Are Patrick going to shut down Pac Blue

[grdproxinop]

Interesting reading the local paper in Aust recently, It appears that if Patrick get what they want then one of there options is to shut down Pacific Blue. Of course Godfrey totally dissagrees but that was there first agenda to get rid of him. They figure that even if they are breaking even or even making a profit on the tasman, that the aircraft can make even more money domestically within Aust under Virgin Blue and we all know that all Patrick are interested in is making money.

This is what I see happening:

1. Patrick get control and either, Sack Godfrey, shut down pacific blue and put the aircraft back into the domestic market. Then go to Qantas and make a deal. Something like we want 35% of the market and you can have 65% and lets "jack" the prices up for domestic travel. Of course this will we behind closed doors ( just like the oil companies with petrol prices ).

OR

2. Patrick get control and sell Virgin Blue / Pacific Blue and take there money and run. If this happens, Branson will sell his share and be back again within 5 years setting up another budget carrier with a Singapore airlines partnership.

Of course these are my opinions only but will be interested to see what others think.

[Howard Hughes]

we all know that all Patrick are interested in is making money

Hmmm, seems like a very sound business plan to me!!

Cheers, HH.

:ok:

[TIMMEEEE]

No way in hell would Corrigan sell his share in VB.

VB are making a profit, just not as much as CC would like.
In Corrigans opinion (and that of his backers) VB has been less than optimally run since Jetstar came along, hence Godfrey must go.
Also Pacific Blue is losing money overall and a profit is nowhere on the horizon.
No amount of hype or marketing babble accounted for the fact that the VB team totally underestimated Qantas, Air NZ and Freedom's resolve.
They just totally misread the market and seeing that Chris Corrigan is in the business of making a profit then bid them farewell.

Longer term, when the name Virgin Blue can be changed in a few years time, bet your family jewels that the name will be changed and see it turn into a leaner and more efficient version of Ansett.

[rescue 1]

I would be surprised to see potential ex Pac Blue capacity return/enter the Australian market - it is saturated now.

[Sheep Guts]

grdproxinop, your quote:

1. Patrick get control and either, Sack Godfrey, shut down pacific blue and put the aircraft back into the domestic market. Then go to Qantas and make a deal. Something like we want 35% of the market and you can have 65% and lets "jack" the prices up for domestic travel. Of course this will we behind closed doors ( just like the oil companies with petrol prices ).

I think if they did this the AAAC we be down on them like a tonne of bricks these days. Gone are the days of price fixing.

Sheep

[HGW]

I think he means that they wouldn't tell the ACCC and that they would keep it a big secret just like the oil companies and wharves do now.

[grdproxinop]

TIMMEEEE.... I agree with you, I think the first of my opinions is more likely to happen rather than the later, ie Sack Godfrey and sell Pac Blue and put Pac Blues aircraft back into the aussie domestic market

Sheepee...... HGW hit the nail on the head with regards to what I was implying. Why in the Hell would you tell the AAAC.

Further more Pac Blue have nothing in NZ to tie them here, All there Tech Crew are on Contracts through Rishworth and there Cabin Crew's contract has nothing at all to stand up on. I believe the Pac Blue loads have been average to say he least and when you are only selling tickets for $1 you'd have to be selling alot of chocky bars on flight to be making a profit of any kind

As I said just my opinion

[Sheep Guts]

Oops I goofed, I knew it was triple somethiing thanks HGW.:) Yes they may keep it a secret, but that wouldnt stop the ACCC from invetsigating suggested price fixing. There powers of investigation and prosecution arent to be messed with, and Im sure they werent around in the old TAA and Ansett Days. Patrick maye be a large Company but it aint an Oil Company like BP etc etc. with big Pockets of Capital and the power to change market forces.


Sheep

[jb_flyer]

BP's biggest hold over oil prices (well in WA at least) is refining capability. When you have a BP plant supplying the petrol requirements (and Av fuels) for all of WA, and parts of the rest of australia you have the oppurtunity to set the Terminal Gate Price for all the competitors.

So take the TGP in Singapore, add the cost of an Oil Tanker to get it to Australia, divide by number of litres, and bingo, you have the local Terminal Gate Price. As long as it is still (marginally) cheaper to buy it from BP rather then Singapore, BP wins the supply.

As far as this debate goes, i dont know as much about that then as oil prices, but my opinion is once it is known (through some unoffical channels...) that one carrier wont force another off the market, then prices will bob up to a sustainable level. But once the market share target is not acchieved, and loads drop, then the price will, to stimulate demand and raise market share.

[BankAngle50]

Pac Blue will be the first thing to go. The aircraft will come to Oz and the crews on contract unfortunately will be ringing Parc aviation. There loads have always been crap and they are fighting a loosing battle on this “Low Yield” Tasman route. The Aussie crew will (As they should have always been doing) the Islands from Oz.

[Sunfish]

ACCC, in my opinion, do not have the necessary AVIATION forensic accounting skills to take on QF.

The way the collusion happened in one industry was : "You guys can have 38% of the market but if you get 1% more than 38% we will beat you down to 25%".

It was never detected.

[Wirraway]

Tues "Herald-Sun"

Virgin doing it tough
Geoff Easdown
29mar05

BRETT Godfrey has told Virgin Blue staff he will remain with the airline and see it through the "tough times" this year.

The discount carrier's chief executive says he is not resigning because control of the airline has shifted after the successful takeover bid by Patrick Corp.
But in a letter he warns airline workers to brace for change as Virgin Blue diversifies to become both a value-based leisure and a value-based business carrier.

Click here for FULL story (http://www.heraldsun.news.com.au/common/story_page/0,5478,12686474%5E664,00.html)

===========================================

[Keg]

I see that BG has picked up on GD's use of the term 'fair return on captial invested'. :rolleyes:

[COP]

Does anyone have any valuable info instead of rumour regarding the possible fate of Pacific Blue? Those who are working there would no doubt be glad to hear from those who may be in the know. Also for those who are considering going to Pacific Blue in the near future, what is in store for them? Will they spend their savings on 737NG rating and have the possibility of losing their job, or do those out there think that PB is here for the long term? What is the reality of PB's future? Are they making money or not? What is the consensus regarding Rishworth and the possibility of a job if PB do get the chop? Know one will ever know the final outcome, but as it stands is it worth going to Pacific Blue????:confused:

[burty]

I believe the Pac Blue loads have been average to say he least

grdproxinop

No, loads are fine, WLG BNE/SYD is around 80%.

[COP]

Burty
What do you think will happen to Pac Blue? Do you work there? Could you give me some details regarding the operation.
Thanks:ok:

[propaganda]

COP,

I've heard Freedom are suffering " BIG TIME " rumour of a reduction in one airframe.....PB is still worth a gamble get the rating although self financed...get some 73 time . If it goes, you're still in a better position on the job market, if not with your bank manager.....
Good luck.

[Animalclub]

Saw in the BNE Courier Mail where Freedom is losing some of it's routes to Air New Zealand. What's going to happen with staff... or do Air NZ do all the ground handling?

[Choice bro]

I think you will find that PB are doing reasonably well on the Tasman. I know for a fact, that Freedom are dropping AKL-BNE. mmmm, wonder if that has anything to do with PooBlue moving into AKL next month............... My bet is they are here to stay. O yeah, herd one of there flights depart WLG today with 168 POB, and that’s there weakest port apparently. :) go figure.

[Crusty Demon]

Freedom dropping AKL-BNE? Ouch. Going to make it short of seats on that particular sector. Particularly with ANZ increasing capacity, as well as both ANZ and QF running 400's on this route.

However, if Freedom are dropping it then Pacific Blue must be caning it, even if they haven't started yet. Better sell those 400's ANZ and QF, they won't be needed soon.

BTW, full loads don't always equal profit - depends on what amount you are selling the seat for.

[The Enema Bandit]

I bet their yields aren't worth pissing on.

[HGW]

As others have said before on this subject, PB are not always the cheapest which bodes well for hanging around.
As I have said before the oncarriage is worth a fortune to VB and PB. There is even rumours of bigger planes.

[COP]

Do you guys (who seem to know more about what is going on with Pac Blue) think that it would be a good idea to leave a job and go to Pac Blue? It seems from this forum in the last day that the loads are good but the yields??? I often see the Pac Blue aircraft at the airport in Melbourne and the people waiting to get on board fill the gate lounge. But is this an indication of what it is usually like or what it is like sometimes. I have read in an article in the Australian yesterday that Godfery wants to keep Pac Blue open and that speculation that it will be shut down is incorrect. But in today's corporate day and age where peoples lives are or seem to be in constant turmoil (pilots - other than with mainline airlines) is it worth the risk? I guess it is the age old question do you leave one job for another and risk the possibility of it not working out. Therefore you are down 30 grand or so and then have to find another job if it all falls over. Speculation is rife in this industry and no doubt it always will be that way. No one ever thought Ansett would go but..........
So......Pac Blue is it the way to go. Food needs to go on the table for more than one consecutive year!

[Pete Conrad]

When are you guys going to stop equating big loads with success and profitability? QF consistently carry great loads out of all three ports in NZ both with the mainline operation and the Jetconnect lower cost base operation, that does not mean that all is rosy. No one, I repeat, no one is making money on the Tasman.

I wouldn't go as far to assume that as Freedom are cutting back that that bodes well for PB. The Freedom operations are being absorbed into the AirNZ network with I doubt, minimal net reduction in services overall. Though I am willing to be corrected on this.

Don't forget that PB will still have to compete with an emerging Jetstar operation on the Tasman.

Both QF and AirNZ have publicly stated there will be no retreating on the Tasman in the face of increased competition so it remains to see who has the deeper pockets. Also you have Emirates with an increased presence between Melbourne,Sydney,Christchurch and Auckland with an expanding freight/Skycargo network complimenting the operation.

Just my 2 cents, but if Corrigan wants to keep PB going, I would be concentrating on reducing PB flights on the heavily serviced MEL,SYD,BNE network and concentrate more on the leisure ports, IF he wants to keep it going.

HGW, there may be bigger aircraft on the Tasman soon, but not from the Virgin camp. Wait and see.

COP, you can only do what you think is the best thing at the time based on the current information you have. If I was you, I'd be looking more at AirNZ or Jetconnect if you are looking for a more "relaxed" for want of a better word, tenure. I've learnt in the past that it pays to be on the side of the 600lb Gorilla.

I reiterate, PB has the threat of a looming Jetstar operation on the Tasman. Do not forget this and the damage Jetstar has done to Virgin in Australia

[COP]

Thanks for the info Pete Conrad.
These decisions are hard to make because they tend to make or break you so to speak.
If anyone else has any info feel free. Cheers:ok:

[Z Force]

Personally I wouldn't risk leaving a job for PB. Why not enquire with Jetconnect? It would certainly offer more stability, not that there is a lot of stability in aviation these days.

[burty]

When are you guys going to stop equating big loads with success and profitability? QF consistently carry great loads out of all three ports in NZ both with the mainline operation and the Jetconnect lower cost base operation, that does not mean that all is rosy. No one, I repeat, no one is making money on the Tasman.

Pete Conrad.

No kidding. The point was made in regards to a previous comment regarding loads, not profitiability. It's common knowledge that the Tasman is hard work.

COP

Haven't been told of any future plans other than whats already been announced.

[No worries mate]

Here's what I think will happen.

Patrick will scale back Pac Blue and then give it 6 months to improve. If it doesn't improve he will close it.

There will be no more growth at Virgin Blue for at least 2 years. The aircraft on order will replace the older leased aircraft and some of the aircraft on order will be deferred.

Patrick will pull Virgin Blue of the lower yield routes such as BNA, CFS and a few more that routes that are marginal.

There will be no Regional Jets for Virgin Blue. Patrick will instead make use of airlines such as Skywest and Alliance with their F100's (Just like the old Ansett days). These airlines will replace Virgin Blue on the low yield routes. Patrick already deals with Alliance!

Patrick will also make greater use of the other independant regionals such as REX, once again just like the Ansett days.

[Pete Conrad]

burty, your point is? My point was for the interest of COP. No need to get defensive. Think if you go back I aint the only one to mention load versus profit.

COP, Z force is correct, if it's some semblance of stability you want, stay clear of PB and go for Jetconnect and AirNZ.

[BankAngle50]

Funny how things seem to go full circle. So when do VB aircraft get the Star Alliance logo painted on the nose?

[Dehavillanddriver]

I don't know about BNA, but I believe that the yields on Coffs are pretty good.

The loads are pretty good as well.

It has performed well since day 1....

[Beer Can Dreaming]

FACT - if PB doesnt perform well over the next 6-12 months and shows no signs of improvements then in true Corrigan form its Hasta Le Vista............baby !!

[Kickatinalong]

SHEEP GUTS,
how much are you paying for mogas at the moment?
A thing of the past, CRAP!!
ACCC has a big name but no balls.
Sorry to disagree, but.
Kinkatinalong

[COP]

So now what does all this mean for Pacific Blue, with 62% being owned by Corrigan. When will he make his move regarding the future of Pac Blue? No one is a mind reader, but what are the general thoughts now that Corrigan is effectively running the show???????

[Fred Basset]

FACT - if PB doesnt perform well over the next 6-12 months and shows no signs of improvements then in true Corrigan form its Hasta Le Vista............baby !!

Well what was said before hasn't really changed.

Maybe some smaller ports might go, and if Pacific Blue isn't profitable then its got 12 months to get it self profitable.

With BG owning a few shares maybe he won't be kicked out just yet, but like most politicians when they say more than 3 times that they aren't leaving they probably are. I wonder if BG sold Patricks some of his shares to get Patricks above the 50% mark in return for staying on a bit longer.

Well if Pacific Blue gets shut down I hope we get some warning so I can get a seat on the final flight.

[MrApproach]

The counry is crying out for a competitor to QANTAS. One airline with a monopoly over business travel surely can't sit comfortably with big business and Corrigan would know that. The growth area for Virgin is now at the font of the jet. Whether that is full-blown business class or seats for suits I imagine will be the subject of many a meeting in VB now that Patrick is in charge. As for Star Alliance, they have been able to throw ANZ or Alliance airlines into the mix since Ansett was gutted, and they've done neither. Star recently quoted the two holes in their network as being India and China so I assume Australia and it's 20 million really don't matter that much. Interesting to see how it all works out.

[tinpis]

Seats that suit anyone other than a dwarf would be step forward.

[jetblues]

Re regional ports every Ballina or Coffs I have flown have been bursting at the seams. It's all about aircraft utilisation and yield.

Re the seat pitch comment my understanding, and experience shows Virgin and Qantas B737NG seat pitch to be very similar, someone will have the exact figures I'm sure. Don't beleive all the hype as it's closer than you think.

I hear whispers PB's days may be numbered whilst there are still so many gaps in the VB network.

[Eastwest Loco]

With no fear or favour shown, as I have abolutely no problems selling Pacific Blue, locally there is zero call for them from the general public.

This may be due to low local advertising impact, but I feel that it is most likely due to the extremely low fares on the pacific available through the traditional, and full service new operators.

Through QF NZ and EK, New Zealand fares are at close to an all time low, not to mention BI GA and TG.

There are so many carriers on the Tasman alone, that something has to give - and soon.

EWL

[COP]

Does anyone out there think that PB has a chance of staying around for the long term? What is happening there at the moment in terms of profits? The loads, what are they like? Does anyone think that there will be a merging of PB and VB? The fact that Corrigan has control, who thinks that the freight business for PB and VB will be here and will assist in supporting PB. If PB is not making money in the future, what will happen to the pilots who spent the dollars getting the rating? Will VB take them on? Is it worth applying or going to PB if you already have another job, considering that both are contract and not being a New Zealander?
Any info greatly appreciated.
:confused:

[zulu_kilo]

PB start flying into AKL from next fri or sat.... the big question is how long for?

They have already reduced the schedule somewhat from the original plans

[Eastwest Loco]

Running narrow body equipment over short-medium haul in high density seating as all very fine, but when you refuse cargo clients uplift due to full loads, then you will lose them to a more reliable carrier with a heavy that is not tankering fuel, as they will have the space every time.

Sort of a Catch 22 - If we are not doing well we can make up the balance in freight revenue, but if we are doing well we will have to offload freight for baggage and piss off the shippers and lose them, and when we are not doing well again the freight will be riding an A345 and the shippers will not want to know about us.

Anybody see a spinning propellor here??

Best all

EWL

[Mobi LAME]

This is my first post on the PRUNE and I enjoy reading EWL's posts on any topic. We spent a very enjoyable afternoon in the Legends Bar on Pacific Sky on the way to NZ but he complained of liver problems later I believe. I said hello to our mutual friend from EWA days who now drives for Jetstar and appears to be very happy.
Cheers Ron

[Eastwest Loco]

Weeeeellllll LAME!!!

Good to see ya!!

What happened on the ship stays on the ship. Got that??? And the blonde is MINE!!!!!!!!!! :p

Best regards

EWL

Ron

[Barbers Pole]

Nobody is making any dough on the Tasman so it depends how long Corrigan wants to subsidise it? PB didn't get there 4th a/c as it went to VB. If things don't improve soon they will be Dog Tucker! I belive they have no fuel hedginig as well!

AirNz has taken back the main port (CHC,WLG,AKL) to Brissy flights off Freedom (winter schedule so more capacity req'd) and Freedom have been given WLG-Fiji.

Freedom are short on crew (guys doing airbus courses) so zk-NGA has gone back to AirNZ & they are doing quite a few flights for Freedom in it.