Chadzat,
Let's just get this straight.
Let's discuss my 'bunkam' to use your words. Virgin Australia, who LOST $80 Million last financial year are going to pay 'Skywest' (spelling error corrected) under a wet/damp lease arrangement sufficient $$ to cover SXR's fixed and direct costs as well as provide what would esentially be a guaranteed profit contribution to SXR regardless of whether SXR carry '68 or 6 bums on seats'. I hope you will agree there must be a sufficient profit element in the lease rate to cover SXR's financial risk, unless of course SXR has decided to register itself as a charity rather than remain as a commercial airline business with hopes of paying future dividends to its shareholders.
Chum, I don't think Mr Borghetti is a chump, nor father christmas giving away financial 'gifts' to SXR to ensure their future profitability. Only Governments offer those types of subsidies to airlines and the ministerial minders try to shave every public penny during such negotiations. Virgin would certainly have bargained hard on the lease rate, because being a loss maker, they too must count every penny. I think certainly there will be some $$ for 'slack' during the start up phase, but down the road the 'tensioning clauses' will certainly come into play and throughout all this Qlink will be deep discounting on any contested routes to ensure passengers stick with the 'ROO'.
You also mentioned Cobham/QLink as an example of the type of business model jointly struck by SXR/DJ, however, the NJS (now Cobham)/Qantaslink model was originally struck many year ago to provide essential services over remote and what were then largely uncontested routes.
Contesting established east coast regional markets to take business away from aggressive and well funded existing operators is a very different dynamic to the business previously and currently existing between Cobham/Qantaslink. Cobham in its own right is a $ Billion company with extensive financial resources whereas SXR made a very small profit last year and declared a $00.01 cent dividend and Virgin lost $80 Million.
Do the math!!!
The Oracle