Originally Posted by
Rated De
To what costs do you refer?
Would that be fuel costs, for your assertion is correct. They have a very high fuel cost base per ASK.
With respect to the other costs, being denominated in AUD has been claimed both an advantage and a disadvantage.
They do have high back office headcount relative to other airlines.
So were the replacement to remove excess non-operational headcount then that might help the cost base.
As of 24th July 2019, number 15 on the list of biggest shareholders was Alan Joyce, so yes self evidently, he works for the investors (shareholders), most of the rest of which are nominee companies of foreign entities.
Fuel costs for QFA last time I looked ran around 24% of total costs. Personnel costs are considerable, and get the arbitrage treatment. Maintenance, arbitrage. aircraft asset, lease for tax benefits and to improve short term cashflows. Catering, brown bag service.
Every aspect of cost saving comes with consequences, saving on staffing through increasing productivity impacts schedule reliability, and complicates training demands for equipment changes or expansion. outsourcing alters the public perception and can either improve or detract from the process. Calling QF helpline and getting Dave from AT&T in Mumbai has a limited charm. multiple parallel staffing structures have increased administrative overhead and cause friction that can affect the product delivery. Maintenance outsourcing has its merits, and also issues, the need to put QA on the job, and the amount of rework diminishes the gains. You tend to get what you pay for. Asset management is well established, most airlines are in the same boat there.
Southwest had a concept that worked well for them for a long time, use a single type and gain efficiency from that, and keep the team happy, so the pax are happy, and give a fair return to the investors. That was OK, up to the Max, and that now is being reviewed.
CEO's beyond founders often end up with shares in the company they are managing, as part of their remuneration package etc. It may seem like a conflict of interest, and indeed for short term decisions it obviously is, it is the ultimate insider trading, however, the CEO otherwise has the same personal interest as the investors other than for a short term gain. Nothing in the gnomes history has been short term, and he is smart enough to never benefit from a short term gain that is attributable to knowledge arising from his post. Of course, all things are possible in this universe.