Originally Posted by
Paragraph377
That’s the problem. He was a politician. He is used to doing and saying whatever he wants under parliamentary privilege. He is used to getting whatever he wants, when he wants. He is used to doing whatever he wants without being held to account. He is used to doing slippery deals behind protected doors that always benefits himself. He has taken that mindset and applied it to REX. Unfortunately he is too stupid to realise that although he can still call in favours, he no longer has the full freedom to do as he wants without consequences, without accountability even.
The decision to start 737 operations should ultimately be laid at the Board Chairman and CEO’s feet. The two of them got this business decision very wrong and they are paying a huge price for it, with more pain to come. Sharp might go down screaming that the entire world is at fault and not him, but it won’t change the fact that he has screwed up big time. The 737 operation will end in tears. And even though Joyce is circling an injured lamb and would love to bury them once and for all, he is playing a smart game. He knows the REX 737 operation is bleeding to death. Why risk the ire of the Australian public or a pineapple from the ACCC when REX is killing itself off without help from anybody else!
It is hard to see what Sharp expects ACCC to do. Does he think a certain % of market share should be set aside for REX's use or that QF and VA have to charge a set fare? As was stated both airlines are effectively restarting from a ridiculously low base so, of course, they are adding capacity regularly and are also stimulating demand through rolling special deals. REX's entire jet expansion was predicated on the mistaken belief that VA would not restart and REX could copy Virgin Blue's 2001 playbook and become Australia's second airline. When Bain announced they were purchasing VA, REX should have seen that its attempt to start a jet operation was doomed. Bain was investing way too much to allow VA to fail.
Some have suggested that REX had a long-term plan to prompt Bain to also enquire the REX operation. That may have been a plan if they had maintained a successful regional operation and stuck to their knitting. It looks like REX will emerge from this folly severely weakened so Bain will not be interested in acquiring from the shareholders and will probably prefer to wait until they can get business from administrators at a discount price without the associated liabilities having to be taken on.