Current Conditions?
This EBA should have been done an dusted 18 Months ago, influenced by the economic conditions prevalent at that time. Stall, stall, stall, to the next sob story. The boy who cried wolf! It's the oil this time, really it is!
Questions have been asked as to why QF's hedging is about to expire or otherwise deteriorate. Look a little deeper. These speculative calls come down to the wire. Congratulations should be extended to QF's hedging department. It appears yet again that they have read the market perfectly. Give or take 3 months, the current hedging performance will efficently expire just as the oil price slumps to true market levels. Qantas have led the Airline world with incredibly accurate hedging policies and this time is no different. When QF's hedging appears to be losing its economic viability, bet on one thing, the oil price is about to fall. They are the best Airline Economics Management Team in the world. Problem is, you can't run any business in spite of your employees. Irrepairable damage sustained. Just like VH-OJH. Fix it at all costs to save the brand value. $110M on one aircraft. Disenfranchising your work force would have to be worth ten OJH's. Priorities? Is there an insurance policy to pick up this bill? APA, all eggs into one basket. Where to now?
Last edited by Acute Instinct; 21st Jun 2008 at 02:56.