Race you seem to be channeling Ben Sandilands.
Qantas reporting gradually approaches the real issue | Plane Talking
I'd agree that the punters have rushed off much faster than the papers have on this.
Today’s continued apologetic treatment of Qantas in the mainstream media leaves Fairfax and News some distance behind its long term investors, who have bailed out.
But gradually, the emphasis is shifting. It may not be long before the issues reported are not about the obvious problems that affect Qantas, and for that matter, many airlines, all of whom have fuel costs and eurozone jitters in common, but the dismal performance of its managers in dealing with them.
Qantas isn’t just challenged by geography, or the competitors that it continually slanders, but bad management.
Qantas group CEO Alan Joyce, has a habit of making big attention grabbing statements or decisions, like suddenly waking up and deciding to break an industrial situation of his own making by stranding 100,000 people all around the world, or experiencing death threats that the police found incapable of further action, or announcing ludicrous luxury Asian airline plans he couldn’t deliver and which Asian authorities first learned about from Australian reports.
These were with the benefit of hindsight, nothing more than headline generating nonsense that took place while the financial state of the carrier gushed down the gurgler.
Of course Joyce is right about what the problems are, apart from his critical inability to engage his staff as part of the solution rather than the problem. But if he knows the answers, he certainly hasn’t delivered on implementing any of them, and talking about five year recovery plans for the international Qantas business when it has shrunk below 18% of the market on his watch and according to his belated profit guidance, doubled its losses in a year while retreating from the market is enough to frighten off attentive shareholders.
By any bankable metric, Joyce as CEO and Leigh Clifford as chairman of the board have been damaging, costly failures.
The on going disaster with market share and the mismanagement of the Jetstar/Qantas relationship that drives loyal customers into the welcoming arms of Virgin Australia is bleeding the brand and loyalty at the domestic level, where Qantas says it is making its money out of flying.
Threatening to have a capacity and fare war with Virgin Australia is one of the signs of desperation that would have scared the heck out of investors with any grasp of what such threats have lead to in the US and Europe. Qantas no longer has the ability to carry out its threat to price or dilute Virgin Australia into oblivion because it has been financially weakened by management failures in strategy and competency.
It can’t even afford new jets on the necessary scale, or of the necessary design for that matter, to meet what is left of demand from its loyal following on international routes, leaving the high volume ports to major A380 operators Emirates and Singapore Airlines, and trying to fill in elsewhere with a museum fleet strategy of refurbishments of 747s that burn punitive amounts of fuel and and maintenance dollars compared to the 777s, A330s and A380s that each cover very specific payload/range combinations with unbeatable competency in their class.
Qantas made some very astute decisions in recent years that were let down by second rate implementation. Jetstar was a very clever move, as was morphing it into a trans border low cost franchise in Asia. But the returns never quite matched the rhetoric, and turning it into some sort of joke where it offers fares that are often higher than those available on Qantas for similarly timed departures on key interstate routes like Sydney-Melbourne is not a smart way of competing for profitable corporate passengers against single branded Virgin Australia.
To work, Jetstar has to be less than $100 each way on that route, not over $200 at times when the writer and his family found Qantas for $117 or Virgin Australia for $195.
On any close reading of ATSB reports of Jetstar incidents investigated by the safety body there is something seriously wrong with its approach to flying standards. When Joyce was CEO of Jetstar the airline inexplicably decided to change the approved flight manual for A320s in relation to missed approaches so that pilots didn’t immediately check the throttle settings in a go-around or missed approach situation, an act of operational madness that nearly destroyed one of its flights making a missed approach to Melbourne Airport in July 2007.
It was as monumentally stupid and dangerous as the Qantas decision way back in the late 90s not to use full reverse thrust on landings on 747s in order to save $1 million a year on brakes and fuel, which BASI, the previous incarnation of the ATSB, found was at the core of the crash landing of a Qantas 747-400 at Bangkok in 1999.
The focus of the board and management at Qantas seems at various times in recent years to have been more about selling out at the highest possible price, or having prolonged and damaging labor wars that, whatever the merits of labor reforms, have alienated the very people, the pilots, engineers and support staff, whose standards and professionalism are the basis for the Qantas brand value. If you lose your talented people you will also lose your customers, as the loss of John Borghetti to Virgin Australia, and those he took with him, amply shows.
These are all some of the matters that the media has, in general, avoided getting into.
But not the investors, who have bolted.