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Old 31st May 2020, 03:04
  #2349 (permalink)  
IsDon01
 
Join Date: Feb 2019
Location: Sydney
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From the last webinar Tino made clear his opinion that QANTAS had the right number of people going into this COVID crisis, and it was his firm belief that translates to having the right number of people coming out the other side of it.

I read into that to not expect any widespread redundancies any time soon. With the flexibility management are enjoying with the stand down provisions it seems to me that management are taking a wait and see approach to see how quickly recovery happens. They’re under no pressure to do anything different. I expect any fine tuning will be through LWOP opportunities. There will also be some natural attrition during this period as people reach the time of their lives that it’s just easier to disappear into the sunset. If I was 10 years older, that would certainly be my position.

Forward bookings are usually the lens that management use to determine the amount of seats to put on any particular route. Be that putting more seats on the route by using bigger aircraft or more frequency or reducing frequency and/or aircraft size depending upon forward booking demand. When determining whether a new route is viable a lot of research goes into the likelihood of it being a success by looking at the demographics of the planned market and then taking a leap of faith by opening the route. Forward bookings can then be used as the barometer to “right size” the route. QANTAS have been ruthless at cutting or downsizing routes if the load factors fall short of expectations as any competent airline would.

QANTAS, like all other airlines, now finds itself in a reset period. By that I mean that the usual barometer of forward bookings are not presently an accurate reflection of route viability as every route has been artificially restricted by both international and interstate borders. Nobody's making bookings anywhere at present as it’s actually illegal for Australian citizens to leave the country and any international visitors face a 14 day quarantine. QANTAS must effectively now treat every route as if it were a new route and take a leap of faith once restrictions are lifted and hope that forward bookings flow in. I think they will, and so do QANTAS management.This seems to be a perfectly reasonable expectation.

As to how this equates to forward recruitment is a more difficult question. A lot will depend upon confirmation of forward bookings and realisation of the expected pent-up demand. No recruitment will happen until this is known for certain. Added to this will be a decision upon the future of the 747. The longer this goes on, the less likely it is that the 747 will fly again. It was planned to retire in March next year anyway. Any short-term conversions would be associated with the expected RIN process of those crew on that fleet. If, as expected, forward bookings return then I expect the three deferred 789s will be delivered and the 789 will form the backbone of any return to international routes. That includes routes out of SYD traditionally flown on the four engines fleet. I expect the 787 will actually be short of crew early next year. I may be wrong. Time will tell.

The A380 is also a “wait and see” prospect. There has been a lot of conjecture that because QANTAS stopped the refresh of the last 6 A380s that this somehow signals the start of the demise of the A380 for QANTAS. This position was scoffed at by Tino in the last webinar. He stated that we had the right number of A380s going into this crisis and we’ll have the right number, 12, coming out of it. The pause on the refresh on the last 6 aircraft was purely the short term requirement to preserve cash and that the refresh will be continued once we start making money again. I feel for the guys on the dugong. I was there myself until recently and to some extent these guys have as much, if not more, uncertainty as the 747 guys. The 747 guys can expect retraining in the short term, whereas the A380 guys will probably be just kept stood down for a long period, maybe another 12 months. The company is still planning to operate the A380 into the future so they won’t want anyone leaving this fleet in the short term, but they won’t be flying again for a significant period. Any crew required for the 787 will be coming from the 747 in the short term.

My crystal ball is to not expect recruitment for at least 18 months or so. If the demand returns, as expected, then it will have to happen then. Tino also stated that he is committed to Project Sunrise and I can see the logic here. The point to point out of Australia makes even more sense now than it did pre-COVID. I firmly believe the A350 remains firmly in focus and will form a big part of QANTAS’ future.

It will take a couple of years but I expect QANTAS will be back to where we were, and even stronger. I’m normally quite cynical about QANTAS but I don’t think we have anything to be pessimistic about. The next few months will be a struggle for those on the 4 engine fleet but we’ll get over it.
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