QANTAS cancels 787 orders
Join Date: Aug 2007
Posts: 647
Likes: 0
Received 0 Likes
on
0 Posts
Humm
I take that to mean short - so with 40 years for an engine design to mature 20 years for an airframe to mature - we will be flying around in HP42's or similar equivalents depending on lease rates.
? CAT III
? CAT III
Paxing All Over The World
Shamrogue
The older a company is the 'heavier' is the company. This means the accretion of people doing jobs that may nolonger be strictly needed, or too many people doing jobs now more fully automated. It means too many buildings and leases to be maintained into the future.
It also means the people who fondly remember what the company was 20 years ago when it was a different world. Those people may be staff, directors and pax but they may not have accepted where commercial air passenger transport is these days.
Who would have thought that Kodak would have gone bankrupt? But they did not change. Who saw PanAm/TW and all the rest? Ask (in the UK) Woolworths. I am NOT saying that QF is a basket case - but any company that is over 90 years old has a specific problem to deal with, on top of all the regular 21st Century trading problems..
The age of the company has bugger all to do with anything.
It also means the people who fondly remember what the company was 20 years ago when it was a different world. Those people may be staff, directors and pax but they may not have accepted where commercial air passenger transport is these days.
Who would have thought that Kodak would have gone bankrupt? But they did not change. Who saw PanAm/TW and all the rest? Ask (in the UK) Woolworths. I am NOT saying that QF is a basket case - but any company that is over 90 years old has a specific problem to deal with, on top of all the regular 21st Century trading problems..
Join Date: Feb 2007
Location: Melbourne
Age: 57
Posts: 628
Likes: 0
Received 0 Likes
on
0 Posts
Here's one of teh best articles I have seen on this.
Times of Oman
The aircraft weren't to be delivered until 2016 anyway, and that assumes Boeing get the delivery schedule right from this point forward.
I wonder if it has anything to do with the changed business case for the aircraft?
One theory has it that the actual fuel performance is nowhere near as advantageous as the theoretical model predicted due to the 787 weighing more than originally envisaged as a result of the use of carbon fibre panels over a metal frame rather than all carbon fibre tube structure. That lack of fuel performance means that the business case for switching to the 787 is nowhere near as compelling as the savings just aren't there. Unless Boeing can do something to reduce the weight or otherwise garner the savings they predicted then there will be more cancellations to follow.
Refer also to the China Eastern cancellation of 24 aircraft in March. In some ways that is a more serious event than the Qantas cancellation as CE is widely seen as one of the potential huge growth stories in world aviation.
Alternatively it may be that Boeing and Qantas have worked a mutually agreed exit strategy for Qantas. The advantage to Boeing being that other customers have less uncertainty in their delivery schedule as those 35 Qantas aircraft represent 3.5 months of full scale production. As the article notes that will almost certainly mean less penalties for late deliveries, and even more importantly it removes a degree of leverage those airlines have over Boeing.
What it is likely to do however is drag forward similar decisions from other airlines. Whereas they have been able to sit back and take payments and other offsets from Boeing they are now faced with a lesser time period in which to make their minds up. If they want the aircraft they are now more likely to get them on time so if their economics don't stack up then more rejections may occur.
Interesting times.
Times of Oman
The aircraft weren't to be delivered until 2016 anyway, and that assumes Boeing get the delivery schedule right from this point forward.
I wonder if it has anything to do with the changed business case for the aircraft?
One theory has it that the actual fuel performance is nowhere near as advantageous as the theoretical model predicted due to the 787 weighing more than originally envisaged as a result of the use of carbon fibre panels over a metal frame rather than all carbon fibre tube structure. That lack of fuel performance means that the business case for switching to the 787 is nowhere near as compelling as the savings just aren't there. Unless Boeing can do something to reduce the weight or otherwise garner the savings they predicted then there will be more cancellations to follow.
Refer also to the China Eastern cancellation of 24 aircraft in March. In some ways that is a more serious event than the Qantas cancellation as CE is widely seen as one of the potential huge growth stories in world aviation.
Alternatively it may be that Boeing and Qantas have worked a mutually agreed exit strategy for Qantas. The advantage to Boeing being that other customers have less uncertainty in their delivery schedule as those 35 Qantas aircraft represent 3.5 months of full scale production. As the article notes that will almost certainly mean less penalties for late deliveries, and even more importantly it removes a degree of leverage those airlines have over Boeing.
What it is likely to do however is drag forward similar decisions from other airlines. Whereas they have been able to sit back and take payments and other offsets from Boeing they are now faced with a lesser time period in which to make their minds up. If they want the aircraft they are now more likely to get them on time so if their economics don't stack up then more rejections may occur.
Interesting times.
Join Date: Feb 2007
Location: Melbourne
Age: 57
Posts: 628
Likes: 0
Received 0 Likes
on
0 Posts
Originally Posted by 1pilot
Anybody got any info if the delay of 787s for QF will affect Jetstar?
Jetstar is getting 787-8, scheduled for next year.
From the same article quoted above:
"The airline's budget arm Jetstar will still receive 15 of the smaller 787-8s starting next year."
Join Date: Jun 2011
Location: New South Wales
Posts: 16
Likes: 0
Received 0 Likes
on
0 Posts
"Shamrogue re your option B: Some of the other wizards are right and there is a financial stroke going on."
This might be a lot closer to reality.
Why is it that so many institutional investors are remaining so quiet about not receiving a dividend for the past 3 years, and after AJ's announcement the other day not likely of getting one this year either?
Surely these companies and institutuions have the responsibility of being good stewards of their own company/institution funds?
Not only that, under AJ's watch the share value has more than halved. Institutions should have bailed out of Qantas shares long ago? Maybe, just maybe, they've been advised to 'hold tight' for the takeover bid??
In the meantime Jetstar is being made to look the real star performer and there'll be a huge push for the new owners to sell it (with them assuming it's outside of the Qantas Sale Act), and that sale could well recoup all of their investment.
This might be a lot closer to reality.
Why is it that so many institutional investors are remaining so quiet about not receiving a dividend for the past 3 years, and after AJ's announcement the other day not likely of getting one this year either?
Surely these companies and institutuions have the responsibility of being good stewards of their own company/institution funds?
Not only that, under AJ's watch the share value has more than halved. Institutions should have bailed out of Qantas shares long ago? Maybe, just maybe, they've been advised to 'hold tight' for the takeover bid??
In the meantime Jetstar is being made to look the real star performer and there'll be a huge push for the new owners to sell it (with them assuming it's outside of the Qantas Sale Act), and that sale could well recoup all of their investment.
Join Date: Jun 2008
Location: Sydney
Posts: 498
Likes: 0
Received 0 Likes
on
0 Posts
Shamrogue
Quote:
The age of the company has bugger all to do with anything.
The older a company is the 'heavier' is the company. This means the accretion of people doing jobs that may nolonger be strictly needed, or too many people doing jobs now more fully automated. It means too many buildings and leases to be maintained into the future.
It also means the people who fondly remember what the company was 20 years ago when it was a different world. Those people may be staff, directors and pax but they may not have accepted where commercial air passenger transport is these days.
Who would have thought that Kodak would have gone bankrupt? But they did not change. Who saw PanAm/TW and all the rest? Ask (in the UK) Woolworths. I am NOT saying that QF is a basket case - but any company that is over 90 years old has a specific problem to deal with, on top of all the regular 21st Century trading problems..
Quote:
The age of the company has bugger all to do with anything.
The older a company is the 'heavier' is the company. This means the accretion of people doing jobs that may nolonger be strictly needed, or too many people doing jobs now more fully automated. It means too many buildings and leases to be maintained into the future.
It also means the people who fondly remember what the company was 20 years ago when it was a different world. Those people may be staff, directors and pax but they may not have accepted where commercial air passenger transport is these days.
Who would have thought that Kodak would have gone bankrupt? But they did not change. Who saw PanAm/TW and all the rest? Ask (in the UK) Woolworths. I am NOT saying that QF is a basket case - but any company that is over 90 years old has a specific problem to deal with, on top of all the regular 21st Century trading problems..
QANTAS, by choice of management, are not giving QANTAS International new aircraft to expand the network. 12 A380's and 9 747's doesn't really constitute a TRUE International airline of the future, and with only 21 international destinations today as compared with 37 in 1973 shows where the International side of QANTAS is heading.
From mid 2013 Jetstar get the 787's and start handing back old, flogged A330's to replace 767's that have had interior upgrades from October this year for domestics, only to be phased out upon the return of the A330's.
Can anybody guess where the cost of the upgrade is going to be allocated against? QANTAS International, to justify it's losing money, and can no longer be sustained as an ongoing concern.
Last edited by QF94; 26th Aug 2012 at 07:11.
Paxing All Over The World
QF94
Correct. Both of these things had nothing to do with the companies being old, getting complacent and unable to change?
I am delighted to hear that QF is in good health (I never said anything else) and that they might be changing their plans for very good financial reasons. BUT they are 91 years old and cannot move without being fully aware of that long and heavy 'tail'.
Really???? PanAm had a bad history of maintenance and accidents and Lockerbie finished them off. Kodak didn't go digital which finished them off.
I am delighted to hear that QF is in good health (I never said anything else) and that they might be changing their plans for very good financial reasons. BUT they are 91 years old and cannot move without being fully aware of that long and heavy 'tail'.
Join Date: Jun 2008
Location: Sydney
Posts: 498
Likes: 0
Received 0 Likes
on
0 Posts
I am delighted to hear that QF is in good health (I never said anything else) and that they might be changing their plans for very good financial reasons. BUT they are 91 years old and cannot move without being fully aware of that long and heavy 'tail'.
Paxing All Over The World
QF94 Yes, the 'tail held high' was the benchmark - as it was/is for many others. Swiss? BA? Kodak? Ford? HMV? etcetera.
The problem is keeping that tail aloft (and out of the dirt, as you say!) costs money. In the current era, most pax don't want to pay for the 'tail'. Companies cannot afford it and nor can holiday pax. Those new companies that can provide a reasonable/tolerable service at a price that pax will pay? They have the pax.
Which is why I say (too often I know) that age has everything to do with the company's problems. I hope they get through OK, however, some folks will get bruised before the process is settled - one way or the other.
The problem is keeping that tail aloft (and out of the dirt, as you say!) costs money. In the current era, most pax don't want to pay for the 'tail'. Companies cannot afford it and nor can holiday pax. Those new companies that can provide a reasonable/tolerable service at a price that pax will pay? They have the pax.
Which is why I say (too often I know) that age has everything to do with the company's problems. I hope they get through OK, however, some folks will get bruised before the process is settled - one way or the other.
Join Date: Jun 2008
Location: Sydney
Posts: 498
Likes: 0
Received 0 Likes
on
0 Posts
The problem is keeping that tail aloft (and out of the dirt, as you say!) costs money. In the current era, most pax don't want to pay for the 'tail'. Companies cannot afford it and nor can holiday pax. Those new companies that can provide a reasonable/tolerable service at a price that pax will pay? They have the pax.
- After about five years of absence from the Gold Coast, QANTAS has decided to return to it. People weren't really wanting to fly Jetstar, but had to as there was no real other choice other than Virgin, as they offered a premium product. Now that QANTAS will be returning with a premium product, many people I have spoken with say they will gladly fly QANTAS and should never have pulled out of the Gold Coast, and that's only a 1 hour flight from Sydney and a couple from Melbourne.
- QANTAS currently fly to HNL three times weekly. They're flying banged up 767's with 1990's IFE. All flights are very much full. When QANTAS pulls out, I am led to believe the passengers won't all go to Jetstar, but Hawaiian, who offer a premium product in newer aircraft, which happen to be A330's, just like Jetstar. There is no other choice on this Pacific run.
The current regime in QANTAS is changing the way they do things, but at the detriment of QANTAS and the benefit of Jetstar. QANTAS left with aging and old aircraft, Jetstar get new aircraft, and competing on the same routes.
No one is saying you shouldn't move with the times, but you can't take a European model and make it work in Australia. We have much further to fly to go anywhere internationally, especially from Melbourne and Sydney, where most of the traffic is concentrated,so people are prepared to pay the extra for their goodies on board. Companies are meant to increase market share and run profitably. This is not the way to do it.
People will tolerate bare minimum for an hour or so sector, but when you're talking 4, 8, 10 hour sectors, the sentiment changes.
Join Date: Jun 2011
Location: New South Wales
Posts: 16
Likes: 0
Received 0 Likes
on
0 Posts
Re QF94's comment about flights to HNL....
With QF off the route some will try Hawaiian, but probably only once. Their service is good and the food OK (only out od SYD) but the seats are terrible. Have sampled two of their aircraft and it seems someone forgot to order padding for the seats, not very good for 6 hour sectors.
Getting back to 787's...news today is that Air India are finally to take delivery of their first of three standing at the ready tomorrow, and they've announced that one of the first routes (next month) for them to be used is India to Australia. Oh dear, QF are again left standing without modern equipment to even think about providing some competition.
With QF off the route some will try Hawaiian, but probably only once. Their service is good and the food OK (only out od SYD) but the seats are terrible. Have sampled two of their aircraft and it seems someone forgot to order padding for the seats, not very good for 6 hour sectors.
Getting back to 787's...news today is that Air India are finally to take delivery of their first of three standing at the ready tomorrow, and they've announced that one of the first routes (next month) for them to be used is India to Australia. Oh dear, QF are again left standing without modern equipment to even think about providing some competition.
Join Date: Jun 2008
Location: Sydney
Posts: 498
Likes: 0
Received 0 Likes
on
0 Posts
Guglielmo,
I can't comment on Hawaiian's seats, but I know of quite a number of people, both QF and non-QF people, and they loved it. It was either QANTAS or Hawaiian for them. They wanted nothing to do with Jetstar.
The decisions coming from Coward St, Mascot are certainly hurting the International side of things, and I firmly believe it to be no accident.
I can't comment on Hawaiian's seats, but I know of quite a number of people, both QF and non-QF people, and they loved it. It was either QANTAS or Hawaiian for them. They wanted nothing to do with Jetstar.
The decisions coming from Coward St, Mascot are certainly hurting the International side of things, and I firmly believe it to be no accident.