifit as a whole.

Qantas has shown its hand, Hong Kong is a key strategic point for its pan Asia strategy, more routes were applied for out of Hong Kong than all of Qantas and the subsidiaries combined.

There are lots of benifits for both Australia and Hong Kong for true open skies, and true open beyond rights. It might upset some airlines at either end, but the economic advantages for both countries would be seen beyond airlines, it will be in tourism, exports, business, banking, and education. You are fundamentally wrong when associate the benifits of air service agreements to airlines alone, the agreements are not for the benifit of any particular airline.

The reason for the rejection was not to protect airlines in Hong Kong, it was to protect the hard earned traffic rights that Hing Kong has negotiated. If you want to use those traffic rights, be a true Hong Kong airline, if you want to expand the recripical rights, Hong Kong would be willing to have same for same rights in return.
Human rights lawyers are "ambulance chasers of the very worst kind.'" - Sky News

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