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Old 6th May 2020, 21:53
  #103 (permalink)  
SecretAngel
 
Join Date: Oct 2019
Location: Sydney
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Originally Posted by machtuk
To make any attempt work the new "Co" will have to be a very lean operation. Now what can be cut!
Leasing? Hardly!
Maint? Nope!
Fuel? They wish!
Airways charges? Hardly!
Airport leases and associated costs? In yr dreams!
CREW/personel? Exactly!
The hunan element is the only area that can be squeezed & they will come flocking!
I don't think that's quite right. Aircraft and airport leases could both quite possibly be reduced. For aircraft, that's pretty straightforward - there's a global surplus of aircraft, and the administrator has the power to cancel contracts, which means they can credibly say to lessors, "You can keep your lease, at an X% discount, or we'll cancel it and talk to the other lessors."

For airports it's a bit trickier because most airports are monopolies in their city, but still possible because the administrator only needs a majority of creditors to agree to their plan - they can say "Agree to a discount now, or we'll cancel the contract and you can try to renegotiate it in an environment where your terminals are half empty and VA only needs two thirds of the floor space."

Obviously, maintenance activities can't easily be cut. But there may be savings to be had on parts and labour. There'll be a glut of parts, and a lot of MRO shops hunting for business

Fuel and charges - agreed.

Also, don't forget all of the other supplier costs - catering, uniforms, cleaning etc. All of that is up for negotiation too.
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