JET* International...dont expect too much

[pondoklabu]

Hello all
After reading countless arguments to and fro about the likely huge success about the impending explosion of Jet* International and how they will destroy QANTAS mainline and all that get in there way with brand new 787.
I now hear the rumor of airbus 380 well lets just take a deep breath and have a look at some hard facts.

Jet* domestic is QANTAS with a mask on, its competes on select routes with dedicated and guaranteed loads with minimal competition, hence making a profit is easier than getting Indonesian politicians off side.

Now have a look at Jet* Asia they aren’t protected and they have to compete in the big bad world where QANTAS not only cant protect them but they have to fend for themselves against very competitive rivals with superior infrastructure.
Jet* Asia is burning so much cash at present they have already told the board they will be downsizing their fleet to 6 A320 from 8 and they have put their hands out for more cash from QANTAS.

Jet* Australia and Jet* Asia have the same business model but one has protection while the other one doesn’t.

Now have a look at Jetstar International, they will be opening new routes not taking over trusted QANTAS ones I have already had a piece of paper pass over my desk suggesting Puket, Ho chi Min and Nadi being the first 3 routes followed closely by Bangkok and Bali.

All the Asia runs will be run through Singapore to try and code share with Jet* Asia and here is your problem before Jetstar can get all excited about more new huge aircraft like A380 which, you have to be joking they will never see, they have to try and make money against 17 other very competitive carriers in a very tight market.
I personally don’t care if Jet* pilots fly for free Jet* International will be very lucky if they break even in 5 years.

And even if they do don’t expect some massive growth to startle the world they have to learn to crawl before they can walk let alone run.

On one side note I have already been informed by my boss that Jet* International will be shadowed on any route they do up here and prices will be slashed to make sure QANTAS gets a bloody nose from quote " Geoff Dixon's arrogant Asia plans"

So people, believe what you want, but don’t think Jet* international is something new and will be an instant success, because its all been done before.

Have a great day

[Buster Hyman]

I didn't realise that QF didn't operate to BKK & DPS!

Surely, where they do operate on current QF routes, they'll be ahead anyway, based on costs to the Empire of operating Death Stars instead of the giant Corellian frigates!

[Elroy Jettson]

Dont think the plan is to make billions on low yield routes, its not. These guys are smarter than that. The master plan is set up a low cost structure, then morph it back into Qantas, in so doing smashing current terms and conditions without even a whimper from the staff.

Think about it. Look at Australian Airlines. They have been told, "sorry guys, two brands under the Qantas umbrella, thats it. Not sure where you fit, but we will let you know. In the mean time, dont take out a home loan."

The smart money says, Borghetti will keep them, put them back in Qantas colours and unifiorms, and then wet lease them to do the same flying they are doing now, on the lower than mainline cost structure. There is absolutely nothing stopping them doing the same thing with Jetstar international or domestic. Ala Air NZ and Freedom. Its happening all around us, it used to be refered to as transfer of business. :*

[qcc2]

pondoklabu you a right on the money. my sources also tell me that J* asia burns money L/R/C. had to bring in a local ceo (ex government) to mend fences and get some leverage. elroy you are wrong in your australian assessment. the only cheap part of australian is their cabin crew. pilots on secondment from qf, seperate management structure (not cheap either), low yielding routes and no J class. given the losses they had in the last 2 years i can only see them in J* int colors.:E

[Elroy Jettson]

Qcc2, I did say the smart money, not your money! :} 25% lower costs than mainline is the quoted figure, Borghetti wont pass that up!

You might be surprised at the techie savings too. Their savings come from their flexible T&Cs, rostering flexibilities and super. Not out of their base salaries. No pattern protection, blank lines, min gaurantee, roster bidding, leave seniority, home transport, allowances etc etc. It looks like they saved a fortune from getting their uniforms from customs seconds shop too! :} Win win.

[B A Lert]

The following article, while reporting little that's new, is from today's Sydney Morning Herald. All is still unwell in paradise!

Troubled Jetstar Asia to scale down fleet

By Scott Rochfort
April 5, 2006

QANTAS'S dream of grabbing a sizeable chunk of the low-cost Asian aviation market is looking increasingly shaky, with its 44.5 per cent owned Jetstar Asia seeking a fresh $S36 million ($31.2 million) capital injection.

The troubled Singapore airline is also looking to cut back its fleet of eight A320s to six by the end of the year in order to rein in its ballooning losses.

Singapore's Straits Times newspaper reported that Jetstar Asia's holding company, Orangestar Investment Holdings, sent a note to its shareholders proposing the capital-raising. The airline's other key shareholder includes the Singapore Government's investment arm, Temasek Holdings.

The note cited the airline's inability to gain landing rights into key markets and the "aggressive competitive landscape with new entrants and capacity growth".

Unlike its Australian namesake, Jetstar Asia has been bleeding cash since its launch in December 2004. Even its merger with rival budget carrier Valuair last year has failed to steady its losses.

The airline reported a $27.4 million loss in the six months to December 31.

The latest scale-back of the Jetstar Asia fleet comes just one year after the airline was forced to sub-lease four of its A320s to a Turkish airline.

It is understood the Qantas-backed airline will only look to build up its fleet of A320s when it gains access to key markets, such as China.

There is also speculation that Jetstar Asia is considering ditching the Valuair livery.

This was retained to allow Jetstar Asia to take advantage of Valuair's access to Indonesia - a market from which it has so far been barred.

A Qantas spokesperson declined to comment on the report. "This is commercial in confidence. Jetstar Asia is a small part of Qantas's business. It is a long-term investment and we remain committed to its future success," the spokesperson said.

Despite there being no end in sight to Jetstar Asia's losses, Qantas hopes its plans to foster greater co-operation with the Singapore airline and its Australian Jetstar will soon bear fruit.

Aside from drafting plans to link the routes of its Jetstar International offshoot with Jetstar Asia, both Jetstars are looking to share other services.

For instance, it is understood that Jetstar is mulling over whether to use Jetstar Asia's call centre in Malaysia

And for Buster, Qantas did operate to BKK and DPS but handed the latter to Australian. From what one reads, it appears that even they, with lower costs than Mainline, can't make it pay. They still serve BKK each day on the way to and from Heafrow.

[lowerlobe]

HEAFROW ????????

Is that like an AFRO ???????

As far as DPS is concerned the bali bombings certainly did not help their loads irrespective of AO's cost structure and if you have few if any pax then you will never make a profit on any destination

Quote from B A LERT "They still serve BKK each day on the way to and from Heafrow."...........I did not realise that AO flew to HEAFROW or anywhere in the UK for that matter...mmmmm DPS/LHR on a 767...interesting

[The_Cutest_of_Borg]

LL, even I can see that 'Lert's use of Heafrow was intentional, and he is referring to QF going to LHR via BKK rather than AO.

[B A Lert]

Thanks CoB - you have saved me the trouble of righting my ambiguity but it really wasn't necessary. The poor guy complaining calls him or herself "lowerlobe': what a misnomer as all of the evidence implies that there's no lobe (except for his or her ears) at all above the shoulders. ;)

[lowerlobe]

Ahh people are getting so serious these days

I was just wondering if BA had a speech impediment or the Brits were building another airport when he/she mentioned Heafrow….I mean BA is a supposed aviation expert…or so he tells us

When someone is discussing two airlines and uses the word "THEY" it usually refers to both airlines...

[speedbirdhouse]

"I mean BA is a supposed aviation expert…or so he tells us"

If he was an expert, anywhere other than in his own mind , he might have an idea what a "lowerlobe" actually is......

Ahhhhh....... the "sportsman's bar"

Those were the days.....

[lowerlobe]

I'll drink to that

[rammel]

My guess for BKK would be MEL-BKK. QF used to fly a 767 or 743 on this route and it always seemed to have a decent load. TG have 2 flights a days from MEL-BKK both of which seem to have a reasonably healthy load factor most of the time.

[Buster Hyman]

BA lert...with reference to...
Jetstar International, they will be opening new routes not taking over trusted QANTAS ones
then...
Puket, Ho chi Min and Nadi being the first 3 routes followed closely by Bangkok and Bali
hence...
I didn't realise that QF didn't operate to BKK & DPS!

(ie: QF132 DPS/DRW...they don't always have to operate East coast to count!):ok:

[LTBC]

Don't we all have better things to do than sit in the lowerlobe bitching? Some things never change!

[Eagleman]

The post by Pondoklabu was excellent. It links to the greenman thread as well.

The Jetstar Asia experiment has been a disaster for QF. Real competition and they are down for the count! It should be very obvious to all why GD was so anti SIA on the Pacific.

If the JQI experiement goes ahead, will their pilots being doing endorsement and sector training with QF mainline?

:confused:

[ur2]

Eagleman, YES

[Eagleman]

Will AIPA agree to that?

I suppose it wont matter if the AIPA can mount a transfer case successfully.