View Full Version : Turboprops for Virgin Blue?????

10th Jan 2010, 09:18
The Jan/Feb issue of Australian Aviation has an interview with Brett. A few times in the article turbprops come up (ATRs and Q400s), plus a statement saying 'watch this space' regarding a regional expansion . He also says that the Embraers are not really regional aircraft and they haven't fully deployed them properly. Plus they are operating them into markets that are not ideal for the them, they should be on long thin routes and the 190's shouldn't be doing anything under 1.5 to 2 hours. Also mentions SYD-CBR and how they would like to increase the frequency but doesn't want to put to many jets on it.

So will we see ATRs or Q400s in DJ's colours? ATR have their new -600 aircraft on the market and would be very keen to have it operating in Australia.

Howard Hughes
10th Jan 2010, 10:39

10th Jan 2010, 11:42
Well he does have a point that jets are more economical around 2hrs and TP on shorter routes

Red Jet
10th Jan 2010, 13:03
Turboprops for Virgin Blue?????Yeah, they were made in Sweden ages ago, and currently has the name of a dog painted on the side:}

10th Jan 2010, 18:22
Oh God!

I hope not. :suspect:

The Green Goblin
10th Jan 2010, 18:51
On the bright side if Virgin get into the regional turboprop game, REX better lift it's conditions else KRUSTY will be the last man standing :}

10th Jan 2010, 23:14
That's of course if they decide to compete with REX G.G?

Personally I can't see it. The Regionals are profitable, REX because of their agressive program of debt minimisation, QLink because of their economies of scale, but most of all due to the virtual monopolies enjoyed by these carriers over 90% of their routes. The monopolies aside though, both these carriers have manged to make Regional flying approx 50% cheaper than what it was a decade ago. This has been through some competition on a few sectors, but mainly because of a rationalisation of the previous route structures. Many Regional centres have lost their air service simply because they were marginal. I mean Hell, REX wouldn't still be in QLD if the routes weren't subsidised!

Profitable as they are however, the margins are still thin. For an operator to effectively compete, a substantial capital outlay would be required for what would be at best a 5% P/A return on investment?

If VB do intend to compete, then as well as the issues mentioned above, there is the problem of crewing. Most REX pilots (other than the Cadets of course) would probably move for a Jet job, but to go sideways? Anyway the major airlines (VB included) will probably be focused on recruiting the last available experienced pilots for mainline. My sources tell me that VB will be looking for at least 110 pilots by April, and Jetstar quite a few more than that before the end of the year! No point starting a Regional airline if you can't get pilots to fly it.

The logical choice (if you can call any of this logical) would be, as Red Jet alluded, for VB to buy REX. That would be interesting. You never know Red Jet, they may offer you a DEC. At least your pay would go up. :ok:

oil additive
11th Jan 2010, 03:03
Maybe VB are looking at bidding for the WA coastal network? Have Skywest got it in the bag yet? Nice new Q400's or ATR's vs outdated F50's... I know what I'd prefer :ok:

11th Jan 2010, 09:23
Yes they (Skywest) have, announced earlier in the year, to arrange a new 5-year contract to allow them to upgrade their fleet...

On the E190's the WA network is perfect then, lots of long, thin routes - ZNE, KTA, PHE and BME

SGT Schulz
11th Jan 2010, 19:52
Along a similar train of thought...any truth to the rumour Qlink is getting CRJ900's??

12th Jan 2010, 03:17
It would make a lot of sense for VB to acquire Rex, and run all E-jets and turboprops under the Rex AOC. Fewer people would leave and there would be a more interesting career path for the Rex crews.

At the same time it would make some sense to get some of the Rex management into VB. They may not be the most popular guys with the crews, but they sure have made a difference in the survival, growth and profitability of Rex.

Hugh Jarse
12th Jan 2010, 08:09
Err, Timber:

Why would VB buy Rex and take the risk (and expense) of buying REX and its old aeroplanes, when they could simply take them on as a partner with less risk?

And why would/should they operate the E-Jets on the Rex AOC, when Rex doesn't have the required high capacity AOC, and VB are doing fine with them right where they are in-house?

And finally, why would VB take on REX management following a takeover? I'd imagine that they'd be surplus to requirements if VB were ever crazy enough to buy REX. Historically, duplicated/redundant management are the first to go in a takeover/buyout.

It would be more cost efficient for VB to set up their own turboprop operation with a type that is current - not a type that has not been produced for 11 years.

Sgt. Schultz: If QL get CRJ-900's, my money is on Cobham operating them. They are the QLink jet operator.

Apologies if this shatters a few fantasies:ugh:

Mr. Hat
12th Jan 2010, 10:06
Couldn't think anything worse than VB buying REX.

I could write a thesis on why that would be a bad idea.

I didn't know skywest got back the 5 year contract. Wonder what the plans are regarding the fleet upgrade. Sounds like exciting times with A320's rolling in and fleet upgrades.

Either way I'll believe the turbo prop story when i see it. What it will do apart from cutting the guts out of the existing regionals will be basically to take the pilots that would have originally gone to the rex qlink ect.

12th Jan 2010, 10:21
----------Media statement

Release date: 30/6/2009
Transport Minister Simon O’Brien has announced that regional Western Australia will be guaranteed regular passenger air services.

Mr O’Brien said the State Government believed it more important to put regional WA’s need for regular passenger air services ahead of wholesale deregulation of intrastate air routes.

“Securing air routes for regional communities, which may have lost their regular passenger services if deregulation was allowed to proceed, is the government’s main priority,” he said.

“Airlines around the world and domestically are struggling; for example, since 1960, 43 WA based regular passenger transport airlines have collapsed. Deregulating the system in the current environment does not secure the best outcome for regional WA.

“The airline industry is in a delicate state, it needs certainty where presently there is uncertainty.”

The Minister said he offered the two existing main regional network operators, Skywest and Skippers Aviation 12-month extensions while arrangements for long-term contracts were negotiated and both companies had accepted this proposal.

“I will immediately set about working with the aviation sector to negotiate appropriate long-term arrangements that will give airlines and passengers the security and certainty they need for the future,” he said.

“The way to guarantee future services will be to give airlines the long-term certainty they need to invest in new aircraft and other infrastructure.”

The Minister said as soon as long-term arrangements had been agreed, the 12-month extension would be annulled, with the new arrangements beginning immediately.

“What is essential though is that Western Australian air service providers have the long term stability to provide even better services,” Mr O’Brien said.

“In the coming months I will be visiting those communities for whom regular air services are a vital link.

“This will enable me to take soundings and seek feedback on what additional service levels and standards regional communities would like to see improved upon as the State Government negotiates long term contract arrangement with regional air service providers.”


12th Jan 2010, 10:32
Rex is a very profitable unit with a very low cost base. Partner is fine but VB didn't elect that route for VA either.

There is nothing wrong with the Saabs for the work they do.

It would be easy for Rex to get a high capacity AOC and thus the cost base for the "little" aircraft (E-jets) could be brought down in time.

Re the management I wasn't thinking of adding some of the Rex people but rather replacing some of the VB managers, so no duplication intended.

The future is further cost reductions. That would be the role of Rex for the V-group. Just like J* is the low cost arm of QF and eventually a new entity will become the low cost arm of J*. Lowering the cost base all the time... lower and lower.

A bit rough this .... sorry.

12th Jan 2010, 22:52
Just avoid the Metro's please DJ had enufffffffffff

14th Jan 2010, 03:37
If VB do intend to compete, then as well as the issues mentioned above, there is the problem of crewing. Most REX pilots (other than the Cadets of course) would probably move for a Jet job, but to go sideways? Anyway the major airlines (VB included) will probably be focused on recruiting the last available experienced pilots for mainline.

Open your eyes Krusty... GA is full of pilots who would give their left cajone for a gig with VB regardless of type.

Interestingly, heard a dirrrrrrty rumour that ATR72 was added to the AOC last week.

14th Jan 2010, 07:01
Hi Jarse

Hope they are treating you well there. Q400 would be the logical choice with plenty of VB staff previously CASA approved for SIM and check and training (we miss them).Also ready made crew at their competitor now the retention has been paid and crew spivved again and ready to walk and hopefully proper progression.

He at no 42 has told us they are definately looking at jet equipment however 717 doesnt come off lease until 2016 with Cobham contract due around the same time so now they have paid the retention bonus they are now holding the regional jet carrot in front of us again. After 12 years its wears a bit thin.

14th Jan 2010, 07:02
Been in this game very long have we bagchucka?

And what sort of pilots are they?

14th Jan 2010, 07:26
Slight thread drift, but where do REX have pilot bases?

14th Jan 2010, 07:46
Let me see Wiz'. North to South, East to West.

Wagga Wagga

Hugh Jarse
14th Jan 2010, 08:19
Gidday Vigi. Hope all's going well with you.

I understand they've spivved you all on the super guarantee? I've said all along they'd do anything to get out of paying any of the bonus to you guys, and it seems I was correct. :yuk:

Never mind, recruiting in other airlines is stepping up this year apparently, so expect a lot of your colleagues from the Link and Rex to be called up for interviews.

Just remember, (as I wrote before) - the clause which was thrown in to the Sunnies EBA was a diversion to entice the guys (a sweetener, if you will) to sign off on what was otherwise a shitty EBA. The only reason it's in there is to be used as a lever against Cobham when the contract is next up for renewal. Purely to keep the Qantaslink Cobham jet contract lean, if you know what I mean. They have no intention of changing the preferred jet operator. That would require the expenditure of funds. Remember how tight they were about even spending the money to put the Q400 on the EAA AOC? Have they done that yet, or is it still on Sunnies AOC only?

Fat Bastard wins both ways with that EBA clause: He keeps Sunnies and Eastern pilots happy in the romantic notion that they'll get jets (and some guys will wait around in the foolish belief that this will eventuate), while he sneaks off to the negotiating table with Cobham in a couple of years, and says "our guys at Eastern and Sunnies can do it cheaper". :hmm::suspect:

Of course, Cobham will sharpen their pencils as much as they can, and who knows - they'll probably pull it off. But I feel sorry for the Cobham crew that will be put under yet again more pressure financially.:ugh:

My money's on Cobham for a leaner contract, and you guys are left to languish yet again in the deception that is the Institution at Number 42.:hmm:

Keep this in mind, mate :) You guys deserve better.


tea & bikkies
14th Jan 2010, 09:06
Hi Jarse

My bank account went up today:ok:


14th Jan 2010, 09:13
Krusty and the like, why does DJ need REX? DJ have a AOC, have been operating in Australia for almost 10 years and during the last 18 months have added a few regional ports, so their is no advantage in buying REX. Plus don't forget Branson got burnt when he purchased the European operated he used to set up Virgin Express and said he would never buy another airline outright again (to much baggage).

And why do you say it would be a side ways move for the REX pilots if DJ got turboprops? I see it has a step up for those REX pilots who would join DJ, as they would be operating larger equipment (with better pay) with a career path to jets. It would be like the old days at Ansett and TAA, new guys join on the turboprop and work their way through the system.

Turboprops would fill in many dots for DJ such as Dubbo,Tamworth, Bundy, Gladstone, Devonport the list goes on and on. They could also replace/ supplement the E-jets into Coffs and Port ie they could start overnighting there, thus giving Qlink a run for their money. The E-jets could then be used on routes such as SYD - ASP, SYD -AYQ, BNE -ASP, BNE -AYQ, ADL -ASP -DRW and PER- ASP -CNS.

I just had a look at the ATR -600 on their web page, it looks like it will give the Q400 a run and the flight deck looks pretty flash (all glass now).

If Qlink are looking at jets again the 'C' series looks like a good machine.

14th Jan 2010, 11:04
Gidday GAFA.

I never said DJ need REX. I said due to the high startup costs and the thin margins, it would probably be the most logical thing to do. In fact I'm not convinced it would be better for the crews if REX were to be taken over. Hense my statement in post #5.

I think DJ have enough to worry about with a mixed domestic fleet as it is. Not to mention an International carrier (setting new benchmarks in the lowering of pilot T&C's) that has yet to turn a profit, and will probably be sometime in doing so! And they now want to start a regional. I just don't buy it.

I would love to see DJ offer a real career path for pilots. Regional Turbo-prop to Domestic Jet to International widebody. Not only would that help to invigorate the profession, but in my mind would make perfect corporate sense. Give people long term goals within the corporate structure, and at the same time take the finite resource of experienced pilots from your competitors. Do you think it will happen like that? Not a snowball's mate! Just have a look at the track record.

If your view of better pay and a career path becomes a reality, then REX, QFlink, and the like will bleed, and bleed badly. However when you consider that a QFlink line Captain earns more than a VOZ F/O, I feel a significant shift in thinking from the Ivory Tower brigade just might be in order.

Do you honestly think that's going to happen?

14th Jan 2010, 11:53
Been in this game very long have we bagchucka?

And what sort of pilots are they?

Apart from the cadets, where do you think the majority of your F/O's come from? GA is full of pilots with plenty of hours and good experience. With the lack of significant hiring in the past 12-18 months that pool of experience has only grown larger.

14th Jan 2010, 21:20
I see it has a step up for those REX pilots who would join DJ, as they would be operating larger equipment (with better pay) with a career path to jets.

Would there be progression from the turboprops to the jets (especially seniority based bidding)? Is this what happens at QLink or happened in Kendell/Hazelton during the Ansett days?

As far as being a step up we'd have to see what the conditions are, how much will they pay? If the pay is the same to fly an ATR on a fatigue based rostering system it would be a backwards step. To simply say a bigger aircraft is career progression is misguided.

I think VB management have admitted that they were very naive to buy into regional jets in the hope to break into the regional markets already serviced by well established turboprop operators. For BG to make the comments he has reflects this and now they have to come up with an alternate plan of attack involving turboprops to compete.

No Idea Either
14th Jan 2010, 22:38
My two bobs worth,

Turboprops for VB regional........maybe.....and that's a BIG maybe. As mentioned the EMB's haven't been the money spinner that the ivory tower thought they were going to be. I would think that the introduction of turboprops would also see the downscaling of the EMB ops, so there probably wouldn't be a huge net gain in pilot positions. As for progression, well thats anyones guess. The new turboprop company would probably be an independant company under the VB umbrella, just like VAus. Progression from VB into VAus has been about as exciting as a visit to your local proctologist. I hear there is dissent amongst the ranks in V due to no foreseeable upgrades right across the ranks. They are going to need to sort that one out. So I cant see the 'holy grail' of seemless progression from an FO on a turboprop to CMD on a 777 ever being an eventuality. I'm sure the the company will tell you that this will be an option in order to get you to sign up, but I would want it in black and white in an EBA before I believed it. Have you ever noticed when you get home from shopping and cook up those nice looking carrots, they're real bitter, and you throw them out.

14th Jan 2010, 22:50
You're forgetting about the hireing by the majors 'Chucka.

When REX went looking to replenish their loses 2 years ago they were in for a rude shock. Insulated from the realities of the past decade, they found out the hard way the inexorable decline in people learning to fly had resulted in "Experienced" pilots becomeing a finite resource. They even used the unstable situation in South Africa to recruit from overseas!

G/A is like a recovering trauma patient. In fact crewing wise, so is REX! The resurgence in interest in learning to fly, no doubt fuelled by the feeding frenzy of the larger carriers, went some way to filling the vaccum, but has it been enough?

There may be an increased number of pilots with "...plenty of hours and good experience.", but will they go to QFlink, REX, or even DJ Regional! Will they settle for $44K P/A? Are there enough of them to satisfy the demand? What then happens to G/A? Lots of questions 'Chucka.

As for "...giving their left cajone for a gig...", the REX cadets probably thought that way. Many are now not so sure!:=


No Idea Either. Spot on IMHO!

14th Jan 2010, 23:31
Read an interview with BG a few years back where he said that that VB looked at turboprops but the economics were horrendous. I doubt that much has changed in 2-3 years.

14th Jan 2010, 23:38
An extract from an artical just over 2 years ago regarding QLinks aquistion of more Q400 aircraft:

But Virgin Blue believes that the Qantas operated turbo-props will be no match for its new generation E-jets, which offer much wider seats and more legroom than on all other domestically operated aircraft.

"We believe our E-jets will compete very well with their turbo-prop competitors, " said Heather Jeffery, Virgin's head of corporate affairs, in response to the Qantas Q400 deal.

Brett Godfrey, her boss and chief executive of Virgin Blue, was far more forthcoming in an interview last month with BusinessDaily.

"Where people have to make a choice they will prefer to fly on jets than on turbo-prop planes," he said.

Quite clear what they thought of turboprops and the e-jets impact on regional routes back then. Whilst the added competition has made an impact on load factors it seems most passengers will just opt for the lowest fare (or preferred operator) regardless of type.

Read an interview with BG a few years back where he said that that VB looked at turboprops but the economics were horrendous.

Maybe he got the regional jet and turboprop documents mixed up or mislabelled?

23rd Jan 2010, 22:50
:ugh: :ugh: :ugh: :ugh: :ugh: :ugh: :ugh:

Would anyone atleast care look on CASA under the AOC section. If someone cared to look you will see NO ATR72's on the AOC, dirty rumour .

:ugh: :ugh: :ugh: :ugh: :ugh: :ugh: :ugh:

24th Jan 2010, 08:42

Not sure if the AOC you found on the CASA website is the same as the one I found by searching under 'operators', but it seems to be dated 16 September 2009 and at least 5 of the current fleet (VUR,VUS,VUT,ZPN,ZPO) are also missing from the list.

bagchucka's rumour suggested the type additions occured 'last week' (as at the 14 January 2010), so I would assume an updated AOC would be necessary for the mythbusters to claim 'BUSTED'

Arnold E
24th Jan 2010, 08:53
Just to clear things up, coz its getting messy here, are you saying that REX is going to get ATR72's or not. This rumour has been around for a few years that I know of so, what is the source of this rumour. I must admit, it would be realy good for REX employees if that was the case. What is the strength of your rumour??:confused::confused:

Horatio Leafblower
24th Jan 2010, 10:21
Would anyone atleast care look on CASA under the AOC section. If someone cared to look you will see NO ATR72's on the AOC, dirty rumour .

My AOC isn't on the CASA website either, but I've been operating under it since July 23 2009. It's Hanging on my wall in full colour, autographed by Peter Fereday.

If you look under the ATO section, at least 3 of the ATOs listed therein are dead and one of them for nearly 5 years.

If I ran my manual suite like CASA ran theirs.... :ugh:

G Jetson
25th Jan 2010, 04:18
I know some of the ex Macair ATR guys would be glad if VB started operating the type, if they got a gurnsey that is. A couple of them had 72 experience o/s and said they were very efficient, pax and accountants loved them.
FFS in NZ now as well.

25th Jan 2010, 21:11
'pax..loved them' and pilots did too because the touchdown was smooth with the trailing link undercarriage. Not so sure about the accountants until the early engineering bugs had been got used to. Most of the time if you had a 'spike' in a system you pulled and reset a circuit breaker and it went away. Pretty advanced for its time back in the mid and late '80's. Air Queensland (Bushy's) operated two 42-300's themselves up and down the Qld coast and leased the other two to Air Pacific. When those came back from lease they got out of them. Air Pacific were happy with their two new ones delivered from late '88, running them to closer in regional ports from Fiji and were going to get more of them, until mid '92 when they did a u-turn on a new 5 year plan and went all jet with a 737-500 that could also go to Wellington. The airconditioning was good too, even without an APU on the ground, although it used to startle some pax with the copious amounts of fog sometimes in the tropical humid areas.

The Green Goblin
25th Jan 2010, 23:39
It's a great machine until it flies into icing :}

Give me a Dash any day

26th Jan 2010, 20:51
Any machine flies into icing above 15,000 feet in the tropics, and the supercooled raindrops are big too.. Sure, ATR's pick up ice, just like any aircraft, and with the best cruise levels around 21,000 - 22,000 (maximum 25,000, but not really a proposition in a heavy 300 because she struggles) you have to trade altitude to recover speed for safety. Only operated in the tropics, where the freezing level was high, so can't speak for the colder climes with the FL on the ground, but they went well up there with anti-ice and de-ice protection. The cousins in NZ with their later models and 72's would know more about the abilities in ice down low. If you havn't flown them, don't criticise them, as you are probably only repeating someone elses predjudices.

26th Jan 2010, 21:20
The early ATR had a problem due to ice build up behind the wing boots, very well known accidents in the US. However the boots were redesigned and now the aircraft has no more problems with icing than any other turboprop, dash included.

26th Jan 2010, 22:10
The ATR has been through more icing certification since Roselawn, than any other aircraft to date. There are no more major problems with the aircraft in icing conditions, if you follow the FCOM and operational procedures which ATR have devised. Of course if you don't follow those procedures, then like every other aircraft you do have a problem!

As Frigatebird has stated, the ATR42 is happy around FL200 to FL220 in the tropics (although with the -500 an the extra power FL250 is achievable with a good load) so you are in the middle of the severe icing level in the tropics. The ATR72 with a full load won't get anywhere near FL200 though - so flying it in the tropics won't actually see too much of the severe icing.

Anyway from an economic point of the view - the ATR 72 is a bean counter's dream, with a breakeven point for the 72 at 23 pax at mid-range fares (according to a well established ATR72 operator) it would be an ideal aircraft for shorter regional routes for an LCC.

27th Jan 2010, 00:37
And the Beancounters will go for LCC wages to boot!

Another reason why it will fail.:suspect:

27th Jan 2010, 00:37
Bring on the 42 and 72 600's.
They sound like they will have the goods to hit the sweet spot. :cool:

27th Jan 2010, 00:51
Bring on the 42 and 72 600's.
They sound like they will have the goods to hit the sweet spot

Yeah, the 127M on the -600 will have the same Horsepower as the 127E/F currently installed for the ATR - performance wise they're going to the same as the -500s (the 127M has been installed on all ATRs from late 2008 anyway).

Certainly the 42 is a real rocket in comparison to the 72!

27th Jan 2010, 02:06
Read recently that the new 127M engines on the 600 72 get a 'boost function' of 5 percent, that can be used for additional power as needed when called for at takeoff. And they get a single engine ceiling increase of 1,000 ft. Max t.o.w. of 23,000 kg. Is this new then, or hype ? With the Cat 111A autopilot it all sounds good at this point in time..

27th Jan 2010, 02:51
I hadn't heard of the 5% boost as required for take off, but to me I'm wondering if that is just a spin on the up-trim from the ATPCS.

The extra 1000' on the single engine ceiling is correct, the 72-500s that have been released with the 127M already have that in place. The new 127M does have the same output as the 127E or F, but must have some clever French electrickeriery going on in the EEC/PEC to get the higher Single Engine Ceiling.

The ATR 72-500 MTOW is already at 22,800kg. So a 200kg increase of MTOW could be in regards to the cabin fittings (drop down LCD screens as standard) in order to keep the same payload? I'm not sure on that.

Certainly the CatIIIA and autothrottle for approach only will be interesting to use. But last I heard from ATR, they are still negotiating with the JAA over what sort of CCQ can be used for the -600. Also that no one has ordered the 42-600 as of yet so the special prices for it still stand (operating economics make the 72 a better bet).

kiwi grey
27th Jan 2010, 07:11
More likely to compensate for the increase in US FAA 'standard' passenger weights than anything else, I think.
Quite a number of regional airframes have had a 'paper-only' increase to allow carrying about the same number of fatter standard pax as the old thinner ones.:hmm:

Goat Whisperer
27th Jan 2010, 10:38
So we're abandoning the thread title and realising that VB has no intention of operating props.


Don't stop expounding on the virtues of ATRs just because of the thread title.

27th Jan 2010, 11:35
'So will we see ATRs or Q400s in DJ's colours? ATR have their new -600 aircraft on the market and would be very keen to have it operating in Australia.'

I would be so bold to say that it makes more sense to discuss the positives of the new generation aircraft as a fit for the regional networks, by people in the know, than a lot of the wishful thinking and speculation that gets touted on these boards.. or the spin rammed down the throat of those who have to make them work, by people in a company who select an aircraft for the wrong reasons..
Rant over.. its just that I have seen it happen several times before where a more suitable aircraft was shelved in favour of a less perfect fit by management because they mishandled the political and economic aspects and had to save face and prolong their tenure with something else..
Stand up and be counted early, if it is important enough to get right.

27th Jan 2010, 19:52
Lads - get over yourself - its not going to happen .....

27th Jan 2010, 23:25
Yeah, well said littlehurcules.

It has been entertaining, and I must say informative (from a technical point of view), reading the enthusiasm of some of the ATR exponents.:ok:

27th Jan 2010, 23:53
Personally I don't see Virgin Blue operating Turboprops either.

But it would make more sense for Pacific Blue to operate them in NZ. Sooner or later one of the competitors to Air NZ has to wake up to the fact there is a massive untapped market in such cities as Dunedin, Hamilton, Palmerston North, Tauranga, Invercargill. These markets are sick of the monopoly of Air NZ and the excessive fares they pay in comparison to flying out of the major centres.

Certainly the long term survival of Pacific Blue or Jetstar will depend on the regional markets. Certainly for Air NZ the amount of profit made out of the regional routes in NZ, allow them to compete direct with PacBlue or Jetstar and not affect their profits! If PacBlue or Jetstar want to hurt NZ in the domestic market - bring the lower fares to the regions, because I know that if better services were provided to Dunedin (not necessarily jet services either), the Air NZ flights will be almost empty!

Mr. Hat
30th Jan 2010, 01:33
Having said all that there would have to be a few cash cow turbo prop routes they'd like to get there hands on.

30th Jan 2010, 06:22
Maybe all this talk of Virgin Blue getting props is a way of getting REX to the table to talk about a full codeshare arrangement?

Virginblue would get their code on prop services & REX gets their code on jet services.

REX would remain independant but would operate as a "VirginLink service" via codeshare, this would benefit both airlines, but REX doesn't want a bar of it for some reason. :hmm:

30th Jan 2010, 09:51
I think the big problem with REX is it's owners who think they can do it all on their own with second hand Saabs that are 10+ years old while everyone else is using newer larger equipment.

Will DJ operate turboprops, you really can't rule anything out. Three years ago they were an all 737 operator and now they have 20+ Ejets, plus 50+ 737's. Not one of us 3 years ago thought they would ever operate anything other than 1 type.

There are a lot of pros and cons for them operating turboprops. A big con I can thing of is slots and gates at Sydney. The current terminal cannot take any further jet movements with 3 of the gates now shared with Tiger and if the new finger is added Tiger will most likely be given access to half the gates. With a turboprop they will be able to park in the 'Foxtrot' bays or up at Domestic 4. With regard to slots they number of slots available for jet RPT is rapidly running out.

As already mentioned they a many routes that Q'link have to themselves which could do with some real competition, which the E-jet isn't or wouldn't work.

DJ could phase out the 170's and replace the shorter routes currently operated by them with a turboprop and use the 190's (add a few more) on the longer routes currently operated by the 170's such as CBR-OOL, CBR-TSV, SYD-MKY etc. This would then give them a fleet operating the high density trunk routes (737's), a fleet oprating the long thin routes (190's) and anything under 250 miles operated by a turboprop which is far more efficient than any jet on short legs.

30th Jan 2010, 11:21
REX'a Debt/Equity ratio currently stands at less than 5%! Something DJ could learn from.

The cost of equiping a comparable regional operation would be what, $200 mil?

Not to mention the training, logistics, the lack of monopoly, and did I mention the sucess of which would not be dependant on the collapse of a competitor!

I'm sorry GAFA, but REX have been doing it on their own for some years now, and quite sucessfuly.

IMHO, if DJ were to go down this path, they'd be just throwing good money after bad. :confused:

Going Boeing
30th Jan 2010, 21:21
Krusty, I don't pretend to know much about corporate finance but my understanding is that if REX has a D/E ratio of 5% then that means that they are missing out on some tax benefits - I believe that 45% is about optimum between keeping the debt at a manageable level versus getting good taxation advantages.

If DJ were to get Turboprops, that would be an admission that they got it wrong when they purchased Embraers in response to QF Link's purchase of Dash 8-Q400's. A number of PPRuNers claimed at the time that the DJ Embraers would dominate the market because of the pax preference for jets. From what has happened over the last few years, it appears that pax are still very price sensitive and that Turboprops are significantly cheaper to operate than Jets.

30th Jan 2010, 23:02
BG has said in interviews that the Embraers are better for routes that are at least one and a half hours or two hours long. That hardly makes the Embraers a wrong decision. No jet is better than a TP on a short stage like SYD-CBR. Of course DJ could go back to the bad old days of cross subsidising Canberra flights from profits made on other routes, but they would need a protected Two Airline Agreement to make that work.

Depending on cost of fuel, some people say a jet starts to win on routes of longer than 350 miles, so the Embraers would be better choices for BNE to Mackay and Rocky than Q400s. Are the slots available at SYD if DJ wants to match the frequency that Qantas offers between SYD and CBR with TPs?

31st Jan 2010, 04:21
Gidday GB.

I mentioned REX's low level of debt to highlight the diferences between them and a previous airline that DJ went up against 10 years ago. Assuming of course DJ went after the entire regional market. They may simply choose to pick the eyes out of the prime routes. That would be interesting.

If the overall size of the operation remained with just the major regional markets, then DJ may suffer from the economies of scale of operating a relatively small fleet.

If DJ chooses to compete across the board with either REX, Qlink, or both, then all the associated problems I mentioned in my previous post would have to be taken into account.

Either way, I still don't buy it!

Arnold E
31st Jan 2010, 09:57
I mentioned REX's low level of debt to highlight the diferences between them and a previous airline that DJ went up against 10 years ago.
Which was??

6th Feb 2010, 14:32
Doesn't make too much sense to me for VB to go to Turbo Props when the high yeild destinations in QLD (EML & GLA) are gearing up for jets. The money for the airline, whoever it is, is in the high yeild routes, and the client will prefer a jet to a turbo prop any day. The question should be, Will QF meet the challenge of the VB jets on the currently monopilised QF (Qantaslink) routes?

If QF decide to put jets on some turbo prop routes, will they use NJS, QLink or set up a new LCC (like IMPULSE)?

My bet is QF will bargain QLink against NJS to push the rate down, and NJS will get the contract!

6th Feb 2010, 21:15
your not wrong...engineering the q400 is a nightmare, but its an accountants aircraft. On the good side, it keeps engineers jobs!

7th Feb 2010, 03:34
but its an accountants aircraft

Only if they cannot add the fuel used per ASK

Arnold E
7th Feb 2010, 07:07
On the good side, it keeps engineers jobs!Then thats gotta be a good thing:ok: