How does Qantas 'de-transform'? [Archive]

Rated De

16th Jan 2018, 21:16

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)

So Leigh and Alan, was wondering how exactly Qantas was 'terminal' and now 'transformed'?

Same fleet, same route, same everything except lower fuel prices and an accounting write down, timed by you to remove a depreciation charge...

Handsomely rewarded for impairing the fleet and benefitting form lower fuel prices itsn't transformation now is it?

It ranked Qantas the worst in 2016, finding it burned on average 64 per cent more fuel per passenger-kilometre than the top ranked airlines, China-based Hainan and Japan's ANA.

As I stated previously in recent days ;

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

What now from the most handsomely rewarded CEO in Australia?

blow.n.gasket

16th Jan 2018, 21:47

What now from the most handsomely rewarded CEO in Australia?

Ummmm , An even bigger Bonus to come up with a solution to your question Rated De ?

International Trader

16th Jan 2018, 23:11

Ummmm , An even bigger Bonus to come up with a solution to your question Rated De ?

Read the article.

........ major airline?

Rated De

16th Jan 2018, 23:19

We know the angels visit these forums, pray tell what fuel savings measures have Qantas employed to 'close the gap' in fuel per RPK?

Why not just shut an engine down in cruise, surely Fort Fumble has worked on that one? :ok:

DirectAnywhere

17th Jan 2018, 00:00

It’s a disgrace really, and pretty obvious to anyone with any knowledge of airline ops. Pilots have been saying it for years. Big twins would have made such a difference to this outfit.

Two things to take away from this. No other airline across the Pacific is at greater risk from rising fuel prices and no other airline is at a greater risk from a price on carbon. These are significant risks that should be priced into the share price.

It’s all cool though, shares vested for execs at much higher prices so they’re all good.

777Nine

17th Jan 2018, 00:24

NSEU

17th Jan 2018, 02:48

Qantas 'worst major airline' for fuel efficiency on trans-Pacific flights, study suggests - ABC News (Australian Broadcasting Corporation)

Are they comparing apples with oranges? If you're basing the survey on the number of passengers and cargo carried vs fuel usage, of course an airline which squeezes 500 passengers into sardine class is going to be more efficient than an airline with aircraft which have three or four zones of First, Business and Premium class seats with decent legroom ( which weigh far more than regular seats) and have a greater baggage allowance.

LeadSled

17th Jan 2018, 03:24

It ranked Qantas the worst in 2016, finding it burned on average 64 per cent more fuel per passenger-kilometre than the top ranked airlines, China-based Hainan and Japan's ANA.

Folks, below is one of my posts from another thread.

I would not agree with the quantum of difference , but the fact is that the difference is still stark, there is no way that having an inefficient fleet, fuel wise, can be turned into an efficient fleet, short of having the efficient aeroplanes.

If Qantas had had an efficient fleet during recent years, it would NOT have made the losses it did on international operations. As I also said, in my opinion, the investment freeze that resulted in the present fleet went back to the preparations to take the company private and strip it.

The international operation has never been as bad a business as "management" has made it out to be, one of the few aviation or financial journalists who ever called it for what it was, as opposed to re-publishing the PR spin, was the late Ben Sandilands.

Tootle pip!!

Rated De

17th Jan 2018, 04:51

The international operation has never been as bad a business as "management" has made it out to be, one of the few aviation or financial journalists who ever called it for what it was, as opposed to re-publishing the PR spin, was the late Ben Sandilands.The international business was accounted to look bad. In 2011 3 weeks before the lockout they applied to amend all European bilaterals, other than two slots a day to London they wanted the ability to operate them with a JQ tail...

How else would the public accept their grand plan (of JQ to the world) unless Qantas international was 'Terminal'
Yes he did.
A few others too...

What is left as the tide goes out?

The Operating Revenue in 2010. $13.7 billion
The Operating Revenue in 2016 $16.2 billion

If one considers inflation to be 3% discounting 2016 figure back to 2010 dollars you get $13.56 billion.
Qantas 'group' went no where...

They poured resources into Asia and JQ ventures for what?
If you look at the JQ contribution they fly a lot of ASK for small RPK...Certainly cannot generate anything like Qantas margin, at least until these geniuses assumed 'management 'and took a spread sheet view of aviation with more consultants driving these projects than ever in its history!

dragon man

17th Jan 2018, 05:24

And to keep themselves looking good with their snouts in the trough you can bet they have hedged a lot of fuel for the next 5 years at the very low prices that were prevailing the last two years. Rather than a kangaroo on the tail a pig with its snout in a trough full of $$$ would be more appropriate!!!!

Rated De

17th Jan 2018, 06:04

Qantas used to run 763 domestically.

Twin aisle, 260 odd passengers.
two pilots
Two engines
One air frame in the terminal area

Having sent the 788 to JQ, for all those high yielding backpackers, Qantas has:

67 738
Handful of A330 (10 of the shorter range variant and 18 200 series)

To get the same passengers into a capital city needs nearly 2 738, with extra pilots, extra cabin crew and indeed two air frames in the same terminal area...

Real genius that

27/09

17th Jan 2018, 06:47

I loved one of the comments at the end of that article from someone name "SomeGuy" Running engines lean increases the wear on engine components, increasing the chance of engine failures. Also, more reserve fuel means more weight thus hight fuel consumption. I consider myself a environmentalist, but I have no problem flying Qantas.

Sounds like he knows what he's on about. He would do well as an airline CEO.

BusyB

17th Jan 2018, 11:11

I don't consider this compares like with like. You expect premium airlines to have First, Business and Premium Economy so how can you compare that with an all economy flight that cancels half the year because the loads aren't enough and doesn't offer the freight options.

bvcu

17th Jan 2018, 12:09

and ETOPS considerations for routing and the costs and restrictions for the longer routings ? Very simplistic !

morno

17th Jan 2018, 12:15

Errr all the Airlines mentioned in the article are full service airlines. There’s no budget carriers in the study from what I can see.

BusyB

17th Jan 2018, 13:21

morno,
A lot of the higher rated ones don't have premium cabins and this becomes more obvious if you look at the transatlantic survey and not just the Pacific one.

morno

17th Jan 2018, 13:35

Perhaps, but from the article;

20 major airlines conducting trans-Pacific flights.

It's not talking about trans-Atlantic.

And the one's listed are all premium airlines.

Airbus A320321

17th Jan 2018, 20:21

The international business was accounted to look bad. In 2011 3 weeks before the lockout they applied to amend all European bilaterals, other than two slots a day to London they wanted the ability to operate them with a JQ tail...

How else would the public accept their grand plan (of JQ to the world) unless Qantas international was 'Terminal'
Yes he did.
A few others too...

What is left as the tide goes out?

The Operating Revenue in 2010. $13.7 billion
The Operating Revenue in 2016 $16.2 billion

If one considers inflation to be 3% discounting 2016 figure back to 2010 dollars you get $13.56 billion.
Qantas 'group' went no where...

They poured resources into Asia and JQ ventures for what?
If you look at the JQ contribution they fly a lot of ASK for small RPK...Certainly cannot generate anything like Qantas margin, at least until these geniuses assumed 'management 'and took a spread sheet view of aviation with more consultants driving these projects than ever in its history!

$417 million profit from JQ last financial year. Hardly an insignificant contribution.

morno

17th Jan 2018, 20:39

Don’t tell the Qantas boys that, they’ll find some way to talk it down and make it seem like Qantas paid for everything to get that profit. ;)

V-Jet

17th Jan 2018, 21:56

Don’t tell the Qantas boys that, they’ll find some way to talk it down and make it seem like Qantas paid for everything to get that profit

Unfortunately there has been zero real evidence supporting either POV presented. No one in QF doubts the hard work any JQ staff do, but wouldn’t genuine figures and real answers to the litany of serious questions put to ‘management’ solve the issue? One simple fact stands out from all the others. QF has an atrocious fleet but has spent the money that could have solved most (if not all) of its’ issues on JQ. JQ sells tickets far, far cheaper than QF, it’s a legitimate question to ask (among many others). So where are the answers? Phrases like ‘commercial, in confidence’ have been handed out like confetti. People asking genuine questions are not stupid, but the answers are frankly insulting.

On another note, I bet Jetstar can’t wait to get their hands on something as good as Qantas’ new Gamechangers! If I were a JQ driver I’d be pink with envy at Qf’s (two) tiny, shiny jets! Just that display of hypocrisy from management guarantees few will trust what they say. Especially with no hard evidence.

PS: Pink with envy - political pun intended.

Rated De

17th Jan 2018, 22:19

QF has an atrocious fleet but has spent the money that could have solved most (if not all) of its’ issues on JQ. JQ sells tickets far, far cheaper than QF, it’s a legitimate question to ask (among many others). So where are the answers? Phrases like ‘commercial, in confidence’ have been handed out like confetti. People asking genuine questions are not stupid, but the answers are frankly insulting.

Correct.

No one is disputing JQs existence. There is a market segment for it.
However under nearly every metric, its performance is less than its parent, allowing for management allocation of cost away from JQ. This is permitted, but was never intended to 'distort' in a way to support an industrial narrative.

The JQ 'segment' is NEVER going to be De aggregated. Qantas management would never do that, I leave it to the reader to ask why not? Qantas is 'split' into two segments (both domestic and international) JQ is not and this ensures that no accurate assessment can be made. Qantas was split in 2012, you know when the Qantas international, today transformed, was then terminal.
Given the management discretion allowed with how costs are allocated between those segments means that distortion of 'performance' is easily 'manufactured'.

Transition Layer

18th Jan 2018, 03:31

Don’t tell the Qantas boys that, they’ll find some way to talk it down and make it seem like Qantas paid for everything to get that profit. ;)

*yawn*
Your Qantas Pilot bashing getting very boring now Morno :rolleyes:

BusyB

18th Jan 2018, 08:32

Morno,

I don't know what you define as a Premium Airline. For me it includes 1st Class and a Business class with individual beds, not beds that mean you have to climb over the next seat to go to the WC. Compare like with like please.

griffin one

18th Jan 2018, 22:44

Looks like the 787 Dreamliner will be relegated to just two flights a week Mel-Lax with the rest of to SFO.
A380 to service remainder of MEL-LAX service
That’s transforming.

Transition Layer

19th Jan 2018, 12:39

Looks like the 787 Dreamliner will be relegated to just two flights a week Mel-Lax with the rest of to SFO.
A380 to service remainder of MEL-LAX service
That’s transforming.

They should just bite the bullet and send the 787 MEL-SFO daily. Makes much more sense to fly a route with zero (direct) competition where you can charge a premium. And besides, no one really likes going to LAX!

dragon man

19th Jan 2018, 19:00

They should just bite the bullet and send the 787 MEL-SFO daily. Makes much more sense to fly a route with zero (direct) competition where you can charge a premium. And besides, no one really likes going to LAX!

Problem is they have to get the Melbourne based 787s to Lax for maintenance in the huge hanger they built.

Rated De

20th Jan 2018, 21:21

As was sent to me.
Interesting spin.

Media are reporting on our ranking....We rank low in this study of airline efficiency and carbon emissions when flying across the Pacific. We rank low in this study because we use larger aircraft, fly very long distances and have premium cabins that naturally have fewer people on board...Dear Angels,

The great circle track 'across the Pacific' is the same. Although flex tracking changes this slightly.
RPK is the Revenue passenger kilometres, this may change with cabin configuration.
Larger aircraft burn more fuel.
They also have four engines (in the Qantas fleet)

Thus the simple fact that your fleet growth sat with JQ (from 36 to 120 aircraft) Your genius board and executive management took a viable airline in 2009 and trashed the brand in 2011 in a 'terminal decline' grounding and lockout. Only to handsomely reward themselves for its 'transformation'.
This was all done with:

The same fleet A380 and B747
The same contracts
and the same staff.

Sadly despite your attempt to spin it otherwise your fuel included CASK is higher than your competitors because instead of strategically positioning your airline for efficiency with a twin engined fleet, your management ran an IR campaign. 'Right fleet right route; exists only in the minds of marketing and branding, it sounds nice but is ultimately as hollow as the transformation.

This report suggests rather subtly, that Qantas is neither efficient nor transformed.

With a grand total of 8 787 and your management signing up to the IATA fuel efficiency targets of:

(1) a 1.5% average annual improvement in fuel efficiency from 2009 to 2020; (2) carbon-neutral growth from 2020 and (3) a 50% absolute reduction in carbon emissions by 2050.It may be time for another manufactured decline (you know an industrial dispute) in case management are shown to be the myopic self serving group this independent report suggests your management are

Beer Baron

21st Jan 2018, 05:59

Rated De,

I get it, Qantas senior management suck. I work there and yep we’ve been through a really ****ty decade but some of your oft-repeated statements are about as accurate as the ITN emails we receive.

You have made the comment many times in numerous different threads that the turnaround is a sham as we still have; “The same contracts and the same staff.”

But this is clearly not true. Qantas cut approximately 5000 staff. You see it everywhere. There is no one to answer your call or email in nearly every department we deal with. There is no one to drive the aerobridge, there are less flight attendants on the flight, there is no one in crewing to fix your rostering problem, etc, etc.

And the contracts are clearly different. Long haul has had a major change in the 787 section and both LH and SH have accepted/endured pay freezes. But more broadly, nearly every employee has had a pay freeze forced upon them. Many of our colleagues have been forced onto lesser contracts to do the same role.
Think of the cabin crew, QCCA staff or the QD contract. The baggage handlers are increasing employed on a lesser contract by ‘Qantas Ground Services’ as opposed to the previous Qantas contract.

I’m sure there are many more examples.

Now don’t get me wrong, I’m not in favour of ANY of this. It’s just the sad reality of the company we work for. But you can’t keep repeating a line as an attack on the company if it is evidently false.

There is plenty to attack them over without making stuff up.

Rated De

21st Jan 2018, 06:27

There is plenty to attack them over without making stuff up.

I certainly don't make it up.

To save you actually looking;

Staff costs in nominal AUD FTE Staff

2014 $3.77 billion 30,751
2015 $3.60 billion 28,622
2016 $3.86 billion 29,204
2017 $4.03 billion 29,596

But you can’t keep repeating a line as an attack on the company if it is evidently false.

Where exactly are the approximately 5,000 staff you 'quote'?

How many pilots are on different contracts flying the 787? Are there three or four in service?

MickG0105

21st Jan 2018, 09:27

Where exactly are the approximately 5,000 staff you 'quote'?

The 5,000 FTE reduction was off the 2013 baseline of 33,265 FTEs, wasn't it? So there's a reduction of 3,669 FTEs in absolute terms to 2017.

And then there's the fact that the 5,000 target was never a straight up reduction in absolute terms; I'm pretty sure that it was always couched as a net reduction after adjusting for activity and new businesses. I'm not sure how they looked to measure activity but passenger numbers aren't a bad surrogate. Passengers numbers between 2013 and 2017 grew by around 11 per cent so "after adjusting for activity" there's the equivalent of something like an additional 3,000 FTEs.

So there's your 5,000+ net reduction in FTEs after adjusting for activity and new businesses right there.

Rated De

21st Jan 2018, 19:26

The real risk to the 'transformed' Qantas lay in the genesis of its so called recovery.

Fuel price falls were $597 million of the turnaround profit, the depreciation change from CGU impairment another $326 million. They were the only substantive changes in expenditure.

With Fuel prices having bottomed in 1QCY16, Qantas with its fleet languishing at a substantially higher fuel included CASK than competitors runs a very real downside risk that its so called 'transformation' vanishes.

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

Pearly White

21st Jan 2018, 22:35

I loved one of the comments at the end of that article from someone name "SomeGuy"

Sounds like he knows what he's on about. He would do well as an airline CEO.
I’m looking forward to learning more about leaning out a jet engine. To lean out the engine do you also have to lean out the window to see the flame colour, you know, like adjusting a Bunsen burner?