Originally Posted by
Dragun
Is anyone giving any thought to the fact that under normal business conditions with a functioning economy, yes, there would probably be another carrier from any number of places that could come in to pick up where VA left off as is being discussed above....but every carrier everywhere in the world will be nursing a balance sheet too weak to do anything but pick up their own pieces, or have been bailed out by their own respective government that would severely restrict investments in markets anywhere, let alone here, prior to those debts being paid or conditions satisfied?
Why is no one understanding that this is just simply not going to happen any time in the next 2-3 years given the unique circumstances surrounding the ultimate reason that Virgin will fail if there's no bail out?
This is 100% different to a normal business failing in a free market.
All the post above just seem to ignore this one simple fact - that VA has had its operations shut down by the government (indirectly not their fault) which, regardless of its balance sheet prior to this crisis, stopped any chance it had of getting back into the black. Most importantly, this is not unique - every airline in the world is in the same boat. Qantas itself will likely need a bail out if this continues, at the very least for its international segment.
Why are people focusing so heavily on the past and ignoring the likely outcome, that no one is coming and a monopoly will exist?
You can point fingers at poor management and bad balance sheets and the fact they deserve to fail, not arguing about that, but the rife speculation of some other carrier coming to pick up the pieces shows a delusion beyond reason at what is actually happening on a broader level here. Please have a think about that fact before speculating on who, what, where and when the next carrier will come from. It's naive at best.
The country needs to prepare itself for a monopoly for a very long time, at least in the premium market, if Virgin goes to the wall. Those are the objective facts.
Time will tell.
Agree completely. Also in their defense, analysts predicted a break even point for just after July this year, due to the cost reduction restructure (remember, there's a difference between statutory and underlying). Virgin Australia was expected to slowly make it through without COVID-19. At this stage however, I don't think a direct "bailout" from the Government will occur.
The Financial Review is owned by Channel 9 and both have reported numerous time loudly and proudly the Government will not bailout Virgin Australia. Other articles quote the Financial Review and Channel 9. Once again, I personally don't think it will happen in the form the CEO wants, but the battle is not over just yet. Once again, this evening the Financial Review has just posted another article yet again against Virgin Australia, rebuking Virgin Australia's monopoly theory. I thought they'd wait at least one day before writing another article against the airline.
https://www.afr.com/companies/transp...0200403-p54gp2