Originally Posted by
The Bullwinkle
Couldn’t possibly do any worse!
In complete agreement.
Whilst gracing these pages are the usual mix of pilot types, there are some very interesting contributors.
The problems that Jetstar face are not dissimilar to many low fare airlines; revenue margin (over cost) is difficult to achieve.
As T-Vasis remarked ancillary revenue is very important for a unit elastic demand product is very susceptible to fluctuations in the broader macroeconomic narrative.
The issue for Mr Evans to navigate is complex and has many moving parts.
He must balance the operating economic reality of low fare airlines which are low margin businesses versus the real problem that pay freezes and management excess (self enrichment) have left all staff bitter and rightly incensed that Little Napoleon pockets $24 million and they suffer declines in real income compounded forever.
Try as he may, Mr Evans with self interest never far away, must please the puppet master, sitting in the big chair at Fort Fumble.
Jetstar is a business that needed scale to try to grow margins, but in doing so became a festering sore. It has a footprint and capital requirement that ought deliver far more revenue.
That it doesn't is a problem. Self evidently, lower unit cost helps, but without a far more transparent approach to disclosure, QF must be trusted with their "exclamations"
There is a reason Qantas management choose not to report Jetstar segments.
There is a reason few airlines try an airline within an airline on the scale of Jetstar
There is also a reason why Little Napoleon clings to the creation myth, that he created it. He didn't.