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View Full Version : Merged: JetStarization Of Qantas Finished


DEFCON4
15th Oct 2009, 22:55
October 16, 2009
The Australian
AFTER a difficult year, Qantas is starting to see signs of an upturn in demand, particularly in economy class, according to chief executive Alan Joyce.

Speaking after what he calls a "bath of fire" in his first year as Qantas chief, as he had to deal with the global financial crisis, failed merger talks with British Airways and swine flu, which cost the airline $90 million in business from Japan, Mr Joyce also said Qantas was looking at increasing economy and premium economy seats in some international flights to boost returns.

That could mean ditching first-class seats on some short international routes.

He also said there would be no more replacement of Qantas routes with Jetstar flights.

Jetstar's future expansion would come from organic growth, including eventual flights to southern Europe.

"We are seeing some life in the marketplace," Mr Joyce said in an exclusive interview with The Australian.

"We are seeing, in recent months, the volumes being a bit better than we were expecting.

"Yields are still terrible but we are getting some high seat factors, which is a good sign.

"The first prerequisite of getting the yields back is that the demand is there."

Mr Joyce said Qantas's seat factor was "two to three points" ahead of last year.

"Our yield is still bad -- it is still over 20 per cent down internationally and in the low teens down domestically, but volumes are better than expected."

The airline's profit fell by 88per cent to $117m for the year to June, but it was one of the few international airlines to report a profit for the financial year.

A difficult second half was offset by profits from the Qantas Frequent Flyer business, although Qantas International lost money.

Mr Joyce said Qantas was looking at reconfiguring its long-distance aircraft, including the A380, to boost the number of economy-class seats, for which demand had been stronger.

That could mean ditching first-class seats completely on some routes.

"One of the things we are looking at is what is the right mix of seats and how they should be laid out to optimise the amount of revenue-generating capacity on each aircraft," he said.

"We are still going to be a first-class airline -- we are absolutely committed to that -- but do we need first-class everywhere?"

"We need it to London and to LA, but where should first-class be apart from that?"

Before the global economic crisis, he said the A380 had more than 70 business-class seats, "but maybe now we only need 50, and more premium economy".

"Economy is going very well at the moment. Maybe we could do with more economy seats."

He estimated reconfiguring seats in the current environment could boost the yield from some flights by as much as 8 per cent.

Irish-born Mr Joyce, who was responsible for the start up and successful launch of the low cost Jetstar airline, has decided the replacement of Qantas routes with cheaper Jetstar services has reached its limitations.


When appointed, concern was expressed that he was going to further "Jetstarise" Qantas.

"This year we will grow Jetstar by 24 per cent and Qantas is going to be reduced by 5 per cent but that is a function of returns," Mr Joyce said.

"If things turned around, I could easily see, in a couple of years when the business market is returning, that Qantas could have a greater growth than Jetstar. We have decided that, with Qantas, we have gone to a minimum network, a network we can't drop below.

"There will be no further replacement of Qantas flights with Jetstar. That's it."

In the past year, Mr Joyce has replaced Qantas routes from Cairns and the Gold Coast to Tokyo with Jetstar flights, both routes that largely service leisure travellers from Japan.

He said this had been critical in heading off potential losses of $100million on the routes.

But he said the Sydney-Tokyo route would remain a Qantas service because it was primarily aimed at business travellers.

He said replacing Qantas's domestic flights in New Zealand with Jetstar services had also turned around a loss of $30m on the routes last year with a break-even situation for the group.

In the longer term, he said there were plans for Jetstar to expand into leisure destinations of southern Europe, which could include Athens, Milan or Rome.

"Rome and Athens are where Qantas has some history of operating," he said.

"There were good loads but the yields were terrible.

"With the big Italian and Greek communities here, there is a big visiting-friends-and-relatives market."

Mr Joyce said the Pacific route to the US was a "blood bath" and predicted one of Qantas's competitors would eventually drop out of the market.

Delta Airlines and Virgin Blue's V-Australia, which began services last year, are the two major competitors with Qantas on the Australia-US routes.

"Qantas is the best performing airline on that network," he said.

"It has a better seat factor and better yields. All the rest are losing money."

Gingerbread
16th Oct 2009, 02:41
Well it might be DefCon, but what it's replaced with, is, I trust, the question on everyone’s tongue?

Assuming the future will look like the past, would be a mistake.

ozbiggles
16th Oct 2009, 03:53
Ha ha ha.... Give it a week

bonvol
16th Oct 2009, 04:28
"The cupboard is bare Mr Joyce." :eek:

"Righto then,very good, we better announce we have no more plans to raid it." ;)

ifsknt
16th Oct 2009, 06:35
"Qantas is the best performing airline on that network," he said.

Using which measurement?

Certainly not service and travelling pleasure on the A380 upper deck "business class barn"

From a passenger perspective, its V Aus if going to LA and SQ via SIN if going to New York.

He needs to get out more and see what the competition is doing. QF J Class is very mediocre these days.

OneDotLow
16th Oct 2009, 06:50
Conversely I was pretty happy with QF J/Class LAX SYD a few weeks ago. Comfortable, great inflight entertainment (no comment on the reliability, but it worked fine on our flight), good food/wine selection, friendly service oriented cabin crew.... What's to complain about??? Certainly didn't look, smell, feel, sound or taste like a barn to me, ifsknt.

Disclaimer : I do work for the mob, but have nothing but good experiences to relay from that sector. Even on the way over (B744 BNE LAX) we had a similarly good experience with the only exception being the "not horizontal flat bed" (fixed on the a380).

pigdriver
17th Oct 2009, 00:20
ifsknt, I dont agree!!! After flying Vaust a few weeks ago, Qf bus class leaves it for dead!!! ( and I generally dont like flying qf if I can help it) Vaust was a joke. Service was very poor, meals not real flash, and the pretty little things trying to run it were obviously very new at their jobs...
Overall, not real good at all.
I do agree though that SQ is a better product. I just wish they could start across the pacific...

skybed
17th Oct 2009, 05:38
changes soon as AJ mentioned at a dinner recently that QF will have 20 A380 & 747 ER (reconfigured)in the longhaul fleet by 2015:eek:

mohikan
20th Oct 2009, 11:14
See this press release for what it is - an attempt to calm an increasingly concerned institutional shareholder group.

Remember this group holds shares in Qantas, not in the yield destruction exercise that is JQI.

It is an open secret that the Boston Consulting plan for the Qantas 'group' is for 70% of existing destinations to be services exclusively by JQ and the rest by red tails.

Note that excluded to this is the B787 flying which will be done by contractors outside both seniority lists.

At some point the cross subsidisation will end because the parent revenue stream will not be there to support the JQ operation. When this happens is anyones guess, but inside 10 years would be my bet.

Hopefully the institutional shareholders will be able to see inside the operation by then and exert influence. The problem is that so much is being done by Clifford in the name of 'union busting' that by the time the penny drops any remedial action to save the brand may be a case of too little too late.

This current situation has eerie parallels to the way Frank Lorenzo took apart Eastern in the 1970's in the name of 'breaking' union influence of the operation.

By the time Lorenzo had finished the airline was bankrupt, tens of thousands were unemployed, and Lorenzo himself was vilified and banned from being involved as a company director in the US ever again

hotnhigh
21st Oct 2009, 11:39
Well, here we are. The AGM is done and dusted. The remuneration package has been voted on and the absurd statements are still made by the qantas board.
Qantas chairman hits out at maintenance unions (http://www.flightglobal.com/articles/2009/10/21/333754/qantas-chairman-hits-out-at-maintenance-unions.html)
Industrial action [last year] by Qantas engineers cost us around A$130 million ($120 ) .................. Sorry, but industrial action???? I thought it was engineers abiding by their contractural obligations. ie no overtime?......
also...."Mr Clifford said rather than cannibalise Qantas routes, Jetstar would compliment them.

“Here is Qantas, one of the world’s premium carriers, (that) has introduced one of the best low-cost carriers in the world,” he said. "
Mr Clifford said rather than cannibalise Qantas routes, Jetstar would compliment them.

http://www.asx.com.au/asxpdf/20091006/pdf/31l5g8ddtn28jh.phttp://www.asx.com.au/asxpdf/20091006/pdf/31l5g8ddtn28jh.pdfdf

a nett reduction in market share and passengers in qantas mainline traffic.


Living the dream.....
Qantas, the true spirit of Australia. Or perhaps, Jetstar, the true salvation for shareholders.

prairiegirl
21st Oct 2009, 12:08
http://s9.addthis.com/button1-share.gif (http://www.addthis.com/bookmark.php) According to the Sabre Airline Study - you just very well might be: Sabre has released a study which highlights a number of key findings.

I will pick out the ones I think are relevant and while cherry picking is the name of the game here - I think it is important to recognize that while airlines think they know what they are doing - there is an underlying trend that shows they are conflicted. So what do you want - Revenue or Brand Value?

According to the study it is "customer loyalty and retention efforts that are viewed by an overwhelming majority of survey respondents (86 percent) as having the most positive impact on their business."

The study goes on to note the conflict the airlines face: "The importance of developing customer loyalty is part of the unwieldy crisis airlines face today as charging additional fees is viewed by them as one of the top tactics to increase revenues."

Overall customer satisfaction with airlines was down this year, at at time when the fewer passengers on planes should have improved the service. The recent passenger imprisonment examples can't have done a lot for their overall image. But if you look at the recent annual Power's survey, Airline customer satisfaction has fallen to its lowest level in four years.

The decline in satisfaction in this year's survey largely was driven by unfavorable customer perceptions on in-flight services, flight crew and costs and fees, according to the survey of nearly 13,000 passengers who flew between April 2008 and May 2009.

Both leisure and business traveler respondents reported overall declines in customer service.

its annual survey, JDP measures customer satisfaction in seven categories: cost and fees, flight crew, inflight services, aircraft, boarding/deplaning/baggage, and check-in and reservations. It awarded Alaska Airlines its highest US airline ranking.

"Unfortunately, any improvements in customer satisfaction are being offset by passenger displeasure with cutbacks on inflight services, increases in fees and issues with the helpfulness and courtesy of flight crews" said Dale Haines, senior director of JDP's travel practice.

Going back to the Sabre study, according to 58 percent of those (airlines) surveyed, merchandising and ancillary revenue will help airlines’ bottom line results. Baggage fees, travel insurance, and vacation packaging were rated among the highest in the survey to generate revenue.

And herein lies the conundrum. Revenue or Brand Value.

The Professor thinks that there is a clear case for the "Brandless" brand such as the LCCs leader Ryanair. Michael O'Leary and his crew don't give a toffee for brand. For them the issue of revenue and thence profit is paramount. For legacy airlines in survival mode - as the Head of IATA constantly reminds us - one would have thought that was also the case. But the legacy airlines tend to revert to type.

For example one would have thought that it was a little weird that Qantas in the middle of a recession and in the middle of one of their heaviest periods of losses in recent memory - would be running a very expensive strategic branding campaign.

So let's count the ways the airlines are undermining their brand value:

Confusing fees
Unbundling the product IE charging for things that were previously included
Debasing the currency by "selling" differentiators that the high value frequent flyers have paid for with their loyalty
Moving ancillaries to the point of departure and not making them available at the point of sale
Selling frequent flyer miles for cashI could go on but you get the point. The numbers don't lie. Airlines are surviving because of ancillary revenue not because of the long term brand value.

Other interesting Sabre survey findings:
Increasing revenue and reducing costs is among the most significant challenges in managing airline profits over the next 18 months, according to 67 percent of those surveyed
Managing revenues (44 percent) and distribution mix (12 percent) are the top two tactics survey respondents plan to use to increase revenues. Ancillary revenues followed closely behind with 11 percent of those surveyed planning to employ this tactic.It is the last one that I find most perplexing. Given the sponsorship by Sabre of the study - one would expect it to be brought out. However if the legacy airlines REALLY don't regard distribution as important - then they are missing both the opportunity in lowering costs and increasing revenue by doing the one thing they seem to be failing to do... IE leveraging the value of their relationship with the majority of their distribution namely agents.

The obvious way to solve that conundrum is through the deployment of new technology and breaking the Gordian knot of the GDS cost model. But then I guess Sabre is none too keen to bring out that point.

Still there is food for thought here. Are the airlines mortgaging their future value for revenue today? Does that future value of the brand actually matter? Perhaps more to the point are the airlines going to have to finally admit that they really are not in control of their brand. Social Media seems to have done a number on several airline brands - both good and bad?

Ah this is good stuff

Enjoy

Cheers
Thanks for reading - private comments please to [email protected]

Sunfish
21st Oct 2009, 19:55
The downward spiral continues one step at a time, can't wait till it's over and we can build something better that caters to all Australians.

Gingerbread
21st Oct 2009, 21:15
Mohikan! Think you dropped a penny.

Alas, too many people are too wet and too weak to chase it down.

When the huffing and puffing is over, expect your words of warning will come back to haunt those who deliberately dropped the ball, rather than claim a contested touchdown.

Hmmm! Wet and weak is too kind, but :mad: is probably defamatory.

QFinsider
25th Oct 2009, 20:28
Mohikan,

Your statements ring at the heart of the issue facing all of us at Q. In the absence of scrutiny the BS that passes as "J* financials" noone knows what damage is done. It is akin to pruning a tree(mainline) to the point where the tree either recovers or dies. Clifford isn't terribly bright, just another HR Nicolls induced "industrial chieftain" who is personally profiting whilst whistling the tune of the evil of unions.

The media gloss over the lack of information and merely fall into line. further if this so called "complimenting" of mainline is so successful why hasn't one other airline adopted Cliffords/Dixon/Oldmeadow/Joyce's vision of airline salvation?

rescue 1
26th Oct 2009, 09:13
I would be cautious with the wording "compliment". That could be read as continue to support the QF brand through codeshare activities, with Jetstar doing the flying...

my oleo is extended
27th Oct 2009, 12:52
Next step in QF's evolution -
Perhaps The Roo and Latestar will merge with Boston Consulting Group to form another enterprise?
It would be like a scene from the Matrix in which thousands of 'Andersons' ( Consultants) take on Neo ( the Unions ) in a battle for supremacy.

ampclamp
27th Oct 2009, 23:10
I think its pretty clear qantas had to do something in the jetstar space else be beaten by another operator.they had to secure the space.
I dont like it any more than most but the world has changed.
My gripe is not with its existence but the cross subsidisation that is not declared.
If AJ is serious about cuts he would have another dig at middle management and structures processes within.

Howard Hughes
27th Oct 2009, 23:54
Disclaimer : I do work for the mob, but have nothing but good experiences to relay from that sector. Even on the way over (B744 BNE LAX) we had a similarly good experience with the only exception being the "not horizontal flat bed" (fixed on the a380).
Would you have been as satisfied if you had paid $6000 for the privilege?:eek:

Capn Bloggs
31st Oct 2009, 00:08
JetStarization Of Qantas Finished
Agree. They've taken one bikkie out of my bikkie pack. :{

lowerlobe
31st Oct 2009, 00:28
I found something interesting the other day...

I was booking a domestic flight for my daughter and was looking at the web sites....QF,J* and VB.

VB have a happy hour at midday and was comparing prices.I noticed that out of OOL the QF flights were all J* and when compared to the J* prices on their web site for the same flight and type of ticket were more expensive...

So for the average punter why would you buy a ticket on QF because it's the same flight,ticket etc..but cheaper on J*......

Now being the cynic that I am I was wondering if QF eventually will turn around and say we are reducing services because the travelling public prefer to fly J* than QF....

By the way in the end I saved money by booking the tickets on VB....and on principle as well.

73to91
31st Oct 2009, 10:47
"He also said there would be no more replacement of Qantas routes with Jetstar flights."

I recall a few years back in Bali having a typical holiday chat by the pool, 'where are you from' etc and a few people asking 'who did you fly up with' for us, that was Australian and we thought they were very good. Anyway a number of people who flew Garuda said that they flew Garuda simply because, they have 1st and J class and since Qantas stopped flying here we will only fly Garuda.

My former employer had a call centre on the Gold Coast and staff only ever flew SYD-OOL-SYD on QF. Once QF pulled out we simply started to go Virgin, it always amazed me the number of people on the Virgin flights with QF FF and Qantas Club tags on their bags. Our CEO actually wrote to Dixon to say that there are plenty of business people who fly to OOL, he actually told a few people about the arrogant response from QF, it basically said that 'our research shows that the majority of travel to OOL is leisure.

My point: there was and still are plenty of people flying to DPS who are willing to pay J class fares and indeed, full service fares and I'd say, happier to fly a QF rather than a Garuda, so where's the analysis.

In regards to OOL yes, plenty of leisure travel but what about MICE (meetings, incentives, conferences and events) related travel? plenty of that and that is typically paid not by the pax but by the employers - so why wouldn't they have say, a few QF early morning and late afternoon? rather than just gifting this travel to Virgin.

Then there's the Japan flights and that has been touched upon plenty of times. In regards to HNL, this is one destination where the 2 compete, I wonder who has the better loadings? forget operating costs, simply the better loadings each week, month, quarter? that may be interesting.

Next it will be NAN - people seem to be happy paying the advertised QF fare and fly FJ .
Joyce states that there would be no more replacement of Qantas routes with Jetstar flights, but indirectly, isn't this is what he's doing with the NAN services if Jet* fly there? What's it costing Qantas to fly there? What's the saving by flying there with JetStar?

Mstr Caution
31st Oct 2009, 11:57
Next it will be NAN - people seem to be happy paying the advertised QF fare and fly FJ .

FJ will continue to codeshare for QF after J* commences services to NAN.

Joyce states that there would be no more replacement of Qantas routes with Jetstar flights, but indirectly, isn't this is what he's doing with the NAN services if Jet* fly there?

The opposite is also true, say for example yields & premium demand was to start improving. Let's say HNL for an example. Then the QF / J* flights could/would be altered to reflect the changes in demand.

Minosavy Masta
31st Oct 2009, 22:33
One wonders how any Airline would know if "Premium" demand is improving.....when a "Pemium" product is not being offered....I cant Immagine too many well heeled travellers approaching Jet* or whoever and offering to pay more money for what is currently on offer....so is this just Fob Off Rhetoric ;)

lowerlobe
1st Nov 2009, 00:30
Mstr Caution...

You still have not explained why QF was charging more than J* for the same ticket on the same flight....

Is that not another way of creative accounting?

skybed
1st Nov 2009, 00:47
yield management:ok:

TMAK
1st Nov 2009, 03:41
Lowerlobe,

my understanding is JQ website only sells bare bones fares...but when done by QF it is often a step up in fare level...probably to cover the admin/tktg costs which are then incurred.

JQ website bookings have no tkt issued...its just a credit card debit. QF assumes some responsibility and therefore cost/risk when pax book on QF codeshare flight with them.

Cheers

Mstr Caution
2nd Nov 2009, 03:55
Lowerlobe,

Without looking at the conditions associated with the ticket, I would guess the QF ticketed passenger may have some flexibility associated with the ticket.

As for accounting practices between QF & J*, that's slowly getting sorted out.

lowerlobe
2nd Nov 2009, 05:40
TMAK & Mstr Caution...
Nope,as far as I know it's the same type of ticket no difference in flexibility (no checked in baggage just carry with normal weight restrictions),same aircraft,same day,same flight etc...but with the exception that if you purchased a QF ticket on that J* flight and pay with a credit card you would be charged $7.70 extra as well as the extra price for the effort of buying a QF ticket....

I would have thought that for the extra you would get a free cuppa but as far as I know ...Nope....

If this is not the case and you get something extra for the extra bucks then someone let me know....

By the way it ended up being cheaper on Virgin Blue than either QF and J* ....

Pedota
11th Nov 2009, 23:12
It seems that QF senior management also refer to the term JetStarization – see bold below.

But the premise in the article below seems to be that premium passengers do their own check in and (by definition of being a premium passenger) pay extra for it. That’s cute!

Qantas unveils vision for 'the airport of the future'
ANDREW HEASLEY
The Age November 11, 2009

IN A world first, Australian domestic air travellers will soon check themselves and their bags in electronically rather than face the long queues at manned counters, under a radical vision for the airport of the future unveiled by Qantas yesterday.

It could even mean the bane of the air traveller – lost luggage – might be relegated to just a bad memory if the airline’s faith in smart cards and computer-chipped luggage tags is realised.

In unveiling the plan, Qantas chief executive Alan Joyce said its domestic passengers have "told us that airport check-in today is nothing less than a major point of pain".

"Check-in takes too long. It causes too much stress. Our customers know what they want: speed and ease," he said.

Qantas’ self-service system promises to process passengers much faster than the current system, when queues at peak hours regularly stretch back through the departure concourse.

"Our plan is to halve the check-in time – or better," Mr Joyce said.
The system, a world first, is being developed between the airline and technology giant, IBM at a cost of $40 million to its first phase of implementation.

Only frequent flyers rated with "silver" status or above will be issued with the new smart identity cards and chip-embedded baggage tags to access the system. It will be a re-issued frequent flyer card with an embedded chip.
Those passengers will be able to swipe their card across check-in readers planted across the terminal concourse and drop their bags directly on new baggage carousels.

The smart chip in the identity card will have all your details and will match you and your bags up with your flight details, avoiding the need for a paper boarding pass and the sticky barcode luggage tag.

Passengers can then go through what Mr Joyce described as a streamlined security process, which he described as another "bottleneck" and proceed to board.

You will still have to go through hand luggage security screening, including removing laptops from bags, before boarding.

Mr Joyce announced an ambitious timetable for its introduction — in as little as seven months' time.

It is scheduled to be trialled at Perth airport in mid-2010. The Sydney Qantas terminal will install the system at the end of next year and in Melbourne in early 2011, and other major airports during 2011.

Terminals’ floor-plans need to be remodelled to accommodate the open-plan field of card readers and new baggage drop carousels.

In a different but concurrent project, Qantas is looking at ways to speed up baggage processing at disembarkation.

So, is this the latest example of technology replacing people?
Mr Joyce said check-in staff would be on hand in service kiosks and at baggage carousels to help passengers with any problems they may encounter, including overweight bags, which would be weighed when they were placed on the belts.

"We’re making sure that we utilise the staff for a customer service focus. Staff will be hosting the process all the way through," he said.
Mr Joyce said the new high-tech approach fitted with Qantas’ positioning as a "premium" airline.

"Time is the new luxury," he said.

"People have suggested that Qantas is going to be Jetstar-ised.

"Far from downgrading our commitment to the premium status of Qantas, we are reinforcing it."

hotnhigh
12th Nov 2009, 02:30
No bounce in business class, says QantasMATT O'SULLIVAN
November 12, 2009 .
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www.SITM.com.au/RegisterOnline

ALAN JOYCE, the Qantas chief executive, admits the airline is yet to see a rise in the lucrative business traffic despite an improvement in general economic conditions.

A continuation of the ''very weak'' demand for first and business classes, particularly on international routes where yields are still more than 20 per cent lower than last year, has left the airline more reliant on its domestic network.
Mr Joyce said flights across its network were near full but weak yields would ''take some time to wash out of the system because we … still have a lot of cheap air fares in our inventory''.

''Domestically we are seeing the air fares increase put in place four weeks ago stick … and we are seeing an improvement in average air fares,'' he said yesterday. ''[But] we are not seeing an improvement in business traffic - that is still some time off. Our position … is being strengthened by the leisure market, not the business market.''

First- and business-class flyers make up less than 10 per cent of a Qantas aircraft's total occupancy, yet they contribute about 40 per cent of revenue.

Airline executives worldwide have become more confident in recent months about the outlook for travel after almost a year of substantial falls in demand.

Singapore Airlines suffered its second consecutive quarterly loss on Tuesday but said demand for air travel was ''gradually recovering''. However, yields were unlikely to return to pre-crisis levels within the next six months.

Yesterday Qantas announced an overhaul of its domestic airport check-ins, beginning in Perth in the middle of next year at a cost of about $40 million. The eventual upgrade of other domestic check-ins is expected to total $200 million.

Mr Joyce was coy about whether the upgrades, brought about by the introduction of better technology, would cost more jobs at the airline.

Meanwhile, Qantas's talks with the Fijian Government about selling its 46 per cent stake in Air Pacific has dragged into its third month without any sign of resolution.


well, if you treat your premium pax like they have, and serve up a sh&t alternative product, what the hell do you expect?:ugh::D

hotnhigh
12th Nov 2009, 02:52
Heard at the last qf board meeting........."WTF do you mean they don't want to fly with us! We have the best two branded strategy in the world." :ugh:
Onya jetstar!
Nov. 11 (Bloomberg) -- Singapore Airlines Ltd., which reported its first back-to-back quarterly loss in at least seven years, said it may reintroduce some capacity after an improvement in travel demand.

“There are clear signs from the pattern of forward bookings that have been coming in, that there is not just a narrowing of the drop, but some real growth starting to come in,” Chief Executive Officer Chew Choon Seng told reporters in Singapore today. The airline, which gets about 40 percent of its revenue from premium travelers, is seeing a “definite” pickup in business class traffic, he said.

ferris
12th Nov 2009, 07:11
Ok, so Dixon might've looked clever by 'Jetsarring' going into the recession/crises/whatever, but how is the group positioned now, when things look like improving?
If, instead say, Dixon had continued with QF only, but re-classing business seats as economy- as demand required (as I have seen done)- / deep discounting the seats down the back etc. {the cost of starting a new airline must be enormous, and that money could've been used to offset discounting etc} then the group would be far better positioned to take advantage of any upswing.

It just doesn't seem very nimble, going down the permanent road of creating a whole new airline to weather temporary market conditions. Low cost has it's place- but there will always be another one along a bit lower, soon. IMHO, a mistake to even wrestle that pig. Some strange (to me) decisions have been made, and then "spun" to look clever.

If the whole thing was purely an industrial play, then the shareholders should lynch him (which they should anyway).

7378FE
12th Nov 2009, 07:25
Now going to try Jetstaration of JAL.

News item contains the details : Qantas offer to help JAL | Herald Sun (http://www.heraldsun.com.au/business/qantas-offer-to-help-jal/story-e6frfh4f-1225796816275)

The Hill
13th Nov 2009, 01:38
IN A world first, Australian domestic air travellers will soon check themselves and their bags in electronically rather than face the long queues at manned counters

dont think so, Air NZ has been doing this for 12 months now

griffin one
13th Nov 2009, 02:01
reading between the lines , Sounds like an A380 painted with a big orange star will be heading to southern europe with 750 pax onboard.

blow.n.gasket
15th Nov 2009, 22:59
And the pilots flying it won't be based in Australia I bet!:suspect:

blueloo
6th Dec 2009, 21:37
Well I thought Joyce said no more jetstarisation....and maybe he meant it.

But I just heard the Perth Narita run is having pax with QF tickets changed to Onestar - apparently travel agents havent been advised yet).

The QF website appears to have no more PErth Narita flights from May onwards.

Hopefully it isnt true.

Anyone know more?

Eastwest...?

Taildragger67
7th Dec 2009, 05:50
The Hill,

dont think so, Air NZ has been doing this for 12 months now

Agreed - I was checking in for a NZ domestic at little ol' Christchurch just about when you wrote your post; all very simple, if you can fly an ATM then you could fly this process. One chap at the belt to weigh it and help lift it on and a couple of staff floating round to help those for whom an ATM remains a challenge.

There was no need to have any costly smart-chip-card whizz-bangery, I used a PNR and my LH FF number and it all worked 100% - didn't need to be a NZ FF.

So I suspect the spin here would be along the lines of "Well, yes, our cousins in NZ have been doing this for a year or so now, but we're better because we'll be doing it with smart cards and we won't have ANY staff around to help punters!"

Or else the 'world first' comment is just a reflection of how Aus views NZ...?


Slight thread drift, but now we see how the rest of the business community views Jetstar:

We're not the Jetstar of banking: Westpac (http://www.smh.com.au/business/were-not-the-jetstar-of-banking-westpac-20091207-key5.html) :eek::hmm:

blow.n.gasket
7th Dec 2009, 09:26
Anyone else heard the rumour that Qantas mainline will only get 8 A380's.
After that ?? Jetstar?
I've been trying to find the video of Dixon and Jackson signing the papers up in Toulouse for the BlunderBus .There you will see on the feature wall behind them ,all the launch customers for the A380. Guess what ,JetStar's up there???:bored::eek:

illusion
7th Dec 2009, 12:46
Let the Qantasisation of Jetstar begin..................................:rolleyes:

Sunfish
7th Dec 2009, 16:18
I have no doubt that there are feather - bedding unionists in Qantas.

I have no doubt that there are overpaid pilots.

I have no doubt that there are incompetent and over paid managers as well.

But ferchrissake the cure administered by the current Board is worse than the disease.

All of QF's problems start at the very top - the Board and Senior Management.

The rest of the company takes its cues from them - it's called "modelling the behaviour". Ask Mr. Fyffe at Air New Zealand what that means.

When the staff see the Board and Senior management knocking back champagne in the Chairmans lounge while stuffing their face with Caviar, throwing paying passengers out of first class to seat their friends and family, organising "upgrades" for friends and treating the place as their personal fife, is it any wonder that they don't try and grab a fragment of this largesse for themselves???????


To put it another way, deliberately cryptically, have you ever received a fax from your Boss calling for staff cuts and an austerity campaign that was sent from the effing Hotel Danieli in Venice? I have. I didn't know whether to frame it and hang it in the staff toilet or roll it up and shove it up.

To put it yet another way, "bottles of Grange as Christmas presents to senior management, thanking them for their contribution?" OMFG!

Qantas has Three problems that are interrelated.

1. It wields enormous political power through its iconic status and its ability to deliver very valuable perks to its "friends". This attracts the worst possible type of external candidate to high office in such a company - narcissists, very charming, intelligent and outwardly capable narcissists that think only of themselves and their advancement. They will always push out good people to get to the top of the heap and they are very difficult to remove once a few levels of infestation are entrenched.

2. While it may not wield it now, Qantas has dominated the market for years. The issue here is that the economic development of the Australian States is affected by their easy and frequent access to Direct International Flights because this is a critical factor in attracting and holding international business investment and internationally focussed export industries. This has made QF's international flight schedules a subject of key interest to State Governments since at least 1975.

3. The intersection of (1) and (2) has seen QF "captured" by the NSW Government, whatever its political persuasion, as an examination of the political connections of its Directors over time demonstrates. This has led to the desirable situation, from the NSW Governments point of view, of QF facilitating the portrayal of Sydney as some sort of "Gateway" to Australia and the skewing of its schedules and operations in that city's favour. This will continue.

The problem for QF then becomes simple.

At the highest level - Its Board and management thinking and behaviour is clouded by (1), which means that nobody at all is thinking of the stakeholders (Customers, Staff, Suppliers and Shareholders), only themselves.

The range of available strategic options considered for Qantas are constrained by (2) and (3), in effect shackling the company's operations and futures to Sydney - the most expensive place to base an airline in Australia.

Hence the focus on "union busting", the attempted privatisation, the rotten investment decisions, and who knows what folly next month.

...And as for marketing, forget the perks and the other crap, what people want first and foremost in an Airline is a reliable transport and a repeatable level of service - something that QF long ago ceased to provide.

To put it another way, I know of no one who will willingly fly Qantas or Jetstar if there is another available option.

I don't see much future for QF at all because it's corporate baggage is just too heavy and the important parts of its corporate memory have been destroyed leaving just fairy floss. God forbid, but a couple of hull losses would put it out of it's misery.

Captain Marvel
7th Dec 2009, 21:32
God forbid, but a couple of hull losses would put it out of it's misery

You are one very sad unit!!

Ski Guru
8th Dec 2009, 01:14
You need to get a life Sun Fish. You're like a moth to the flame with this stuff. Its sunny outside.

noip
8th Dec 2009, 01:41
I don't agree with all that Sunfish has said ... but ...

He has a point that is worth listening to ...

N

blueloo
8th Dec 2009, 02:13
EastWest Loco,

any chance you can have a look in your system, or if you have been advised about the loss of PERTH - NARITA to JETSTAR in MAY (approx) nxt yr.

cheers

C441
8th Dec 2009, 05:05
Just chatting to someone who should know.
QF 79 Perth-Narita remains bookable on Tues, Fri & Sun throughout next year, operated by 767.

Taildragger67
8th Dec 2009, 06:59
Sunfish,

You made a reasonable point or two, but specifically:

I know of no one who will willingly fly Qantas... if there is another available option

You do now, mate.

Pedota
9th Dec 2009, 01:24
And interesting little twist . . .




Qantas mouthpiece tweets all over Jetstar

The Age - December 9, 2009

Karl Quinn


Deborah Hutton's deleted Tweet.

Qantas spokeswoman Deborah Hutton appeared to forget the golden rule about not biting the hand that feeds you yesterday when she tweeted about her frustration with Jetstar - Qantas's upstart sibling.

"Jetstar nightmares: queues as long as Tigers [sic] biggest drive and then I get whacked $180 for the priviledge [sic] of taking my Callaways!''

Ms Hutton tweeted yesterday afternoon while en route to a pro-am celebrity golf tournament in Queensland.

Mindful that there was no guarantee the ******* account in Ms Hutton's name is actually the work of Ms Hutton, we called her management to ascertain the account's veracity. We never did get a call back, but when next we looked at her ******* page, the tweet in question had been removed.

Luckily, we'd already saved a copy.

Ms Hutton is a high-profile face of Qantas. She presents the inflight program Welcome Aboard and contributes to the Qantas blog Global Roaming.

While her duties include talking up Qantas they are unlikely to include talking down Jetstar.

While not a PR disaster on the same scale as Tiger Woods' philandering or Kraft's abortive iSnack 2.0 launch, Ms Hutton's apparent slip of the tweet does point to the perils of high-profile personalities taking to the new media world with gusto.

It can be fun to play with the kids, but it pays to remember your adult responsibilities while you're there.

Qantas has declined to comment.

blow.n.gasket
9th Dec 2009, 23:30
She got JetStarred did she?:}

captaintunedog777
10th Dec 2009, 00:07
Sunfish

"I don't see much future for QF at all because it's corporate baggage is just too heavy and the important parts of its corporate memory have been destroyed leaving just fairy floss. God forbid, but a couple of hull losses would put it out of it's misery"


My MY you are evil. I can not believe for the life of me what you have written. You have psychopathic thoughts. After the latest series of air disasters you state the above in hope. I seriously hope you do not operate anything that flies.

ASIO or any law enforcement agency should have their eyes on you.

You must have seriously wanted that job at Q or JQ. To their relief you are not there.

blow.n.gasket
11th Dec 2009, 04:46
illusion wrote: Let the Qantasisation of Jetstar begin........................:rolleyes: 7th December 2009 23:20

To paraphrase Geoff Dixon,that would have be along the lines of ,"There will be no more than 5 Qantas aircraft planned" would it?:}

breakfastburrito
7th May 2011, 01:42
Pretty simple really.

I fly Sydney Sunshine Coast a few times a year.

QF does not fly the route, I don't fly JQ.

It's not all about lowest fare price.
+1000


I remember seeing a roadshow some years ago by (I think) Damian Wallace, group GM of networks & planning. He clearly stated that when Harvey Norman had a sale of Large Screen TV's there was a drop in j* sales.

The j* market is in a lot of cases a "disposable" market, competing with consumer electronics or an expensive night out. Very few premium holiday makers make a mutually exclusive choice between a WS TV and a quality holiday.
My neighbor, with cash to burn will not under any circumstance travel j*, he prefers QF, but will accept VB. He will simply not travel to a destination serviced exclusively by j* under any circumstances.

This is not to say there isn't a market for j* "disposable" travel, there is. But by attempting to force everyone onto it, a lot of the market will simply go elsewhere, even O/S, particularly with the AUD at record high's. In doing so ~75%, will not be travelling with the QantStar group.

For every low fare they gain, I wonder how may high yields they lose. Remember, its all about choice.

packrat
7th May 2011, 02:14
How many travellers have purchased a Qantas ticket and then found themselves on a JetStar aircraft?
Big mistake.
Once bitten twice pissed off.
It also creates the perception that the Jetstar product and Qantas product are the same......that they are both crap.Albeit one more expensive than the other.
Travelling to HNL is a perfect example.Compare Qantas Jetstar and Hawaiian for value.Hawaiian wins hands down.Hawaiian is a daily service.
Many Qantas staff now use Hawaiian to Honolulu simply because of the schedule and value.HA has 9 crew on a well maintained 767.The tandem service in Y/C works beautifully.All in all an excellent product

Captain Sherm
7th May 2011, 03:14
Thing is, a 1000 anecdotes about people who won't fly JQ don't make a truth. The segment needing that style of low cost no frills service DOES exist, so arguments about whether it SHOULD exist are pointless. Let's celebrate the fact that there's freedom of choice and people who don't want JQ don't have to fly them. A choice regime unavailable before deregulation came.

There is a vast market segment for discretionary spending, one of the favoured areas being air travel. Been so in Europe forever, the "bucket and spade" brigade being a giant chunk of air movements in and across Europe. And yes it does compete with a new TV, a cruise, a new kitchen, whatever.

The real issue is how major airlines address this challenge. Yes it will involve tough choices, including withdrawal by legacy carriers from some routes.Many major European airlines set up charter subsidiaries, Lufthansa's Condor comes to mind. When a younger Sherm started flying in Europe it was quite astounding to see the sheer enormity of it all. And the giant destinations like the Canary Islands, the Greek islands, Majorca etc etc were mainly not serviced by the big flag carriers but by others. I am sure Qantas has considered running a couple of CitiFlier 737's in and of the OOL daily but the truth is that's a management choice and anecdotes about folks refusing to fly JQ don't fill aeroplanes. As for HNL....that's probably right on the cusp of being half a market that might support a premium service and half a pure price based route. Hard to call.

The low cost market is big, and growing and here to stay. The real questions are not and will never again be: "Should it be done?", rather we have to live with "How we will do it?"

As I posted yesterday, quoting from whatever6719

"I really do think a successful 2 brand strategy was their intention, but, they got greedy. They saw the savings that could be made by "Jetstarising" Qantas and they have sadly gone too far with it.

Make Jetstar what it was meant to be ...low cost, cheap and cheerful carrier that does not cannibilise mainline"

packrat
7th May 2011, 04:34
You choose to buy a Qantas ticket because you want to travel Qantas.
You find yourself on a Jetstar Kite.That ain't choice.Thats bloody deception.
Sure there is a requirement for a LCC but please lets have some honesty.
Bit like buying a Mercedes and ending up with a Volkswagen

T-Vasis
7th May 2011, 05:03
I'm sorry, but whenever you purchase a ticket and it relates to a codeshare agreement, it details the service is not operated by the carrier your booking with, on the website and on the itinerary. If an agent fails to detail this - its not the airlines fault.

When you're booking on Qantas.com and the flight you choose is a JQ one, it takes you straight to JQ's booking engine to complete the transaction. If that does not make you enough aware the service is operated by Jetstar, then you can't be saved - I don't know how it is deception. The information is there at time of booking.

Codeshare agreements have been around for years and are not uncommon.

If you book a codeshare international flight (excluding TT and NAN) with Jetstar, you'll get the same "trimmings" i.e. meals, blanket pack etc.

Domestically, well, once again I come back to the argument around codeshare flights.

The information provided to the customer is detailed enough from what I've seen...

DEFCON4
7th May 2011, 06:41
Most of us here work in the industry and are aware of the fine print.Others find out the hard way.They are reluctant to repeat the experience.Deception with these LCCs is rampant-Caveat Emptor,Caveat Lector
Repeat business must surely be low

Captain Sherm
7th May 2011, 08:07
Busdriver007,

This humble Sherm went to university a long time back and such computer skills as Sherm possesses started with punched card Fortran. Things like the internet have come much later in Sherm's sheltered life than for some.

However..... I just tried to book on the Qantas website a flight from SYD-MCY and as soon as I pressed GO on the Qantas web page the following came up:

"Flights between Sydney and Sunshine Coast are operated by Jetstar or one of Jetstar's partner airlines. To book these flights you will need to go to Jetstar.com.
Continue to Jetstar"

I then tried booking a MEL-OOL flight and the second page that came up after pressing GO on the Qantas page was indeed a Qantas page, but clearly marked flight numbers for each flight, with the Jetstar logo and a note say "This flight operated by Jetstar". As soon as you select the flight and proceed to payment the following notice appears:

"The trip you have selected is operated by Jetstar. To book these flights you will be directed to the Jetstar website. Continue with selection? Yes click OK, No click cancel and amend your selection".

Now if you get a bit cunning and try to trick the system you could pick the MEL-OOL via SYD option on the QF website and you can book that all on a QF page. Yet even there is a note clearly saying *= Flight Operated by Jetstar

Now, a quiet beer on the balcony and Sherm really decides to beat the system. Book MEL-LST on QantasLink (who would pay $502 for that!), and fly back the next day with JQ for half the price. Again you stay on the QF page for the whole booking but again, the pesky note is there *= Flight Operated by Jetstar. Repeat the exercise for a JQ flight MEL-SYD then return on QF. Again you stay on the QF page but the note is there: *= Flight Operated by Jetstar

As a final test Sherm reached once more for the keyboard and tried to book a Qantas flight through the JQ website but it doesn't look like it can be done. So there's no risk that you thought you'd be flying on a shiny new A320 with happy cabin crew and actually end up on a clapped out 767. That would wreck your day.

Your humble Sherm has done his best, aware that this is not an exhaustive test and not rigorous enough to count as a valid comparison. But it does seem from these few snapshots that unless you were using a braille keyboard and typing by ear, you really would be hard pressed to end up on a star-tailed A320 without expecting it.

But, as Mrs Sherm (Happy Mothers Day tomorrow!) and the Shermettes regularly point out, I am often wrong. However, while I don't think I'm that smart I can figure out that I might in fact be travelling on JQ. Or am I getting it all wrong? Most really good conspiracies baffle me I do admit.

Mr. Hat
7th May 2011, 08:52
Anyone know how the Gold Coast Perth is going for Jetstar?

600ft-lb
7th May 2011, 09:27
So there's no risk that you thought you'd be flying on a shiny new A320 with happy cabin crew and actually end up on a clapped out 767.

Ive flown both quite a bit, Qantas quite a bit recently. Qantas cabin crew have been fantastic, attentive and proficient every flight, not 1 complaint from this stafftraveller.

My last jetstar flight the cabin manager scolded the entire cabin on the PA for the disorderly disembarkation, the cabin service was started and finished within 2 minutes and the crew hid from sight for the remainder. Oh and all of the flights were over 2 hours late. Cheap or cheerful, probably not both, unless the crew haven't received their first payslip yet.

But yes it is disappointing that even though the 767s and 747s look clapped out, they dont need to. Other airlines made the investment. Qantas management have focused their whole attention on the jetstar product which is fine, but it might well bite them in the arse once virgin start taking their premium passengers. C

The contempt that they show their business class travellers in 737-400s(nice J(Y?) class seats)

All passengers in the 767s(nice IFE?? if you can even see the screens or make out what the projector is projecting)

2-3-2 J class config in the A330s

and the dated 1980s 747-400 interiors and a first generation inseat IFE .

Not a good fleet presentation if youre claiming to be premium.

firepussy
7th May 2011, 10:03
Fascinating that someone should refer to themselves in the third person and then find it necessary to claim educational qualifications that are unverifiable on an anonymous forum.
Further not all travellers book their travel through an airline website.Unless of course they want to pay the published fare.There are a myriad of websites that will provide cheaper fares than those quoted on the Qantas site.Unfortunately this is where things become a little hazy.Buy a ticket with a QF flight number from one of these sites and you can/may end up on Jetstar without being informed.The trusting Japanese often find themselves on a Jetstar flight to Australia after paying for a Qantas service.
This doesnt happen with Virgin .They are honest and proud about who they are.No schizophrenia there.The market that Jetstar pitches to are those that would normally travel on a Greyhound bus(domestically)These folk can be either uninformed or misinformed about the vagaries of travel.The low cost model works best when oil is around $US80/ barrel.At the moment its above a $US100.
If Capt. Sherm has all the qualifications he claims he will have realized that JetStar is being propped up through cost apportioning from mainline.
The travelling public have been patiently waiting for a real alternative to the twisted sisters(Qantas/Jetstar)Borghetti is about to reward them for their patience

Captain Sherm
7th May 2011, 10:54
Firepussy...

Yes indeed I did squander way too many of the younger years on study. Send me a .pdf copy of a receipt showing you donated $100 to the Salvos and I will email you certified copies of everything in Sherm's life including the dog licence.

And I was referring to the issue of whether you could book on a QF flight and get no warning at all til you boarded that in fact it was a JQ flight. Seems very unlikely to me. Did I not make that clear?

As for my name and the third person....a harmless bit of persiflage meant to lighten the day. I would apologize but to someone bold enough to call themselves "Firepussy" I suspect even the apology would be misunderstood.

As for JQ being "propped up".....the use of internal cost efficiencies to allow one business to run multiple divisions more cheaply than could the same number of individual competitors is a strength, not a con trick, not a weakness. You show an admirable level of ignorance in refusing to see a truth just because it doesn't suit you. For many years, and maybe even now for all I know, QF First Class rarely paid its own way, but it was a part of a suite of products that made the whole show worthwhile. Was it "propped up"? I have a lot of work to do or about 100 other examples that spring to mind could cross this keyboard.

I do not work for JQ. I do not think they do everything well and I sure don't think the whole 2 brand system has been run perfectly. I have referred to that in very simple straightforward terms on these pages, there for all to see. Did you not see that?

Run well, with affordable fleet strategies and decent internal engagement and leadership, Qantas/Jetstar/Qantaslink could be truly formidable.

The sad thing for one and all including the staff members is that it would not take much effort to do it properly.

Eastwest Loco
7th May 2011, 13:08
packrat - The nett remit fares are generally available through any Travel Agent that has no fibreglass flight deck member outside the door and no brains inside the door. That lot sell what they are told to and generally inflate the price as that is where most of their salary comes from.

Qantas in the vast majority of cases has published fares available through all resellers, but they are in some instances region specific.

All be warned. Airline websites and many online resellers are self centred. Airlines look at their own product and the online Agencies use their web engines to a large degree. They lose the ability to manipulate searches. You need a savee professional with a top flight GDS to do that. Sabre is by far the most capable.

My eldest son who knows everything, as 25 year olds do wanted to go MEL DPS TYO LON one way. I told him to knock himself out as he said he would do it on the web. He got his price and I told him to keep it to himself. The old fart did 20 minutes of research and came up with a composite fare. The old fart won - by $500.00. Just because it's on the web doesn't mean it is the best fare.

Go onto the Qantas site and do a fare search for Business class Sydney to London. You will be quoted the best Qantas fare. That's fine. We use our system and we are given a Finnair fare for instance. I just booked 2 pax on the AY fare for over $4000 per person less.

Now - back on thread. Virgin Australia has a lot to do before it is to be taken totally seriously as an equal competitor to the Rat.

For a start they need to accept 100% connectivity within their own network for bookings and baggage. They also need to go into the GDS systems. That is Sabre, Galileo, Amadeus etc. We can book them now as connectors to some international carriers but therein lies another problem.Through checking of baggage. Fares need to be promulgated in conjunction (or combineable) with more outbound internationals and full service in the passenger cabin is required without hands going to wallets.

One needs to be equal before claiming to be equal.

Another point of horrror is the Manila?? call centre. Why? Jetstar is no better there. If you have a complex problem and get a female you are screwed. I am in no way sexist in saying that but in Asian and Arab societies the females seem not to be allowed to know anything or make a judgement call. You have to become abusive to get someone with danglies on the line to get a decison. Poor form also, as we all know, outsourcing jobs.

All I can say is good luck Virgin Australia. I wish you no ill will but there are parts of the game you must learn to consider yourself the equal of a pretty fair legacy carrier.

Best all

EWL

Eastwest Loco
7th May 2011, 13:14
Captain Sherm

The 200 series QF flights are clearly branded in Sarbe as operated by Jetstar. I also believe they have a tag on the QF website that indicates they are JQ operated.

The QF283 SYD HNL is a JQ aircraft.

A travel professional will pick this immediately if they are not a totall nuff nuff.

Any decent system will flag this, but the wombles who book on line seldom read the important information that is presented pre confirmation.

I have them in my office every day of the week trying to put out bushfires their ignorance lit.

Best regard

EWL

1a sound asleep
7th May 2011, 22:43
Dont laugh about Star Class on the A320. QF are going to get hammered by DJ's business class on the routes where they shafted loyal pax and threw them on to JQ. Now those same ex loyal QF pax can run off to AN, opps I mean DJ. You watch them stick fat seats on the 320. Bogan Business class here we come

Sunfish
8th May 2011, 00:21
I'm afraid all of you here make one critical assumption - that there are hordes of Europeans, and Australians for that matter, that have the disposable income to spend on air travel. I suggest to you that this happy state may not continue for ever.

Were this gravy train to come to an end, then you will suddenly find that the carriage trade will reassert itself, and they will be, as usual, rather discerning about how they travel. The Bogans will vanish as customers, and we will be back to the "young teacher saving to go to London for a trip of a lifetime" passenger in economy, as was the case in the 1970's.

You might wish to consider that the United States is by no means out of the woods economically and there is not enough money in the world to refinance their debt as it comes due later this year.


Of course the companion assumption to this is that Australian workers are always too expensive compared to Asian workers even after making adjustments for productivity. That one will be tested too if Australian sovereign debt gets tested like Americas is about to be, as has Greek, Irish and British debt.


To put it another way, how would you like Australian domestic interest rates to be pushing 14% and the Australian dollar sitting at 75 US cents again? What happens to Jetstar and Qantas then?

T-Vasis
8th May 2011, 01:10
There will never be a "premium" class on the JQ 320's. This is not part of the model and will increase CASK's dramatically to provision a premium service, which again will not suit their model. On markets where there is no QF, this is because the route was unsustainable for a QF full service outfit. That means the J class patronage was non-existant. Just because DJ will now come in with a "premium" cabin on markets Qantas existed, does not mean the route supports the product. Don't forget, DJ's cost base is lower than Qantas, so whilst QF couldn't make it work and used their LCC vehicle to extract yield from that route, DJ may well turn a dollar thanks to a lower CASK, but let's not count the chickens yet...

JQ Domestic will remain a LCC and will continue to simplify and rationalise that operation to reduce CASK and drive RPK's.

There is no doubt Qantas will compete aggressively with DJ on pricing. QF DOM is very profitable - QF will have the ability to leverage some yield erosion (whilst not ideal) to ensure it remains competitive against DJ.

When you then take into consideration the drivers for premium customers (lounges, frequency, schedule, loyalty programs etc), I don't think you're suddenly going to see a mass exodus...Yes, some will go, but 10% - I don't believe so.

Whilst I wish DJ well (means industry jobs in this country), I'm not so sure they are the "messiah" they're being stereotyped by some people on this board.

Time will tell (as it always does) - but I hope it works for employment sake....