IndianicWorld
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RE: Australian Aviation Thread Part 138

Wed Mar 30, 2016 11:09 pm

Quoting georgiabill (Reply 149):
I think they needed more than 5 77W'S in their fleet.A fleet of 10 or so would have allowed more routes and frequencies if required. Perhaps had the 787 or A350 been available would have been better suited for their longhaul ambitions.

They had 7 77W aircraft on order but didn't take the last 2 from memory (and options to take it to a fleet of 13).

At the end of the day, the 77W's are too big for their needs, but as you stated the newer generation twins were not available at that time. They needed the range but not the capacity.

Quoting georgiabill (Reply 149):
When QF chose to suspend SYD-SFO service, VA should have launched their own SYD-SFO. Now that QF is resuming that service a missed opportunity for VA.

Not sure it was a market VA would have thrived on either.

We will see how QF goes on the route this time.

Quoting georgiabill (Reply 149):
Their JNB service was short lived. I do not know their performance numbers on the route. More time the route may have grown and developed into a profitable route. Perhaps splitting the services between MEL and SYD to JNB or adding CPT to JNB routing.
JNB was not a MEL vs SYD market issue but the use of a twin engined 77W to operate the sector.

The routing taken was substantially longer than optimal and the aircraft size was too big. It all seems to come back to the latter point unfortunately in many of the challenges they face.

[Edited 2016-03-30 16:15:56]
 
Sydscott
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 12:12 am

Quoting mariner (Reply 146):
"Reading between the lines it would seem that Luxon pushed his case with the Virgin board – and lost."

I have a slightly different spin on that. I think Borghetti / Management pitched a plan to the Board and that Luxon, both in his capacity as a Director and as a representative of a major shareholder, could not bring himself to back it. In that context, and without the Board support necessary to change Management he had no other alternative but to resign because he could not support Managements vision nor the direction of the Board in approving it. So it wasn't a case of him losing his push, more that the Board still supports Management where it's clear NZ and Luxon does not.

Quoting mariner (Reply 146):
AIR New Zealand’s move to quit Virgin Australia is a seismic event for the airline industry in Australia, for domestic travellers and for tourists both into and out of Australia.

Air New Zealand has been determined to have a significant presence in Australia for more than 20 years. For them to now say that they actually don't need to own any part of an Australian Airline is a massive change of strategy for NZ but, as other have agreed, a necessary one. Why waste money on this?

Quoting aryonoco (Reply 148):
SQ on the other hand does need VA, but would they have the stomach for the huge amounts of investment required to turn VA around?

I'd actually say they would. Having VA would fulfill a long desire of SQ's to be Australia's second airline in reality and this is, I think, finally their moment. If they can get their hands on the entirety of the NZ stake that gives them control. They would then need to make a takeover offer for the rest. Even if that failed they could re-shape the Board, have the new board appoint new Management, cancel the EY codeshare and other one's they didn't agree with and start the process of VA being a vassal of SQ. I'd suggest that they would also re-brand it. Once the EY codeshare was gone EY would no longer be getting traffic or feed from VA so there would be no point in them holding the stake.

The same also applies in reverse.

Quoting georgiabill (Reply 149):
Not sure if they could obtain 5th freedom rights but a route to LHR or MAN via HKG or KUL might have been something to consider should they had a big enough fleet to make it viable and competitive.

If SQ was to takeover, I could actually see VA doing SIN-LHR.
 
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 12:25 am

Quoting sydscott (Reply 151):
Air New Zealand has been determined to have a significant presence in Australia for more than 20 years. For them to now say that they actually don't need to own any part of an Australian Airline is a massive change of strategy for NZ but, as other have agreed, a necessary one. Why waste money on this?

I think this highlights the volatility of the VA board and the issues JB would have faced in trying to manage his shareholders. I think we have to remember prior to the airlines getting board seats VA was growing at substantial rates. Something changed. Whether that be market conditions, effectiveness of the VA board or a combination of the two something very substantial happened in a very narrow space of time (2013-2014)
 
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 12:49 am

Meanwhile QF goes from strength to strength…

QF Group reports 10.5% increase in pax numbers for February 2016:

http://www.sbs.com.au/news/article/2...03/31/qantas-passenger-numbers-feb

Seems the only thing VA have managed to do is make QF stronger.
 
IndianicWorld
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 1:12 am

Quoting vhebb (Reply 153):
F Group reports 10.5% increase in pax numbers for February 2016:

Impressive results.

Quoting travelhound (Reply 152):
Whether that be market conditions, effectiveness of the VA board or a combination of the two something very substantial happened in a very narrow space of time (2013-2014)

I tend to think that VA went too far down the "premium" image track without a plan at the time to support its position leisure market.

It took its stakes in TT while it was already down the track and it seemed an after thought, more than a well executed business plan.

Now it has a VA brand that does not appear to be generating significant yield and volume benefits, with TT not really being used effectively to best utilise ts overall group market position.

Quoting sydscott (Reply 151):
If SQ was to takeover, I could actually see VA doing SIN-LHR.

Re: SIN-LHR. I can't see such an outcome sorry to say.

One thing is for sure though, the 3 x weekly VA flights on SYD-AUH would be gone if SQ took over and I would expect that the 77W fleet replacement would be prioritised to best fit the airline's needs.

Quoting sydscott (Reply 151):
I'd actually say they would. Having VA would fulfill a long desire of SQ's to be Australia's second airline in reality and this is, I think, finally their moment. If they can get their hands on the entirety of the NZ stake that gives them control. They would then need to make a takeover offer for the rest. Even if that failed they could re-shape the Board, have the new board appoint new Management, cancel the EY codeshare and other one's they didn't agree with and start the process of VA being a vassal of SQ. I'd suggest that they would also re-brand it. Once the EY codeshare was gone EY would no longer be getting traffic or feed from VA so there would be no point in them holding the stake.

I'm sure that SQ would like to have a shot at having greater power in VA's decision making, but at the end of the day it will all come down to how much capital will be required to make a strategy stick.

Quoting sydscott (Reply 151):
Air New Zealand has been determined to have a significant presence in Australia for more than 20 years. For them to now say that they actually don't need to own any part of an Australian Airline is a massive change of strategy for NZ but, as other have agreed, a necessary one. Why waste money on this?

NZ is an airline that comes across as rather aggressive in its business dealings, especially considering its rather limited size. It is a smaller airline than VA, and was also far smaller than AN when it launched its takeover of that airline too.

It needs to think smarter in terms of its size and risk profile and this move is likely the medicine it needs to re-evaluate its future position. As QF/EK/JQ/AA all strengthen their ties into the NZ market, the challenge really only get harder for it.
 
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 1:48 am

Quoting sydscott (Reply 151):
I'd actually say they would. Having VA would fulfill a long desire of SQ's to be Australia's second airline in reality and this is, I think, finally their moment. If they can get their hands on the entirety of the NZ stake that gives them control. They would then need to make a takeover offer for the rest. Even if that failed they could re-shape the Board, have the new board appoint new Management, cancel the EY codeshare and other one's they didn't agree with and start the process of VA being a vassal of SQ.

I believe that VA needs a management team in place who are flexible and prepared to innovate. I'll put it on record here that if SQ take over VA and install their own (Singaporean) management team then I expect to hear a lot of positive buzz in the media but I do not expect to see their performance improving any time soon.

SQ are conservative and premium in nature and they also come from a long position of dominance. Sure they have plenty of competition but they are the major carrier out of Singapore and possibly the most respected airline in the region, along with CX.

However, it's Qantas that is in that same position in Australia.

SQ may be a highly respected brand in Australia, but most Australian passengers who are going to expect SQ's level of long haul service will likely be sorely disappointed when flying a VA narrowbody (this is perception, the reality would be to compare with something like SilkAir).

SingTel faced the same issue when they acquired Optus. I've heard from insiders that they struggled to cope with being Number 2 in the Australian market rather than the dominant Telstra. They are still having problems.

The best idea would be for SQ to get a management team from outside both organisations and give them the freedom they need to do what's required, accepting that VA will likely never dominate. Number 2 and kiasu may rhyme but they ain't compatible and that could be a problem.

Rebranding Tiger to Scoot locally wouldn't be a bad idea though (dog wiping bum). Opinion seems relatively positive with passengers I've spoken to (though I'll still fly Jetstar in preference).
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 2:07 am

Quoting allrite (Reply 155):
Rebranding Tiger to Scoot locally wouldn't be a bad idea though (dog wiping bum). Opinion seems relatively positive with passengers I've spoken to (though I'll still fly Jetstar in preference).

Given that Scoot and Tiger are now getting far closer in their relationship in Singapore (mainly through a bigger share of investment in Tiger by SQ), this may well occur.

SQ is running with too many brands (Singapore Airlines, SilkAir, Scoot and Tiger) and is more than likely going to look to restructure is LCC offering in future. The Scoot and Tiger situation only really came about as it did not have control of the latter.

A VA takeover will also see it positioned to direct further synergies between its offering in this market, with a combined Scoot/Tiger having a significant network of Australian domestic and international destinations. It will be their 2nd attempt with TT, but this time it will have a better position to work from.
 
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 2:21 am

Quoting allrite (Reply 155):
Rebranding Tiger to Scoot locally wouldn't be a bad idea though (dog wiping bum).

Rebranding Tiger to anything else wouldn't be a bad idea. The Tiger brand is damaged beyond repair in Australia. One of JB's biggest mistakes IMO was going through all the expense of a rebrand to Tigerair, while keeping the name "tiger".
 
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 2:29 am

Quoting sydscott (Reply 151):
I have a slightly different spin on that. I think Borghetti / Management pitched a plan to the Board and that Luxon, both in his capacity as a Director and as a representative of a major shareholder, could not bring himself to back it.

You may be right, I wasn't there, I don't know.

But since the tension between JB (and the board?) and Luxon seems to be of long standing, I suspect that this simply brought things to a head.

In either event, the end result seems to be the same, as in:

Quoting sydscott (Reply 151):
So it wasn't a case of him losing his push, more that the Board still supports Management where it's clear NZ and Luxon does not.

What continues to surprises is the amount of support that JB's relentless sunniness seems able to muster.

Quoting sydscott (Reply 151):
Air New Zealand has been determined to have a significant presence in Australia for more than 20 years. For them to now say that they actually don't need to own any part of an Australian Airline is a massive change of strategy for NZ but, as other have agreed, a necessary one.

Two things: just as there has to be a question mark over Virgin's future strategy, there may be a question mark over Air NZ's future Australian strategy.

Luxon has said he expects the alliance to continue. Hope so, but he could have other plans, instead of or as well. I think it will be a while before we have an answer to either question.

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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 2:32 am

Quoting IndianicWorld (Reply 154):
Re: SIN-LHR. I can't see such an outcome sorry to say.

One thing is for sure though, the 3 x weekly VA flights on SYD-AUH would be gone if SQ took over and I would expect that the 77W fleet replacement would be prioritised to best fit the airline's needs.

I agree re the fleet replacement. An SQ group takeover gives access to a pretty decent order backlog of new widebodies to re-equip with. The 77W currently going into AUH could easily be re-oriented to fly to or through Singapore to do something.

Quoting allrite (Reply 155):
Rebranding Tiger to Scoot locally wouldn't be a bad idea though (dog wiping bum). Opinion seems relatively positive with passengers I've spoken to (though I'll still fly Jetstar in preference).
Quoting IndianicWorld (Reply 156):
Given that Scoot and Tiger are now getting far closer in their relationship in Singapore (mainly through a bigger share of investment in Tiger by SQ), this may well occur.

Agree with this sentiment and is a logical extension of what SQ is doing. The Tiger brand would probably disappear under that scenario in Australia to be replaced entirely by Scoot.

Quoting allrite (Reply 155):
SQ may be a highly respected brand in Australia, but most Australian passengers who are going to expect SQ's level of long haul service will likely be sorely disappointed when flying a VA narrowbody (this is perception, the reality would be to compare with something like SilkAir).

SingTel faced the same issue when they acquired Optus. I've heard from insiders that they struggled to cope with being Number 2 in the Australian market rather than the dominant Telstra. They are still having problems.

This is a slightly different scenario to Optus because unlike SIngtel, SQ at a basic level needs VA to bring feed to and from its own long haul aircraft. That would be the primary aim of the acquisition so VA in and of itself does not need to be individually highly profitable for as long as the contribution to group is a large net benefit. Singtel acquired Optus to expand its coverage but Optus doesn't really feed things onto Singtels network. It needs Optus to perform well in its own right.

Quoting allrite (Reply 155):
The best idea would be for SQ to get a management team from outside both organisations and give them the freedom they need to do what's required

I hear Gary Toomey is free.....................................oh the irony!

Quoting allrite (Reply 155):
Rebranding Tiger to Scoot locally

The Virgin name would also disappear. No point in paying pointless Brand and IP fees to Sir Dick for nothing.
 
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 2:34 am

Quoting IndianicWorld (Reply 156):
A VA takeover will also see it positioned to direct further synergies between its offering in this market, with a combined Scoot/Tiger having a significant network of Australian domestic and international destinations. It will be their 2nd attempt with TT, but this time it will have a better position to work from.

Hmm... And if they can get rights for Scoot Australia to fly long-haul to places like Japan and Hawaii then they would be a direct competitor to JQ. Although, would the cost structure be any lower than JQ in that case (787-8 vs 787-9). Could get interesting at the bottom end of the market.

Quoting aryonoco (Reply 157):
Rebranding Tiger to anything else wouldn't be a bad idea. The Tiger brand is damaged beyond repair in Australia. One of JB's biggest mistakes IMO was going through all the expense of a rebrand to Tigerair, while keeping the name "tiger".

I am still bitterly disappointed that he didn't take up my still feline associated suggestion of "Virgin Pussy".  
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 2:57 am

Quoting Bluebird191 (Reply 143):
Brisbane - there is often one sitting idle

Same here in Canberra... there's generally one idle here for a big chunk of the day, too.
 
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 3:13 am

Quoting sydscott (Reply 159):
The Virgin name would also disappear. No point in paying pointless Brand and IP fees to Sir Dick for nothing.

Ya...

Quoting allrite (Reply 160):
I am still bitterly disappointed that he didn't take up my still feline associated suggestion of "Virgin Pussy".  

There's still time... Tiger Pussy?

Quoting mariner (Reply 158):
What continues to surprises is the amount of support that JB's relentless sunniness seems able to muster.

I have noticed the JB fanboys here are remarkably quiet on this thread...

SQ controlled VA longhaul:
I see 3 scenarios:
a) longhaul is abolished OR somehow operates in Tiger Pussy name only with the actual aircraft being SQ as a quasi wetlease.
b) all assets will be deployed BNE/SYD/MEL-LAX/SFO with additional leased aircraft until the 777's can be replaced
c) possible SYD/MEL-HKG/NRT nonstops after North America is fixed- or use the existing A332's
I see no longhaul to any points west of SIN.
 
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 5:29 am

I can see Delta wanting to buy NZ, SQ and EY out . Think about it
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 5:54 am

If SQ does buy NZ's stake or even EY's stake I could tip them using the 77Ws to take over some of SQ's own East Coast-SIN flights while deploying some of those displaced SQ aircraft elsewhere on their own network. HKG and/or NRT on VA 77Ws really depends if they can get feed from either CX or NH.

Under a SQ controlled VA, I could probably see VA stick around on SYD-LAX but probably pull out of BNE-LAX in favour of either DL taking over (though unlikely) or feeding them to NZ via AKL (even though NZ may not be part owners in the future)
 
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 7:43 am

Quoting IndianicWorld (Reply 154):
NZ is an airline that comes across as rather aggressive in its business dealings, especially considering its rather limited size. It is a smaller airline than VA, and was also far smaller than AN when it launched its takeover of that airline too.

On what measure is NZ a smaller airline than VA? If you use market capitalisation - the market's valuation of the 2 companies, NZ has a market cap of $3.21bn vs VA's market cap of $1.3bn.
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 8:13 am

Quoting sq256 (Reply 164):
If SQ does buy NZ's stake or even EY's stake I could tip them using the 77Ws to take over some of SQ's own East Coast-SIN flights while deploying some of those displaced SQ aircraft elsewhere on their own network. HKG and/or NRT on VA 77Ws really depends if they can get feed from either CX or NH.

HKG/NRT on VA 77W would be too much for them to fill. Also remember about half the VA 77W fleet have the non-standard small cargo doors which creates further logistical problems.
 
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 9:21 am

Quoting jetfuel (Reply 163):
Think about it

I did. For a second.

Virgin Australia provides almost nothing to Delta. They have one flight per day into Sydney that they can easily fill without feed. Back in 2009-10 the marriage of convenience between Delta and V Australia meant that at least one, and possibly both, wasn't forced out of the market. Now the two coexist happily enough, but they have done absolutely nothing to jointly develop the market over the past five years. Capacity has been flat, while Qantas and United have both expanded during that time. Delta's priorities are elsewhere. There is no need for them to throw good money after bad in such a peripheral part of their network.

Quoting allrite (Reply 160):
if they can get rights for Scoot Australia to fly long-haul to places like Japan and Hawaii then they would be a direct competitor to JQ

I can't see NRT and HNL working out for TT, unless they want to stick it Jetstar and be damned with the cost, but if they are smart, especially after a rebranding as Scoot Australia, then there would still be some very attractive growth opportunities. Australia-Hong Kong for example must surely be an El Dorado weighting to be discovered.
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IndianicWorld
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 10:34 am

SYDSpotter, My comments were based on VA carrying more pax and is around the same size in their fleet size from numbers I have seen.

Market cap is another story, but when NZ tries to push its weight around to push an agenda for VA it would make sense why it may not get its way. SQ and EY likely can influence things further and could well be better placed to bankroll VA's needs.

We will see how it pans out.
 
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 10:53 am

Quoting RyanairGuru (Reply 167):
I can't see NRT and HNL working out for TT, unless they want to stick it Jetstar and be damned with the cost, but if they are smart, especially after a rebranding as Scoot Australia, then there would still be some very attractive growth opportunities. Australia-Hong Kong for example must surely be an El Dorado weighting to be discovered.


Is there strategic value in destroying JQ's medium haul operations with their Asian 787 flights already facing LCC competition? Surely there's more value to be had in Scoot maintaining their Asian focus, especially as it should have a lower cost basis.

Aren't the constraints, either capacity or slots, that are preventing further Australia - Hong Kong operations? Surely if it were such a gold mine for a LCC then JQ would already be on it (direct rather than 3K and Jetstar Japan). I can't see Hong Kong doing any favours for an SQ affiliate either!  

Another thing if one single foreign carrier gets effective control over VA, could their international rights suffer? Whilst VAH is structured as an Australian owned operation, will concerns be raised over the fact that a foreign company will actually control it. The US seems to get upset about such things IIRC.
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 10:54 am

Quoting IndianicWorld (Reply 168):
SYDSpotter, My comments were based on VA carrying more pax and is around the same size in their fleet size from numbers I have seen.

Market cap is another story, but when NZ tries to push its weight around to push an agenda for VA it would make sense why it may not get its way.

But if your market cap is 2.5 times the size of a competitor, that gives you the financial means to push whatever agenda you want. The issue is that SQ/EY are also on the table (who are in turn much bigger, have deeper pockets and have significant backing). When it came to money, NZ would always be the first to blink when it came down to financial clout.

Passenger numbers/fleet size don't really mean an awful when it comes to takeovers/acquisitions.
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IndianicWorld
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 11:02 am

^^ It does when you look to operate an airline with more passengers to handle than your own airline does and effectively doubles the fleet it must manage. NZ should have learnt some similar lessons from its AN adventure.

Market cap only tells part of the story really.

SQ and EY are on a different scale and are likely better positioned to support VA. Let's hope though that they get the strategy right moving forward as there does appear to be improvements that can be made.
 
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 12:56 pm

What is the mythical feed that VA delivers to SQ? Don't SQ already serve the capital cities?
 
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 3:48 pm

Another A388 diversion to PER, this time EY455 (A6-APC)

http://www.flightradar24.com/ETD455/94356b7
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 4:47 pm

Quoting eta unknown (Reply 166):
Also remember about half the VA 77W fleet have the non-standard small cargo doors which creates further logistical problems.

still allows 8 pallet positions . And what is wrong with loading cargo into LD3's?
 
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 8:02 pm

Quoting allrite (Reply 169):
Another thing if one single foreign carrier gets effective control over VA, could their international rights suffer? Whilst VAH is structured as an Australian owned operation, will concerns be raised over the fact that a foreign company will actually control it.

Foreign companies already control 80% of Virgin.

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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 8:04 pm

Quoting Nouflyer (Reply 172):
What is the mythical feed that VA delivers to SQ? Don't SQ already serve the capital cities?

It's all those Singaporean tourists that want to relive their army days in ROK.  
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 8:06 pm

Quoting Nouflyer (Reply 172):


Maybe passengers not going to the major cities? It might be hard for some to believe but not everyone wants to go to Sydney or Melbourne. While the numbers are much smaller, it's something. Virgin put quite a lot of passengers onto SQ out of CBR, and I'm sure it's the same in HBA, TSV, ROK etc.

(and I will ignore your insulting comment about "the capitals" while ignoring Canberra, Hobart and Darwin)

The real value though isn't in connections, it is frequent flyer programs. They get a large group of status frequent flyers handed to them on a plate who are now coming to fly SQ (and EY) with little or no effort on their part.
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allrite
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 9:02 pm

In news sure to please many on this board I'm hearing that Qantas is set to announce a big order of 777s (variant unknown).

Press conference at midday.

Source: AFJ (can't link from my mobile)

[Edited 2016-03-31 14:04:01]
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 9:15 pm

Quoting allrite (Reply 178):
In news sure to please many on this board I'm hearing that Qantas is set to announce a big order of 777s (variant unknown).

. . . and it's 1 April, too . . .
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 9:19 pm

Quoting davidbyrne (Reply 179):
Quoting allrite (Reply 178):
In news sure to please many on this board I'm hearing that Qantas is set to announce a big order of 777s (variant unknown).

. . . and it's 1 April, too . . .

Who'd have thought QF would do a 777 order on the 1st of April?
 
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 9:52 pm

Quoting davidbyrne (Reply 179):
. . . and it's 1 April, too . . .

Spoiler! :P

Quoting sydscott (Reply 180):
Who'd have thought QF would do a 777 order on the 1st of April?

The same ones who can't let it go. 

Anyway, Qantas did order the 777. Alternate Qantas. Not sure it has worked out for them so well. We'll see. 
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 11:35 pm

Quoting mariner (Reply 175):
Quoting allrite (Reply 169):Another thing if one single foreign carrier gets effective control over VA, could their international rights suffer? Whilst VAH is structured as an Australian owned operation, will concerns be raised over the fact that a foreign company will actually control it. Foreign companies already control 80% of Virgin.

I wonder, accounting wise, VA is not controlled by any of the foreign airlines, so is it a foreign controlled airline? What's the act/regulation that defines this from a route rights perspective?

Quoting allrite (Reply 178):

Well played, you had me for about 15 seconds!!
 
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RE: Australian Aviation Thread Part 138

Thu Mar 31, 2016 11:55 pm

Quoting QF2220 (Reply 182):
I wonder, accounting wise, VA is not controlled by any of the foreign airlines, so is it a foreign controlled airline?

Everywhere else in the world, and usually in Australia, "control" resides with the majority ownership. All that needs to happen at Virgin is for any two of the foreign airline owners - plus Branson - to exceed 50%, and thus have control.

When Virgin wanted to start Virgin America, they had to dance through hoops, twice, to prove to the DOT that even minority ownership did not give them any control. They even had to sack their original choice of CEO.

The Murdoch family controls News Corp, even though they only own about 14% of the shares. But the shares they do own are voting shares, the common stock is not.

http://www.theguardian.com/media/201...amily-news-corp-shareholder-revolt

"Murdoch family defeat shareholder revolt over News Corp voting structure"

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RE: Australian Aviation Thread Part 138

Fri Apr 01, 2016 12:13 am

Quoting mariner (Reply 175):
Foreign companies already control 80% of Virgin.
Quoting mariner (Reply 183):
When Virgin wanted to start Virgin America, they had to dance through hoops, twice, to prove to the DOT that even minority ownership did not give them any control. They even had to sack their original choice of CEO.

Yep, I was looking at the Virgin America case as a precedent. Also the hassles Qantas has had with Jetstar HK and 3K. Cases where technically the holding may (or may not in the case of HK, let's not start that again) comply with the law but the effective control may be perceived differently by regulatory authorities. Airlines seem to find their ways around this, but it may be a big complication in trying to structure a takeover of VA and I'm sure Qantas and others will raise it as an issue.

Right now it would look like no single airline/nation has control over VA.  
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RE: Australian Aviation Thread Part 138

Fri Apr 01, 2016 12:43 am

Quoting allrite (Reply 184):
Airlines seem to find their ways around this, but it may be a big complication in trying to structure a takeover of VA and I'm sure Qantas and others will raise it as an issue.

It isn't so complicated in Australia because of a law that I don't think exists in too many other countries - that a 100% foreign-owned (controlled) airline can fly domestically in Australia, as Tiger did originally, as a 100% owned subsidiary of Tiger Singapore.

The international flying of Virgin is a piece of legal slight of hand that still bemuses me.

Quoting allrite (Reply 184):
Right now it would look like no single airline/nation has control over VA.  

As I stated above, because no single shareholder controls - owns if you like - more than 50%. Put any two of the foreign shareholders together and throw Branson in and they'd be over 50%.

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RE: Australian Aviation Thread Part 138

Fri Apr 01, 2016 12:59 am

Qantas has announced where the 8 A380s they have on order are going

Latest plans for 8 new A380 aircraft are for them to be leased to Jetstar in a 720 seat configuration
Where's the passion gone out of the airline industry? The smell of jetfuel and the romance of taking a flight....
 
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RE: Australian Aviation Thread Part 138

Fri Apr 01, 2016 1:09 am

Quoting jetfuel (Reply 186):
Qantas has announced where the 8 A380s they have on order are going

Not much space left in that configuration. 25 more and it would have become very uncomfortable.  
Quote:
11:59:35
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RE: Australian Aviation Thread Part 138

Fri Apr 01, 2016 2:22 am

I saw the AA 777-300ER in person today for the first time as she flew past my home - what a nice looking bird! I must admit that I really disliked the new AA livery at first but it has grown on me over time.

And regarding 777s... doesn't time fly... I missed the opportunity to catch one last look at the UA 777s in SYD before the 787s took over. Let's hope UA has better luck with their 787s on the SYD flights than they had with the 777s and 747s  
Quoting jetfuel (Reply 186):
Qantas has announced where the 8 A380s they have on order are going

Latest plans for 8 new A380 aircraft are for them to be leased to Jetstar in a 720 seat configuration

April fools!
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RE: Australian Aviation Thread Part 138

Fri Apr 01, 2016 7:52 am

Quoting RyanairGuru (Reply 177):

Quoting Nouflyer (Reply 172):


Maybe passengers not going to the major cities? It might be hard for some to believe but not everyone wants to go to Sydney or Melbourne. While the numbers are much smaller, it's something. Virgin put quite a lot of passengers onto SQ out of CBR, and I'm sure it's the same in HBA, TSV, ROK etc.

(and I will ignore your insulting comment about "the capitals" while ignoring Canberra, Hobart and Darwin)

The real value though isn't in connections, it is frequent flyer programs. They get a large group of status frequent flyers handed to them on a plate who are now coming to fly SQ (and EY) with little or no effort on their part.

I'm not meaning to offend anyone.

I'm just conscious that Singapore Airlines' own flights meet almost all SQ's inbound demand and the vast majority of outbound demand too. In terms of inbound demand, I'd think that Cairns is really all that Virgin Australia offers to Singapore Airlines.
 
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RE: Australian Aviation Thread Part 138

Fri Apr 01, 2016 8:16 am

Quoting Nouflyer (Reply 189):
'm just conscious that Singapore Airlines' own flights meet almost all SQ's inbound demand and the vast majority of outbound demand too. In terms of inbound demand, I'd think that Cairns is really all that Virgin Australia offers to Singapore Airlines.

Carns now has Silk Air to SIN.


NZ's shares will be bought by the Chinese more than likely IMO. They have an insatiable desire to buy everything Ausralian
Where's the passion gone out of the airline industry? The smell of jetfuel and the romance of taking a flight....
 
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RE: Australian Aviation Thread Part 138

Fri Apr 01, 2016 8:23 am

Quoting jetfuel (Reply 186):
Qantas has announced where the 8 A380s they have on order are going

Has to be an April Fools day joke, Jetstar are more intrested in playing with Q300s at the moment.
 
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RE: Australian Aviation Thread Part 138

Fri Apr 01, 2016 9:34 am

Quoting Nouflyer (Reply 189):
I'm not meaning to offend anyone.

I'm just conscious that Singapore Airlines' own flights meet almost all SQ's inbound demand and the vast majority of outbound demand too. In terms of inbound demand, I'd think that Cairns is really all that Virgin Australia offers to Singapore Airlines.

Not sure why everybody always gets so offended by this, its math. Well over 70% of the Australian population live within driving distance of a city currently served by SQ, and while that still leaves another 30% of the population (not insignificant), demand will be higher than 70% of total demand for those cities as they are business hubs and/or tourist destinations, something destinations like ROK, HBA or TSV don't have (to the same extent anyway).

CBR fills in one of the remaining markets even more.

Quoting jetfuel (Reply 190):
Carns now has Silk Air to SIN.

Not to contradict my previous point, but Silk Air is only 3x weekly SIN-CNS so probably still a large portion going via BNE.
 
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RE: Australian Aviation Thread Part 138

Fri Apr 01, 2016 9:45 am

Quoting jetfuel (Reply 190):
NZ's shares will be bought by the Chinese more than likely IMO. They have an insatiable desire to buy everything Ausralian

It's becoming a popular theory:

http://www.adelaidenow.com.au/busine...y/6a6d369b9ed001862d54e7ba49fa6a0a

"Chinese airlines up for Virgin flights after Air New Zealand sale

CHINESE airlines are tipped to be the high-priced front runners to swoop on a stake in Virgin Australia, which would allow them direct entry for the first time to the Australian domestic travel market.

“No-one on the Australian ASX is going to want to buy up to 25 per cent of an airline dominated by Singapore and Etihad. There is just no benefit, they’d never get control and would always be a minor investor,” aviation analyst and founder of Strategic Aviation solutions Neil Hansford said yesterday.

“If Singapore and Etihad don’t buy up the parcel the front runners are the big Chinese carriers, China Southern, China Eastern or China Air,’’ Mr Hansford said."


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RE: Australian Aviation Thread Part 138

Fri Apr 01, 2016 10:06 am

Quoting mariner (Reply 193):

Quoting jetfuel (Reply 190):
NZ's shares will be bought by the Chinese more than likely IMO. They have an insatiable desire to buy everything Ausralian

It's becoming a popular theory:

http://www.adelaidenow.com.au/busine...y/6a6d369b9ed001862d54e7ba49fa6a0a

"Chinese airlines up for Virgin flights after Air New Zealand sale

CHINESE airlines are tipped to be the high-priced front runners to swoop on a stake in Virgin Australia, which would allow them direct entry for the first time to the Australian domestic travel market.

“No-one on the Australian ASX is going to want to buy up to 25 per cent of an airline dominated by Singapore and Etihad. There is just no benefit, they’d never get control and would always be a minor investor,” aviation analyst and founder of Strategic Aviation solutions Neil Hansford said yesterday.

“If Singapore and Etihad don’t buy up the parcel the front runners are the big Chinese carriers, China Southern, China Eastern or China Air,’’ Mr Hansford said."

Would be interesting, and would upset the dominance QF currently has with partnerships with MU and CZ.
 
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RE: Australian Aviation Thread Part 138

Fri Apr 01, 2016 10:41 am

Quoting TruemanQLD (Reply 194):
Would be interesting, and would upset the dominance QF currently has with partnerships with MU and CZ.

That's what makes me think its Air China and/or Cathay
What?
 
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RE: Australian Aviation Thread Part 138

Fri Apr 01, 2016 11:03 am

Quoting aerohottie (Reply 195):
That's what makes me think its Air China and/or Cathay

It's now past that time of day/date when a SQ/CX partnership would have been announced.   It would have happened at the same time as QF and CX announced a restart of Jetstar Hong Kong.  

I certainly wouldn't doubt rumours of Chinese investment in VA but I'd certainly question if the subsequent mix of airline investors would be good for the management of VA.
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RE: Australian Aviation Thread Part 138

Fri Apr 01, 2016 11:23 am

Quoting allrite (Reply 196):
It's now past that time of day/date when a SQ/CX partnership would have been announced.

I don't think that is what i'm suggesting... It would be a hostile move against both QF and SQ on the part of CX

[Edited 2016-04-01 04:26:39]
What?
 
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RE: Australian Aviation Thread Part 138

Fri Apr 01, 2016 11:25 am

Quoting allrite (Reply 169):

I am confused why JQ don't do HKG already, IMHO the access of Scoot shows that there is a maker for longhaul LCC flights out of Australia to cities as well as just tourist destinations. Maybe QF are reluctant to have them trash yields on a highly lucrative duopoly route?

Regarding slots, Australian carriers have no concerns from a bilateral capacity standpoint, and the nature of an LCC operation means that they can take less lucrative timings. An 05:00 arriv in HKG and 07:00 departure won't necessarily appeal to business passengers, but will an LCC could still pack them in if the price is right. I have no idea if there are slots at that time, I was just using an example. Look at JQs flight from NRT to MEL with its zero dark hundred arrival time as an example.

Quoting TruemanQLD (Reply 192):
Not sure why everybody always gets so offended by this, its math

Of course, and if one were to say "major cities" then I'm not going to get upset if Hobart was excluded. I do object to referring to "the capitals" though.

Quoting mariner (Reply 193):
the front runners are the big Chinese carriers, China Southern, China Eastern or China Air

I say no way to China Eastern, but I wouldn't be at all surprised if they eventually took a reasonably sized stake in Qantas (within the bounds of the Sale of Qantas Act of course). China Air [sic] is the distant third also-ran in this market, and it probably isn't a strategic concern for them. I could definitely see CZ making a move, though. They are the largest Chinese carrier in Australia by quite a margin, and while there was lots of glitzy lights for the announcement of their partnership with Qantas, the two carriers have done very little together since then. Qantas is much more focussed on deepening their relationship with MU, and CZ have received the relative cold shoulder.

Quoting aerohottie (Reply 195):
Cathay

Stranger things have happened, but I can't see them playing nicely in the same sandbox as SQ.

Unless of course they decide they to stick it to both Qantas and Singapore in one swoop!
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RE: Australian Aviation Thread Part 138

Fri Apr 01, 2016 11:29 am

Interesting article in the AFR this weekend which notes Luxon had asked for Borghetti to resign. Posting in here since the dedicated thread has gone a bit off-topic. Most interesting takeaway:

Quote:
Several weeks ago Air New Zealand's chief executive, Christopher Luxon, stood up in a private meeting and called for Virgin boss John Borghetti to resign. He has no such plans.

Some key points:
  • Air NZ has been disappointed with Virgin's financial performance for some time, and was becoming increasingly concerned it would be asked to stump up more cash when Borghetti completes a capital review in two to three months;
  • Air NZ and Virgin agreed at a meeting between Air NZ chairman Tony Carter, Virgin chairman Elizabeth Bryan and Virgin CEO John Borghetti on 30-Mar-2016 that the existing code-share arrangements with Air NZ would remain in place;
  • Borghetti is believed to have offered to retire a year ago but was asked to stay on by Bryan;
  • Borghetti says he has largely achieved everything he set out to do and cannot understand the criticism at a time when the airline has returned to profitability;
  • Most likely buyers looks like either Singapore or Etihad, or both, acquiring the shares. While Singapore and Etihad are competitors operationally, their sovereign wealth fund owners are said to have a close relationship.

Interesting that Borghetti continues to blame analysts for 'short-term thinking' after having six years to bed in his transformation, given Qantas achieved a significant turnaround in their own business over a much shorter period of time.

Question over EY vs SQ also interesting - they'd obviously not rather another airline join the fray, but EY doesn't seem to have much appetite to take a bigger stake and SQ seem to be consolidating around full control of their subsidiaries rather than minority stakes after the challenges Tigerair brought.

Full article here: http://www.afr.com/business/transpor...s-aviation-shakeup-20160331-gnvds9

Also seems to tease at a bigger wrap in the weekend fin if anyone is interested  

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