Originally Posted by
non_state_actor
I'd take it as given there will be no bailout and unless the country gets moving by about July it will be all over. 'Senior Government Sources' is usually a euphemism for a Minister or the PM. Stand around demanding a direct quote if you like but I personally would take that as 'writing on the wall'.
Branson has gone all woke and will probably be glad that he is no longer responsible for increasing Global Warming. He'll just retire in the Caribbean with who knows how many Billions in tax havens.
Remember there is a political game at play here. The government can't be seen to be just saying 'yes' to any bailout immediately and definitely not until the 11th hour. "On the record" simply has not happened and "senior government sources" is a political play to dupe the masses - of which you appear to be one. I'm not saying it's a guarantee, but when they've essentially bailed out SMEs with $100k interest free loans, bailed out regional aviation last weekend, specifically excluding Virgin and Qantas, are now supporting food exports and have categorically stated, on record, that Australia needs two viable airlines on the other side of this, have a think about the probability that the news today is simply part of a political play.
I still think the odds are that Virgin will be granted an 11th hour reprieve. There is too much at stake, far more than the $1.4b in lost tourism revenue and flow on effects. The most important point is that this is simply not the demise of an airline as a result of bad business in isolation - Virgin were well on their way to the black prior to this. Also, the perspective is a little skewed given there is a direct comparison with an airline that has one of the strongest balance sheets in the world, an anomaly by world standards in terms of self-surviving this unprecedented situation. The government shut down the ability for the airlines to operate. The business operation isn't failing during a period of free market capitalism, it has been prevented from operating at all. A very different situation indeed to enable Joe Public to see out businesses like Virgin through for their own benefit and I think most people understand the different between this and Ansett and other airline failures like them.
Furthermore, what happens if in 12 months Qantas are struggling due to a still subdued international market and go cap in hand to the government then asking for a bail out, when Virgin was allowed to fail 6 months earlier? This is an eventuality they also need to consider. Qantas might be ok now, but based on projections by Air NZ for example (who are expecting an international business 30% of the size it was pre-COVID 19), Qantas are definitely not out of the woods yet and are probably likely to require assistance at some point too. These are eventualities that advocates for letting VA go need to consider. If one size fits all, then it will still fit in 12 months.
Yet to be determined of course, Virgin might go under. However if anyone thinks an airline from anywhere or a new operator is going to sweep in over the next 12-24 months and pick up the slack where Virgin left off, given that balance sheets world wide will be decimated, has another thing coming. The public will have to accept a monopolised airline industry in this country for a long time and the airfares that go with it. Or, lend VA the money on favourable government terms and keep a fully operational airline along with trained staff and infrastructure on standby for the recovery. Seems like a relatively easy choice, politics aside.
Time will tell.