Originally Posted by
ECAMACTIONSCOMPLETE
thats a fair point!
I guess what I was getting at was that there are some ideas that have been discussed so many times that guys convince themselves that they are facts.
My counter point would be why would qantas prop up a loss making entity for all these years and continuously lie to the ASX in the process (which is of course, illegal)?
Or is it maybe possible that Jetstar does in fact turn a profit.
Even if JQ isn't profitable (which I think is unlikely, for the reasons you say), it very plainly serves an important strat fix role for the Qantas Group. It allows the Group to capture a large proportion of the leisure and VFR traffic at a lower cost, while focusing QF itself on targeting corporate and premium leisure traffic. Without JQ, either:
- VA would be free to make larger profits from the segments that JQ covers, giving it a much stronger base to compete with QF as a hybrid carrier, or
- QF would have had to heavily restructure itself to become a hybrid carrier, covering low cost and premium traffic.