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Quoting RyanairGuru (Reply 1): Responding quickly to the Virgin results, I was most alarmed by Borghetti's comments. It wasn't so much what he said, but how he said it with a positive spin, a salesman's smile, and an everything will be great demeanour. |
Quote: "While we pitch our new business class at halfway between business and first, premium economy will be halfway between economy and business but certainly closer to business class," Borghetti told Australian Business Traveller at the launch of airline's new business class. |
Quoting RyanairGuru (Reply 1): It's probably a facade but that is still a concern in itself as he isn't been honest with the market |
Quoting RyanairGuru (Reply 1): Fuel dipped below $30/barrel in the last quarter, the capacity war is long since over and capacity from all operators was flat, and Qantas is on track to deliver a thumping profit. VA should not be making an underlying loss in this environment. If they can't make money in a time of low fuel prices and capacity discipline then they will probably never be profitable. |
Quoting mariner (Reply 2): And I keep coming back to the same question - if (LCC) Virgin Blue was not the answer, why is (LCC) Tiger now the engine of growth? |
Quoting mariner (Reply 2): And I keep coming back to the same question - if (LCC) Virgin Blue was not the answer, why is (LCC) Tiger now the engine of growth? |
Quoting allrite (Reply 5): he A330's are an example. There are plenty of places for them to deploy them other than on the PER runs. |
Quoting IndianicWorld (Reply 7): DJ tried to be everything to everyone at one stage and did not really find its market position, but TT is unashamedly a ULCC, with a cost base that offers a lot of advanmtages. |
Quoting mariner (Reply 8): Quoting IndianicWorld (Reply 7):DJ tried to be everything to everyone at one stage and did not really find its market position, but TT is unashamedly a ULCC, with a cost base that offers a lot of advanmtages. Even so, Virgin Blue was more profitable than Virgin Australia has ever been, reinforcing that the money is in LCC. |
Quoting Airvan00 (Reply 6): |
Quoting mariner (Reply 8): Even so, Virgin Blue was more profitable than Virgin Australia has ever been, reinforcing that the money is in LCC. |
Quoting DeltaB717 (Reply 9): I don't think it's so much a case of the money being in LCC. I think it's more to do with efforts to pull pseudo-LCC DJ apart and put it back together as high-end VA not really working - as others have already said, the consistency of product, both hard and soft, has never been there and that lack of consistency at VA keeps QF as the more attractive proposition for the higher yielding business travellers and frequent flyers. VA may have some high points which outdo QF here and there, but QF still has the "you know what you're getting" factor. |
Quoting IndianicWorld (Reply 10): I do tend to think it needs a new CEO to pull that off though as JB is likely not best placed to try and admit errors in his strategy so far. |
Quoting xiaotung (Reply 11): Rob Fyfe invited him to a Star board meeting a few years ago. Did JB's ego get in the way? |
Quoting mariner (Reply 2): But he's always been jam tomorrow. The losses are always someone else's fault - the restructuring or the economy or price of fuel or Qantas being nasty by not willingly giving up market share. He has burned through hundreds of millions of other people's dollars in his quest to prove that he's the CEO the Qantas board should have chosen. What is shocking to me is that JB so seldom gets called on it and that when he does, as Luxon did, the rest of the BOD - and the new Chair - closes ranks around him. And I keep coming back to the same question - if (LCC) Virgin Blue was not the answer, why is (LCC) Tiger now the engine of growth? |
Quoting timtam (Reply 13): JB's strategy has been fundamentally flawed right from the beginning. |
Quoting Airvan00 (Reply 6): |
Quoting travelhound (Reply 16): I'd suggest the QANTAS grounding was such a large disrupt-er |
Quoting allrite (Reply 5): If I understand correctly, VA bet big on the resources market. Their later acquisitions and routes have been structured around servicing the mines and miners |
Quoting DeltaB717 (Reply 9): the consistency of product, both hard and soft, has never been there and that lack of consistency at VA keeps QF as the more attractive proposition for the higher yielding business travellers and frequent flyers |
Quoting allrite (Reply 3): While we pitch our new business class at halfway between business and first, premium economy will be halfway between economy and business but certainly closer to business class |
Quoting travelhound (Reply 16): I'd suggest the QANTAS grounding was such a large disrupt-er, VA's strategy was nullified. Time will tell |
Quoting QF2220 (Reply 17): F disrupted itself, you are saying?! |
Quoting RyanairGuru (Reply 18): I agree that the slowdown in the resources sector is going to impact their earnings, but IMHO it is nothing more than a convenient excuse to explain their underlying loss. Writing down assets, such as the three ATR-72s, on a one-time basis is what it is, but the fact that Virgin isn't breaking even flying planes around is still a cause for concern. As you said, Qantas was also very exposed to their resources sector, having acquired Network so they could play a larger role in the RPT market and they also had a plethora of Qantas-branded scheduled services to places in Queensland and Western Australia that I can barely pronounce, let alone find on a map. While Qantas do of course have a much broader network to move assets around, I think that at the most fundamental level the reason that Qantas are doing much better right now is that they are enjoying higher yields on their core network between the capital cities. And this is why I find Borghetti blaming the resources sector disingenuous, it is a side show to deflect attention from the inherent weakness of Virgin's core network. |
Quoting RyanairGuru (Reply 18): I think that this goes back to them trying to please everyone, not wanting to alienate more of the market to JQ with the higher fares than a proper full service model would necessitate while trying to provide a high cost full service model, and ultimately therefore pleasing nobody. |
Quoting VapourTrails (Reply 21): Canberra Airport has unveiled it new international departures and arrivals hall designs as it prepares to welcome its first overseas flights in September, claiming it will be the best international terminal in Australia. |
Quoting Bluebird191 (Reply 22): Am I missing something or did CBR previously have international flights from FJ to NAN a few years ago that flopped? Another case of poor journalism and a lack of research - technically is the second (or maybe more...) international flight into CBR |
Quoting Bluebird191 (Reply 24): Some staff, including management, must have short memories. Surely they'd know and give correct info.. |
Quoting VapourTrails (Reply 21): Can't see that this has been mentioned yet.. I for one will be looking forward to seeing it from the international traveller perspective in coming years, or sooner, hearing about it from others. I am really impressed with the new terminal - could have more choice of places to eat though, but it is nowhere near cluttered, for the perceived lack of eateries. Striking a balance perhaps. |
Quoting VapourTrails (Reply 21): Canberra Airport has unveiled it new international departures and arrivals hall designs as it prepares to welcome its first overseas flights in September, claiming it will be the best international terminal in Australia. Canberra Airport managing director Stephen Byron said the design was more akin to the quality and standard expected from airline club lounges than an airport waiting area. |
Quoting allrite (Reply 20): For Virgin it's been seen as a core driver of their recent growth. I would not be surprised if some of the move upmarket was done with a belief that cashed up miners and their employers would use the lounges and the business class seats, would stick with VA due to connections, contracts and points. But if this has indeed been VA's strategy then Borghetti is both right and wrong to blame the resource sector slowdown. Wrong, as you say, because it's VA and Borghetti's fault for pursuing too narrow a strategy. |
Quoting allrite (Reply 20): VA are relative newcomers to regional services through VARA, whereas Qantas, through the Qantaslink umbrella, have been doing it since before the minerals boom. The assets they've added, like Network, have built upon those existing services and assets. They've also been built up using older aircraft. So I think they've seen the resources driven business as just one part of their greater operations. |
Quoting RyanairGuru (Reply 18): I think that this goes back to them trying to please everyone, not wanting to alienate more of the market to JQ with the higher fares than a proper full service model would necessitate while trying to provide a high cost full service model, and ultimately therefore pleasing nobody. |
Quoting timtam (Reply 13): JB's strategy has been fundamentally flawed right from the beginning. |
Quoting timtam (Reply 13): JB has overseen the destruction of significant value with the business being pretty much cashflow negative for the whole time he has been there. He hasnt returned a brass razoo to shareholders in his time at VA. |
Quoting mariner (Reply 2): And I keep coming back to the same question - if (LCC) Virgin Blue was not the answer, why is (LCC) Tiger now the engine of growth? |
Quoting QF2220 (Reply 30): if they were trying to make QF type 2, what is their competitive point of difference that would lead to pax choosing them instead of QF in the first place? |
Quoting qf789 (Reply 28): |
Quoting IndianicWorld (Reply 33): There's talk around that QR will likely reduce frequency of the ADL service soon. It was a mistake to go in at a daily frequency. Seems like the fleet planner got his way more than any commercial sound decision making. |
Quoting soyuz (Reply 34): The night time arrival and departure at PER will certainly pose an interesting challenge to spotters |
Quoting soyuz (Reply 34): Thanks for providing that! The night time arrival and departure at PER will certainly pose an interesting challenge to spotters. Am really looking forward to seeing the photos. |
Quoting Sydscott (Reply 29): Wrong because, like our Government, if that is what VA believed then they have stupidly made investments to service a once in a generation boom that will probably never be seen again in any of our lifetimes. You don't build a sustainable business that way. |
Quoting Sydscott (Reply 29): honestly the best thing that could happen to Virgin is that they become a wholely owned subsidiary of Singapore Airlines and the entire Board and Management ranks are cleansed. |
Quoting qf789 (Reply 35): On the 22nd of April a pregnant woman went into labour on 3K583 RGN-SIN. The baby boy was born onboard and as a result has been named Jetstar |
Quoting allrite (Reply 37): I think they need someone with a bit of vision and independent thinking from outside the region (especially as New Zealand has given up). I fear SQ is too conservative and too much like VA is right now (unless you want to make it a Scoot subsidiary) and the Chinese airlines too inexperienced. |
Quoting SYDSpotter (Reply 32): QF of course hasn't been standing still and certainly sharpened their pricing whilst at the same time reduced their cost base. Now the cost base differential between QF and VA is minimal but QF are able to command a higher premium/yield compared with VA. |
Quoting qf789 (Reply 35): AAB also said today PER will be next A350 Australian destination |
Quoting Sydscott (Reply 38): I think SQ buying VA will make for a significantly more formidable competitor to QF in terms of: |
Quoting RyanairGuru (Reply 18): Writing down assets, such as the three ATR-72s |
Quoting mariner (Reply 42): I just see it as the same ol' players doing the same ol' things. |
Quoting ben175 (Reply 40): I'm flying QF and AA on MEL-SYD-LAX (then connecting on B6 to JFK) in a few weeks, and Qantas has cancelled over 4 of the morning MEL-SYD services (including the flight we were originally booked on) as it's a public holiday on the 13th. Now we only have 1 hour to connect in SYD, and my travel companion has two knee replacements and can't run. The only options are a 6:00am departure (which is full in J) or 8:30am, the flight we have been moved to. It's going to be an absolute disaster if the first flight is running late. |
Quoting Sydscott (Reply 38): I disagree. I think SQ buying VA will make for a significantly more formidable competitor to QF in terms of: 1. All codeshares would be cancelled other than with SQ and NZ. Thus traffic would be funnelled through key hubs internationally. 2. You'd probably see the DL deal end and a UA one put in place instead. That gives VA access to a true hub at SFO which they could fly into along with a lot more Trans-Pac services. 3. Not to mention it would fulfil the SQ dream of having a sub flying trans-pacific from Australia!; 4. You'd see an integration of Scoot & Tiger Australia which would be fairly formidable. I could then see a Scoot Australia using 787's; 5. Replacement of VA's 77W's with A350's. |
Quoting mariner (Reply 42): I just see it as the same ol' players doing the same ol' things. |
Quoting Sydscott (Reply 44): SQ buying VA is the ultimate and logical option. |
Quoting mariner (Reply 47): At the very least, I would expect them to do what Virgin should have done yonks ago - (and I doubt Singapore ever would) - and start direct flights Oz to China. I haven't kept in-depth tabs on Chinese demand for Australia, but in New Zealand it's stratospheric: http://www.nzherald.co.nz/business/n...ticle.cfm?c_id=3&objectid=11633328 "China Business: Air NZ tourism market flies ahead Stephen Jones is upbeat about the unparalleled rate of growth out of the Chinese tourism market." I assume it's true for Australia as well, or even more so. |
Quoting allrite (Reply 48): Growth out of China is huge in Australia. The problem is that it is difficult for Australian airlines to compete both on cost with the Chinese airlines and with capturing local sales networks. It's not a level playing field. |
Quoting allrite (Reply 48): The other issue with ownership of VA by a Chinese airline is the lack of experience in foreign ownership. |