So you need a new fleet Leigh?

[Rated De]

Qantas says foreign ownership cap could make fleet overhaul harder (http://www.smh.com.au/business/aviation/qantas-says-foreign-ownership-cap-could-make-fleet-overhaul-harder-20180103-p4yy8l.html)

'chairman Leigh Clifford said the Qantas Sale Act, which caps foreign ownership at 49 per cent of shares, was still holding it back, including in its ability to raise capital'.
An admitted aviation light weight, Mr. Clifford claims it is the foreign ownership that 'restricts' Qantas raising capital.

In simple arithmetic Qantas bought back its own shares to the value of $1.24 billion (all on market). With another $500 million of 'capital giveback' there is almost $1.75 billion with which to find capital to buy a fleet.

Of course share buy backs have a dubious history. Forbes magazine which am sure you have a copy of did a number of pieces about the dubious nature of the practice.

https://www.forbes.com/sites/aalsin/2017/02/28/shareholders-should-be-required-to-vote-on-stock-buybacks/#73e619476b1e

It isn't legislation stopping Qantas buying a fleet, it was executive bonuses and the option vesting dates! With share prices 23% lower, of course someone/something else is the reason why Qantas lacks a modern fleet of long range twins.

[V-Jet]

If they did raise more capital you can bet the same result would occur. Why waste valuable capital on things like long term assets?

[TBM-Legend]

But according to the experts on PPRUNE its OK for Virgin Australia to be 90% foreigned owned!!!

[V-Jet]

It's not the ownership that Qf staff have issues with. It's the obscene waste of resources at the expense of the long term health of the Company.

[Rated De]

https://s14-eu5.ixquick.com/cgi-bin/serveimage?url=https%3A%2F%2Fqph.ec.quoracdn.net%2Fmain-qimg-f598420276f6e33bcf4daa13ed5119f9-c&sp=62f9964c4bbf85f6079c56af2b8d9625

Share buy backs don't reward terribly many people

[TBM-Legend]

I'd be more concerned if I worked for VA...

I guess there is always an option to work elsewhere too...

[rjtjrt]

Pretty soon they will be asking Gov for an unsecured $3B loan.

[bangbounceboeing]

Good to see ya back on the " I hate everything anything Virgin bandwagon again TMB 🙄

[busdriver007]

So let me see $1.6 billion on Jetstar(according to a former QF Exec) and $1.75 billion on Share Buybacks and there is your $3.0 plus billion AJ was after. Time to pull the eject handle! That money could have bought a lot of fuel efficient jets.

[AEROMEDIC]

Here we go again...

I wonder which statement comes first.
"We need a level playing field..." or The Qantas Sale Act is redundant"... or perhaps "We may have to shed staff to save money".

Stand by...

[blow.n.gasket]

So we have the Amazing transformation engineered by the Pikey.
How many staff are still working under the same EBA’s on the same aircraft to the same destinations with the same load factors ?
Next question is , what is Qantas’ Effective Full Time Employee to Aircraft Ratio Alan?
Or the Drone to Worker ratio for us plebs.

[Rated De]

I wonder which statement comes first.
"We need a level playing field..." or The Qantas Sale Act is redundant"... or perhaps "We may have to shed staff to save money".Whilst it is understandable that the manufactured decline of Qantas International was designed to shock and awe staff just the way Chairman Clifford likes it (as did Alan, he was handsomely rewarded), nothing has changed.

The mistake the staff made, sitting through the reeducation days, Orwellian though it must have been was to believe anything had changed.

When the 'extend and pretend' business cycle completely rolls over, EBA negotiations will follow with the familiar rhetoric: "cost neutral, times are tough, there is no more money"

They blew the time in the sun making themselves wealthy.
The first shot in this new IR campaign is the 457 visa, quietly announced when everyone is not paying attention and digesting plum pudding.

[4Greens]

The Government needs some control over Qantas as it is the fourth arm of the military. When you need lots of troops taken to a trouble spot.

major problem Qantas can do it,

Bin there done that.

[Rated De]

The Government needs some control over Qantas as it is the fourth arm of the military. When you need lots of troops taken to a trouble spot.You bet it does, try enforcing national interest with a contract!

Of course the economic benefit of a Qantas controlled by Australians, results in around AUD$7 billion of direct and another AUD$4.5 billion indirect economic activity. Whilst the report by Deloittes, was commissioned by Qantas to serve some political interest in 2016 and thus open to critique as most inputs are interna(Qantas provided) lEven allowing for the input bias, if it is say $9 billion that is a substantial contribution to GDP.

As an aside I remain perplexed why foreign ownership of a now Quasi (pun intended) national carrier is even discussed when the landmass of Australia's size and the sheer distances across the continent lend itself directly to air travel.

Leigh Clifford is neither an airline man nor a patriot. Qantas cleverly ensured any mainstream media criticism of their actual performance was curtailed when 30 journalists went on the junket to Seattle. Newspaper performance being what it is, Qantas' advertising spend is important to survival. :(

But just to state the obvious it isn't the sale act Leigh.

[Rated De]

Qantas fuel spend for ASK is way higher than peer airlines attributable in a substantial part to fleet decisions.

So Leigh can you read?

Qantas 'worst major airline' for fuel efficiency on trans-Pacific flights, study suggests - ABC News (Australian Broadcasting Corporation) (http://www.abc.net.au/news/2018-01-17/qantas-fuel-efficiency-worst-for-trans-pacific-flights-study/9333616)

[LeadSled]

Rated DE et al,
The ABC piece is a statement of the bleeding obvious.

With the QANTAS investment grade credit rating, it will have zero problem financing a modern fleet at extremely good rates.

So the question must be asked, is the present management actually managing the airline in the best interests of their shareholders, as required by the Corporations Act 2001.

The various references to the QANTAS Sales Act is a furphy, in my opinion.

Tootle pip!!

[Rated De]

Qantas will let one Boeing 787 option lapse, undecided on others - CEO | Euronews (http://www.euronews.com/2018/02/05/qantas-will-let-one-boeing-787-option-lapse-undecided-on-others-ceo)


So new A320 NEO for JQ and the 'mythical 50 aircraft order' still hasn't happened...
More implied threats of toys going elsewhere and delays! Must be contract season!

Still need a new fleet Leigh, but guess IR need to run another scare campaign first!
In the meantime continue running a defunct fleet across the pacific burning lots more fuel than competitors and blame the staff for the cost difference..

[blow.n.gasket]

How many $ Billion share buy back was it ?
That boosted the share price , how much ?
This occurred how long before the senior executive share scheme vested ?
How many 787’s would Those $ Billions buy ?
What sort of return on investment would that expenditure make ?
How much has been expended on the Jetstar Asia business ?
What return on Investment has been reported on those ventures ?
Come FY 2019 , FIRS16 comes into effect with off balance sheet debt having to be accounted for on the books .
Will be interesting to see how that effects debt equity ratios , share price and the potential to effect debt covenants .
99x. 320’s for the amazing business that relys on financial alchemy that is soon to change due to International Accountancy laws.
WHERE’s the money for those coming from ?
Yet we are told , more 787’s won’t be ordered for Mainline until their costings are proven.
The amazing business has been operating 787’s for how many years ?
What sort of business plan is Alan using?

[Rated De]

What sort of business plan is Alan using?Mr Joyce is a child of the financially engineered airline fraternity. Alchemy is an apt description.

As fixed cost is fixed and changes not substantially no matter what the airline model, off balance sheet leasing and driving down staff costs were two planks in the model. Load factors need to be consistently above 80% and yield is tricky to capture. The model is demand elastic relative to a more traditional structure as the revenue stream is very sensitive to price change: The traditional airline is not as susceptible. Jetstar had a role but not what Mr Joyce and Leigh Clifford hoped.

Qantas imagined not only using leverage against the staff but effectively replacing the terms of employment entirely. Perhaps 'work choices' encouraged them, who knows!

They have benefited personally very handsomely.

They need a new fleet, they are signatories to IATA's CO2 reduction plan, seeing 1.5% annual reduction to 2020 and further reduction into carbon neutral. Other than a grounding and lock out a new fleet is the only real way to achieve this given their route profile.

They spent nearly $1.75 billion on share buy backs and capital returns. Curiously their own options vested at the same time...That is a big start for a new fleet, but given the staff contract negotiations start soon it is wash, rinse and......repeat! IR first

Any sort of real regulatory oversight would at least investigate the correlation...

[bazza stub]

seeing 1.5% annual reduction to 2020 and further reduction into carbon neutral


The real reason behind single engine taxi and giving the pax a stinking hot cabin I suppose.

[CurtainTwitcher]

^^^^^^^^^^^
Exactly my first thought too! Don't forget idle reverse, lessor flap & the new app to quantify precisely the savings in every phase of flight. I always wondered why my decent fuel was only half to a third of the flight planned burn, yet the actual FOD figure was always about what you would expect. A fudge in the system to make sure almost everyone "under-burns" compared to the flight planned figure?

It makes complete sense now. Thank you Rated De.

[ExtraShot]

Perhaps someone more 'in the know' with regards to this topic could clarify, but I was of the understanding that these 787 Options were at such a good discount to List Prices the Qantas couldn't afford to NOT take them.

If that is the case, surely there were a few other options here that would have been more financially viable for the Group than letting the Option lapse, like perhaps, taking the frame and leasing it to another operator, or sending it to JQ (or haven't they proven the aircrafts 'worth' yet either?).

I'm fairly sure of one thing, if it is part of more of this childish IR rubbish, it is a waste of time. Most QF and JQ pilots are seemingly used to this kind of nonsense and no-one seems threatened by it anymore. We are all well aware of the looming Pilot shortage, and the difficulty in crewing the lower Paid subsidiaries for the birdseed they offer, and only a massive downturn is going to have any real effect on how individuals will approach the looming QF SH/LH and JQ EA negotiations this year.

All its going to achieve is increasing the risk of the next financial downturn coming around, and QF once again, stuck trying to manage through it with an inefficient, out of date fleet.

[Rated De]

All its going to achieve is increasing the risk of the next financial downturn coming around, and QF once again, stuck trying to manage through it with an inefficient, out of date fleet. That is precisely the point.
They enjoyed a $597 million windfall in fuel price reduction.
The impaired the International fleet saving $326 million

That is pretty much the entire 'turnaround'
The fleet has how many 787 (3 or 4?) of a total of 8?

Mr Clifford may be well suited to the personality and characteristics of rocks, but airlines are completely different. At Rio Tinto if they didn't like the price of ore they left it in the ground. A substantial fuel price spike or indeed demand collapses airlines with inefficient fleets are precariously exposed.


Instead of actually structuring the business to deliver lower CASK, by re-equipping so that if fuel spiked again they would be prepared they instead vested million of options and spent nearly $1.75 billion pumping the share price..


This is from IATA itself...

Industry priorities

IATA recognizes the need to address the global challenge of climate change and adopted a set of ambitious targets to mitigate CO2 emissions from air transport:


An average improvement in fuel efficiency of 1.5% per year from 2009 to 2020
A cap on net aviation CO2 emissions from 2020 (carbon-neutral growth)
A reduction in net aviation CO2 emissions of 50% by 2050, relative to 2005 levels



Short of a grounding or fleet change it will be interesting to see just how Qantas achieves the targets. Thanks CT it would appear that the office holders reap the KPI and the passengers suffer in stifling cabins because the international fleet burns almost double the fuel per ASK.


Interestingly Mr Joyce and Clifford denied Qantas domestic a twin aisle aircraft sending the 788 to JQ.





There are now nearly three 737 required to carry the same ASK as two 767.
Six pilots needed
More cabin crew?
More fuel burned
Airspace congestion as more airframes in same 'air space' (think terminal area) leads to delays and holding

Seems like pure efficiency to me.

Must be the labour cost or the Sale Act. Have a look in the mirror Leigh it is that guy who is responsible.

[TBM-Legend]

There are now nearly three 737 required to carry the same ASK as two 767.
Six pilots needed
More cabin crew?

So who's complaining about more pilots, F/A's and ginger beers having jobs?

As for congestion I suggest a trip to ATL TMA might give a hint to real congestion..

[Rated De]

So who's complaining about more pilots, F/A's and ginger beers having jobs?

Nice.

However the thread and the conversation are about 'efficiency'.
More aircraft and pilots and engineers because management chose to send the twin aisle 788 to JQ denying Qantas domestic of a 'game changing' premium domestic product is not transformation now is it?

[IsDon]

Nice.

However the thread and the conversation are about 'efficiency'.
More aircraft and pilots and engineers because management chose to send the twin aisle 788 to JQ denying Qantas domestic of a 'game changing' premium domestic product is not transformation now is it?

Rumours about A321s for JQ international might mean the 788 in JQ colours being bought back to mainline.

Why would you operate a small fleet of 788s beside a majority fleet of A320/321s? Sure the 788 has greater range, but does JQ actually utilise that range with any of its current 788 routes? The A321LR has comparable range to a 763 which should suffice for its needs.

[Rated De]

Rumours about A321s for JQ international might mean the 788 in JQ colours being bought back to mainline.

Rumours may also be the next step in an IR campaign softening pilots for contractual outcomes more to the company likening. The first step was announcing 457 visas in the Christmas New Year shutdown.

[High_To_Low]

QANTAS has a SMALLER 788 fleet than Jetstar (8 vs 11) IsDon...just saying ��

[RealityCzech]

Pretty soon they will be asking Gov for an unsecured $3B loan.

When did they ever ask for a $3b unsecured loan?

[itsnotthatbloodyhard]

Qantas asked for $3 billion unsecured loan, Prime Minister Tony Abbott says - ABC News (Australian Broadcasting Corporation) (http://www.abc.net.au/news/2014-03-05/qantas-not-in-imminent-danger-of-failure-deputy-pm-truss/5299636)

There, that wasn’t so hard, was it?

[RealityCzech]

Thanks. I couldn’t find it on google.

[Troo believer]

Thanks. I couldn’t find it on google.

https://blogs.crikey.com.au/planetalking/2014/03/04/hockeys-hint-qantas-wanted-7-bn-guarantee-to-smash-competitors/
No you didn’t look. Couldn’t find it. Troll.

[IsDon]

QANTAS has a SMALLER 788 fleet than Jetstar (8 vs 11) IsDon...just saying ��

Not for long.

[High_To_Low]

Allegedly....

[GA Driver]

Rumours about A321s for JQ international might mean the 788 in JQ colours being bought back to mainline

Wouldn't be too stressed about this for awhile. Whilst it WILL do a Bali flight from Eastcoast Aus ports, the range the thing doesn't have is a problem. Airbus quote the 321neo as having 4000nm range.......:rolleyes: Perhaps..... but not with 230 punters jetstar want, nor carrying ANY freight in the holds because they need to be filled with auxiliary fuel tanks.
Anywhere else in the JQ international network forget it.

[ExtraShot]

Wouldn't be too stressed about this for awhile. Whilst it WILL do a Bali flight from Eastcoast Aus ports, the range the thing doesn't have is a problem. Airbus quote the 321neo as having 4000nm range.......:rolleyes: Perhaps..... but not with 230 punters jetstar want, nor carrying ANY freight in the holds because they need to be filled with auxiliary fuel tanks.
Anywhere else in the JQ international network forget it.

I don’t pretend to be an expert on the 321neo, but I was reading something, somewhere, from Airbus the other week, that with a strengthened undercarriage being worked on, the 321LR supposedly will do that distance with around that number of punters. ‘Lightly configured’, whatever that means, a range closer to 5000nm was quoted :eek:(quoted by Airbus, so take it with a grain of salt).

[fdr]

So Leigh can you read?

Qantas 'worst major airline' for fuel efficiency on trans-Pacific flights, study suggests - ABC News (Australian Broadcasting Corporation) (http://www.abc.net.au/news/2018-01-17/qantas-fuel-efficiency-worst-for-trans-pacific-flights-study/9333616)

The ABC is using a poor metric for evaluating efficiency. Breguet's range formula is appropriate to use if you are doing any comparison, but ASK is not.

The Qantas fleet mix is not optimum, but it also not bad. The A380 has a niche market that is appropriate to part of QF's program, but you definitely need the feeder system into it. The B777 and B787 are good aircraft, but if you want to you can also get lousy "marks" using the ABC's method for those aircraft as well. An aircraft is a transportation device to achieve a payload transport, and hat includes cargo etc. Comparing the A330 to the B777-200ER shows that the 330 looks great, if it is moving out to ranges of not more than 10 hours, AND if no cargo is hauled for commercial freight; add longer flight stages or high value freight, and the the picture changes. There are lousy routes to fly with particular aircraft, but the metric needs careful analysis to say which is which.

As a fraction of total weight for a given sector, very few airlines will match QF's fuel load or fuel burn for a specific airframe.

QF could use the 777 and the 787 effectively, but is also a good candidate for the A350.

A long time back I was doing an investigation on the MD11F and comparing with the B772, and it is interesting to see the similarity of the airframes performances, up to 4000nm, beyond that there is no comparison, but equally, at that sort of range, if you can tech stop without grief, then that is efficient to do usually, spot fuel price dependent.

[Bootstrap1]

Only 3x 787s and they are already changing the flying pattern. Melbourne - LAX was supposed to be daily now going back to 2 days a week with the A380 picking up where it left off.
Already leaving LAX at MTOW while having to lock seats out just to make it home. Game changer, absolutely.

What did they think would happen when reducing the available seats by over 50% on that route? It may be a good aircraft but I don't think it is an ultra-long haul aircraft.

PER-LHR another route with seats to be locked out and probably minimal if any cargo. Awesome.

The numbers don't add up, not on the routes they have chosen to use it on. It is not the right aircraft IMHO.

No wonder they have chosen not to take up the options at this time. Maybe there will be some announcement on Monday once all the execs have had their jolly on the A350-1000. Now that would be a game changer

[TurningFinalRWY36]

A350-900 would be a good choice, 15 hr sector and no need to restrict seats

[On eyre]

Bootstrap dunno where you get the 50% reduction from. A380 was and still is a daily service. Only change is the additional B744 (I think it was 5 days a week) now B787 4 or 5 days a week - hardly a 50% reduction. And don't forget soon Melbourne to San Francisco to add to Nth American routes.

[Bootstrap1]

Sorry I thought the 787 was replacing the 380 out of Melbourne and not an additional service. My bad. I should pay better attention to the press releases next time.
Google also said it replaced a 744 not the 380, still a reduction of over 100 seats. Someone is going to notice
Cheers

[C441]

Since it became available, the 787 has been doing 5/week MEL-LAX-MEL along with the daily A380. For a month it was to replace the A380 for a month but it now will replace it for 4 of the daily services.
From 25th March, when MEL-PER-LHR starts, it will go back to the original schedule; 5/week until at lest September.

[Bula]

Considering the A350 is up to 90 tonne heavier than the 787, is it really surprising burning 1000 kg/hr more?

[dragon man]

Since it became available, the 787 has been doing 5/week MEL-LAX-MEL along with the daily A380. For a month it was to replace the A380 for a month but it now will replace it for 4 of the daily services.
From 25th March, when MEL-PER-LHR starts, it will go back to the original schedule; 5/week until at lest September.

From the loads I’ve been watching on these two flights what the Einstein’s have done is taken one A380 with a very high load factor and now have two flights with at best a break even but more likely a loss making load factor. IMO that’s why they are going to do SFO from Melbourne, however they still need to get the 787 to Lax for maintenance hence the two services a week.

[dragon man]

A350-9 280T.
B787-9 254T

The A350-9 is over-burning by close to 1000kgs/hr over Airbus quoted specs. It is also over-burning by close to 1000kgs/hr compared to the 787-9 on the same route.

Excuse my ignorance here but what are the payload and pax numbers for both?

[TurningFinalRWY36]

Not sure where you are getting bad performer from, on 15hr sectors we are burning average of 6T/hr carrying upto 42T of payload. Compared to a 77W on a similar route we are burning almost 30T less with a comparable payload

[dragon man]

Not sure where you are getting bad performer from, on 15hr sectors we are burning average of 6T/hr carrying upto 42T of payload. Compared to a 77W on a similar route we are burning almost 30T less with a comparable payload

Just imagine if you had the right aircraft for the right route (Qantas) you could operate a 747 on that 15 hour sector at about 11 tonnes an hour average for a 30 tonne payload. We really are managed by a bunch of clowns.

[TurningFinalRWY36]

And on that 15hr sector carrying enough fuel for a total endurance of 16.5hrs, people like to rip on airbus but they have made a great aircraft of the A359

[patty50]

The A350-1000 will be in town on Monday. Can’t even decide if they want 787s they ordered 12 years ago though so probably a waste of time for airbus.

[Captain Dart]

Well, I have just started operating the A350-900 into AUS; on first impressions it has the same burn as a 330 but with about 30-40 more pax and gets there 20 mins faster (0.85 IMN cruise). As for the flight deck; it's Star Wars, man. Stunning. Airbus got this aircraft right.

[IsDon]

Airbus got this aircraft right.

I guess there’s a first time for everything.

[LeadSled]

Folks,
And now fuel prices are headed up again, the great "turnaround" starts to fray at the edges, is QANTAS EVER seriously modernize the fleet???

With a good investment rating, Qantas has no trouble financing whatever, Airbus or Boeing, talk otherwise in camouflage -- but camouflage for what agenda, the "interests of the shareholders"???

Tootle pip!!

[gordonfvckingramsay]

Oh the irony:

https://en.m.wikipedia.org/wiki/Qantassaurus

[Rated De]

And now fuel prices are headed up again, the great "turnaround" starts to fray at the edges, is QANTAS EVER seriously modernize the fleet???


http://www.iata.org/publications/economics/fuel-monitor/Documents/ChartB.png


It is only when the tide goes out you will see who has been swimming naked...

[Transition Layer]

Qantas could be flying towards fleet renewal spending cliff, says S&P (http://www.smh.com.au/business/aviation/qantas-could-be-flying-towards-fleet-renewal-spending-cliff-says-s-and-p-20180215-p4z0gd.html)

Blind Freddy could have seen this coming. But first we need to blame the foreign ownership laws, and then we’ll blame the pilots for not taking the Network/Jetconnect changes lying down.

[LeadSled]

Folks,
All the S&P analysis says it what has already been said here, time and again. And, of course, many other places.
So the question remains, what is the real long term agenda??
Tootle pip!!

[ExtraShot]

People have been saying what a GENIUS bunch the current management are due to the turn around... but us idiot Pilots and Engineers (and others) have been saying otherwise. Most of us have been indicating that fleet renewal should have been ongoing throughout this period, yet is hasn’t. What would we know!?

Now, it’s seems even the Financial Gurus are cottoning on!
Snippets From the Australian Financial Review, my bolding:

Ratings agency Standard & Poor's says Qantas will have to significantly boost investment in aircraft just as it may have to resume paying company tax in 2020... OOPS!


. Qantas has used surplus capital to fund shareholder returns rather than grow invested capital, S&P said.
well, Duh!


. We believe increased aircraft investment is inevitable for Qantas given its older fleet and large international exposure," S&P said.
Indeed it is. And so, the choice they now have, is either they renew the fleet, or the competition eventually eats their lunch.

Qantas Management may very well be furious with S&P right now. The only ammo they really had against Mainline Pilots, was to hold Aircraft orders, ‘fleet renewal’, over their heads. Now those darned investment rating/banker types have gone and told everyone that Qantas is at a point where fleet renewal has to happen Regardless.

It has taken a while, but management seemed to have backed themselves into a little bit of a corner here. Thus, I’m fairly skeptical of Managers seeking Pilot capitulation on the Network/Jetconnect issue,( because otherwise we won’t be able to defend the line against Virgin), in return for heading to the board about ordering more 787s, when, if they don’t order more 787s, the company will be unable to defend its line against Virgin (and others) anyway.

[Qantas 787]

The journos should put the hard questions to the CFO in the half yearly results. He is the reason the airline will face this problem.....

[Rated De]

A quick check tells you that S&P are not inside the tent with the 'approved' analysts. You know the ones that get 'special briefings'

"Since its financial turnaround in fiscal 2015, Qantas has used surplus capital to fund shareholder returns rather than to grow invested capital.
"We do not view this as sustainable."
As we stated repeatedly nearly $1.75 billion was blown lining their own pockets with curiously timed option vesting dates.

Whilst the tide hasn't yet receded sufficiently to see how naked the little fellow swam, it has turned.

Declining international yields, rising jet fuel prices....
One may postulate that the short side open interest may rise in the near term if Qantas don't succeed in getting stories like this pulled from mainstream papers with advertising spend..

Nero and Rome

[neville_nobody]

Problem is that people have been saying QF will go broke/collapse for 20+ years, yet they never do and life goes on.

What's different this time as opposed to the other previous near financial disasters?

[blow.n.gasket]

What's different this time as opposed to the other previous near financial disasters?

A Jetstar fixated woofta pikey , thats about to be caught out by IFRS accounting standards , that’s what’s different this time around !

[Nunc]

Face it, thanks to inept management at all levels QANTAS is the Titanic looking for an iceberg.

[Capt Fathom]

I don’t think the Qantas as we know it, has long to live. It will be broken up into many fractured pieces, poorly disguised as one entity.
The flying public will happily pay the low fares and conveniently ignore the truth.
RIP.

[blow.n.gasket]

I don’t think the Qantas as we know it, has long to live. It will be broken up into many fractured pieces, poorly disguised as one entity.

Qantas is already many fractured pieces , some more fractured than others , it’s called the Qantas Group .

[ExtraShot]

.What's different this time as opposed to the other previous near financial disasters?

Nev, it’s not so much talk of financial disaster, or the collapse of Qantas. But the foundations for that will start to appear if they try to navigate the next downturn with their current fleet.

The new narrative, out just this week,seems to be that if Short Haul Pilots don’t accept Open slather Network/Jetconnect flying without written scope, that no more 787s can be ordered.

Like a kid being offered an Ice Cream for being good for his mum at the shops, if SH Pilots behave, then we Might be able to get the board to agree to buy more 787s... otherwise, those options are just going to be allowed to lapse. (Alan Joyce has said they won’t buy anymore until the 787 Business case proves itself, so there’s already a conflicting statement to the above, unless 3 months of flying a part schedule has told them what 600 plus aircraft flying around the world already should have).

As we all know, QF can’t fly it’s current fleet forever. Even ratings agencies are starting to notice that they HAVE to spend money on fleet improvements to remain competitive. And Soon! So QF Pilots should be looking at threats like this with the utmost suspicion.

If Qf weren’t to spend that money, perhaps we can analyze what happens when Oil goes back to $100 plus per barrel, and Qf is flying 15-20yr old 747s and A330s against its competition, who have a350s and 787s... (what’s the fuel burn per seat of a QF 744 vs a new SQ 787-10?).

[Transition Layer]

Nev, it’s not so much talk of financial disaster, or the collapse of Qantas. But the foundations for that will start to appear if they try to navigate the next downturn with their current fleet.

The new narrative, out just this week,seems to be that if Short Haul Pilots don’t accept Open slather Network/Jetconnect flying without written scope, that no more 787s can be ordered.

Like a kid being offered an Ice Cream for being good for his mum at the shops, if SH Pilots behave, then we Might be able to get the board to agree to buy more 787s... otherwise, those options are just going to be allowed to lapse. (Alan Joyce has said they won’t buy anymore until the 787 Business case proves itself, so there’s already a conflicting statement to the above, unless 3 months of flying a part schedule has told them what 600 plus aircraft flying around the world already should have).

As we all know, QF can’t fly it’s current fleet forever. Even ratings agencies are starting to notice that they HAVE to spend money on fleet improvements to remain competitive. And Soon! So QF Pilots should be looking at threats like this with the utmost suspicion.

If Qf weren’t to spend that money, perhaps we can analyze what happens when Oil goes back to $100 plus per barrel, and Qf is flying 15-20yr old 747s and A330s against its competition, who have a350s and 787s... (what’s the fuel burn per seat of a QF 744 vs a new SQ 787-10?).

This ^ :D :ok:

[Rated De]

But the foundations for that will start to appear if they try to navigate the next downturn with their current fleet
They fiddled whilst Rome burned, rewarding themselves handsomely.
They were gifted an Australian icon with a clean balance sheet and the youngest fleet age in IATA of 6.3 years.

Take out the JQ 'experiment' and the Qantas fleet age exceeds 10.5 years.
Renewal is an imperative becoming increasingly obvious to the market.

Any contract discussion is curious as the necessity to replace the fleet on fuel CASK metrics alone is ably demonstrated.

The pilots can afford to be indifferent and remember An emergency on Qantas management's part does not constitute a need to sign a hastily put together contract...

Get the aircraft or don't get the aircraft ought be the message to the self appointed smartest guys in the room!

Indifference to their 'rubbish narrative' will serve each individual well!

[What The]

Andrew David $8m last year
Alan Joyce $25m last year

And they are worried about what they pay their pilots?

Seriously?

[dragon man]

IMO it’s time we collectively ( the Qantas pilots) stopped bailing management out. Without our goodwill numerous flights every day would be cancelled. This morning there was no Capt for the 63 , they got the 25 Capt going to Haneda tonight to operate that and then found someone else to operate that tonight. One SO position was anther Capt who could only operate over and pax home because he’s out of hours. This sort of thing occurs daily on all fleets, it’s time to let the chickens come home to roost.

[neville_nobody]

The new narrative, out just this week,seems to be that if Short Haul Pilots don’t accept Open slather Network/Jetconnect flying without written scope, that no more 787s can be ordered.

That there is the same spin that has been going on for some 20 years. Just change the names and aircraft types around Jetstar/National Jet/Jet Connect/Network etc

I remember a few years ago it was all doom & gloom sub $1 shares and look what happened. And the time before, and the time before that.

What you have to remember with large corporations is that it is just a game moving assests/cash around to create whatever narrative you wish to dictate.

[What The]

If you want to know where the cash has gone to renew Qantas’ mainline fleet check how many Jetstar leases are being bought out by Qantas. The aircraft are then being leased backed to Jetstar at what I am certain are commercial rates. Driven by changes to financial reporting.
Alan’s folly has come home to roost.

[Justin. Beaver]

Nev, it’s not so much talk of financial disaster, or the collapse of Qantas. But the foundations for that will start to appear if they try to navigate the next downturn with their current fleet.

The new narrative, out just this week,seems to be that if Short Haul Pilots don’t accept Open slather Network/Jetconnect flying without written scope, that no more 787s can be ordered.

Like a kid being offered an Ice Cream for being good for his mum at the shops, if SH Pilots behave, then we Might be able to get the board to agree to buy more 787s... otherwise, those options are just going to be allowed to lapse. (Alan Joyce has said they won’t buy anymore until the 787 Business case proves itself, so there’s already a conflicting statement to the above, unless 3 months of flying a part schedule has told them what 600 plus aircraft flying around the world already should have).

As we all know, QF can’t fly it’s current fleet forever. Even ratings agencies are starting to notice that they HAVE to spend money on fleet improvements to remain competitive. And Soon! So QF Pilots should be looking at threats like this with the utmost suspicion.

If Qf weren’t to spend that money, perhaps we can analyze what happens when Oil goes back to $100 plus per barrel, and Qf is flying 15-20yr old 747s and A330s against its competition, who have a350s and 787s... (what’s the fuel burn per seat of a QF 744 vs a new SQ 787-10?).

What’s with this idea here and on Qrewroom of “accepting” the Jetconnect and network decisions? There is no “acceptance” needed. It is happening. AIPA does not have the option to not “accept”.

[dragon man]

What’s with this idea here and on Qrewroom of “accepting” the Jetconnect and network decisions? There is no “acceptance” needed. It is happening. AIPA does not have the option to not “accept”.

You are correct however the pilots have the right to work to rule. The airline runs on our goodwill nothing else at the moment.

[V-Jet]

Anyone who comments on the rolling catastrophe that once was a world beating airline and advertises their location as 'The Campus' either knows nothing about aircraft and airlines and is therefore incompetent at same, or has a sense of humour that would rival the irony in labeling Titanic as 'unsinkable'. I suspect the former - especially with a 'Justin Beaver' handle.

IF you do wish to understand airlines and understand just how silly your next love in with your HR 'co-workers' is, you should read (and more importantly understand) some of the highly insightful commentary by Rated De; Angry Rat; What The; neville nobody; Extra Shot; Blown Gasket and countless others here. Kool Aid is a wonderful product, but if you mainline it long enough it will seriously affect your health! What is so upsetting to people here is that lunacy created through overdosing Kool Aid is ruining a once iconic business and the livelihood of tens of thousands of innocent staff. Although Weeman is reducing that figure as fast as he can, it's still grossly unfair.

Surrounding yourself with yes-men when you are demonstrably incompetent has worked SO well for everyone from Nero, Hitler, Mugabe and even Kevin Rudd! So much undeserved adoration in one (campus) place simply beggars belief.

As an aside, has anyone noticed the pillorying 'Mr Real Estate' has got in the press lately? Wee man has a major gambling problem, a major (how can I say this best) 'accounting reporting addiction' and hasn't even made his own money. Why is he missing out on the publicity he so richly deserves??

[SRFred]

Because the media is too busy having fun with Barnaby!

[V-Jet]

The financial media, not the likes of News of the World:)

[ExtraShot]

That there is the same spin that has been going on for some 20 years. Just change the names and aircraft types around Jetstar/National Jet/Jet Connect/Network etc

I remember a few years ago it was all doom & gloom sub $1 shares and look what happened. And the time before, and the time before that.

What you have to remember with any large corporations is that it is just a game moving assests/cash around to create whatever narrative you wish to dictate.


A fairly direct ‘threat’ (if you will) was made the other day to Short Haul Pilots (who don’t fly the 787), that either the current issues are resolved, or a Request to the board to order more new 787s in the coming months cannot/will not be made.

Letting options lapse is now being pinned on this Network/Jetconnect issue, and Short Haul Pilots.

I’m trying to point out that ordering more of these modern, fuel efficient aircraft is now imperative, no matter what is going on between Pilots and management, otherwise it won’t be long until we see those $1 shares again. It is a stupid threat to make, because it is not something they can be held to if they want future success for the airline.

[Rated De]

I’m trying to point out that ordering more of these modern, fuel efficient aircraft is now imperative, no matter what is going on between Pilots and management, otherwise it won’t be long until we see those $1 shares again. It is a stupid threat to make, because it is not something they can be held to if they want future success for the airline. Precisely.
To them as hammers every problem is a nail!
They will not change the HR/IR adversarial model unless it is forced onto them. The demographic shortage will over time weaken this model of employee relations.

In the interim:



Qantas signed up to reduce CO2 1.5% year on year to 2020, then carbon neutral
The fuel included CASK is an order of magnitude outside their peers.
Others (media and analysts) as well as pilots have noticed.
http://www.iata.org/publications/economics/fuel-monitor/PublishingImages/ChartB.png



They run a real risk that the narrative of 'transformation' could unwind. Their capital expenditure is lagging cyclically. This is precarious which is the point of the SMH article. Not replacing capital equipment juices the numbers, but you still have to do it. It would have been a far more efficient use of shareholder capital to re-fleet rather than buy back shares.


For pilots it must be distressing to watch these self anointed smartest men in the room, do more damage after the lock out and grounding in 2011.




If it is goodwill that holds it all together, simply withdrawing that by not complying, ignoring phone calls and the 'can you help us out' cries will be sufficient.



To hurt these fools, hurt them with the things they count. Goodwill to them is a given, so they don't bother counting it.Boy do they notice when it isn't there!..Just say NO is rather elementary. No I will not extend, NO i will not sign on early. Rather simple.


If what was written is correct, the $8 million dollar man Andrew David ought be able for that amount of money to work it all out!

[CurtainTwitcher]

Point of order.

The Qantas 2017 Annual report (http://investor.qantas.com/FormBuilder/_Resource/_module/doLLG5ufYkCyEPjF1tpgyw/file/annual-reports/2017AnnualReport.pdf) page 38, shows Andrew David's total 2017 package, including share price growth at $3.890 million. Gareth Evans package was $8.182 million.

Carry on...

[Justin. Beaver]

For all the hot air and braggadocio written here, none of you properly understand who you are dealing with and how they think. They aren’t afraid of work to rule or loss of good will. The union doesn’t seem to have any plan beyond holding a meeting. What happens after the meeting? I’m going to put my money on: not much. Why? Because there aren’t any realistic options available, even within the EBA process. FWA isn’t going to go scope clauses or the like and Qantas isn’t going to give you any. Why? Because then everyone else will want one.

But good luck to you.

[V-Jet]

If you are under hardship, it is possible to access your Super. Don’t forget, he has to pay tax on that as well. Has anyone asked if he is OK?

[NGsim]

We all know that they will use jetconnect as a threat come your negotiation. However all need to remember that jetconnect as an 'airline' themselves that can't provide a contract in this present market let alone crew what they need to do.

[What The]

Yep, my bad. Out by 5m.
I hope he is ok.
Why was Andrew (participant in 3 failed airlines) worth so much less than Gareth?

[Transition Layer]

AD and the CFO are both attending the SGM. Time to call them out on their idle threats of cancelling aircraft orders...the ball is in their court, not ours.

[V-Jet]

Justin, The problem is (the way I see it) that this is an extraordinarily inept management ‘team’. Either long term employees succeed in bringing about change or Qantas won’t exist. I’d rather go and count barnacles on a fishing trawler in the Territory than provide any support for the greatest bunch of self enriching incompetents I could possibly have imagined. I am
fortunate to have seen and lived through Qantas when you automatically went an extra 10 miles every day. This lot were in the box seat of airlines to do something special. They couldn’t have done a worse job at running an airline, conversely they couldn’t have done a better job at enriching themselves at the long term expense of the Australian economy. They also forget this is a business dealing with thousands of lives. For the first time a few weeks ago I heard the words used ‘if this keeps going’ and ‘disaster’ in the same sentence by someone highly qualified. It’s been unsaid in many thoughts, but this was the first time I’ve ‘heard’ it. Once again, this isn’t about money it’s about everything that has (and is) being right royally stuffed up by people paid millions (even after tax) to do the opposite.

[Justin. Beaver]

Justin, The problem is (the way I see it) that this is an extraordinarily inept management ‘team’. Either long term employees succeed in bringing about change or Qantas won’t exist. I’d rather go and count barnacles on a fishing trawler in the Territory than provide any support for the greatest bunch of self enriching incompetents I could possibly have imagined. I am
fortunate to have seen and lived through Qantas when you automatically went an extra 10 miles every day. This lot were in the box seat of airlines to do something special. They couldn’t have done a worse job at running an airline, conversely they couldn’t have done a better job at enriching themselves at the long term expense of the Australian economy. They also forget this is a business dealing with thousands of lives. For the first time a few weeks ago I heard the words used ‘if this keeps going’ and ‘disaster’ in the same sentence by someone highly qualified. It’s been unsaid in many thoughts, but this was the first time I’ve ‘heard’ it. Once again, this isn’t about money it’s about everything that has (and is) being right royally stuffed up by people paid millions (even after tax) to do the opposite.

You can think they’re inept all you like but the shareholders don’t and neither does the market and that’s all that matters.

[Rated De]

AD and the CFO are both attending the SGM. Time to call them out on their idle threats of cancelling aircraft orders...the ball is in their court, not ours.

I tend to agree with Justin, if the union 'invite' these cretins to the Special General Meeting of pilots then the union has no plan of attack. The 457 visa announcement was nearly two months ago.
Relying on a union that was grounded and locked out for wearing ties and making in -flight announcements to take a confrontational approach is self deluded.

The only approach that ever yields results is to withdraw the goodwill. It isn't done openly or verbally. Just quietly.

[dragon man]

justin, the problem is (the way i see it) that this is an extraordinarily inept management ‘team’. Either long term employees succeed in bringing about change or qantas won’t exist. I’d rather go and count barnacles on a fishing trawler in the territory than provide any support for the greatest bunch of self enriching incompetents i could possibly have imagined. I am
fortunate to have seen and lived through qantas when you automatically went an extra 10 miles every day. This lot were in the box seat of airlines to do something special. They couldn’t have done a worse job at running an airline, conversely they couldn’t have done a better job at enriching themselves at the long term expense of the australian economy. They also forget this is a business dealing with thousands of lives. For the first time a few weeks ago i heard the words used ‘if this keeps going’ and ‘disaster’ in the same sentence by someone highly qualified. It’s been unsaid in many thoughts, but this was the first time i’ve ‘heard’ it. Once again, this isn’t about money it’s about everything that has (and is) being right royally stuffed up by people paid millions (even after tax) to do the opposite.

👍👍👍👏👏👏👏👍👍👍

[V-Jet]

You can think they’re inept all you like but the shareholders don’t and neither does the market and that’s all that matters.

Airlines are specialised. Analysts most certainly are not! Analysts were pretty keen on Enron, Lehmans, World Com, Lyondell and closer to home Bond Corp, Qintex etc etc etc as well - right up until the time they weren't.

I met a banker a couple of years ago who was very boastful about his relationship with 'Alan'. Having no idea who I was or what I (really) did I let him feed me the lines from the Great Man. I inherently do not trust bankers to understand much at all really, but all I could think of afterwards was that the lenders had ZERO idea about what Qf was doing and wasting money on. The penny will drop - make no mistake, it always does. The only reason it's lasted as long as it has is that Qf is a near monopoly. It's pretty hard to stuff up a near monopoly, but they sure are giving it a red hot go! I mean come on, $1.7b of borrowed cash, essentially to guarantee their own bonuses? That's straight out of the Enron copybook!

The first 35 seconds is enough:
https://www.youtube.com/watch?v=leAHmpKRVMo

They're analysts, they don't know preferred stock from livestock!

[*Lancer*]

Angryrat, Dragonman,

Is it just goodwill? Changing Haneda to Joburg is $4049 as a straight swap. I’m sure you can do the numbers at Divisor +5, or Drop Paid with Fixed Protection, for the same days away. Being ‘assigned’ the Haneda would be at the higher end of that range.

Overall it comes down to the balance between goodwill/money and workrate/disruption/engagement, how that plays out in a market with an increasing shortage of pilots and to what extent Qantas mainline remains insulated.

[Justin. Beaver]

Airlines are specialised. Analysts most certainly are not! Analysts were pretty keen on Enron, Lehmans, World Com, Lyondell and closer to home Bond Corp, Qintex etc etc etc as well - right up until the time they weren't.

I met a banker a couple of years ago who was very boastful about his relationship with 'Alan'. Having no idea who I was or what I (really) did I let him feed me the lines from the Great Man. I inherently do not trust bankers to understand much at all really, but all I could think of afterwards was that the lenders had ZERO idea about what Qf was doing and wasting money on. The penny will drop - make no mistake, it always does. The only reason it's lasted as long as it has is that Qf is a near monopoly. It's pretty hard to stuff up a near monopoly, but they sure are giving it a red hot go! I mean come on, $1.7b of borrowed cash, essentially to guarantee their own bonuses? That's straight out of the Enron copybook]

Get back to me if and when Qantas ends up like those companies. Until then it’s a false association driven by your industrial grievances.

When the SP is high and the market is happy, the pprune experts say it’s all because of fuel prices and dumb luck. If the SP was low, that would all be Alan’s fault and he should be sacked. In other words, he can’t win unless he gives you what you want industrially. It’s not going to happen.

[V-Jet]

Industrially, I want an airline that works and will be around in 50 years time. Everything else is window dressing.

Explain to me why you borrow $1.7b to secure bonuses? Qantas needs aircraft urgently, 10 years ago. Why is it wasting capital on largess instead of capex?

Getting back to you once Qf is financially wrecked is just a tadge too late don't you think?

[Justin. Beaver]

Industrially, I want an airline that works and will be around in 50 years time. Everything else is window dressing.

Explain to me why you borrow $1.7b to secure bonuses? Qantas needs aircraft urgently, 10 years ago. Why is it wasting capital on largess instead of capex?

Getting back to you once Qf is financially wrecked is just a tadge too late don't you think?

Obviously you’d support a decision to improve 737 utilisation to allow Mel-Bali and Osaka flying and decisions to have more appropriate aircraft on WA might routes then? Those are the kind of decisions that will help ensure the airline is around in 50 years time.

[Rated De]

When the SP is high and the market is happy, the PPRuNe experts say it’s all because of fuel prices and dumb luck. If the SP was low, that would all be Alan’s fault and he should be sacked. In other words, he can’t win unless he gives you what you want industrially. It’s not going to happen. Nice strawman, it isn't industrial it is reality; Qantas need a new fleet.

This 'management' had the opportunity of a lifetime with historical low rates of interest and build in yields. Fuel price being as low as it was, meant they could either invest or ignore; they chose the latter. Instead what they did was spend $1.75 billion of shareholder funds driving the share price higher and rewarding themselves handsomely. As I gestured to Mr Clifford, I am sure he has access to Forbes magazine, so by all means Justin have a read.

https://www.forbes.com/sites/greatspeculations/2016/02/24/how-stock-buybacks-destroy-shareholder-value/#5414e3147841


Given Mr Joyce's very humble upbringing in Ireland, it is likely that the man has known some real hardship. Those of us who have also experienced it can attest that support and community are vital. I remain disappointed how quickly he forgot the community, the family that a modern labour intensive airline actually is.

The share price is but a reflection of perceptions. That perception is now just beginning to challenge the carefully cultivated and repeated narrative.

Industrially he may attempt to gamble again that the events of 2011 are behind him and the public still believing that Qantas was 'terminal' and 'transformed'. He may blame pilots, he may blame staff and 'overpaid' pilots, that may or may not work, but ultimately they need a new fleet.

It is obvious to those in the company, it is obvious to the traveling public, their competition and even the MBA types running projections through black box computing program and 'selling' opinion as an analyst.

What disguised the structural problem that has been neglected by the 'management' was cheap fuel.

Pilots simply withdrawing co-operation will provide pressure, the company will attempt to identify transgressors and set up adversarial industrial HR against them, however CAR224 provides the ultimate protection. Well used it is difficult to identify, almost impossible to police yet very powerful.

[V-Jet]

Obviously you’d support a decision to improve 737 utilisation to allow Mel-Bali and Osaka flying and decisions to have more appropriate aircraft on WA might routes then? Those are the kind of decisions that will help ensure the airline is around in 50 years time.

Qantas is the issue, and as anyone with half an idea would understand, outsourcing is brilliant today and a disaster tomorrow. Outsourcing is the VERY last thing any company needs, Qantas especially.

Please answer the one question I asked. Why was $1.7B thrown away on self enrichment when it was desperately needed for fleet replacement?

[Justin. Beaver]

Qantas is the issue, and as anyone with half an idea would understand, outsourcing is brilliant today and a disaster tomorrow. Outsourcing is the VERY last thing any company needs, Qantas especially.

Please answer the one question I asked. Why was $1.7B thrown away on self enrichment when it was desperately needed for fleet replacement?

What are you talking about self enrichment? The buy back of about 317m shares starting in 2016 was done at average prices well below today’s price. Most shareholders would I think regard that as good capital management. Fleet decisions would be in accordance with the annual capital expenditure guidance they’ve given the market. Off the top of my head this is about $1-2b per annum. Enough to buy more 787s if the numbers for more than 8 stack up I would have thought.

[V-Jet]

What are you talking about self enrichment? The buy back of about 317m shares starting in 2016 was done at average prices well below today’s price. Most shareholders would I think regard that as good capital management. Fleet decisions would be in accordance with the annual capital expenditure guidance they’ve given the market. Off the top of my head this is about $1-2b per annum. Enough to buy more 787s if the numbers for more than 8 stack up I would have thought.

Done a bit of study have we? Asked someone further up the chain? Unfortunately the get out clause you quoted of ‘most shareholders’ is the one flaw in your argument.

For the longevity of the company (which you yourself seemingly espouse). What utter crap! Give your brain a chance!!

You use the pittance of return a (relatively mild) change of contract a single group of employees ‘might’ allow - but in the same breath you also seemingly ignore that fact that self enrichment share purchases with BORROWED FUNDS!!!! are entirely legitimate. What complete nonsense! Qf has a fleet burning upwards of 10-13 tonnes an hour of fossil fuels when every one of our competitors carries around 20-30% pax less per flight (assuming FULL), but burns c4.5 tonnes. And it's been like this since 1995!! This is insane!!!! I could explain this to a child of 3, but Qf management - clearly beyond them.

Since when have BORROWED funds at the expense of a company’s long term viability ever worked out in favour of anyone but the recipients of said largesse? One example please?

Without you fully understanding the implications of what you write - you have proved you have absolutely no idea about what makes a company either successful, viable or even profitable. In other words you represent the ‘perfect’ and ‘balance sampled employee’ at your advertised workplace. Well done your employers - they chose a perfect drone. If you work hard (and say ‘yes’ more often - Peter Warren?? - don't know why I remember that, but it should the Qf exec Mantra!!) you may too have a chance at the executive bathroom key. And that’s assuming (I suspect VERY erroneously) that the ‘yes men’ you said ‘yes’ to, will actually leave enough in the trough (once they’ve emptied it) for you to enjoy. Real individual success in life? Cant see that happening for you my friend, because that takes individual thought and genuine understanding. So far, you’ve demonstrated none of that. Play the Group Think concept hard - it’s your only chance.

Here’s a simple thing about business. Business is about charging prices that people feel are justified for the service they receive. Qantas has had a second to none brand name - and again as you say - Still!! (despite the monumental screwups of the last 20 years) so why the fxcx aren’t you giving it the tools to do the job it can? The only dollars ‘you’ have spent are on share buybacks and buying trinkets for low cost carriers which have either failed to take off at all, net dollar one, or even better, been nationalised by communist governments and left your employees in danger of life imprisonment. You just could NOT make this stuff up (stuffup - pun:)!!

So we get back to the original question. Qantas spent $1.75B (they are the really big numbers JB - if you don’t understand, just ask Siri) on share buybacks when Qantas desperately needs aircraft. Why?

If you can’t answer answer that very simple question (clearly it's very tricky for a Pikey management team) then can you possibly try to provide in ONE simple sentence what is the Qf Mission Statement?? It might be helpful for employees to know what it is that they are working for - you know, instead of providing bonuses....

PS: What purchases for the benefit of Qantas in the future has Weeman actually made? You work for an airline (forgive me for explaining this to you - from your comments I have to assume you don’t understand) but airlines use aeroplanes to take people from where they are to where they want to go. Just like Uber (see I can speak millennial too!) or a traditional taxi service, you actually need aeroplanes to do this. Are you with me so far? I don’t want to leave you behind - maybe ask someone if you are lost? Getting back to the original point - you need equipment to do this. Where are the examples of Weemans purchases - as in, investment for the future of the airline?

PPS: We haven't even got to a myriad of other, real issues yet - I'm looking forward to discussing those...

[Derfred]

I tend to agree with Justin, if the union 'invite' these cretins to the Special General Meeting of pilots then the union has no plan of attack. The 457 visa announcement was nearly two months ago.
Relying on a union that was grounded and locked out for wearing ties and making in -flight announcements to take a confrontational approach is self deluded.

The only approach that ever yields results is to withdraw the goodwill. It isn't done openly or verbally. Just quietly.

Ok, so according to Rated, attempting to organise pilots is a waste of time. The only successful strategy is chinese whispers to not answer the phone. Yep, management are going to be shaking in their jocks, Rated. You da man.

[blow.n.gasket]

Off the top of my head after a few vinos,
AIPA Angels.
Media saturation offering an alternative to whatever Qantas Media and the Qantas Angels try to pass off as fact.
Scrutiny of all Qantas financials .
Offer an alternative interpretation to the Qantas KoolAid narrative .
A staff accessible website to report all forms of wasteage and cross subsidisation of subsidiaries and managerial ineptitude.
An IR expert to advise on what is/isn’t possible/Legal.
A financial expert to comment on the next annual reports with regards to FIRS compliance.
Take the fight to the smartest guys in the room.
They have been given Carte Blanc by mainstream media thus far.
There’s more than one way to piss off a Pikey !

[Arthur D]

It seems QF may have discovered how much ROIC is TOO much......

By my recollection, over the last 20 odd years, the only time new fleet have been ordered (as against paid for and delivered) is when a change of leadership is immanent.

[Justin. Beaver]

Ok, so according to Rated, attempting to organise pilots is a waste of time. The only successful strategy is chinese whispers to not answer the phone. Yep, management are going to be shaking in their jocks, Rated. You da man.

What needs to be understood is that they won’t be shaking in their boots at any industrial action and they won’t give in to any because they can’t afford to. This is the single most important thing you need to understand and I don’t know why so many have such difficult seeing it for its simplicity and obviousness.

You would be better advised capitalising on rhe current good state of Qantas in your EBA to make some contract gains, rather than some half baker industrial anger over something you can’t control and which are long term beneficial to the company. I don’t have high hopes though.

[V-Jet]

they won’t give in to any because they can’t afford to.

If I search hard enough I can find some common ground with Qf management! With borrowings around 70% equity (without the Jetstar aircraft back on the books) and no desperately needed aircraft, there is only just enough money left to pay bonuses. There will either be a mountainous (insurmountable?) pile of debt to sort out 20 years of mess, or the airline will cease to exist.

You would be better advised capitalising on rhe current good state of Qantas

The current good state of Qantas sure can't last! I'm staggered it's withstood being raped for so long! Lucky it's a near monopoly...

[Rated De]

A show of 'force' at a union meeting is not taking action. It may be a waste of time, given that there is little room for any prescribed action.

The company are dictating dance steps, the union was caught completely off guard during Christmas and New Year when the 457 Visa issue appeared in the media 28 December 2017.

Have a good read of the Fair Work Act it is very quickly evident that other than filing the matter with FWA, there is little 'organising' a group of pilots will achieve. You could ask if they have or are filing a motion with FWA.

Otherwise, enjoy the day, catch up with your friends, have your beers and tell a few stories. It may be a good day out.

You would be better advised capitalising on rhe current good state of Qantas in your EBA to make some contract gains, rather than some half baker industrial anger over something you can’t control and which are long term beneficial to the company.

Au contraire Justin, this 457, Jetconnect and Network is designed precisely to ensure that the pilots do not notice the leverage a global shortage generates and as ever attempt to control labour unit cost.

[Derfred]

Rated, sorry for my tone, but my response was aimed at your defeatist attitude that an SGM is a waste of time.

Effective industrial battles in today’s environment are won by baby steps. Never take too big a bite, but keep biting. This has been QF’s strategy for years now, and it’s been working reasonably well.

The same strategy can be exercised by the workforce, but it takes well-thought strategy, long term planning and as close as possible to 100% support of the workforce.

An SGM is not a waste of time, it is simply one of those baby steps, or little bites, as part of a longer strategy. It is also very useful in conveying accurate information rather than relying on the rumour mill (or prune), and also evaluating the support of the membership for whatever strategic plans that might be available.

I can guarantee you that whilst QF won’t be too concerned that AIPA is holding an SGM and that X number of pilots turn up to drink beer, it doesn’t go unnoticed either. Sometimes it even makes the news, although I seriously doubt this one will. I can also guarantee that QF will have spies turn up and will be very interested in what is said at this meeting.

I, for one, will most certainly be attending, and I am very interested in not only what the elected representatives and IR advisers/lawyers have to say on the subject, but also what the general feeling of my peers is - it’s a biggish airline, and I only fly and socialise with a small subset. AIPA needs to know too - there is no point our Association heading down a path, no matter how well thought out, if it doesn’t have good support of the workforce. They made that mistake once in a certain failed EBA. Oh, and I might have a beer too.

The baby step campaign prior to the lockout some years ago was a good example of an effective industrial campaign. What let it down was that other unions got on the bandwagon and couldn’t help themselves - they started taking bites that were too big. While pilots were wearing red ties, other unions were publicly promising to kill the airline. Once that started affecting bookings, their (and consequently our) fate was sealed. A fatal mistake.

Pilots have been marginalised many times in the recent past due to lack of organisation. Please don’t make out that any attempts to improve that situation are a waste of time - not something we need to hear from a colleague.

Do you think QF would be making the sudden threats that have just surfaced (via emails from execs, dial-ins, roadshows) if they weren’t in some way concerned about the potential pilot reaction?

Regards, Fred

[Rated De]

The IEA (International Energy Agency) agrees.



The world consumes 30 billion barrels of WTI crude a year.
The world discovered 550 million barrels per month.
The draw down on reserves was accelerated.
The 'replenishment rate reserves for Oil and Gas was 11%
Oil demand rises 1.3 million barrels per day.





This information is publicly available and accessible.


The smartest guys in the room would know this if half competent.





Qantas need a new fleet.

[dragon man]

The last line to me is the most important in the above post “ Qantas needs a new fleet”. Not Qantas domestic not Qantas international but the whole of Qantas needs a new fleet down to the 737s domestically plus a new wide body for domestic. They rave on about new services to Bali, FFS a 737 from Melb , Syd, what a joke. The airline is so short of airframes its a joke, that’s without getting into fuel efficiency. Personally I think oil will go higher further hurting the airline further. It’s like a rolling snowball , it gets (the problem) larger and larger as they delay the inevitable decisions that need to be made. All this is without the prospect of 3 747s going early next year, however I think the Einstein’s have that covered with increasing utilisation on the remaining 7 been increased to 19 hours a day, and if that’s the case they are smoking some strong s##t. 😂😂😂

[Rated De]

if that’s the case they are smoking some strong s##t. 😂😂😂


'When you decline to implement rigorous discipline in your strategic and capital management, eventually the market notices and implements it for you!' - Anon


Perhaps the market is beginning to notice.

[Foxxster]

And the share buybacks continue

..Qantas also announced $500 million in shareholder returns, through an on-market share buy-back round of up to $378 million and a 7¢ a share interim dividend.

“After several years of consistent performance, we now have a lot of momentum behind us," chief executive Alan Joyce said.

"Today’s result comes from investing in areas that provide margin growth and a network strategythat makes sure we have the right aircraft on the right route."

[Rated De]

So Leigh around $1.75 billion on share buy backs already...

For shareholders, we continue our focus on building long term value. The board has announced a further $500 million of capital will be returned – comprising a 7 cent per share dividend, unfranked, and another buyback worth up to $378 million.
This additional buy-back is expected to bring the total reduction of shares on issue to 24 per cent since 2015. That’s almost a quarter of our capital base.


So about AUD $ 2.6 billion on pumping a share price...

It sure ain't the Qantas Sale Act stopping you buying a fleet!
Have a look in the mirror Leigh, it is that guy looking back at you that is the problem!

[fdr]

The IEA (International Energy Agency) agrees - Rated de

true enough.

Hubbert's curve is valid, however the wildcard has been the oil industries investment in EOE as the long term pricing of oil was climbing. That resulted in a deferral of the pain of the Hubbert curve. Liquid hydrocarbons remain the foundation of the civilisation we have on this here 3rd rock. There is a finite amount of the stuff gifted to us from the fauna/flora of ages past, and currently, we are not achieving effective direct conversion of any energy source into a storage medium as useful as liquid HC's. Capturing sufficient energy to provide an effectively renewable fuel supply is nowhere near in our future. The best options that exist, those that give us 20,000 years to sort out our problems are mired not in technical issues, but in political ones from lack of comprehension within the political masters as what is and what is not a safe system. The moving of the goal posts ever advancing in time in our current experience, which builds an expectation that the irrational use of energy on the planet can continue indefinitely has the potential to bite in the end. Historically, the problem with any system is it's limited ability to cope with change, specifically the rate of change. Given enough time, we can change what we do, but only if time is adequate to address the problem and implement the remedial actions. Every day we find new reasons not to implement change, and in fact we entrench the belief that there is no problem; the same as a frog luxuriating in a simmering sauce pan. We are in the halcyon days of low cost fuel at this time, where it is not a driving factor, even when it is between 24% and 50% of the total costs of the industry dependent on operational structure.

Hubbert did not incorporate the flexibility of the system in respect to exploration, EOE development, and elasticity of demand from economic slowdown/recession etc, which has been our saving grace to date, he looks like a pessimist until we exceed the ability of the system to accomodate the supply side constraints. The global economy is build around a house of cards; exchange rates float determined by a change of a fraction of the total currency in circulation, much as house prices, business valuations etc, they are all built on confidence in the system, and we accept that an appraisal based on a fraction of a percent of total value has meaning, and it does, until it doesn't.

Malthus wrote in various essays and manuscripts from 1798 onwards hinting on the inability of society to manage growth in a responsible manner, where there is an abundance of food, the population will grow to consume that. Today, our markets revel in growth, and despair of recessions, however if we were considering, say, cancer, that would not be the case. In the 50's a herd of wild animals in a remote island off the west coast of Scotland were left to their own devices, and in the absence of any immediate constraints, grew exponentially to a point where there population collapsed, and were nearly completely extinguished. Sustainability is not derided if a catastrophic collapse has occurred and has been recognised, and survived.

Does QF need new planes? why not. That will cure everything.

In the short term, the Delta fleet planning tactic which Qantas is similar to is valid, so long as fuel costs don't spike. The A380 is not such a bad aircraft for the ultra long haul, if that is what yo have to do, and as I have said before, the recent metric of efficiency used to consider relative efficiency is poor in method and application, Breguet range equation gives a rational basis for analysis of efficiency, pretty sure that is what Boeing intimates in their Jet Transport Performance Methods manual (Blake, 2009).

Its a nice day outside, time for some red wine.

[Rated De]

With a closer look at the figures there is an $82 million black hole. Looks like it’s in the Jetstar International business.

It is precisely despite JQ possessing more aircraft than the parent that the JQ segment is not broken down into domestic and international , yet Qantas is.

AASB 8 gives 'management discretion' to report segments with some parameters. Ever wonder why they 'choose' not to break out JQ into segments?

Astute readers will remember Qantas management chose to break out Qantas Domestic and International into two distinct operating segments back when Qantas international was 'apparently terminal'

Qantas need a new fleet

[73to91]

Astute readers will remember

It's the financial journalist that remember what they were just told or just read in their press releases, that are one of your major issues.

Take the Ch 9 news last night, Ross Greenwood when reporting on the QANTAS profit and mentioned the 'pilot strike'. (note, I didn't take a great deal of notice, it was just background noise but he mentioned the airline shut down in same sentence)

Many listeners would automatically hear that and think there was a strike and perhaps have negative thoughts about the pilots.

It doesn't help when and AJ can pick up the phone anytime and speak with these journalists who will tell AJ's story to a large audience.

[LeadSled]

And don't people remember "pilot strikes"!!
A near neighbor ( who frequently tells me how overpaid pilots are --- based on media figures that quote the package for the QF DFO as if everybody is paid that) was recently reminding me of being on strike in that little matter in '89.
That QF was never involved in '89 is something he doesn't want to hear, "all pilots were on strike in '89" is his bottom line, that I actually worked for QF as a pilot in '89 cuts no ice.
Don't disturb him with facts, his prejudices are settled. And many people share his take on the world.
The public misconceptions about "pilots", carefully fostered by QF PR, is remarkably effective and well entrenched.
"Pilot bashing" and "doctor bashing" is always good politics over incomes, and just look at the effectiveness of the Shorten campaigns right now --- stick it to the "rich bastards". Tax the hell out of "rich bastards" and something called "business", enterprise and profit are dirty words.
Please don't be pedantic about the choice of words, just accept the message: "50% of the population is of below average intelligence".
Tootle pip!!

[Tankengine]

Please don't be pedantic about the choice of words, just accept the message: "50% of the population is of below average intelligence".
Tootle pip!!
I didn’t realise you were an optimist! ;)

[gordonfvckingramsay]

I was at a party one evening being berated by some semi drunk bloke about my “ridiculous salary” and the fact that just I sit there and “watch the autopilot do my job”. My reply to this bloke (who worked behind a desk and also made a lot of money) was, “I can do my job without my computers. Can you?” He left shortly after that.

We “do nothing” until there is a problem, then it’s pilot error.

Apologies, I digress.

[Rated De]

Now it makes complete sense why Mr Joyce and Qantas, despite a big write off ensuring they actually pay no tax would 'champion' more corporate tax cuts!

https://www.marketwatch.com/story/now-we-know-where-the-tax-cut-is-going-share-buybacks-2018-02-22

Buyback announcements are up 22%, but capex plans are up just 3%


Self interest....again!

Must have another read of the remuneration reports to see when the next big pay day is for certain insiders..


Qantas need a new fleet.

[patty50]

The public misconceptions about "pilots", carefully fostered by QF PR, is remarkably effective and well entrenched.


Go peruse the “bogan bashing” in the thread on the Network A320s.

It’s truly remarkable why anyone could possibly consider pilots to be overpaid underworked complainers...

Pilots in the US seem to have a much better reputation than here but I’ve never seen them complaining about the red necks who pay their wages. It has to be a QF PR conspiracy. :D

[AerialPerspective]

But according to the experts on PPRUNE its OK for Virgin Australia to be 90% foreigned owned!!!
That's not the point, VA International is 51% Australian owned. The Ownership cap applies to the whole airline in the case of Qantas not just the international part. That's what they're complaining about. However, mutliple unrealised dubious ventures in Asia might have also allowed some capital for use on fleet renewal. I'm not convinced is as bigger problem as has been made out, just because one so-called 'analyst' has expressed an opinion. I would say the bulk of the 737-800 fleet is quite young, the 747s are old and are scheduled to be retired, probably with more 787-9s so that will lower the average fleet age.
No one ever complains about the fact that VA does virtually zero maintenance in Australia either yet QF gets a bashing everytime they buy a rivet from overseas.

[AerialPerspective]

Rated DE et al,
The ABC piece is a statement of the bleeding obvious.

With the QANTAS investment grade credit rating, it will have zero problem financing a modern fleet at extremely good rates.

So the question must be asked, is the present management actually managing the airline in the best interests of their shareholders, as required by the Corporations Act 2001.

The various references to the QANTAS Sales Act is a furphy, in my opinion.

Tootle pip!!
I really wish the Media would stop calling it the Qantas Sales Act - it's the Qantas SALE Act.
Shock and horror aside at media inaccuracy of course... ;-)

[73to91]

The current good state of Qantas sure can't last!
Bonuses all round? surely not.

https://www.businessinsider.com.au/qantas-catering-sold-emirates-dnata-2018-4

Qantas is selling its catering businesses to dnata, an aviation services company that is part of the Emirates Group, a code-sharing partner.


Under the deal, dnata will supply catering for Qantas flights for an initial period of 10 years, and Qantas will continue to work with key suppliers in menu design and development.


“Customers will continue to enjoy Qantas’ premium service, including unique Rockpool-designed menus for First and Business passengers, showcasing the best of Australian produce for millions of travellers each year,” says Qantas Domestic CEO Andrew David.


Dubai-headquartered dnata already operates 11 catering facilities in Australia, trading under the dnata catering brand, recently rebranded from Alpha Flight Services. dnata employs more than 4000 people in Australia across its catering, cargo and ground handling businesses.


The agreement is subject to approval from the Australian Competition and Consumer Commission (ACCC).


Qantas’ catering businesses include wholly-owned subsidiaries Q Catering Limited and Snap Fresh Pty Limited.


Q Catering has centres in Sydney, Melbourne, Brisbane and Perth, with its largest airline customer being Qantas.
Snap Fresh is a meal production plant in Queensland, specialising in Australian-made frozen meals for airlines and the healthcare and food retail industries.


Andrew David says the sale will enable Qantas to partner with a global leader in inflight catering and prioritise investing in the airline.


So it's not core business and they are going to use funds to invest in the airline, hopefully that's mainline.

[Rated De]

So it's not core business and they are going to use funds to invest in the airline, hopefully that's mainline.

No dear chap, declining yields and all, mean the free cash flow has declined a bit.

Maintaining momentum in our 'Executive bonus (LTIP) scheme is hard work.

Those bloody share buy backs are expensive work!

Qantas need a new fleet.

[Roj approved]

:confused:Another part of the airline that was world class, reduced to nothing and being sold of for short term cash injection.

Like the engine testing and overhaul, once a world leader training the likes of SIA, Cathay, ANA, JAL, Lufthansa, now they send the aeroplanes away and just get them to do the maintenance:confused::ugh:

[V-Jet]

:confused:Another part of the airline that was world class, reduced to nothing and being sold of for short term cash injection.

Like the engine testing and overhaul, once a world leader training the likes of SIA, Cathay, ANA, JAL, Lufthansa, now they send the aeroplanes away and just get them to do the maintenance:confused::ugh:

They are selling the family silver. I don’t think I could have chartered a better course for destruction than the one being taken! I read Andrew David’s triumphant announcement of that with utter disbelief. It’s like the Sudetenland volunteering to annex itself to Germany before WWII!

Anyone notice the laser like focus on APU fuel usage? Laughable they are concerned about fuel with the fleet they’ve got but I’ve been told now by two very different sources that it’s little to do with fuel, and a lot to do with the fact Qf don’t own the engines any more but have sold and lease them - on an hourly rate...

Cant change the A in laser for some reason!!

[Arthur D]

Anyone notice the laser like focus on APU fuel usage? Laughable they are concerned about fuel with the fleet they’ve got but I’ve been told now by two very different sources that it’s little to do with fuel, and a lot to do with the fact Qf don’t own the engines any more but have sold and lease them - on an hourly rate...

VJ - it’s called Power By the Hour and has been around for a very long time. Look it up, nothing nefarious, a great way to de-risk a high risk asset as well as pull some predictability into your spending.

Yes I know, I’m an angel cos I didn’t knock the company and bang on about blah, blah, blah. 🙄

[Ken Borough]

One needs to look at history regarding the sale of flight kitchens. Airlines were forced into establishing their own flight kitchens as in the day, no one offered the services they required. So to meet their demand, flight kitchens became part of airlines. The world has moved on and kitchens have long been considered to be not the core business of an airline. For the same reason, one could suggest that's why airlines don't own oil refineries.

[V-Jet]

Arthur - it’s the lies, not the decision per se that is the issue!

Ken - As long as there are meals and beverages consumed on aircraft, there is a business case to supply them. As with Engineering and everything else that was once absolutely worlds best standard, these entities have been decimated, Qantas has offloaded anything that is attractive to others, most likely for a relative pittance. If there is a single dollar to made in a year, Qantas should be making it and not immediately offloading it so a major competitor can then use that dollar against them.

For Qantas to be failing to buy aircraft (are aircraft considered ‘core’ to an airline??) AND offloading major assets like catering - to its’ primary competitor, no less - the situation must be extreme. Is it extreme because there is no money left for Joyce to maintain his exorbitant salary/boasting rights, or is the airline starting to grind to a halt through gross mismanagement (crewing/outsourcing etc)?

[JPJP]

For the same reason, one could suggest that's why airlines don't own oil refineries.

Deltas oil refinery ;)

https://www.fool.com/investing/2017/09/03/delta-air-lines-refinery-bet-is-about-to-pay-off-a.aspx

Along with the largest Maintenance facility in North America.

Aviation MRO Services, Aircraft Maintenance & Engine Overhaul | Delta TechOps (http://www.deltatechops.com/mro-capabilities/view/category/capabilities-overview)

Not being a smart arse. Just pointing out that some ‘non-core’ businesss can work.

[lc_461]

For a similar reason, QF used to do the lion's share of ground handling for international carriers coming to SYD/MEL/BNE etc... utilising assets that would generally otherwise be idle in between QF flights... Nevertheless a few years ago they decided this was non-core as well, forcing these carriers into the arms of the competition. A similar thing happened with Q Catering and a couple of big contracts not too long ago.

[Keg]

VJ - it’s called Power By the Hour and has been around for a very long time. Look it up, nothing nefarious, a great way to de-risk a high risk asset as well as pull some predictability into your spending.

Yeah. That ‘de-risk’ worked so well when one blew up on the wing of an A380 ex SIN. Not sure it worked real well for predictability of spending after that either.

[Oriana]

Sure Keg, but there's insurance for that.:rolleyes:

[Traffic_Is_Er_Was]

“Customers will continue to enjoy Qantas’ premium service, including unique Rockpool-designed menus for First and Business passengers, showcasing the best of Australian produce for millions of travellers each year,”
No they won't. They will 'enjoy' whatever Dnata can supply for the lowest possible price Qantas can negotiate, particularly down the back, where it is hardly a "premium service".

[Rated De]

but there's insurance for thatThe problem with outsourcing is that control of process is lost.
Whilst it is low fruit to the accountant to sell what was once owned, there are sound process control reasons for it. Qantas catering was low fruit, William Meaney was involved in the stripping of Swiss Air and its catering, selling Gate Gourmet to TPG (Texas Pacific Group) with whom he still has connections...Isn't he leaving the board now?


That ‘de-risk’ worked so well when one blew up on the wing of an A380 ex SIN. Not sure it worked real well for predictability of spending after that either. Keg is absolutely correct. No one remembers that it was a Rolls Royce Trent 900. The media splashed pictures of a Qantas logo, not RR. Lovely Olivia was busy defending Qantas, not Rolls Royce.

Mr Joyce made reference to the 'responsibility for the engines not being a core responsibility of Qantas'. Nice Alan, real modern corporate speak. Had it ended worse he would have increased the private security detail to keep him safe.

Qantas still need a new fleet

[Arthur D]

Keg, what would the difference have been if QF had owned the engines on the A380?

Was the PBH contract renegotiated after that event, not in QF’s favour?

As previously said, insurance covered the damage to the airframe, exactly what it’s for.

[Keg]

Keg, what would the difference have been if QF had owned the engines on the A380?

If we’d owned them an maintained them we would have been well aware that there were serious issues with a number of them across the fleet. This was an incident who’s direct cause was due to lack of Qantas oversight of the engines hanging on the wing.



As previously said, insurance covered the damage to the airframe, exactly what it’s for.

Lol. I suspect Oriana’s comment was more about sarcasm than anything else. Brand damage? Grounding of the entire A380 fleet for weeks? How about the risk of a hull loss? Sure, no worries. Insurance has it covered! :ugh:

[RealityCzech]

Qantas still need a new fleet

No it doesn't need one. It can also become more of a virtual airline instead of putting billions into new QI fleet. Basing your plan and thinking on the false premise that QI will inevitably be purchasing new aircraft is a mistake.

[Dee Vee]

Bonuses all round? surely not.
https://www.businessinsider.com.au/qantas-catering-sold-emirates-dnata-2018-4

Qantas is selling its catering businesses to dnata, an aviation services company that is part of the Emirates Group, a code-sharing partner.



Spot on, short term thinking, sell off the family farm, get a big bonus, retire with a Golden Handshake

Its the New Guy's problem to make money when you are paying a fortune for outsourced services that you used to own.
Of course the first thing the new guy does is write down the value of everything, declare a huge loss, and blame the outgoing guy.

The execs keeps getting the big bonuses, while the company is in a race to the bottom, and bankruptcy.

[ExtraShot]

No it doesn't need one. It can also become more of a virtual airline instead of putting billions into new QI fleet. Basing your plan and thinking on the false premise that QI will inevitably be purchasing new aircraft is a mistake.


We keep hearing about these ‘Virtual Airline’ business models, but I can’t really think of one off hand. Where you might say codeshare, etc; all airlines use codeshare and the like to give its customers a slightly improved route network, this is hardly said business model. Every airline still flies its own metal on the routes where it can get the loads it needs and make money... people want to get the product / brands they pay for, and if they don’t get it they’ll go elsewhere.

Qantas is going to be increasingly competing with airlines that have already had more modern and efficient fleets for a decade. Most are already taking a step-change again, leaving Qantas at risk of being an entire generation behind, AND playing catch-up.

Qantas employees are constantly told they are too expensive, or that their Western Terms and conditions are uncompetitive in an Asian region, yet when it comes to making serious strides where costs can REALLY be impacted in competing with SQ and Cathay and the like, the current management seem to drag their feet.

Unfortunately for the IR bullies, using aircraft orders will no longer be effective as a tool in an industrial battle. The staff (pilots/engineers/and others), are now increasingly aware that either Qantas gets serious about a fleet renewal program, or it gets annihilated by it’s competitors who have been serious about it for a decade or more already. It’s only a matter of time before the share market becomes aware of this as well.

Alan Joyce has been at the helm for almost TEN years, and I can't think of one new aircraft order made in that time... but the time has come. They need to outline a fleet renewal program for the next decade, and it needs happen relatively soon.

Rated De is correct.

[Australopithecus]

The aircraft that Qantas needs -big long range twins- both have delivery constraints that seem a bit unstable. There are big 777-9 and A350-1000 orders from the ME3 that could easily shrink or delay which could free up slots. If they don’t Qantas is really screwed.

There are circa 100 Airbus orders for the various JQ entities...if a conversion of some of those to 350s is even possible the first delivery would be 70 months away, assuming the Airbus order book stays stable. There are earlier 777 slots but then what happens with the 100 A320/1 order? Take them all?

In six years QF will lose all of the 747s, the early 330 deliveries will be time-ex or close to it and a lot of 737s will be worn out too.

Regarding virtual airlines: If Qantas had no planes what the hell would a customer even need them for? I might do that myself since I don't own any aeroplanes either. Hey everybody! Look at me...I'm an airline! Weeeeeee!

[RealityCzech]

We keep hearing about these ‘Virtual Airline’ business models, but I can’t really think of one off hand. Where you might say codeshare, etc; all airlines use codeshare and the like to give its customers a slightly improved route network, this is hardly said business model. Every airline still flies its own metal on the routes where it can get the loads it needs and make money... people want to get the product / brands they pay for, and if they don’t get it they’ll go elsewhere.

Qantas is going to be increasingly competing with airlines that have already had more modern and efficient fleets for a decade. Most are already taking a step-change again, leaving Qantas at risk of being an entire generation behind, AND playing catch-up.

Qantas employees are constantly told they are too expensive, or that their Western Terms and conditions are uncompetitive in an Asian region, yet when it comes to making serious strides where costs can REALLY be impacted in competing with SQ and Cathay and the like, the current management seem to drag their feet.

Unfortunately for the IR bullies, using aircraft orders will no longer be effective as a tool in an industrial battle. The staff (pilots/engineers/and others), are now increasingly aware that either Qantas gets serious about a fleet renewal program, or it gets annihilated by it’s competitors who have been serious about it for a decade or more already. It’s only a matter of time before the share market becomes aware of this as well.

Alan Joyce has been at the helm for almost TEN years, and I can't think of one new aircraft order made in that time... but the time has come. They need to outline a fleet renewal program for the next decade, and it needs happen relatively soon.

Rated De is correct.

No, he is not.

Qantas' labour cost base is higher than almost all of its competitors - especially those in Asia, Middle East, New Zealand and South America. If you want an example of a virtual airline, try looking next door at Virgin. If there were easy millions to be made operating a full service international airline out of Australia with modern aircraft, Virgin would be expanding rapidly internationally. Look at the fares being offered to Europe by the Chinese and Middle East carriers. QAN offering these fares would not only be economically loss-making, they wouldn't even be cash flow positive.

I understand there is a strong view among some senior QAN people that no more investment should be made into QI. The 777X or A350 project is a once in a generation opportunity for QI to have a future of growth, but the numbers have to add up. Don't assume that they will.

[Australopithecus]

No, he is not.

Qantas' labour cost base is higher than almost all of its competitors - especially those in Asia, Middle East, New Zealand and South America. ill.

You’re right...time for a sweeping cull of the campus. Time for executive remuneration to reflect the size of the airline. Time for honesty and not this puerile attempt to shape perceptions based on a lie.

[Australopithecus]

No, he is not.

. If you want an example of a virtual airline, try looking next door at Virgin. If there were easy millions to be made operating a full service international airline out of Australia with modern aircraft, Virgin would be expanding rapidly .

How do you know what Virgin's shareholders want? They mostly want out of Virgin, and Virgin's management are well known to be inept with every fleet choice they have made for 15 years. Don't hold them up as a paragon of virtue.

Just leafing through the Chinese A320 cotract rate for captains...its about twice what I make on a bigger jet for QF. The US carriers all pay more, and soon Rated De's predictions will bear out.

[RealityCzech]

Interesting response. At no point did I claim to know what VAH shareholders want nor hold VAH up as a paragon of anything. These straw man arguments are irrelevant.

That's a great n = 1 sample, but misleading. Look at the cost bases in their entirety as well as their ownership structures and the economics of the markets they operate in.

QAN is in a much stronger position financially than a few years ago, especially domestically. But the international scene just gets more and more competitive by the day and QI will only get investment if it can charge fares that allow the investment. Higher pilot costs make that less likely. A lot of pprune posters seem very excited about pilot shortages leading to huge wage rises for Australian pilots. I would bet that the numbers are also being run on doing less inhouse flying and more virtual flying instead of being forced to pay higher wages. That may end up being the path chosen.

It's just one big complex equation at the end of the day.

[Street garbage]

So RealityCzech, how does remuneration of QF executives compare with other airlines in our region? Compared with say Singair, Cathay, Air NZ? How many of the 5000 front line employee's jobs could be still be employed with Mr Joyce's $25mil and Mr David's $10.4mil?
At least you are going to solve the Pilot employment crisis, a virtual airline doesn't need any of those pesky precious pilots..

[RealityCzech]

The endless references to remuneration might make you feel better/worse,but they aren't going to influence outcomes relevant to your career. I'd politely suggest getting over it.

[Rated De]

Imagine realityczech is dealing in reality. Let us explore this administrative wet dream! People wander around the 'campus', Waterside and even CX city (only Monday to Friday) dreaming stuff like this up. Far easier than actually generating revenue like flying passengers, serving passengers and fixing the operating assets.


(Assuming people still want to be in a Frequent flyer program that has no international flying attached to it),


Frequent flyer without the flying bit, generates $1.4 billion.



If Code share revenue is reported in "other revenue' it totals $377 million

Code share revenue is really interesting. Airline executives fall back on 'commercial-in-confidence' however that revenue must be reported in the Income statement somewhere. As we reported in another thread Mr Joyce was extremely careful to never discuss the 'amazing revenue improvement' generated by the rivers of code share revenue flowing form the Emirates 'alliance'.
Simple arithmetic from the cancellation of the Frankfurt (Via Singapore) the Hong Kong and Bangkok to London services at best generates $377 million.

Adding it all up, Qantas group generates with QF international axed about $10 billion.



Given that scenario;


You’re right...time for a sweeping cull of the campus. Time for executive remuneration to reflect the size of the airline. Time for honesty and not this puerile attempt to shape perceptions based on a lie. A proportional cull of the non revenue generating designer coffee brigades would improve efficiency no-end.

Replacing a 'real airline' with a virtual one is something that exists in 'breakout rooms' industry wide. Perfect in theory, as the Professor eloquently draws his neatly constructed graph. MBA level managers the world over taught the theory. The problem they face is that it works far less eloquently in reality.

[ExtraShot]

. If you want an example of a virtual airline, try looking next door at Virgin

Virgin, Not really the shining example of financial success that would support your case.

If Qantas managements aim is to become little more than another ‘Flight Centre’, they should probably inform their shareholders of said aim.

If they wish to remain a competitive airline, a serious program of fleet renewal occurring throughout the next decade, and beyond, needs to become a reality. The lack of which should start to pique the shareholders interest.

[Street garbage]

The endless references to remuneration might make you feel better/worse,but they aren't going to influence outcomes relevant to your career. I'd politely suggest getting over it.
I would personally say I don't give a toss what "they" earn, by their basis of remuneration the rest of the company should be earning 10 times the world average, I just wish reasoned assessment would break out on the Campus, that you would stop blaming pilots for not renewing the fleet. People on the front line only see the slow motion train wreck that is occurring whilst Joyce fiddles.

[Street garbage]

RealityCzech, your post is just another veiled threat from QCC that we you are not renewing the fleet until ....

[Rated De]

Qantas' labour cost base is higher than almost all of its competitors - especially those in Asia, Middle East, New Zealand and South America.A convenient part truth. Which part of the labour unit cost do you refer?
The data sets we use would show you are extremely choosy.


If you want to argue semantics, Qantas has an average stage length that means the longer the flight the lower the CASK and the labour cost whilst incremental increasing, is of a lesser order than say RPK growth. . Qantas factor productivity in key work groups, which we assume is the implication from your statement, are mid range and when adjusted for stage length are better than average.

When we include fuel in the CASK and adjust the unit cost, and hold the stage length constant, Qantas is very inefficient. Want to guess why?
Very good, they burn more fuel per RPK because over a given stage their fleet burn 64% more fuel.

Qantas 'worst major airline' for fuel efficiency on trans-Pacific flights, study suggests - ABC News (Australian Broadcasting Corporation) (http://www.abc.net.au/news/2018-01-17/qantas-fuel-efficiency-worst-for-trans-pacific-flights-study/9333616)

Qantas need a new fleet

[itsnotthatbloodyhard]

The endless references to remuneration might make you feel better/worse,but they aren't going to influence outcomes relevant to your career. I'd politely suggest getting over it.

If you don’t like seeing endless references to executive remuneration, maybe you need to ease up on the endless references to labour cost base.

[JPJP]

I would bet that the numbers are also being run on doing less inhouse flying and more virtual flying instead of being forced to pay higher wages. That may end up being the path chosen.

http://www.reactiongifs.com/wp-content/uploads/2013/08/throne-of-lies.gif

[V-Jet]

RC: Oh dear oh dear oh dear.....

This is one of those very rare occasions I agree with you! More likely an unique occasion - so don't think for one second think this relationship will evolve any further.

I have been convinced that Dear Leader is totally incompetent for a very long time.

There are TWO (possibly 3) things I give him credit for. Firstly, he can use the billions Qantas has provided him to renovate a room into a nice bar. Now many people have managed to create nice bar/cafe's without billions of dollars, or guaranteed licensing etc etc, but I am a generous man at heart, so lets give him credit there. What he's done with that cafe/bar mix, is to turn that into a brand of soft corruption worthy of Chairman Xi Jinping dealing with Pacific Islands. And there is NO doubt, that has been hugely successful - he's read the market very well in that regard. It's inoculated himself against negative press, a negative political environment and also given him enormous clout amongst the small CEO club of Australia. The final plank in his repertoire is his ability to argue for his own benefit (ie:lie:)) - at the expense of everything Qantas stands for -to rape the place with a vigour that defies his stature. To the point I'm sure his sexual partners would attest to same.

Undoubtedly this guy in a business sense has passion fingers (f%cked anything he's touched) but politically he's good.

So - given his great triumph is the Chairmans Lounge, what's he done that anyone with his skillset would do? He's expanded the concept massively. He's worked out that being a contestant on 'The Block' with an unlimited budget and not actually having to even swing a hammer himself is far easier than actually running an airline. Tricky things airlines, even with a near monopoly and possessing all the trickyness of a cunning Leprechaun!

I don't think he has any interest in actually running the airline (as do you RC), he is about using the Lounges to grab customers through the qantas.com website. And it is sort of working.

There are a couple of problems with this. Other airlines have them too, and once they exist around Australia the differentiation between Lounges will diminish. So too with the Chairmans Lounge. At the moment it buys political and press compliance, but as Qantas flies to fewer and fewer places, this will diminish rapidly.

The other tiny problem is that as a virtual airline, it has been done before. And quite well too. We have Google, Tripadvisor, Expedia, Webjet, Flightcenter, Priceline, Hotwire, Travelocity, Orbitz - and that's just off the top of my head. The reach of Qantas.com is pretty much domestic only - and anything just domestic, will, over time, simply wither without a product behind it. The major issue with any website is driving traffic to it. While the Lounges in Australia are attractive that will be possible. But without a SIGNIFICANT benefit to people, that will fall off quickly.

Then we get to the Company 'Mission Statement'. Successful Companies have a single statement that clearly states what it is they do. As far as I can work out, for Qf, it's 'What's in it for me?' because Qf has demonstrated it really doesn't know what it is anymore. Webjet? National Flag Carrier? Round the world airline? Domestic airline? Jetstar? Red Q? Licencing operation? Vehicle for the CEO's political ambitions? Hard to say... I asked this question of an HR drone in a 'meeting' they generously organised for me a few years ago, and they couldn't answer the question either, in fact, it had them totally stumped. If the Thought Police cannot answer such a simple question, what hope do the rest have who don't mainline Company KoolAid hourly?

In short, unbelievably, I think you are right RC. QF doesn't _need_ to have aircraft, but if it doesn't it will sooner or later cease to exist. I think most people here believe that is a shame.

Never in the history of Australian business have so few enriched themselves so much, at the expense of so many:).

[Rated De]

A very accurate precis:

Then we get to the Company 'Mission Statement'. Successful Companies have a single statement that clearly states what it is they do. As far as I can work out, for Qf, it's 'What's in it for me?' because Qf has demonstrated it really doesn't know what it is anymore. Webjet? National Flag Carrier? Round the world airline? Domestic airline? Jetstar? Red Q? Licencing operation? Vehicle for the CEO's political ambitions? Hard to say... I asked this question of an HR drone in a 'meeting' they generously organised for me a few years ago, and they couldn't answer the question either, in fact, it had them totally stumped. If the Thought Police cannot answer such a simple question, what hope do the rest have who don't mainline Company KoolAid hourly?Qantas was gifted an enviable position at Privatisation. Dissected by cost accountants it has hacked itself to pieces. It is not surprising that HR drones don't know the mission because theirs is all about self preservation and mission creep.

Qantas is not enlightened leadership, sadly despite knowing the price of everything and neatly inserting them in a mathematical model, Mr Joyce neglected the one limitation that actually matters:

The real world dynamic of airlines is impossible to model without very expansive limitations (assumptions)

Ask any researcher or analyst about models, the limitations (assumptions) necessary to get models to work mean in fact oftentimes they are highly unstable.

From all accounts, Mr Joyce has an autocratic style, top down and whilst politically astute (Chariman's lounge, upgrades and soft corruption) does not take kindly to critique, we had experienced this with him numerous times.
Thus in trusting the model he ignores anything not contained within it. For airlines this is a really tricky proposition. In fact if one looks at airlines that do it really well, empowerment of people, like Captains exercising command judgement is something that is encouraged. At Qantas we would respectfully suggest it is punished, autonomy of people, profesisonals doing their job is actively discouraged. This doesn't bode well in highly fluid industries.


Jim Collins wrote a great book, From Good to Great one of the most eloquent empirical studies into corporate performance.

Are you a hedgehog or a fox? In his famous essay “The Hedgehog and the Fox,” Isaiah Berlin divided the world into hedgehogs and foxes, based upon an ancient Greek parable: “The fox knows many things, but the hedgehog knows one big thing.”
Those who built the good-to-great companies were, to one degree or another, hedgehogs. They used their hedgehog nature to drive toward what we came to call a Hedgehog Concept for their companies. Those who led the comparison companies tended to be foxes, never gaining the clarifying advantage of a Hedgehog Concept, being instead scattered, diffused, and inconsistent. (our emphasis)


An empirical comparison of Qantas to its peers would suggest that foxes outnumber hedgehogs in Coward street.

Qantas need a new fleet

[regitaekilthgiwt]

Well said angryrat and others.

[Rabbitwear]

Qantas want a new fleet , they just want to crew it at Network rates !

[Keg]

Qantas want a new fleet , they just want to crew it at Network rates !

And given that Network can’t attract and retain pilots at their current rates how do you reckon that’ll go? :ok:

Qantas know they’re screwed. Hence they’re running roadshows and talking pilot academies and so on to try and work out precisely how screwed they are in the medium to long term, and whether there is enough interest out there for them to un-screw the situation.

Yep, they know they’re screwed. They’re still working on the presumption though that their pilots don’t know it also.

[Jeps]

And given that Network can’t attract and retain pilots at their current rates how do you reckon that’ll go? :ok:

Qantas know they’re screwed. Hence they’re running roadshows and talking pilot academies and so on to try and work out precisely how screwed they are in the medium to long term, and whether there is enough interest out there for them to un-screw the situation.

Yep, they know they’re screwed. They’re still working on the presumption though that their pilots don’t know it also.

Could the fact that they are now out of denial be considered an evolution of their thinking? :O:O:O

[ruprecht]

Could the fact that they are now out of denial be considered an evolution of their thinking? :O:O:O

No, because now they’ll be looking to lay the blame elsewhere. :rolleyes:

[knobbycobby]

RC is one of Olivia’s angels. Or perhaps has less experience in aviation than even she does. Perhaps it’s another QF manager that hates his own kind.
All the poorly paid QF subsidiaries are struggling to attract suitable candidates.
Market forces go both ways. All the 457 visas under the sun won’t change that.
US Airline pay is up over 40% now. Given 2 CPT and 2 FOs in USA, Qantas crew in AUD terms are now cheaper. China pays over 400k net for a 737 CPT. EK is short of crews and cancelling flights as Tim Clark has mentioned publicly. Forbes and Bloomberg hate pilots as much as Reality Chezh and even they admit to the massive shortage.
CEO and Exec pay in Qantas is the highest in the globe by a long margin. Even the right wing media are disgusted by it. The public think it’s obscene.
Qantas office staff per aircraft the highest in the globe.
Shortage is real. You know it when the Angels are going fishing on PPRUNE.
8 Flights a day cancelled in QF domestically a day due crew shortages.

[Blitzkrieger]

Good morning angels!


Qantas' labour cost base is higher than almost all of its competitors - especially those in Asia, Middle East, New Zealand and South AmericaCompared to when? Salaries have stagnated for a decade while productivity and flexibility (or exploitation if you will) have skyrocketed.


Anyway, well done for swaying a thread on fleet renewal incompetence into one about pilot salaries.


Qantas need a new fleet! For the angels, that means aeroplanes :cool:


Hooroo.

[fearcampaign]

Had a interesting conversation with the Qantas CFO a few years ago.
He admitted that Qantas International had indeed shrunk as we all know.
What he did say is that it had shrunk to the smallest size it could be as it was needed to feed Frequemt Flyer, QF Domestic, and the favourite children Jetstar Domestic and the Pan Asian Jetstar’s.
The CFO made the point that if Qantas International was to be any smaller, then all the other entities were at massive risk.
Qantas would not and could not outsource the international flying any more than it had already been.
Tony Webber the ex Qantas economist said that pilot costs were 1-2% of the operation. IATA also make mention of this. Even the 30% pay cut on the 787 flying long haul makes 0.3% difference. What did any executive sacrifice to help the business case?
If the numbers are that tight then don’t buy the jets.
It was Ideology more than economics. You can get more to fly a 737 in China.
Seeing as fuel is 40% plus of the cost and that’s rising then Rated D is correct.
Qantas International has bought only 8 new aircraft.
Bonuses and Share Price are high due lack of spending on renewal,however the next poor CEO will have to do something once the CEO leaves with his $100 million in remuneration.
Moody’s and Bloomberg reported exactly the same thing.
I don’t personally believe Qantas will ever grow substantially. They will have to replace the fleet at some point as every other global airline has done.

[framer]

Tony Webber the ex Qantas economist said that pilot costs were 1-2% of the operation. IATA also make mention of this. Even the 30% pay cut on the 787 flying long haul makes 0.3% difference
Grumpy pilots load more fuel than satisfied happy pilots while almost hoping a management pilot queries them on it.
fuel is 40% plus of the cost
Grumpy pilots make less effort to investigate and obtain more efficient flight levels.
fuel is 40% plus of the cost
Grumpy tired pilots configure earlier on approach than satisfied happy pilots.
fuel is 40% plus of the cost
Grumpy tired pilots utilise less single engine taxi.
fuel is 40% plus of the cost
Grumpy pilots don’t wait at the aircraft for the ground staff to hook up ground power before giving up and leaving the aircraft with the APU running as happy satisfied pilots.
fuel is 40% plus of the cost
Grumpy pilots are less likely to extend duties.
Grumpy pilots ‘self manage’ their rosters with sick days more often than happy satisfied pilots.
The above statements might not reflect well on the professionalism of pilots, but they are the realities of human nature. Human nature won’t/can’t be bent by rules or ideology, (see communism) it just is. There will be exceptions to the rule but overall it is the case.
So with pilot costs being substantially lower than fuel costs, it is cost effective to ensure the grumpy/happy ratio is maintained at an economically viable level.

[dragon man]

To framer above, you get and I get it, why can’t they?

As to the fleet renewal one day someone will do a comprehensive report on the house of cards (my opinion) that is Qantas financially and realise that they need to spend tens of billions of $$$ in the next 5 to 10 years on new aircraft. It is unavoidable. Then they will start to short the shares ala Blue Sky Alternative Investments which have been belted.

[Ken Borough]

You can get more to fly a 737 in China

There are many valid and logical reasons for that! Are people rushing the exits to chase the $$$$a in China?

[Keg]

Some of those not employed in mainline are! That decreases the pool of pilots available to mainline. Double whammy!

[Rated De]

Grumpy pilots load more fuel than satisfied happy pilots while almost hoping a management pilot queries them on it.

Grumpy pilots make less effort to investigate and obtain more efficient flight levels.

Grumpy tired pilots configure earlier on approach than satisfied happy pilots.

Grumpy tired pilots utilise less single engine taxi.

Grumpy pilots don’t wait at the aircraft for the ground staff to hook up ground power before giving up and leaving the aircraft with the APU running as happy satisfied pilots.

Grumpy pilots are less likely to extend duties.
Grumpy pilots ‘self manage’ their rosters with sick days more often than happy satisfied pilots.
The above statements might not reflect well on the professionalism of pilots, but they are the realities of human nature. Human nature won’t/can’t be bent by rules or ideology, (see communism) it just is. There will be exceptions to the rule but overall it is the case.
So with pilot costs being substantially lower than fuel costs, it is cost effective to ensure the grumpy/happy ratio is maintained at an economically viable level.

We would like to offer food for thought.
it is relied upon that pilots accept and seek responsibility.
Pilots in airlines of our experience, no matter what tail they fly, tend to hold lots of loose ends together. Pilots are proactive, whether it be simply ordering a flight plan or intervening to circumvent a cascade of events. Pilots save far more than they cost by their simple proactive behaviour.

With this in mind, imagine for a moment that your employment involves assessing labour cost. The models you use have lots of fixed and incremental variable costs for crew. These models ignore noise as it is not defined nor understood. These models make no assumptions regarding compliance, for it is not a consideration: It is an Achilles heel. The only way it becomes visible is by the absence of compliance.

Pilots are a cost, it is right that management focus on labour unit cost control. it is however precarious to cut too far, for disgruntled pilots can very rapidly cause strife by simply withdrawing co-operation.

Simply put, want to see how much pilots 'cost', treat them poorly.

Qantas will as Mr O'leary did apply more of the same.

Qantas unit cost is not the biggest problem, the lack of disciplined capital expenditure re-equipping the company for higher fuel prices is negligent.

If Qantas continue to push their pilots attempting to lower labour unit cost, they may well see that higher fuel prices are amplified by an individual response to an adversarial IR/HR employee model.

Qantas need a new fleet

[blow.n.gasket]

Qantas need a new fleet
and an enlightened managerial hierarchy would help too !:ooh:

[Australopithecus]

I spent an interesting short contract at a carrier that abused its MD-11 pilots sorely. They didn't just take a couple of tonnes extra...they took 20 tonnes and then ran it out the dumps. That was being grumpy. It was fun to watch.

[Ken Borough]

they took 20 tonnes and then ran it out the dumps

Understandable that people can be disgruntled but isn't this kind of practice extremely irresponsible?

[RealityCzech]

It's a futile protest and ultimately, self-harm.

[Street garbage]

I spent an interesting short contract at a carrier that abused its MD-11 pilots sorely. They didn't just take a couple of tonnes extra...they took 20 tonnes and then ran it out the dumps. That was being grumpy. It was fun to watch.
I'd love to see that on FlightPulse...LMAO.

[CurtainTwitcher]

Understandable that people can be disgruntled but isn't this kind of practice extremely irresponsible?

It's managements prerogative to grind pilots into dust, it's the P.I.C's prerogative to manage management, cue "I An Army of One" (https://www.pprune.org/rumours-news/55755-i-am-army-one-merged.html).
I am an Army of One (or 2, or 300, ...)

I am an army of One - A Captain in the Continental Airlines army.
For years I was a loyal soldier in Gordon's army. Now I fight my own war.
I used to feel valued and respected. Now I know I am mere fodder.
They (CAL) used to exhibit labor leadership. Now they exploit legal loopholes.
They used to enjoy my maximum. Now they will suffer my minimum.
I am an army of One.

I used to save CAL a thousand pounds of fuel per leg; finding the best FL, getting direct routing, throttling back when on-time was made, skimping during ground ops, adjusting for winds, being smart and giving the company every effort I could conjure. Now, it's "burn baby, burn".
I used to call maintenance while airborne, so the part would be ready at the gate. Now, they'll find the write-up when they look in the book.
I used to try to fix problems in the system, now I sit and watch as the miscues pile up.
I used to fly sick. Now I use my sick days, on short notice, on the worst day of the month.
I am an army of One.

I used to start the APU at the last possible moment. Now my customers enjoy extreme comfort.
I used to let the price of fuel at out-stations affect my fuel orders. I still do.
I used to cover mistakes by operations. Now I watch them unfold.
I used to hustle to ensure an on-time arrival, to make us the best. Now I do it for the rampers and agents who need the bonus money….but this too may change.
I used to call dispatch for rerouting, to head off ground delays for bad weather. Now I collect overs, number 35 in line for takeoff.

I am on a new mission - to demonstrate that misguided leadership of indifference and disrespect has a cost. It's about character, not contracts. It's about leading by taking care of your people instead of leadership by bean counters (an oxymoron). With acts of omission, not commission, I am a one-man wrecking crew - an army of One. My mission used to be to make CAL rich. Now it's to make CAL pay.

When they furlough more pilots than the rest, pilots that cost them 60 cents on the dollar - I will make them pay.
When they under-staff bases and over-work reserves to keep pilots downgraded, down-flowed, or downtrodden - I will make them pay.
When over-booked customers are denied boarding system wide, while jets are parked in the desert - I will make them pay.
When they force pilots, who have waited 12 years to become captains, to be FOs again - I will make them pay.
When they ask CAL pilots to show leadership at Express, and then deny them longevity - I will make them pay.
When they recall F/As for the summer, just to furlough them again in the fall like migrant workers - I will make them pay.
When they constantly violate the letter and spirit of our contract - a contract that's a bargain by any measure, and force us to fight lengthy grievances - I will make them pay.

My negotiating committee speaks for me, but I act on my own. I am a walking nightmare to the bean counters that made me. Are you listening? This mercenary has a lot of years left with this company; how long can you afford to keep me bitter? I'm not looking for clauses in a contract, I'm looking for a culture of commitment and caring. When I see it, I'll be a soldier for CAL again. Until then, I am an Army of One…And I'm not alone!

[Tankengine]

“Army of one” was very disliked by Geoff Dixon, I doubt if Joyce gives a ****, yet! ;)

[framer]

It's a futile protest and ultimately, self-harm. I agree. It’s also Human Nature and is very predictable and won’t change regardless of who the individual humans are.
At the end of the day, the worse your relationship with the pilot group the lower your fuel efficiency. When fuel makes up 40% of your overheads and you run around in four engine jets, the cost of adversarial IR tactics is high. Simple.

[Rated De]

Tick tock...Qantas still need a new fleet.
Rest assured Coward street warriors are busy looking for another industrial distraction. Ever while the fuel included CASK increases.

http://www.iata.org/publications/economics/fuel-monitor/PublishingImages/ChartB.png



http://style.gq.com.au//media/images/7/1/3/0/0/713077-1_lp.jpg?

Little Napoleon in a pensive moment, silently hoping the Seattle junkets and Chairman's lounge access with unlimited upgrades ensures that people don't notice;

Qantas need a new fleet

[dragon man]

The place is rooted, just spoke to an FO doing command training on the 737, he has need given 2 months off on full pay. Not holidays, two months off , no simulator time. What a joke.

[FYSTI]

The place is rooted, just spoke to an FO doing command training on the 737, he has need given 2 months off on full pay. Not holidays, two months off , no simulator time. What a joke.
Believe it or not, this is probably saving them mone, "time off" avoids out of base training allowances. The current record for that would make you jaw drop...

[dragon man]

Believe it or not, this is probably saving them mone, "time off" avoids out of base training allowances. The current record for that would make you jaw drop...


No no, he’s on full allowances.

[FYSTI]

No no, he’s on full allowances.

In that case, your quote is completely appropriate.
The place is rooted

[Street garbage]

Training and recruitment should have started 2&1/2 years before it actually did, but QF management had to ensure their KPI's where achieved.

Article about the Banking Royal Commission by Ross Gittins in today's SMH:
https://www.smh.com.au/business/the-economy/banks-commission-ross-gittins-metrics-kpi-20180424-p4zbbj.html

Could have been written about QF..management lining their own pockets at the expense of Long Term Strategy and Shareholder Return.

[dragon man]

Training and recruitment should have started 2&1/2 years before it actually did, but QF management had to ensure their KPI's where achieved.

Article about the Banking Royal Commission by Ross Gittins in today's SMH:
https://www.smh.com.au/business/the-economy/banks-commission-bross-gittins-metrics-kpi-20180424-p4zbbj.html

Could have been written about QF..management lining their own pockets at the expense of Long Term Strategy and Shareholder Return.

Spot on, everyone is missing the point that what’s happening in the banks is going on nearly everywhere in corporate Australia due to KPIs and cash bonus’s.

[maggot]

Training and recruitment should have started 2&1/2 years before it actually did, but QF management had to ensure their KPI's where achieved.

Article about the Banking Royal Commission by Ross Gittins in today's SMH:
https://www.smh.com.au/business/the-economy/banks-commission-ross-gittins-metrics-kpi-20180424-p4zbbj.html

Could have been written about QF..management lining their own pockets at the expense of Long Term Strategy and Shareholder Return.

This in spades

My first thought on seeing the article

[Rated De]

Vividly recall a conversation with a very well connected source who stated that Australia's corporate governance was indeed second best: Second best to the rest of the industrialised world.

It is a very pertinent nexus. The gaps in Corporate Governance have grown. It was a decade or so ago that the Sarbanes-Oxley Act, in the USA arose from extreme examples of what Australia is witnessing in a self regulated banking model: Back self interest every time. Lack of regulation has done nothing. The new ASIC Chair inherits a mess, ASIC's prosecution mix is low risk, mostly civil and obvious is the lack of any action against what would be classed as enviable opposition. Low risk and look the other way. Mr Shipton's pedigree no better than the former, another insider, this time of Goldman Sachs no less. In the UK and the USA the Company code now requires the Executive remuneration to be referenced to the average wage level in the firm. One can appreciate the 'business type lobby groups' are donating furiously to ensure such reference is not a statutory requirement in Australia.

A whisper suggests that this may be extended to reference key performance metrics which are less suspected to manipulation by effervescent CFOs. Australia will enact a raft of penalties after Australia's Enron moment too!

By any measure, Qantas executive management have been focused internally on a war with the staff and short term sugar hits to performance that share buy backs are known for. They have been enboldened by short term incentives and lack of regulatory oversight. That ASIC never blinked when a 'terminal' Qantas was 'transformed' and executives reaped rivers of well timed Option bonuses is testament that the regulator has no appetite for investigation.
In the intervening period, other airlines with strategic management a focus and not self embellishment have re-equipped with fuel efficient twin engine Long range aircraft. Doing so,lowers the CASK and and preserves operating margin for when fuel gets more expensive or demand (and consequently yield) falls.

Qantas got lucky with a fuel price decline.

Qantas still need a new fleet.

[busdriver007]

In 2005 Qantas ordered the first B787s in the World. 45 at $4.1 billion(serious discount) and 20 options at $25 million each and 50 options(free). How many have they taken delivery of? 14 to Jetstar(low yielding low cost carrier) and 8 to mainline. Remember Qantas earns 2.65 times the earnings that Jetstar does! Talk about taking the eye off the ball! Remember they have sold all the Assets to help the bottom line and AJ is the highest paid Airlines Executive in the World. The Airline HAS NOT BEEN TRANSFORMED and whoever comes next faces a huge hurdle of Capex. Maybe it is time to short the QF stock! Corporations in Australia have had it too good for too long. It is not only the Banks and AMP that need looking at. When it looks too good to be true it probably is.

Qantas desperately need a new fleet.

[CurtainTwitcher]

The Airline HAS NOT BEEN TRANSFORMED and whoever comes next faces a huge hurdle of Capex. Maybe it is time to short the QF stock! .
The problem is AJ still has capital to burn the shorts through buy backs. Executive renumeration is now tied to ASX & global peer relative return performance, thus the buy backs will continue to ensure the hurdles are exceeded, at the expense of CAPEX no matter the long term damage to the business.


From the Qantas Annual Report 2017 (http://investor.qantas.com/FormBuilder/_Resource/_module/doLLG5ufYkCyEPjF1tpgyw/file/annual-reports/2017AnnualReport.pdf) , pages 39 & 40
The performance measures for each of the 2015–2017 LTIP (tested at 30 June 2017), 2016–2018 LTIP (to be tested as at 30 June 2018) and 2017–2019 LTIP (to be tested as at 30 June 2019) are: —The relative TSR of Qantas compared to companies with ordinary shares included in the ASX100 —The relative TSR of Qantas compared to Global Listed Airlines These Rights will only vest in full if Qantas’ TSR performance ranks at or above the 75th percentile compared to both the ASX100 and the Global Listed Airlines peer groups. At the end of the performance period, the TSR performance of Qantas and each comparator company will be determined based on the average closing shares price over the final 6 months of the performance period. Qantas’ Financial Framework also targets top quartile TSR performance relative to ASX100 companies and global airline peers and therefore relative TSR performance against these peer groups has been chosen as the performance measure for the LTIP. The peer groups selected provide a comparison of relative shareholder returns relevant to most Qantas investors: —The ASX100 peer group was chosen for relevance to investors with a primary interest in the equity market for major Australian listed companies, of which Qantas is one —The Global Listed Airlines peer group was chosen for relevance to investors, including investors based outside Australia, whose focus is on the aviation industry sector and measuring returns from listed companies impacted by comparable external factors

Up to 50% of the total number of Rights granted may vest based on the relative TSR performance of Qantas in comparison to the ASX100 and up to 50% of the total number of Rights granted may vest based on the relative TSR performance of Qantas in comparison to the Global Listed Airlines peer group. The vesting scale for both the ASX100 and the Global Listed Airlines peer groups is as follows: Qantas TSR Performance Relative to Each Peer Group Vesting Scale Below 50th percentile Nil vesting Between 50th and 75th percentile Linear scale: 50% to 99% vesting At or above 75th percentile 100% vesting The ASX100 peer group comprises those companies that make up the S&P/ASX100 Index at the commencement of the performance period. The Global Listed Airlines peer group has been selected with regard to its representation of Qantas’ key markets, full-service and value-based airlines and the level of government involvement. For the 2015–2017 LTIP, the Global Listed Airlines peer group includes: Air Asia, Air France/KLM, Air New Zealand, All Nippon Airways, International Consolidated Airlines Group, Cathay Pacific, Delta Airlines, easyJet, Japan Airlines, LATAM Airlines Group, Deutsche Lufthansa, Ryanair, Singapore Airlines, Southwest Airlines, Tiger Airways and Virgin Australia. The 2016– 2018 LTIP and 2017–2019 LTIP also include American Airlines and United Continental. Tiger Airways was excluded from the 2017–2019 LTIP



ASX short report (http://asic.gov.au/Reports/Daily/2018/04/RR20180418-001-SSDailyAggShortPos.pdf) (updated daily)

QANTAS AIRWAYS ORDINARY QAN 5,959,936 1,729,665,867 0.34 [% short]
This is not [yet] time to short!

[Rated De]

This is not [yet] time to short!

No it isn't yet, the historic open short interest is low.
It is indicative that the key metrics necessary to indicate a move in sentiment were not yet being readily observed. Most analysts 'analyse' airlines as part of the transport sector. Naturally given a company like Qantas' Share Market Capitalisation, Qantas remains heavily represented in most portfolios.

Point in fact, it is the rising fuel price that beings to show the inherent weakness of the 'transformation' narrative.
The same driver is demand induced revenue slowing; yield begins to cascade downwards.

Qantas were very lucky with the fuel price decline. Mr Clifford's missive about the problems facing the company are disingenuous: It is their own waste of shareholder capital, largely rewarding themselves for an industry wide fuel price decline that saved the day.

There is no doubt in our minds, that the impairment charge was well overdue (writing off the International fleet in FY15).
The $597 million dollar fuel saving was due the fact that carrying each RPK (at least across the Pacific) Qantas burn 64% more fuel. Therefore any price reduction on this input would have magnified the benefit as Qantas run a fuel inefficient fleet.

[Rated De]

Remember Qantas earns 2.65 times the earnings that Jetstar does!

It is not well understood just how poorly JQ do.
Mr Buchanan desperately tried to avoid expansion into long haul low fare as most of the purported advantages of Low Far Airlines were readily eroded. It is known that he personally stated numerous times that no way would JQ International ever be able to achieve unit cost needed for such a low yield business. The transfer of the original 14 788 (which became 11) was part of his last effort to eradicate the unit cost over run. When he demonstrated his concern to the lightweight board, his tenure was subsequently short lived: Little Napoleon does not tolerate insolence.

Presently it is impossible to see how poorly JQ International do. Despite having more aircraft than the Qantas segment, management do not dis-aggregate into Domestic and International. Something Qantas management did in 2012 to show how 'poorly' Qantas International was faring.

Given every cost Qantas ever incurred from ticketing to uniforms is replicated, JQ now fly 48% of the ASK Qantas fly.
For all their efforts, it is obvious: JQ "group" generate 22% of the Revenue of Qantas. No 'unit cost advantage' that we ever have observed would cover that gap. Fortunately Qantas domestic has sufficient dominance to stem the losses. Simple factor productivty like this indicates that JQ is likely overscale (has grown too big) To those who suggest that this is anti JQ, it isn't. It is however a critique of the lengths to which Little Napoleon will go to ensure the 'myth' of his airline acumen is maintained.

The problem is AJ still has capital to burn the shorts through buy backs. Executive renumeration is now tied to ASX & global peer relative return performance, thus the buy backs will continue to ensure the hurdles are exceeded, at the expense of CAPEX no matter the long term damage to the business.

That was the point of this thread. The disingenuous nature of the Chairman attempting to link the QSA 1992 to the Capital re-equipment problem deserves comment and rebuttal for the Capital Expenditure will need to be expended anyway. Whilst Mr Clifford and his ilk may well grace these pages, no amount of babble changes the simple fact: Qantas need a new fleet and they haven't done that.
The wastage of shareholder funds on personal glorification , social engineering and image management is staggering. Fortunately for them the tide hasn't gone out yet.

Qantas need a new fleet

[RealityCzech]

You fail to understand the true value of Qantas' ownership of Jetstar and the size of its operation in Australia.

[What The]

You fail to understand the true value of Qantas' ownership of Jetstar and the size of its operation in Australia.

So size does matter? I remember an airline that used to be pretty big in Australia. Didn’t have a benevolent parent to suck dry though. Was called Ansett.

Most of the honchos at Qantas should know a fair bit about it. They were there and are responsible for its failure. Qantas staff just hope that maybe they have learned something but it appears they have only learned how to stuff cash in their pockets.

[blow.n.gasket]

At the end of the day it’s nothing more than Leprechaun inspired Financial alchemy.
Is that why JetConnect has been absorbed back into the fold due to the fact the Financial wizards of Coward St can no longer leverage off the tax minimisation benefits of Price Transference due to the new IFRS accounting rules coming into effect.
Is the tide going out at long last ?

[RealityCzech]

At the end of the day it’s nothing more than Leprechaun inspired Financial alchemy.
Is that why JetConnect has been absorbed back into the fold due to the fact the Financial wizards of Coward St can no longer leverage off the tax minimisation benefits of Price Transference due to the new IFRS accounting rules coming into effect.
Is the tide going out at long last ?

No. No one cares except the chat forum conspiracy theorists. The analysts and the majors have already factored this in. The problem is that pilots reading you write about this stuff might think you're actually on to something, when you aren't.

[dragon man]

No. No one cares except the chat forum conspiracy theorists. The analysts and the majors have already factored this in. The problem is that pilots reading you write about this stuff might think you're actually on to something, when you aren't.

i keep an open mind so please explain to me how it’s a conspiracy that Qantas have a massive fleet renewal due and how it doesn’t need to happen.

[RealityCzech]

Why do you presume they need to do anything? Did Qantas need to keep flying to FRA? Did it need to keep flying to CDG/EZE or anywhere else or did it need to keep flying SYD/LAX 3-4 times a day as it used to? Clearly not.

The assumptions many pilots make that Qantas will inevitably need to do things are simply wrong. Especially when they then take the next step in the assumption and presume it means massive gains in terms and conditions. There is a point where the fares able to be charged cannot justify the investment in new aircraft/more pilots/more expensive pilots. No one who posts on this chat site knows that point.

I see plenty from the likes of Rated De about the evils of HR, IR, politicians, 457 visas, unions etc. I see very little discussion and analysis of the economics of the international aviation market. The latter is a much, much bigger factor regarding new fleet than the former.

[Rated De]

tax minimisation benefits of Price Transference

We would suggest the dissolution of Jetconnect nevertheless renders certain executives vulnerable, the structure of Jetconnect was interesting.


i keep an open mind so please explain to me how it’s a conspiracy that Qantas have a massive fleet renewal due and how it doesn’t need to happen.

Presently the biggest order Qantas ever placed for 110 A320 valued at $9.5 billion, is not 'cancellable', thus delivery commences.... Mr Buchanan telegraphed the 'replacement' rather than 'growth' meme in 2011 when announcing the order. Jetstar's ASK versus revenue factor productivity suggests a scale problem. With the aircraft rolling off lease in need of a home and this being 'contract' year is it any surprise that yet another entity is the new home to these aircraft? Nicely positioned to 'scare' the pilots (irrespective of crewing problems and rejection of product by Corporate clients in WA) ? Enter Network Aviation.

Qantas mainline meanwhile need a new fleet, irrespective of protest and threats, they either buy aircraft or as fuel price rises run the risk of 'De-transforming' the airline!

Qantas need a new fleet

[Buckshot]

There is a point where the fares able to be charged cannot justify the investment in new aircraft/more pilots/more expensive pilots

And the most expensive executives in the world?

[crosscutter]

Here’s some international economics.

Supply and demand. The endless global supply of gluttonous executives behaving badly and the increasing demand for executive accountability. Bank’s first, and a different metoo movement will follow.

Meanwhile the real supply and demand problem facing international aviation will conform to economics. Innovation and flexibility will be part of the solution to keep the masses flying. So will better pilot conditions which recognise the role pilots play in an airline.

[Rated De]

I see very little discussion and analysis of the economics of the international aviation market. The latter is a much, much bigger factor regarding new fleet than the former.

The economics of the International Aviation market are simple. Don't believe us, and as you seem to have a little trouble with research;

Qantas 'worst major airline' for fuel efficiency on trans-Pacific flights, study suggests - ABC News (Australian Broadcasting Corporation) (http://www.abc.net.au/news/2018-01-17/qantas-fuel-efficiency-worst-for-trans-pacific-flights-study/9333616)

In summary the cost to deliver the RPK is 64% higher than competitors, that is 'aviation economics'.

Qantas still need a new fleet

[RealityCzech]

The economics of the International Aviation market are simple. Don't believe us, and as you seem to have a little trouble with research;

Qantas 'worst major airline' for fuel efficiency on trans-Pacific flights, study suggests - ABC News (Australian Broadcasting Corporation) (http://www.abc.net.au/news/2018-01-17/qantas-fuel-efficiency-worst-for-trans-pacific-flights-study/9333616)

In summary the cost to deliver the RPK is 64% higher than competitors, that is 'aviation economics'.

Qantas still need a new fleet

This has almost zero to do with whether or not Qantas needs a new fleet. If your argument is that the cashflow position of individual routes would be improved with a new fleet (forgetting acquisition costs), then you are absolutely correct, however that doesn't mean a new fleet is needed. There are alternatives to a new fleet, including outsourcing flying to other carriers or simply doing less flying - as evidenced by withdrawals and reductions on some routes - as affected and determined by the market and competitors and therefore influencing the revenue able to be earned to pay for the new fleet.

[neville_nobody]

There are alternatives to a new fleet, including outsourcing flying to other carriers or simply doing less flying - as evidenced by withdrawals and reductions on some routes - as affected and determined by the market and competitors and therefore influencing the revenue able to be earned to pay for the new fleet.


What a load of rubbish. What actually is QANTAS? An Airline or a Travel Agent? There is no point in an airline to outsource the majority of it's flying. Why not just shut it down and pocket what's left over. Why the hell would you run a so-called airline then outsource your product and lose complete control over product and safety?

[IsDon]

This has almost zero to do with whether or not Qantas needs a new fleet. If your argument is that the cashflow position of individual routes would be improved with a new fleet (forgetting acquisition costs), then you are absolutely correct, however that doesn't mean a new fleet is needed. There are alternatives to a new fleet, including outsourcing flying to other carriers or simply doing less flying - as evidenced by withdrawals and reductions on some routes - as affected and determined by the market and competitors and therefore influencing the revenue able to be earned to pay for the new fleet.

So, Qantas’s biggest mistake was selling the Connies.

Think of the money we could have saved if we follow your philosophy.

Brainless dolt.

[ExtraShot]

There are alternatives to a new fleet, including outsourcing flying to other carriers or simply doing less flying .

Ha. Tell us again how Virgin Australia’s model is the shining example of what you spout! You know, that airline that is currently doing more flying with its own metal than anytime in its previous history!

Otherwise, perhaps provide an example of how and where this outsourcing of flying operations has worked? Sure, Flight Centre does quite well I see.

No, Qantas does not HAVE to purchase a new fleet. However, if management wish to compete and grow the Airline, yes they do. The ability to innovate and outdo the competition, providing the best quality product that delights your customers, and not only has them return time and time again, but has them telling everyone they know how great you are, will not happen when reliability, and quality, inevitably become an issue (leaving aside the enormous discrepancy in fuel efficiency). Then your unhappy customers stop returning and they’ll tell all of their family and friends not to buy a ticket...

There is no way around it, Either Qantas develops a fleet renewal program for the next decade and beyond, that focuses on high quality passenger experience and fuel efficiency, or it should announce to the market it intends to cede it’s position to the competition and transition to a Travel Agency.

Rated De is correct. Qantas, if it intends to remain an Airline that retains market share and reliably services it’s customers, Needs to start purchasing A New Fleet.

[RealityCzech]

What a load of rubbish. What actually is QANTAS? An Airline or a Travel Agent? There is no point in an airline to outsource the majority of it's flying. Why not just shut it down and pocket what's left over. Why the hell would you run a so-called airline then outsource your product and lose complete control over product and safety?

Qantas and other airlines already do this. It’s called code sharing.

[RealityCzech]

So, Qantas’s biggest mistake was selling the Connies.

Think of the money we could have saved if we follow your philosophy.

Brainless dolt.

Thanks for the insults.

The Connies are irrelevant to the business case for a new 787/777/350 fleet. Nowhere have I said Qantas should not or will not renew its fleet, I’ve just made the point that it depends on the contermpernaous market conditions, as well as its own cost base at the time. Just because 747s replaced 767s and so on does not mean Qantas needs to replace its current fleet. It will only do so if that option is the most commercially sound choice

As for Virgin currently doing the most of its own metal flying - this is a misleading statement with respect to the international medium-losing haul market, which is what we are talking about in respect to Qantas. Where are the huge 777/350 orders for Virgin if the international market ex AUS is such an obviously lucartive market?

I see no mention of the enormous cap growth to/from AUS over the.last decade. Even the likes of the highly profitable AA have now started reducing cap on the LAX route (777>787) because of the overcapacity that affected yields.

I do think Qantas will acquire more 787s, given the business case is sound with niche markets like PER-LHR and demand still being strong enough to North America to justify shifting 380s to Asia and 787s to Nth America. I also think it is probable that it will get 777s or 350s - but only if the numbers stack up. That is very different to NEEDING to buy them.

[crosscutter]

That last RC post is a truism. If the business case is sound they will get them but they don’t need to get them? What if we said to make the business sound a new fleet is needed? The board and exec are paid handsomely to get these decisions right. Different leaders for different times...eg) Churchill. Maybe Clifford and Joyce have had their time in the sun and they aren’t the right people for this time.

All we see is growth opportunities and a training system under immense stress. These same execs were given a heads up numerous times that this crunch was imminent. Making a business case for new aircraft seems irrelevant when running the crewing operations efficiently is beyond this lot.

[Rated De]

You fail to understand the true value of Qantas' ownership of Jetstar and the size of its operation in Australia.

Enlighten us, not with qualitative 'opinion' give us quantitative empirical evidence of the 'value of JQ'

Qantas do not need a new fleet is correct with one important caveat: They desire to allow the business to wither and eventually collapse cease. It would seem that this is the 'theme of your posts' and is interesting from a European perspective that other airlines used a similar implied threat last time round. Nothing new under the Sun! 'We can kill this airline off if you pesky employees don't sign'.

Practically speaking , ignoring the execution risk, the Qantas business is worth more than the segmented parts. Case in point the International network feeds the domestic and indeed is the reason for the "Frequent Flyer' business. Without an international network to 'redeem points' into it is not much more than a marketing database. Ask Macquarie what their valuation was without an International flying business. Airlines around the world understand this, analysts understand this, so please enlighten us how Qantas not getting a fleet with rising fuel prices is sound business acumen? We are not quite sure they would be able to claim the business is 'de-transformed' again, when they personally proclaimed its transformation less than three years ago, receiving huge option driven bonuses for proclaiming so.

So if this bunch are actually running an airline, it is elementary that strategic decisions are now well overdue: Qantas need a new fleet

[fearcampaign]

What reality Czech says varies entirely to what we were told at a
group meeting with the CFO years ago.
Qantas International had shrunk to its minimum size.
In the current form it is still dramatically smaller. For example look at London.
Qantas had 4 747s a day to LHR and it now only has one A380 and one 787.
Gareth Evans made the point that if Qantas shrank any more it would put the Frequent flyer business in jeopardy.
The love child of Jetstar Domestic and Asia and Japan could lose control of a massive feed as would Qantas Domestic.
It would be the equivalent of outsourcing your entire army. The CFO pointed out that there was a limit to how small it could shrink and guarantee a secure, dependable feed for all the other entities. As he said there was a minimum Qantas fleet size.
Emirates or whomever the partner could effectively suffocate the business should circumstances change and wield significant power. Qantas executives have made some questionable decisions however that would be beyond stupid.
Pilot wages are 1-3 % of the operational cost as explained by Tony Webber the ex Qantas economist.
To paint pilots as the make or break factor is disengenuous and factually incorrect. Understand RC hates pilots but that’s the math. It must annoy RC enough to troll PPRUNE to deny that limited supply and high demand is driving Airline pilot wages higher. It must be upsetting for him to see market forces not go his way. Pilot Pay globally is on the rise. Every credible financial press has numbers to back it up. Forbes, Bloomberg etc etc etc.
International is doing well now and routes are being added. That will have more to do with the economy and fuel price than pilot costs or executive genius.
Qantas benefits disproportionately to a lower fuel price as the fleet is one of the oldest globally and hence has a high fuel burn.
Apart from eight 787 Qantas really haven’t replaced or replenished or grown the fleet at all.
As fuel costs rise we will see just how wonderful the emperors clothes are.
Qantas will need a new fleet, but the executives have been happy spending billions buying back shares which is great in the SHORT term for shareholders and thus executive bonuses. Long term the business Would benefit far more from a steady and measured renewal of the fleet. Lower fuel burn, less maintenance, passenger comfort, improved OTP. Bonuses and short term share prices are not measured on such discipline and long term windows. Qantas is not alone in this global trend.
The banking royal commission has uncovered the perils of short term decision making and thus bonus culture in many ASX companies. The banks are not alone.
Rated D is correct. Qantas need a new fleet. Short term share price movement and record bonuses will delay this as long as possible. Inevitable when you get paid $30 million to delay spending.

[No Idea Either]

So if QF placed an order today, what would be the expected delivery time frame.

[Australopithecus]

So if QF placed an order today, what would be the expected delivery time frame.





Like everything else: “It depends”. There are two primary choices with subset options. 1: The 777-8, smaller/farther and the -9, bigger/sub-sunrise* range.

2: A350 in its two iterations. If only those pesky RR engines weren’t the sole choice.

The order books for both types are heavily skewed to the ME3. The ME3 may all be in the cancellation risk zone for a variety of factors evident after a cursory search. Hint: Politics, pride, hubris, ineptitude, vanity, self-fascination, bluster, Dunning-Kruger effect, incandescent rage that there are fewer pilot applicants than MBa grads....etc. The usual litany of malfeasance that seems to bedevil airlines near and far.

* Sunrise project: Is it just me, or does anyone else think this idea is dumber than dog sh*t? Given that the planet's circumference seems to be 2.78 times longer than the average J class passenger's civility endurance. Y class? Fugedaboutit.

Assuming the ME3 don’t defer any deliveries, maybe late 2021 for an A350 and a trickle thereafter (cannot comment on simulator delivery).

777 may be 2022 with some cancellations

The earliest 330 hulls will be around 72,000 hrs in 2021. And time-ex three years later assuming there are no extended service goals in place. Its bad enough to contemplate getting too far beyond the original 60K service life let alone breaching the intermediate life limits.

There also is the A330neo. Anyone buying that stop-gap measure lacks either money or vision. So, maybe...yeah.

To spare Rated De the keystrokes: Qantas needs a new fleet

[Rated De]

You fail to understand the true value of Qantas' ownership of Jetstar and the size of its operation in Australia.

Enlighten us, not with qualitative 'opinion' give us quantitative empirical evidence of the 'value of JQ'

Qantas do not need a new fleet is correct with one important caveat: They desire to allow the business to wither and eventually collapse cease. It would seem that this is the 'theme of your posts' and is interesting from a European perspective that other airlines used a similar implied threat last time round. Nothing new under the Sun! 'We can kill this airline off if you pesky employees don't sign'.

Practically speaking , ignoring the execution risk, the Qantas business is worth more than the segmented parts. Case in point the International network feeds the domestic and indeed is the reason for the "Frequent Flyer' business. Without an international network to 'redeem points' into it is not much more than a marketing database. Ask Macquarie what their valuation was without an International flying business. Airlines around the world understand this, analysts understand this, so please enlighten us how Qantas not getting a fleet with rising fuel prices is sound business acumen? We are not quite sure they would be able to claim the business is 'de-transformed' again, when they personally proclaimed its transformation less than three years ago, receiving huge option driven bonuses for proclaiming so.

So if this bunch are actually running an airline, it is elementary that strategic decisions are now well overdue: Qantas need a new fleet

[Rated De]

Could it be that Qantas 'executive management' beta test IR strategy here?


You know to whom this question is addressed :E

* Sunrise project: Is it just me, or does anyone else think this idea is dumber than dog sh*t? Given that the planet's circumference seems to be 2.78 times longer than the average J class passenger's civility endurance. Y class? Fugedaboutit.


Project sunrise amused Boeing. It was however a 'game changer' for Qantas a whole 'team' spent a week coming up with the name!





To spare Rated De the keystrokes: Qantas needs a new fleet

Thanks Austral

[IsDon]

Project sunrise amused Boeing. It was however a 'game changer' for Qantas a whole 'team' spent a week coming up with the name!


When they were finished with that, the “team” went on to other “game changing” initiatives like deciding the shape of a salad bowl.

Funny as it sounds, I'm actually not joking.

[Australopithecus]

When they were finished with that, the “team” went on to other “game changing” initiatives like deciding the shape of a salad bowl.

Funny as it sounds, I'm actually not joking.

Which, it will come as no surprise, they screwed up. The new crockery/glasswear does not stack in the carts and there are now safety issues as a result.

[Rated De]

Does Qantas actually have the money for the 99 A320 order?

With the US treasury yield nudging 3.00% credit costs are rising.
https://s17-us2.startpage.com/cgi-bin/serveimage?url=https%3A%2F%2Fbpcdn.co%2Fimages%2F2016%2F06%2 Fpiponomics-120315-yields.jpg&sp=1f8a020339b2bb5c928903eba2f084b6

Has Qantas' self indulgent share buybacks (totaling $2 billion) mean they lack sufficient capital and will defer/cancel any further re-equipment of Qantas International in order to fund the 'non-cancellable' JQ order? Has Qantas realised that the cost of funds has increased. Combined with contango in the jet fuel price, Qantas faces a self induced problem of a fuel inefficient fleet, rising jet fuel prices, a $9.5 billion order for the under performing JQ brand, and rising credit costs. Almost like the tide has turned?

If so it makes sense that the industrial narrative being pedaled by 'RealityCzech' that Qantas International may again, despite their pronouncements of 'transformation' (and consequent big bonus payments) be in jeopardy. It would suit an industrial play to obfuscate the real issue of management incompetence. In other words, 'Qantas do not need a new fleet' and blame the labour unit costs (pilots) hoping that no body remembers the FY15 'transformation'.

Qantas need a new fleet

[V-Jet]

and will defer/cancel any further re-equipment of Qantas International in order to fund the 'non-cancellable' JQ order?

Or even capacity to borrow.

Qantas Debt/Equity ratio was around 75% BEFORE any JQ jets were put back on the books. Along with everything else that Qf has wasted money on, those bonuses were VERY expensive.

Nice to know Qantas still have some of their Avro 504 fleet in the domestic terminal. If the shrinking program is successful enough returning to it's original (and it has to be said, highly successful!) format, then maybe RC is correct, and QF could operate Sydney Harbour Joyflights - possibly advertising is virtual presence with a towed banner up the Northern Beaches? Has anyone looked at this? Is the Avro on the books as far as IFRS16 is concerned?

[Rated De]

Qantas Debt/Equity ratio was around 75% BEFORE any JQ jets were put back on the books. Along with everything else that Qf has wasted money on, those bonuses were VERY expensive.

This is a very important point. The impact of IFRS16 is difficult to gauge (for the individual airlines), but its impact is widespread. Qantas is not the only airline having to re-organise the lease structure.
The DE ratio is definitely something concerning firms long airline stocks. Qantas may well find some pressure in FY19 on their funding costs (think credit rating) Time will tell.

Ultimately the type of narrative Mr Clifford was seeking to bed in (the point of this thread) may indicate pressure is becoming evident. As the yield curve now indicates a higher interest rate environment, rising fuel prices levers up pressure on Qantas' fuel included CASK. Combine this with a possibly weaker AUD and Qantas input prices rise disproportionately. RealityCzech is assisting this 'Clifford narrative' by linking fleet to Qantas' International future prospects. The fleet renewal is well overdue, they know it. Their expansion of JQ, although ambitious has never reaped a tangible return. Low fuel price saved the day.As we monitor multiple sources of input price volatility, it appears that Qantas could be sailing into a storm entirely of their own making. Indeed it is suggestive that the self indulgent (share buy backs) beahaviour has exposed the shareholder when prudent financial strategic management would have seen the business better prepared to handle what are clearly for Qantas at least rising seas and falling tides.

[CaptCloudbuster]

hoping that no body remembers the FY15 'transformation'.

With the 4th estate failing miserably to hold QF Management to account over claims of QF International in “Terminal Decline” shortly before an amazing “Transformation” without any Govt handouts - if a new narrative 180 degrees different is trotted out - I expect that the general public won’t remember this time either.

[Keith Myath]

Presently it is impossible to see how poorly JQ International do. Despite having more aircraft than the Qantas segment, management do not dis-aggregate into Domestic and International. Something Qantas management did in 2012 to show how 'poorly' Qantas International was faring.



You have stated a number of times that JQ international have more aircraft than Qantas international. How do you arrive at that proposition?

[V-Jet]

QF Fleet 2005
12 x 747-338
30 x 767
32 x 744

Qf Fleet 2018 (after the Great Turnaround of 2013)
12 x 380
10 x 744 (reducing as per 787 increasing below)
4 x 787 (mustn’t forget the gamechanging extra FOUR!! arriving ‘soon’)
26 x 330

JQ - I don’t know exactly. Someone will.

Shrinking to greatness.

[SandyPalms]

Qantas never had 12 747-300’s. In the early 2000’s, They had 6 300’s Plus 5 200’s and 2 SP’s. By 2005 all the 200’s and SP’s had gone.

The 744 fleet at 32? I’m pretty sure it topped out at 30. There was a BA leased aircraft at one point, but that was before the ER’s showed up. Do you mean 747 fleet in total, including the classic?

I count 28 A330’s.

[Rated De]

You have stated a number of times that JQ international have more aircraft than Qantas international. How do you arrive at that proposition?

Keith corrected for readability.
Jetstar group have more aircraft.

Jetstar International will never be reported as a separate segment despite Qantas management swiftly deciding to suddenly report Qantas International separately in FY12. Qantas management wanted a narrative of 'terminal decline' Thus to open Jetstar to any sort of like for like comparison invites disaster, which is why they refuse to segment it.

[Keg]

You have stated a number of times that JQ international have more aircraft than Qantas international. How do you arrive at that proposition?

Nope, he’s stated many times that JQ international’s figures aren’t split from the rest of the JQ flying and that the JQ segment has more aircraft than QF. The first is accurate, the second....

Jetstar
787
11 Jetstar Airways (JQ)

A320
53 Jetstar Airways (JQ)
18 Jetstar Asia (3K)
20 Jetstar Japan (GK)
8 Jetstar Pacific (BL)

A321
6 Jetstar Airways (JQ)
2 Jetstar Pacific (BL)

Dash 8-300
5 Jetstar Airways operated by EAA.

Total: 126

Qantas
A380
12

787
4

747
10* (reducing and not doing the flying of ten).

A330
28

737
75

Total: 129

How to measure the profit? Per ASK? Longhaul is lower due to the longer distances. The QF FF scheme generates most of it’s profit because people want to fly QF aeroplanes, not Jetstar, so that needs to be factored in too.

(Jetstar fleet data from their website. QF’s from a third party source due to the QF website not listing it explicitly that I could find easily).

[V-Jet]

Qantas never had 12 747-300’s. In the early 2000’s, They had 6 300’s Plus 5 200’s and 2 SP’s. By 2005 all the 200’s and SP’s had gone.

Very moot point but SP’s I was pretty sure had long gone by 2000 - and I’m almost as sure all the 200’s had gone. I’ve asked a few people over the last year or so and that was the ‘consensus’ of all. If anyone’s has got better recollection than that, I’d be interested.

Whats more important is that Qf isn’t Just stagnating, it’s being shrunk - and without any new orders from this CEO, it ain’t looking pretty. Like a funeral parlour not ordering coffins!!

[SandyPalms]

Fair enough V-Jet, you may be right about the SP’s and the 200’s, I can’t remember when they left, but your numbers are still inaccurate.

[Ken Borough]

Very moot point but SP’s I was pretty sure had long gone by 2000 - and I’m almost as sure all the 200’s had gone. I’ve asked a few people over the last year or so and that was the ‘consensus’ of all. If anyone’s has got better recollection than that, I’d be interested.

Not so. As at 1st January 2000 there were two SPs (EAA & EAB) and three -200s (ECB, ECC & EBS) still flying along with the six -300s. I stand to be corrected but this is my best memory.

[maggot]

Very moot point but SP’s I was pretty sure had long gone by 2000 - and I’m almost as sure all the 200’s had gone. I’ve asked a few people over the last year or so and that was the ‘consensus’ of all. If anyone’s has got better recollection than that, I’d be interested.
SPs went late 00/early 01 iirc
200s lasted a little longer

[GA Driver]

Seeing you’re doing like for like with the jq entities, might need to add in a few dash 8’s to inflate the Qf numbers for the ‘link. Whilst you’re doing that, might need to add a few 717’s for that link and a few a320’s for a the new link!

[Keg]

Seeing you’re doing like for like with the jq entities, might need to add in a few dash 8’s to inflate the Qf numbers for the ‘link. Whilst you’re doing that, might need to add a few 717’s for that link and a few a320’s for a the new link!







Nope. The QLink 717, A320 and Dash 8 operation are reported separately to the mainline domestic and international figures. Hence why they should not be included when comparing fleet numbers and overall profit between ‘mainline’ and Jetstar. IE QLink are not ‘mainline’ for the purposes we are currently talking.

However, the Jetstar NZ profits (or losses because let’s be honest, no one would know from the annual report) are reported as part of the overall Jetstar performance. Therefore it’s appropirate that their fleet (including the Dash 8s) are included.

interestingly I think it was the Cutest of Borg who a number of years ago nailed JQ’s rubbery figures when they were including NZ domestic pax as part of their ‘stunning international growth’ numbers.

[RealityCzech]

Might want to also track a few other RatedDe claims:

1. Network A320s to be crewed by Jetstar pilots.
2. 457 visa application for Qantas mainline pilots
3. Supposed new and indefinite training freeze applying to Qantas 737 pilots

Any of these actually true?

[V-Jet]

RC: Much as I think I could have a better conversation about business and profitability with a child of three (because it’s obvious you personally have none) I ask the following question with some trepidation, as what is good for the goose, should equally be good for the gander, but:

Can you attest that they (RD’s) claims aren’t?

Thanks for the input regarding 2005 fleet. It occurred to me a while ago that no one has a record of shrinkage off the top of their heads. I think it’s important to remember what was, compared to what is.

[RealityCzech]

Can you attest that they aren’t?

No, but I'm not the one making the claims, nor have I seen any other evidence to suggest they're true.

[V-Jet]

Ahhhhh - but you have, and on many occasions. Evidence please.....

PS: Are you on overtime - a long day at the Kool Aid Counter for you. My sympathies.

[Beer Baron]

V-Jet, fair go. I’m no fan of RC or Qantas’ strategy but you can’t expect someone to disprove any wild accusation or rumour that an anonymous poster may choose to make.

It is surely encumbent on the person making the allegation to prove its veracity, not for others to have to prove it false.

[V-Jet]

V-Jet, fair go. I’m no fan of RC or Qantas’ strategy but you can’t expect someone to disprove any wild accusation or rumour that an anonymous poster may choose to make.

It is surely encumbent on the person making the allegation to prove its veracity, not for others to have to prove it false.





Post hoc ergo propter hoc.... Or (slightly differently) Why is it that staff are always asked to provide evidence when surely that is the job of people paid millions to do exactly that?

Rather than say 'Give us proof JQ will be more than 12(?? something like that) aircraft - Your claims are baseless, we will never do that!'. Which (as was suspected at the time) is/was/and always will be/ patent nonsense at best and a criminal lie at worst - Why not just provide the proof up front that the allegations are just nonsense?

Up to this point, Qf Management have been an absolute case in point that their words are totally untrustworthy and they lie as a matter of course. So - turn the questions on their heads for a change. So - 'Sorry, commercial in confidence' just doesn't cut it anymore.

The burden of accuracy in this case seems to have been levied (for decades now) upon the innocent questioners. Provide proof. Surely simple enough to defeat the questions with facts that a few quarrelsome drones in Sector 7G might ask. Can't be hard....

Stop apologising for asking simple questions!!! If they can't be answered simply - I guarantee obfuscation and lies are involved....

[SandyPalms]

Hey V-Jet. What would you say to somebody who was making a complete Ass of themselves? Just curious.

[V-Jet]

If history is anything to go by, they would be paid in the region of $25m a year. Why do you ask?

[Street garbage]

Might want to also track a few other RatedDe claims:

1. Network A320s to be crewed by Jetstar pilots.
2. 457 visa application for Qantas mainline pilots
3. Supposed new and indefinite training freeze applying to Qantas 737 pilots

Any of these actually true?
Number 1 is correct, there are at least 2 Jetstar Captains doing training at Network....

[ExtraShot]

Might want to also track a few other RatedDe claims:

1. Network A320s to be crewed by Jetstar pilots.

I understand that JQ Check and/or Training Captains have been on leave without pay at this entity from day one... so, correct. It wouldn’t surprise if it had been canvassed to allow other A320 rated crews to transfer across to perhaps take promotions if/when the numbers at JQ allowed it, therefore the rumour (then posted to a ‘pilots rumour network’) is started.

As for the other two? Again, It’s a rumour network. Post evidence to the contrary (‘quash’ the rumour), otherwise it’s entirely plausible that these options have been considered, ergo they are a subject of discussion.

[RealityCzech]

Number 1 is correct, there are at least 2 Jetstar Captains doing training at Network....

Doing training? Seeings the actual jets are ex-JQ and JQ has an experienced A320 training base and is in the Qnatas group, this is hardly surprising. Kind of like how Jetstar 787 pilots trained Qantas pilots on the 787 too. Not sure this amounts to the whole Network A320 operations being planned to be crewed by JQ pilots long term. Also kind of like how QF trainers went on LWOP to places like EFA to train. Didn't mean the entire EFA operation ended up being crewed by mainline.

As for the other 2 - I have no proof either for or against them. Apparently neither do you either. If you reckon that means people should be able to just post anything unsubstantiated and not be challenged on it, good for you. But when I see someone posing as some Europe-based aviation expert when they are clearly not, I question their real motive for posting random and fear-creating rumours.

[V-Jet]

If you reckon that means people should be able to just post anything unsubstantiated and not be challenged on it, good for you.

Hehe:) That’s worked extremely well for Joyce! He’s made a career out of proclaiming complete fallacies across TV, tabloid, print and social media nationwide and internationally. He hasn’t been seriously challenged on it, so why shouldn’t others?

[*Lancer*]

Qantas operated the 747-200 and SP into 2002. Just one of the many other ‘facts’ on this thread! :D

[Street garbage]

RealityCzech, Cabin Crew Management have already been advised that the Perth B737 base will be closing, to be replaced by Network A320's.

[Rated De]

that these options have been considered, ergo they are a subject of discussion.

Despite the attempt to distract the discussion, please enlighten us as to the "value of JQ" empirical facts and quantitative analysis will suffice. We await your learned response.

RealityCzech, Cabin Crew Management have already been advised that the Perth B737 base will be closing, to be replaced by Network A320's.

Sadly it appears the source of our discussion was correct.

[Street garbage]

Despite the attempt to distract the discussion, please enlighten us as to the "value of JQ" empirical facts and quantitative analysis will suffice. We await your learned response.



Sadly it appears the source of our discussion was correct.

I find it so.."ironic"..that an Angel can write on here and call us liars.

[Beer Baron]

Cabin Crew Management have already been advised that the Perth B737 base will be closing, to be replaced by Network A320's.

Sadly it appears the source of our discussion was correct.
I would hardly call that ‘case closed’. I’ve heard a good many rumours from ‘Cabin Crew Management’ over the years but not many of them have come true. Might be in league with the Townsville refueller.

[goodonyamate]

Maybe the cabin crew base is closing. Probably not. To close a pilot base is very messy, and involves a lot of cost to QF. I’d say highly unlikely, however these idiots do take joy in the misfortune of their staff, so nothing is beyond them!

[Street garbage]

Maybe the cabin crew base is closing. Probably not. To close a pilot base is very messy, and involves a lot of cost to QF. I’d say highly unlikely, however these idiots do take joy in the misfortune of their staff, so nothing is beyond them!
Peter Cosgrove stated during the Lockout that Alan Joyce "had the enemy surrounded"...says it all, really.
And yes, it will cost a lot if they close the base...

[SandyPalms]

RealityCzech, Cabin Crew Management have already been advised that the Perth B737 base will be closing, to be replaced by Network A320's.

Definitely true. What I’ve heard is, all Perth based 737 captains will be forced into the Adelaide base (even if their seniority could hold something else) and all Perth Based FO’s will be forced into SO positions on the 787 in Perth, both groups will then be frozen for the duration of their careers as the company likes 457 Visa cards in preference to Mastercards. Definitely true, heard if from a BBQ sauce.

[Axiom Matic]

Cabin Crew Management have already been advised that the Perth B737 base will be closing, to be replaced by Network A320's.

Given this is of importance to many, has anyone any communication yet that this is happening? Understand the hilarious references to 'Townsville refuellers' but is there anything circulating yet?

Thanks in advance

[Street garbage]

Definitely true. What I’ve heard is, all Perth based 737 captains will be forced into the Adelaide base (even if their seniority could hold something else) and all Perth Based FO’s will be forced into SO positions on the 787 in Perth, both groups will then be frozen for the duration of their careers as the company likes 457 Visa cards in preference to Mastercards. Definitely true, heard if from a BBQ sauce.
The information came from an AIPA Committee member. You can bury your head in the sand (remember 2005? Jetstar will only ever be 12 a/c) if you want to, some of us actually give a toss about career, or what will be left of it.

[Rated De]

We await the learned explanation of the "value of JQ"

In the interim we have considered the impact of the now 99 A320 aircraft commencing delivery and the rotation of the older airframes into Network Aviation. Considering the funding options and delivery timetable it may well be pertinent to consider the fiscal impact of what was reported to be AUD$9.5 billion on Qantas. With a combinaiton of shorter term and longer duration debt, Qantas could conceivably face additional funding costs that didn't appear even 18 months ago. With over two billion expended on share buybacks it is plausible that Qantas lacks requisite funds. Given the usual Airbus funding mechanisms, and the impact of IFRS16 on Qantas' balance sheet it is entirely plausible that new 787 aircraft are deferred as Qantas has committed to delivery of these A320. This makes the role of Network Aviation even more important. If correct, then our source's suggestion of more aircraft to Network seem entirely plausible; they have to go somewhere as they have economic life.Our assessment of JQ is that is suffering from scale deficiency, we await RealityCzech's insightful quantitative analysis as to why this thesis is wrong.

Further there remains the outstanding A380 aircraft (8 in total) we understand the penalties are substantial if Qantas reneges on delivery. We understand Qantas can avoid contractual obligations if the A380 ceases production but otherwise is caught in an enforceable undertaking.

It may well be that Qantas need, but will not get additional replacement efficient aircraft as capital has already been expended.
With contract season open, is it time to blame the staff?