Originally Posted by
planejane
OK, Melbourne Flyer that's your opinion and I'm not here to change it, but you do realise that you and your kids won't be burdened with this debt? It's a loan or part equity - not a grant as has been given to the regionals (Rex is over 60% foreigner owned). The main owners of VA are all airlines and where are they going to find the money now? Interestingly all (except Bransons' Virgin Atlantic) have been given government assistance (not a loan). Remember QF is 49% foreigner owned too. Are you going to whinge when AJ comes holding his hand out to prop up his airline.....again? BTW, if Joyce asks for government help, I'd support that too. As PS has stated many times - industry wide assistance is needed in these truely unprecedented times.
I take your point about not being burdened with debt BUT, there is no way on earth that Virgin Australia can repay $1.4bn loan in three years, which is what Scurrah has proposed.
This is an airline which has lost money every year for, what, six years? It lost something like $88m in 1H20, and we can wipe out 2H20. Now to repay a $1.4bn loan in three years, Virgin Australia would have to make a profit of $470m per year, allowing a few million extra for 'pocket money'. Do you think that sort of turnaround is even remotely possible? Of course it's not.
Which means the Government ends up with a pretty big stake in Virgin Australia, and suddenly the airline will be driven by political factors not business factors. The local member for Whoop-Whoop has people complaining they don't have flights to SYD, or not enough frequency, or they are too expensive. Well, because the member for Whoop-Whoop holds a marginal seat in the Government, he gets to tell Virgin "Start daily flights between Sydney and Whoop Whoop, oh and keep the fares low, no more than $200, because we have to look after the families and the workers." This sort of stuff will keep going forever, Virgin Australia will be worse off.
And if Virgin Australia gets a bail-out then absolutely Qantas should get one as well. I just don't believe either airline should get a bail-out.
And as someone else here said, think about Holden or other car makers who raked in massive government payments for years, but still shut down and you know what? Life went on.