Government Loan to Virgin Australia

[VR-HFX]

Air China makes the most sense.
30% cross shareholding with CX Group.
Star Alliance.
Large operator of 738's
Offer Etihad, Branson, HNA and Nanshan 5-6 cents a share. SQ would probably stay. HNA & Nanshan may be part of a larger restructure of the airline industry in China.
Return all leased aircraft and replace as necessary with surplus a/c from own fleets.
Rebuild domestic services from a base fleet of 40-50X738's.
VARA to be sold to Alliance or J/V with Alliance.
Re-brand as Star Alliance Australia.
Maintain TransPac services -scrap Delta alliance for United.
Debt moved up the tree for renegotiation based on bigger asset pool and negotiating power.
Not sure about the 10% public float and Australian listing but sure something can be worked out to ensure maintenance of Australian traffic rights for any international services such as Transpac.

That may be overly simplistic but might well be the outcome if VAH goes into administration. The only difference with administration is that there would be a huge wastage of precious funds going to the administrator.

[TBM-Legend]

I didn't know that we had a money printing press in Qld.


The Qld printing press is, of course, rented...

[Matt48]

How has VA not been trading while insolvent prior to Covid, they are $5B in debt,with minimal assets and $215M annual losses for a decade.
How to own a small airline....... start off with a large one.

[Matt48]

The Qld printing press is, of course, rented...

With lease payments printed off monthly.

[2020Balance]

Heard Lucinda Gemmell has emptied her desk out and left the Village! Not many lifeboats left now while the band keeps playing. Who’s going to be in charge of hiring all the team specialists and oxygen thief’s now?

[Brisbane Sinner]

Wow, she obviously isn’t interested in a Melbourne office view.

[krismiler]

We all need to remember that this is the pilots RUMOUR network, not the pilots PROVEN FACTS network. Anyone who needs verifiable, concrete information would be better off getting their news from official press releases, and sources such as the ASX.

In a situation such as this, there are any number of things which could happen and it's entirely reasonable to speculate on a range of possible outcomes. There are news reports which have differing points of view depending on who owns the agency involved and some of their sources may be more or less accurate than their competition. Those who know for sure aren't talking, and those who are talking don't know for sure.

Let's not take anything personally, I'm sure the vast majority here want Virgin to come through this and wish them all the best in this exceptionally trying time. Hopefully in the not to distant future the critical decisions will be made and the staff won't be in limbo over their future.

At the moment we're like the meteorological office, scientists when talking about past events and reading tea leaves when predicting the future.

[wheels_down]

Has the CEO left yet? Long overdue. Chief Experience Officer that is. :}

There is also a ‘Chief Risk Officer’. Good Lord.

[Paragraph377]

Heard Lucinda Gemmell has emptied her desk out and left the Village! Not many lifeboats left now while the band keeps playing. Who’s going to be in charge of hiring all the team specialists and oxygen thief’s now?
Oh no! But but who will carry the baton now in the race for diversity in Lucinda’s quest to have freaks, fools and fuc#wits piloting aircraft, all for the sake of ‘diversity’? Is this the end of the era of ‘specialists’?? I thought the pilots would be eventually renamed ‘aeronautical specialists’, the flight attendants ‘In-flight service specialists’, and LAME’s renamed ‘air vehicle specialists’? Morons

[International Trader]

Virgin has proven that low cost does not work in Australia.
It was not started by airline executives with a solid business plan but in fact, by 2 secondhand plane salesmen who managed to sell the idea to get start up money on a bar napkin.
When it was floated the original players pulled out their little goldmines and couldn’t give a toss from then on.
The only reason that Virgin survived was that the last Liberal government allowed Ansett to fall .
There were no new ideas or brilliant management types, just low class service for not so low a cost , and fares went up after Ansett failed.
The attempted transformation from a pig’s ear into a silk purse just cost a lot of money and still produced share prices that have not seen more than a quarter of the issue price and at times 1/20 of issue.
What was the last share price ( when you could buy) ?
Penny stock prices they call it in the US, the stuff for mug punters to buy.
The reason for this was because it was grossly over valued at the float and people bought the hype.
Virgin is a dead business, there is no point in dragging the saga on and another operator will take over without the self inflicted debt that a Virgin has to carry.
If it is sold to Chinese controlling interest, there is no guarantee that fares will remain low and even less that the service will be there.
The air will not be fair and the Chinese will want more than the airline , they will expect the gov to take on the debt and will want to pay little for the airline to boot.
Face it , the price of everything is going up as will airfares whether the government urinates 1.4B up against the wall , Virgin fails or the Chinese get control.
Sure ( sadly) people will lose their jobs but, many more lost their jobs when Ansett fell ( I think it may have been 17500) and the government couldn’t care less, why care now?
In fact the government allowed Air NZ to attempt to buy Ansett when it shouldn’t have and they shouldn’t allow the Chinese to take over Virgin now nor bail it out.

[Predator Jock]

I, for one, welcome our new sino overlords...

[Chris2303]

Why don't they contact the gentleman from Nigeria who has millions to give away?

[wheels_down]

New entrants might be more interested now, in that QLD offered $200m to Virgin, however, when questioned by reporters, she said, if Virgin fails, then the $200m will go to a new startup.

$200m is quite a big help for a new startup. $200m + Vacant Terminal Space, Slots, and with a large skilled workforce available, a very attractive option.

[dr dre]

New entrants might be more interested now, in that QLD offered $200m to Virgin, however, when questioned by reporters, she said, if Virgin fails, then the $200m will go to a new startup.

$200m is quite a big help for a new startup. $200m + Vacant Terminal Space, Slots, and with a large skilled workforce available, a very attractive option.

Any one planning to start up an airline in this environment would be certifiably insane

[Paragraph377]

Any one planning to start up an airline in this environment would be certifiably insane
Absolutely correct. Unlike the AN collapse there is currently no massive void to fill. Even if the all clear was given tomorrow by Scotty from Marketing to return the world to normal operations there would be less domestic and international travel happening for considerable time. Businesses have gone broke, most people don’t have jobs and hardly anyone can afford a holiday. Then there is the unseen damage - people afraid to fly incasee they catch COVID, people not wanting to book with VA incasse they go tits up and you lose your money. Lots of hidden factors.

Virgin has in place all the LEGO blocks to be an airline. The best thing is for it to be possibly rebranded, start again with one aircraft type operating the gravy routes and build up from there. Piss Branson off and stop giving him money for the tails and logo’s. Call themselves V2 Airlines or whatever it takes. Have the Federal or State Government tip in some cash and then get a seat on the Board. But make the airline lean like in the early days. For too many years they have tried to operate in a third tier, somewhere in between JQ and QF. It doesn’t work!!! You are either a JQ which is lean, cheap and nasty or you are QF with a premium business service (well it used to be). But whatever happens, the airline industry will return as a much different industry after the COVID crisis subsides.

[Tubman601]

New entrants might be more interested now, in that QLD offered $200m to Virgin, however, when questioned by reporters, she said, if Virgin fails, then the $200m will go to a new startup.

$200m is quite a big help for a new startup. $200m + Vacant Terminal Space, Slots, and with a large skilled workforce available, a very attractive option.
Where and when was this “said to reporters”, haven’t heard that one. Can’t imagine it actually.

[Paragraph377]

Where and when was this “said to reporters”, haven’t heard that one. Can’t imagine it actually.
It’s in the, dare I say, MSM. Mrs Piggy has put the offer on the table. But it’s obviously not enough and is probably most likely to be a bit of a stage show as she goes to the polls in a few months. Treasurer Trad is also completely on the nose. I wouldn’t trust her with $100 worth of $0.05 cent pieces to invest.

[Superman1]

Could be wrong but I think the rumoured Chinese investors that are apparently ‘circling’ is absolute nonsense and purely designed to add pressure on the government to bail them out. A nice bit of fear mongering when the worlds against China and their ambitions to ‘take over’ Australia and our critical infrastructure.

On a seperate note, just can’t believe that Elizabeth Bryan who oversaw the JB era and JB himself will just walk off and into their next board position once this is all over like nothing ever happened. Would love a public inquiry into the depth of the mismanagement, ludicrous decision making and systemic failure of governance which will lead to thousands of jobless Australians and the mental health issues that arise as a result.

[Chronic Snoozer]

I don’t know how they will
do interstate services to Perth. The WA Premier has just said the WA borders will be closed for at least 6 months.

They need this long to get the COBTs sorted.

[wheels_down]

Where and when was this “said to reporters”, haven’t heard that one. Can’t imagine it actually.
News Corp asked the question

The money could also be used to invest in a new competitor if Virgin doesn’t make it through the pandemic and Qantas gains a monopoly over domestic flights, provided that new competitor also bases itself in Qld.

[The Bullwinkle]

JB himself will just walk off and into their next board position once this is all over like nothing ever happened.
He already has!

https://australianaviation.com.au/2020/03/ex-virgin-md-joins-brisbane-airport-board/

And the mental health issues were already arising when he was still there!

[Paragraph377]

On a seperate note, just can’t believe that Elizabeth Bryan who oversaw the JB era and JB himself will just walk off and into their next board position once this is all over like nothing ever happened.
Unfortunately she will pop up again on a Board somewhere because supposedly she has skill and experience. Plus when you mix in those circles you get to know other incompetents in similar roles and you make connections. Plus she has done a Directors course and has the easily obtainable certification which apparently makes you immortal, so she will definitely end up elsewhere. To be honest, Houston doesn’t have much better qualifications other than slippery pole slider in the armed services and he was he on the Board of ASA. He too leaves a trail of wreckage behind him everwhyere and then lands a plum role on another Board. He bailed the Air Force after the Collins Class submarine fiasco and the sexual abuse investigations into the armed Forces. Then there was ASA with the billion dollar OneSky debacle. Again, when the going got tough the gutless got going. Then he slipped his way into VA. What a joke. No wonder the place never stood a chance.

[2020Balance]

Unfortunately she will pop up again on a Board somewhere because supposedly she has skill and experience. Plus when you mix in those circles you get to know other incompetents in similar roles and you make connections. Plus she has done a Directors course and has the easily obtainable certification which apparently makes you immortal, so she will definitely end up elsewhere. To be honest, Houston doesn’t have much better qualifications other than slippery pole slider in the armed services and he was he on the Board of ASA. He too leaves a trail of wreckage behind him everwhyere and then lands a plum role on another Board. He bailed the Air Force after the Collins Class submarine fiasco and the sexual abuse investigations into the armed Forces. Then there was ASA with the billion dollar OneSky debacle. Again, when the going got tough the gutless got going. Then he slipped his way into VA. What a joke. No wonder the place never stood a chance.


Wonder if she’ll take Stewie and co with her or they’ll stay and slide up the VA mk 2 pole.

[Paragraph377]

Wonder if she’ll take Stewie and co with her or they’ll stay and slide up the VA mk 2 pole.
Needs to be a clean start. Keep Scurrah as he has only been there 12 months. Not a lot of time to make huge changes, but he had started to make slow progress. Any other Executive Manager that has been there prior to Scurrah is likely to be part of the problem, including Board members. Time for a cleanout. As for Stu, sorry, he has been there from start to collapse, 20 years. He is part of the furniture and it’s time to go.

[junior.VH-LFA]

Unfortunately she will pop up again on a Board somewhere because supposedly she has skill and experience. Plus when you mix in those circles you get to know other incompetents in similar roles and you make connections. Plus she has done a Directors course and has the easily obtainable certification which apparently makes you immortal, so she will definitely end up elsewhere. To be honest, Houston doesn’t have much better qualifications other than slippery pole slider in the armed services and he was he on the Board of ASA. He too leaves a trail of wreckage behind him everwhyere and then lands a plum role on another Board. He bailed the Air Force after the Collins Class submarine fiasco and the sexual abuse investigations into the armed Forces. Then there was ASA with the billion dollar OneSky debacle. Again, when the going got tough the gutless got going. Then he slipped his way into VA. What a joke. No wonder the place never stood a chance.

He did not "bail" from the ADF as a result of either of those things (or at all), his tenure in that posting was over and he retired as there isn't a further rung up the ladder to go, as is standard practice. If you're going to attack someone at least make sure what you're writing is accurate.

[Paragraph377]

It’s also ironic that the Queensland Government is courting Virgin with a $200m tease considering Paul Scurrah is holding his hand out for a taxpayer bailout after he hosted State Labor Ministers Jackie Trad and Shannon Fentiman free of charge at his $7.2 million ski lodge in Whistler. Perhaps Mrs Piggy and Trad are hoping to go to Whistler together once the COVID restrictions are lifted?

[Paragraph377]

He did not "bail" from the ADF as a result of either of those things (or at all), his tenure in that posting was over and he retired as there isn't a further rung up the ladder to go, as is standard practice. If you're going to attack someone at least make sure what you're writing is accurate.
My comment is accurate. He left a trail behind him in both organisations. Now he is on the VAH Board where another trail of destruction is being left behind.

[-41]

Needs to be a clean start. Keep Scurrah as he has only been there 12 months. Not a lot of time to make huge changes, but he had started to make slow progress. Any other Executive Manager that has been there prior to Scurrah is likely to be part of the problem, including Board members. Time for a cleanout. As for Stu, sorry, he has been there from start to collapse, 20 years. He is part of the furniture and it’s time to go.

I’m sure the new owners will turn to an anonymous forum for guidance on matters like this.

[Paragraph377]

I’m sure the new owners will turn to an anonymous forum for guidance on matters like this.
Why would they do that? This is merely a’rumour network’ and very few on here are setting out a business recovery strategy for the airline, people are merely postulating and articulating thoughts. Then again, considering the current woes at VA maybe they will turn to anonymous forums for guidance as they can’t do any worse than they already have.

[-41]

Well played. Too true VAH probably could have hired JT on the basis of advice on this forum.

[Paragraph377]

Unfortunately some people feel that people
like Houston and Cosgrove (ex QF Board) make great Board members of listed companies. Based on what? Their experience is having endless supplies of Government money for their organisations with little accountability. Far different to a private company or corporation. Or is it their ability to lick their way to the top of the Defense Force? Again, no skill in that, but airline CEO’s do have ego’s and like their asses being kissed. Margaret Staib is another ex Defense slippery pole slider and she had a tenure with ASA, as CEO, and once again there was no love lost when she left as her performance was viewed as less than stellar.

[Slezy9]

My comment is accurate. He left a trail behind him in both organisations. Now he is on the VAH Board where another trail of destruction is being left behind.

I’ve no idea about Angus Houston’s activity’s after the ADF. But you are WRONG about his military service. He was roundly liked and respected as CAF and CDF. He did a great job and I’m not really sure what he had to do with Collins as an Air Force guy? He was CDF well after Collins was operating at a high level.

Paragraph you you seem to be pretty bitter about life in general. You must be fun at parties.

[Chronic Snoozer]

Unfortunately some people feel that people
like Houston and Cosgrove (ex QF Board) make great Board members of listed companies. Based on what? Their experience is having endless supplies of Government money for their organisations with little accountability. Far different to a private company or corporation. Or is it their ability to lick their way to the top of the Defense Force?

Yeah, like when Houston stood up the government of the day and questioned the 'children overboard' claim. He was only 'acting' CDF at the time but they still promoted him and made him CDF AND extended his tenure.

What are you on about?

[Stretch06]

Paragraph you you seem to be pretty bitter about life in general. You must be fun at parties.

:D:D:D……….

[das Uber Soldat]

Unfortunately some people feel that people
like Houston and Cosgrove (ex QF Board) make great Board members of listed companies. Based on what? Their experience is having endless supplies of Government money for their organisations with little accountability. Far different to a private company or corporation. Or is it their ability to lick their way to the top of the Defense Force? Again, no skill in that, but airline CEO’s do have ego’s and like their asses being kissed. Margaret Staib is another ex Defense slippery pole slider and she had a tenure with ASA, as CEO, and once again there was no love lost when she left as her performance was viewed as less than stellar.
Do you ever shut up? Every thread, the same old man yelling at clouds.

You don't like virgin. We get it. Go play canasta or whatever geriatrics struggling for purpose post retirement are supposed to do.

[H-Dog]

Paragraph I’m trying to do you a favour when I say that you need to stay off PPRUNE as you are making a real C#nt of yourself, the equivalent of stopping someone from drunk texting. I cannot imagine a sadder retirement than feeling the need to get on PPRUNE to shove my controversial views down people’s throats. I bet you were popular on the flight deck :rolleyes:

[Paragraph377]

Paragraph I’m trying to do you a favour when I say that you need to stay off PPRUNE as you are making a real C#nt of yourself, the equivalent of stopping someone from drunk texting. I cannot imagine a sadder retirement than feeling the need to get on PPRUNE to shove my controversial views down people’s throats. I bet you were popular on the flight deck :rolleyes:

Ha Ha! Love it! Always the professional on the Flightdeck cuz and we had lots of fun. Can’t fly as long as I did in the LHS without a sense of humour or professionalism. ANZ was good to me and vice versa. As for wanting VA to fail, you are a muppet mate. Said it time and again that I don’t wish to see Pilots unemployed. But I won’t hold back from showing up management and the Board for what they are. I really couldn’t give two sheep whether you like that or not, cuz.

[junior.VH-LFA]

I guess you could stick to being factual about the people you’re trying to drag through the gutter; that would be a start.

[Paragraph377]

I guess you could stick to being factual about the people you’re trying to drag through the gutter; that would be a start.
Sorry, were you saying something??

[Sunfish]

Para377 has it mostly correct. A lot of Directors are there for their connections. I was schooled by my board about the duties of Directors. It is not a. job for the faint hearted. It is not about port and cigars. It is therefore a concern to have “celebrity” Directors who may not know much about running airlines....

....And no, you won’t just pick it up on the job. You won’t even know the right questions to ask.

[2020Balance]

I wonder if the head of C@Ts new school of aviation excellence is still going ahead in Tamworth? And if the new business divisions had been “Stood Up“ yet or maybe all the “Colouring In specialists” have left the village.

[chickoroll]

On the news this morning Government to offer VA financial assistance few conditions of course, seems to be a big obsession where head office is. Head office must move to Western Sydney Airport precinct.

[chance]

No other than Peter Beattie who attracted Branson to Brisbane has entered the save Virgin crisis urging the States to stump up the money (Courier Mail 20 April) to save services to regional Australia. Given his record as a Premier, Chairman of the Commonwealth Games and Chairman of the ARL is not exactly bathed in glory a heart felt recommendation from him is probably the kiss of death. If Scurrah has urged Beattie to respond because of Scurrah's political connections, having been appointed Head of Qld Rail by Labor and his wife was former Premier Ann Bligh's (now Mrs Banking Australia) Chief of Staff it is a sign of utter desperation. The Chinese have probably read the tea leaves and will abandon the notion of any deal out of fear that Beattie might be appointed the Chairman

[TWT]

The Chinese have probably read the tea leaves and will abandon the notion of any deal out of fear that Beattie might be appointed the Chairman

The 'Chinese consortium buyout' rumour is fake news.

[cloudsurfng]

Frydenberg said this morning that govt won’t be bailing out, the airline has to go through all ‘commercial processes’ (ie, administration). Also said any attempted takeover by a Chinese govt owned airline will be blocked.

not sure what planet the nsw treasurer is on. Last thing VA needs is different state govts pulling on each arm trying to force them to relocate. Just another big decision for an already overwhelmed management

[Sunfish]

Expect Virgin to announce receivership in about 20 minutes. The only other chance is perhaps Paul Little and some Melbourne heavies buying in, but I would suspect they may need to ensure they can keep the AOC, while getting rid of half the fleet. If Virgin goes into receivership, the next hurdle is how the leased aircraft get repossessed and retaining their airworthy status. I don’t know enough about the state of Virgins maintenance and documentation.

[Con Catenator]

Even if Little et al considers a stake in VA, the debt still needs to be quarantined, which can only happen after an administration process. I'm unclear as to how an AOC is managed in this scenario however.

[Section28- BE]

Sunfish- "and some Melbourne heavies buying in,"

The more things change, the more they remain- Fox and Lew, from days gone by..............

Good luck all.
Rgds
S28- BE

[das Uber Soldat]

Expect Virgin to announce receivership in about 20 minutes.
Its been 20 minutes.....

[Con Catenator]

He said "about" 20 minutes, plus this is a rumour forum, so who knows whether it's true. Time will tell. :uhoh:

[normanton]

Frydenberg said this morning that govt won’t be bailing out, the airline has to go through all ‘commercial processes’ (ie, administration). Also said any attempted takeover by a Chinese govt owned airline will be blocked.

not sure what planet the nsw treasurer is on. Last thing VA needs is different state govts pulling on each arm trying to force them to relocate. Just another big decision for an already overwhelmed management
A very smart and wise planet. A buyout from any government owned Chinese company in the current Australian market should be blocked.

[Chad Gates]

The states should either stump up the money condition free, or shut up. They seem to just be playing politics. They want to be seen by their constituents to be “doing something”, but never actually doing anything.

[Des Dimona]

Get back to the reality - It's an Australian ASX listed public company where shareholders won't front up with funds to keep it going. That doesn't give it any rights to preferential government funding. What don't you understand about this ??

On any view, in the current climate, Chinese government funding is just not an acceptable outcome.

[normanton]

It’s interesting, VA isn’t Australian enough, not worthy of a government loan and should look for a market solution. But they can’t have a Chinese money because they are too Australian. And the states can’t given them a loan either. It all makes perfect sense.
It's got nothing to do with being "too Australian". It's got everything to do with blocking government backed Chinese investors coming in and scooping up assets at fire sale prices.

This isn't just targeted at Virgin and aviation, it includes any business.

[cloudsurfng]

A very smart and wise planet. A buyout from any government owned Chinese company in the current Australian market should be blocked.


no I would say outer space somewhere...Frydenberg said Chinese blocked, nsw treasurer says virgin has not been mismanaged and will possibly contribute if they relocate to badgerys creek....don’t you think VA management have enough to deal with at the moment without throwing a ‘pack up and move’ in there as well?

[normanton]

nsw treasurer says virgin has not been mismanaged and will possibly contribute if they relocate to badgerys creek....don’t you think VA management have enough to deal with at the moment without throwing a ‘pack up and move’ in there as well?
Oh please. It's a political stunt to keep the voters. Neither the QLD or NSW government have any intentions to help out.

I have five billion reasons that say the NSW treasurer is living in la la land.

[cloudsurfng]

Oh please. It's a political stunt to keep the voters. Neither the QLD or NSW government have any intentions to help out.

I have five billion reasons that say the NSW treasurer is living in la la land.

which is exactly what I said first up.

[ampclamp]

Virgin should just get 3 head offices one WSA, Brissy and Melbourne.:rolleyes: Problem solved.

States are just posturing hoping someone will stump up the cash before they move. Only a fool will buy in without the debt being quarantined in some way.

[Forced Labor]

As was said above, administration is probably the only way that debt can be quarantined. But that may be the end of the Virgin brand in Australia.

[-41]

Has it been 20mins yet? No announcement on ASX for VAH

[normanton]

Sunfish strikes again.

[Section28- BE]

Fitch Ratings Update: https://www.asx.com.au/asxpdf/20200420/pdf/44h2mx6h9vv5t0.pdf

Moody's Rating Update: https://www.asx.com.au/asxpdf/20200420/pdf/44h2msdqpb0fvd.pdf

Rgds
S28- BE

[junior.VH-LFA]

The saber rattling between NSW and QLD governments is pathetic.

[VR-HFX]

VH-LFA - Couldn't agree more but will certainly try. Both Qld and NSW are showing themselves as needy, unrealistic and just plain stupid. The airy fairy proposals are based on so-many preconditions that they are obviously designed as a publicity stunt. Shame on them.

[wheels_down]

Libs and Labour having a good old crack at each other. Virgin just the puppet here.

Hey, this could work out for Virgin here. Pissing contest back and forth, back and forth, Virgin will have its Billon bucks in no time!

Scurrah can just grab the popcorn, sit back relax and let his cash arrive courtesy of some ******** pollies pissing contest.

As Virgin Australia scrambles to stave off collapse, NSW and Queensland have entered a bidding war over which state will secure the airline's headquarters.

Queensland has vowed to "stop at nothing" to keep Virgin's headquarters in Brisbane and has warned the NSW government to "back right off".
Virgin Australia planes sit idle at Brisbane Airport during the pandemic.
Photo: Darren England - AAPThe NSW government has put forward a Virgin Australia rescue package - with the condition of relocating the airline's headquarters to Sydney.

On Saturday, the Queensland government offered a $200 million rescue package for the country's second national carrier - as long as its headquarters remained in Bowen Hills in Brisbane.

Queensland State Development Minister Cameron Dick said he would "fight any attempt by New South Wales to steal Virgin Australia from Queensland to Sydney".
"Back right off. Just don’t go there,” Mr Dick said.

"If the world knows one thing, it knows this: there is nothing more dangerous than Queenslanders with their backs to the wall.

"New South Wales might want to bring a pea-shooter to the fight, we will bring a bazooka and we're not afraid to use it.

“At a time when their jobs hang in the balance, the 1200 Queensland families who depend on those head office jobs should not have to face the threat of being forced to move to Sydney."

NSW Premier Gladys Berejiklian said her government was "considering all the options we have moving forward".RELATED ARTICLEAVIATION (https://www.brisbanetimes.com.au/topic/aviation-5ut)NSW coy on Virgin bailout as Victoria rejects calls for help (https://www.brisbanetimes.com.au/national/nsw-coy-on-virgin-bailout-as-victoria-rejects-calls-for-help-20200418-p54l2g.html)"If that means encouraging businesses to set up shop in NSW, if it means bringing jobs to our state, we will, of course, consider all those things," she said.

"At the end of the day, my government is responsible for NSW, I don't apologise for that."

Mr Dick has not ruled out pouring more money in to keep the ailing airline in Queensland.

The escalation in the bidding war comes as Queensland reported no new cases of COVID-19 on Monday for the first time since March 9.

Premier Annastacia Palaszczuk said it was an “absolutely tremendous” result and said if numbers continued to stay down for weeks, she would consider lifting restrictions.

More than 1000 Queenslanders have been infected with the virus since the state recorded its first case in late January.

About half of those people have since recovered and of those still infected, 20 patients remain in hospital, with seven of those in intensive care on ventilators.

[Icarus2001]

Expect Virgin to announce receivership in about 20 minutes. That is very specific Sunfish.

My watch may have stopped. How is the time where you are?

[Vindiesel]

I don't think we'll be hearing much until about 0930 Wednesday.

[Sunfish]

I said “20 minutes” that would be 10.00 am. I didn’t say which month, just 20 minutes :}

[Buster Hyman]

The only other chance is perhaps Paul Little and some Melbourne heavies buying in, but I would suspect they may need to ensure they can keep the AOC, while getting rid of half the fleet.
They'd probably do better by offering to buy Tiger from them. All the infrastructure & HQ is in MEL already. About the right size for a "start up"... just a thought.

[wheels_down]

Singapore should take back the Tiger AOC and rebrand it as Scooter.

A Scoot Domestic fleet with 20-30 aircraft would be sustainable, without Virgin.

Its certainly a option. Scoot is in the progress of upgrading its CEO to NEO and will have available aircraft.

They could base it in Sydney and take on a few hundred million in incentives.

Scoot is now run by Campbell again, so most certainly possible.

[DirectAnywhere]

I said “20 minutes” that would be 10.00 am. I didn’t say which month, just 20 minutes :}

With people concerned for their futures and desperate for any info, a post like that is unconscionable. Take a long, hard look at yourself.

[Obie]

If DA thinks the statement from Sunfish is "unconscionable" how on earth would he handle a world wide virus pandemic were we to experience one?

[VR-HFX]

With respect DA, if you are relying on PPrune for information then you are self-harming.

[Lookleft]

If anyone takes what Sunfish saids as anything other than a pathetic cry for attention then you are setting yourself up for disappointment.

As far as Sunfish is concerned I will paraphrase Mark Twain: It is better to not post anything and let people think you are a fool than to hit submit reply and remove all doubt.

[marchino61]

They've gone into administration.

Deloitte understood to be appointed administrator for Virgin AustraliaIt is understood big four accounting firm Deloitte will be appointed as Virgin Australia’s administrators.

The move comes after the federal government rebuffed the airline’s request for a $1.4bn emergency loan as part of a wider industry bailout package and despite duelling aid offers from NSW and Queensland (https://www.theguardian.com/business/2020/apr/20/queensland-nsw-fight-headquarters-virgin-australia-if-it-survives), each of which wanted to host Virgin Australia’s HQ.

It is not clear what will happen to the approximately 10,000 people who work for Virgin Australia if it goes into administration.

Also unclear is what will happen to its fleet of 130 planes, many of which are heavily mortgaged.

The company has been crushed by a $4.8bn mountain of debt and has been burning cash while the fleet is grounded.


From Guardian Australia

[junior.VH-LFA]

Guardian is the only source I can find on this so far, ASX has nothing released other than today's rating changes. Maybe than have an inside scoop other outlets don't?

Sad news coming off the back of State governments touching gloves over where the headquarters are located. I've not been in favour personally of a bailout in this thread but it's sad that any actual progress that may have been made in favour of one has been focused on keeping a HQ in a state rather than keeping people employed and the airline operating.

[cloudsurfng]

It’s in the Fin Review now as well. Board meeting tonight.

thoughts to all VA staff and families. Hopefully something good comes out of it re a new investor

[-41]

Sunfish was very close to the mark he almost nailed it!

[crosscutter]

It should be noted state government funding was going to be contingent on VA. It will still be available when the new Virgin rises, joining forces with whoever else joins the party...and it’ll be a party. My point...a sad situation, but there is hope. My thoughts sincerely, to all the great Virgin staff who deserve far better. I hope everyone can be flying again soon.

[smiling monkey]

From the Sydney Morning Herald

https://www.smh.com.au/business/companies/virgin-australia-set-for-voluntary-administration-20200420-p54lcd.html

Virgin Australia is preparing to go into voluntary administration, sources say, unable to survive under the weight of enormous debts and starved of cash by the coronavirus travel shutdown.

Australia's number two airline had already appointed Deloitte (https://www.smh.com.au/business/companies/virgin-australia-suspends-shares-as-rescue-talks-continue-20200416-p54kad.html) to looking at potential restructuring options and the accounting firm is expected to run the administration process, including trying to find new owners to keep it flying.

Virgin's board of directors were meeting on Monday. One well-placed source said the announcement of it going into administration was "imminent".

Virgin employs around 10,000 people directly and supports another 6000 jobs indirectly.



The airline was saddled with around $5 billion in debt and was running out of money as the coronavirus pandemic forced it to almost completely shut down (https://www.smh.com.au/business/companies/virgin-australia-cuts-domestic-network-to-six-flights-a-week-20200409-p54iqc.html) its business.

The company being reborn through a deed of company arrangement struck in administration is "the airline's only chance", said a source familiar with Virgin's struggles.

Virgin's future had hung in the balance ever since the pandemic took hold. It had asked the federal government for a $1.4 billion loan (https://www.smh.com.au/business/companies/virgin-australia-asks-government-for-1-4-billion-loan-to-help-survive-20200331-p54fis.html) to see it through the crisis but was rebuffed.

Several private equity firms are already sniffing around Virgin looking to potentially buy the business out of administration, which will see some of its debts wiped and aircraft leases renegotiated.

More to come

[The Bullwinkle]

Same story here.....

Ben Butler
Deloitte understood to be appointed administrator for Virgin AustraliaIt is understood big four accounting firm Deloitte will be appointed as Virgin Australia’s administrators.

The move comes after the federal government rebuffed the airline’s request for a $1.4bn emergency loan as part of a wider industry bailout package and despite duelling aid offers from NSW and Queensland (https://www.theguardian.com/business/2020/apr/20/queensland-nsw-fight-headquarters-virgin-australia-if-it-survives), each of which wanted to host Virgin Australia’s HQ.

It is not clear what will happen to the approximately 10,000 people who work for Virgin Australia if it goes into administration.

Also unclear is what will happen to its fleet of 130 planes, many of which are heavily mortgaged.

The company has been crushed by a $4.8bn mountain of debt and has been burning cash while the fleet is grounded.

[Sunfish]

This action might well produce the best outcome for Virgins wonderful staff and their customers. Don’t despair. Many voluntary administrations have a good ending. It’s not over yet.

Be aware though that Qantas will now be doing its level best to drive an oak stake through Virgins heart. I would expect they will engage in dirty tricks. Rumor, fake news, attempts at locking them out of terminals, lobbying CASA, Government and suppliers, etc. Stay strong.

[Cunning_Stunt]

It should be noted state government funding was going to be contingent on VA. It will still be available when the new Virgin rises, joining forces with whoever else joins the party...and it’ll be a party. My point...a sad situation, but there is hope. My thoughts sincerely, to all the great Virgin staff who deserve far better. I hope everyone can be flying again soon.
Virgin reported losses, as Qantas made profitsJonathan Rochford, a funds manager at Narrow Road Capital, told ABC News Virgin Australia had been poorly managed for years, and he thought insolvency would be the best option.

"Virgin has a myriad of problems and a government bailout without insolvency will get in the way of fixing these problems," he said.

Mr Rochford argues Virgin has consistently struggled to attract the high paying customers to be a strong competitor to Qantas.

After an IPO at $2.25 in 2003, its shares have rarely traded above $0.50 in the past decade, he said.

"The company has pursued growth over profits adding marginal routes that weighed down the good business it had servicing the capital city routes," Mr Rochford said.
"This failed strategy has left the airline overloaded with aircraft.
"The sale and subsequent repurchase of part of the frequent flyer business has left it loaded with debt, with most of the fleet and the frequent flyer business locked up by secured creditors."
Virgin wants a $1.4 billion bailout. Here's how that could work (https://www.abc.net.au/news/2020-04-02/coronavirus-airline-bailout-virgin-qantas-failure/12110064)https://www.abc.net.au/cm/lb/12139324/data/plane-with-a-parachute-data.jpg (https://www.abc.net.au/news/2020-04-02/coronavirus-airline-bailout-virgin-qantas-failure/12110064)
A nation of travellers is grounded and Virgin is asking for government help to the tune of $1.4 billion. Here's how a bailout of the Aussie airlines could work. (https://www.abc.net.au/news/2020-04-02/coronavirus-airline-bailout-virgin-qantas-failure/12110064)

He said a government bailout, if put in place without insolvency, would "delay and obstruct the necessary restructuring and increase the risk that Virgin ultimately ends up like Ansett".

He also pointed out that about 75 per cent of the debt is believed to be owed to foreign lenders.

"A bailout of Virgin without an insolvency is likely to result in hundreds of millions of dollars being transferred from Australian taxpayers to foreign lenders," Mr Rochford said.

A revamped Virgin Australia would be better off concentrating on profitable critical domestic routes, employing less staff and reducing its fleet, he said.

In such a scenario, Virgin Australia's loss-making low-cost offshoot, Tigerair Australia, would disappear, and new owners would step in.

As seen on ABC.website. Quite telling re multi millions being transferred from Australian Taxpayers to foreign lenders. Nuff said.

[Kubin rock climber]

Faaaark, hate this ****. Thought for all the V crew. Get on to whatever VA Ops / HR website you guys have and take snapshots of everything important. Leave balances, payslips, currency, sim, EP all that ****. Access might be lost pretty quick if things don’t go well.

Hope this turns out as well as it can for all our V mates. Am feeling pretty distressed for you guys right now.

[2020Balance]

Does this mean the GDOJ is dead?

[Tommy Bahama]

Its Done................... being reported Virgin Australia is in Voluntary Administration

[wheels_down]

Its Done................... being reported Virgin Australia is in Voluntary Administration
Still need that ASX confo.

Reports are board are meeting within the hour

So watch the ASX 7pm onwards

[PoppaJo]

The Perth Mining Operation could be sold off or VARA/Whatever it’s called.

Tiger AOC could be sold to Scoot. To be honest just get rid of it. The AOC isn’t worth anything.

Virgin 737 Domestic stand-alone, with 3 or 4 lounges, feeding of International Partners only, probably has legs too.

I don’t think it’s gone forever. It’s clear NSW and QLD will be a major player in the Administration process. What’s on the other side of the fence, we’ll rewind the clock 15 years and I think that’s what they should go back to.

[Vindiesel]

https://www.theaustralian.com.au/business/dataroom/virgin-australia-airline-private-equity-partnership-eyes-buyout/news-story/6bff600143fdaf133fa3c93959710a1b

"Virgin’s Australia’s board is understood has concluded its meeting, with the airline to be formally placed into voluntary administration on Tuesday."

[directimped]

VA won't disappear but it will be heavily downsized, as it would eventually have been anyway.

Good luck to everyone, those at VA won't be the only casualties.

[normanton]

The name Virgin will be gone. Can't see the administrators paying Branson a cent.

[2020Balance]

So the GDOJ is dead then.

[Chad Gates]

Rebirth under the V Australia Brand? Could just use a big off white sticker over the “irgin”

[Ollie Onion]

Good luck one and all, I truely hope something better rises from this mess.

[DanV2]

Rebirth under the V Australia Brand? Could just use a big off white sticker over the “irgin”

"Velocity Air"? Paint over the Virgin on the white tail, paint over the "Virgin Australia" on the fuselage and stick the Velocity logo on the fuselage?

[John Citizen]

Voluntary Administration (https://10daily.com.au/news/australia/a200420dmspo/virgin-australia-collapses-into-voluntary-administration-20200420)

Statement to be made on Tuesday

[markontop]

Special comments.
Special comments from failed Howard MP Jackie Kelly “Just a blip”

[KRviator]

Didn't take them long to pull their frequent flyer store to stop people redeeming points in a last minute rush!

[PPRuNeUser0198]

Seven News just announced the 'collapse' a few minutes ago...

Deloitte to handle the admin.

[ozbiggles]

This might just show how inept Joyce is.
A government bailout that would have kept VA loaded up with debt that he might need soon too or
A lean aggressive full service carrier operating under a much better financial position.
not since he ran crying like a bitch to the government for a handout has he made such a poor management decision.....time will tell.
Not so good for all the staff, but a lifeline to some?

[machtuk]

Tragic, the destruction now begins! RIP VA, you kept the bastards honest (for a while)

[tail wheel]

It is not a 'collapse'.

Deloittes have been appointed Administrators.

No announcements have been made regarding the Company operation but until the Administrator makes an announcement, the Company is still trading. I suspect the shareholders, creditors, the Company and the Australian Government will be anxious to explore every avenue to keep the company operating.

[Saintly]

So on regards to my query (on page 38) of this thread...looks like i can't get a refund. My flight was PER-MEL-PER in November. I didnt cancel flight and have flight put into credits before announcement was made to have VA put into voluntary administration. Looks like ive lost it all and lools like ive lost my frequent flyer points too

[topend3]

So on regards to my query (on page 38) of this thread...looks like i can't get a refund. My flight was PER-MEL-PER in November. I didnt cancel flight and have flight put into credits before announcement was made to have VA put into voluntary administration. Looks like ive lost it all and lools like ive lost my frequent flyer points too

Big deal.....

[tail wheel]

You are now a Creditor of Virgin: your refund and Frequent Flyer points are in limbo.

Wait for the Administrator's Report to Creditors. This is not necessarily a re-run of 4 March 2002.

I suggest if this is a re-run of 4 March 2002 God help the Australian domestic airline passengers who are about to get screwed - which the Federal Government will be acutely aware of.

The 29 October 2011 was the day Qantas lost the trust and support of the Australian people, which I doubt will ever be recovered.

[LostWanderer]

So on regards to my query (on page 38) of this thread...looks like i can't get a refund. My flight was PER-MEL-PER in November. I didnt cancel flight and have flight put into credits before announcement was made to have VA put into voluntary administration. Looks like ive lost it all and lools like ive lost my frequent flyer points too

None of this is necessarily true yet. Wait for the administrators to make an announcement on how they will handle things, so many outcomes possible it’s not even worth speculating just yet.

[John Citizen]

A lean aggressive full service carrier operating under a much better financial position

Weren't they always aggressive? Isn't this a reason for their downfall?

[Arctaurus]

This is not necessarily a re-run of 4 March 2002

But it's probably a re-run of September 2001 when the 2 Marks tried to keep the operation going through "Ansett MK 2".

Administration puts a wall between the company and the creditors. There may be actions to repossess aircraft by leasing creditors very quickly, so the Administrators will need to move fast if the base assets are to be preserved for a new start up. Interesting to see what the copyright and ownership status is of the "Virgin Australia" logo, because it would clearly be a familiar asset in a future operation.

[Vindiesel]

They weren't aggressive at controlling their cost base and they weren't aggressive at controlling how leveraged the company became. Similar overall amount of debt to Qantas with only 1/3 the revenue. That's not smart and that all becomes very exposed during a black swan event like this....

[Saintly]

You are now a Creditor of Virgin: your refund and Frequent Flyer points are in limbo.

Wait for the Administrator's Report to Creditors. This is not necessarily a re-run of 4 March 2002.

I suggest if this is a re-run of 4 March 2002 God help the Australian domestic airline passengers who are about to get screwed - which the Federal Government will be acutely aware of.

The 29 October 2011 was the day Qantas lost the trust and support of the Australian people, which I doubt will ever be recovered.


I was told by a friend that I had to cancel my flight before VA announced voluntary administration. That way my flight would of gone into credit and id get some sort of refund back as id be a creditor. But seeing as though I didnt do that - my flight still stands as normal and scheduled for November and i will lose money on the airfare cos VA have now announced voluntary administration. Bear in mind that my flight was a cheap airfare and non-refundable.

So does it matter either way? I lose out anyway regardless if i cancelled flight and asked to put flight into credits or left it as it was which i did? Is this correct?

[PoppaJo]

Take your cheap airfare refund dramas elsewhere thanks. This is about VA and it’s people.

[normanton]

So on regards to my query (on page 38) of this thread...looks like i can't get a refund. My flight was PER-MEL-PER in November. I didnt cancel flight and have flight put into credits before announcement was made to have VA put into voluntary administration. Looks like ive lost it all and lools like ive lost my frequent flyer points too
Hope you paid on a credit card. This isn't the right thread for this. There are crew here who have worked for 18+ years at the company, and they don't want to hear your complaint over a cheap ticket.

[Saintly]

Take your cheap airfare refund dramas elsewhere thanks. This is about VA and it’s people.

No, I am asking a question. If you have an issue then I suggest you raise the matter in writing to the mods/administrators of this site. If there is an issue with what i am writing then they will let me know. Thanks.

[Arctaurus]

Vindiesel - that is a perfect summary. They might have survived, but for this COVID-19 black swan event.

[Toruk Macto]

People are losing careers tonight , families discussing futures and how to pay next months mortgage .
Your winging about a refund for a cheap ticket is pissing people off .

[Saintly]

Hope you paid on a credit card.

I did pay on a credit card. Will that perhaps be in my favour in terms of full/partial refund?

[Arctaurus]

Saintly - Can I respectfully ask you stop posting about your ticket issues.

[Saintly]

Saintly - Can I respectfully ask you stop posting about your ticket issues.

Yep thats fine. All i was doing was seeking some guidance and advice. I love aviation and love VA as well. My queries DID NOT intend to offend anyone.

My apologies.

[Lead Balloon]

There may be actions to repossess aircraft by leasing creditors very quicklyReally? And what would the leasing creditors do, precisely, with the aircraft once repossessed?

[Turnleft080]

Hey Saintly I'll fly you personally PER-MEL-PER if only you can get my job back.

[dc9-32]

Saintly

Pprune is not the place to ask about your refund so kindly move along......

[log0008]

Their are thousands of people facing life without a job, the Australian public is facing airfares which will make flying unattainable for some and your worried about your lousy refund. Grow up and get some perspective

[transition_alt]

No, I am asking a question. If you have an issue then I suggest you raise the matter in writing to the mods/administrators of this site. If there is an issue with what i am writing then they will let me know. Thanks.

Not really the time and place to be thinking about yourself when 10,000+ people are potentially losing their job is it???....

[Arctaurus]

They'll do what all leasing creditors do - secure their assets as soon as possible. It's pretty simple.

[PPRuNeUser0198]

I think this will be okay. The vultures can now sweep in to buy the business. Going into VA helps improve the proposition of selling VA. They would not take the $5b debt otherwise...

[Potsie Weber]

Really? And what would the leasing creditors do, precisely, with the aircraft once repossessed?

They get control of them so they can be stored securely and not be neglected or parts pilfered. They may just stay where they are with new contracts in place for security and storage management.

[Ollie Onion]

Saintly,

read this about credit card protection. People are getting annoyed here as their worlds are coming crashing down so maybe take you queries somewhere else.

https://www.choice.com.au/shopping/consumer-rights-and-advice/your-rights/buying-guides/what-to-do-when-a-company-collapses

[Lead Balloon]

They'll do what all leasing creditors do - secure their assets as soon as possible. It's pretty simple.
What do you mean by securing their assets? Do you think the creditors are worried that Virgin might try selling cheap aircraft on EBay?

[TBM-Legend]

If one of the large creditors now appoints a Receiver because they're in default [read the fine print of any loan or lease] it may be the real end.

[Arctaurus]

Hopefully default can be avoided if the Administrators get in early enough.

[Paragraph377]

Sunfish was very close to the mark he almost nailed it!
Sunfish was closer to the mark than anybody else. He copped a lot of **** for doing exactly what was so wrong? Oh yes, showing he was further ahead of the information stream than any of you who were ****ting on him were.

[KRviator]

Hopefully default can be avoided if the Administrators get in early enough.Is that likely though? I mean, realistically? There's next-to-no income, granted salaries and wages can be cut immensely by standing-down crews, and no flying = no fuel used, but the fixed expenses aren't going to go away. Short of selling off any owned aircraft (but who'll be buying in this environment?) I can't see any way to bring in enough income to trade their way out of this.

[markontop]

Special comments
From the failed Howard minister Jackie Kelly, “just a blip”

[Falling Leaf]

The administrators don't care about 'VA' or aviation or airlines full stop, that is not their remit. They are there to protect the interests of the creditors. They are accountants. They see the world as assets and debts.

I've been through this process as a pilot staring at redundancy. I know its tempting to fall for every white knight scenario, we heard plenty in the last 2 weeks we continued to work for no salary while the administrators quietly and politely shuffled around the office, starting what for them was a lucrative 2 year undertaking...

Don't be surprised if none of these aircraft fly for 'V Australia' or whatever else you want to imagine. Its over.

[Telfer86]

Who could ever forget the ramblings of Teresa Green who posted on here
He was a true disciple of the magic man one J . Borghetti

The silly old bugger was forever preaching "get borghetti , get borghetti" he thought JB was the man to resurrect QF post grounding etc

For that matter so many of the pilots were overly enamored by the Virgin spin "its the place to be , its the place to be" they would cry

Back at the ranch magic just continued to spend and continued to spend and continued to spend , flashy paint , flash new uniforms , oh & we must have a flash business lounge also

[dontgive2FACs]

*** PLEASE TAKE CARE ALL ***

All the guys and girls at VA please take care. This is a volatile time and things just went up a notch. Please, please, please reach-out to someone if you’re feeling the pinch!

Many of us have been through this is 2001/2. While the road out seems uncertain right now, there WILL be a road out.

If anyone has friends in VA, please consider giving them a ring to check-in on them soon. We may all fly different tails, but we are all of the same profession.

If you can’t sleep or don’t feel like yourself, please seek out help or go see a Doctor. There is an abundance of help around.

There is absolutely NO need to suffer in silence or take this out on your loved ones.

Stay strong. This feeling will pass. Promise

[ozbiggles]

What is a little different here in terms of aircraft owners is they have no where else to make money on their aircraft so they will be more inclined to negotiate one would hope.
good to see 377 back alive and ranting....stilll

[PPRuNeUser0198]

https://www.afr.com/street-talk/meet-virgin-australia-s-co-pilots-in-waiting-20200420-p54lam

[Paragraph377]

What is a little different here in terms of aircraft owners is they have no where else to make money on their aircraft so they will be more inclined to negotiate one would hope.
good to see 377 back alive and ranting....stilll
Love you too Biggles. Chin up mate. Cheers

[2020Balance]

I just got reissued with a new set of RM’s about 8 weeks ago. Haven’t even worn them yet. Will I have to give them back ???

[Ragnor]

Their are thousands of people facing life without a job, the Australian public is facing airfares which will make flying unattainable for some and your worried about your lousy refund. Grow up and get some perspective

I have been hearing this a lot over the last few weeks! Even if VA was there on the other side you honestly think airfares would be the same! I doubt it airlines have a lot to recoup from this virus. Cheap airfares are gone for a few years to come.

[Vref+5]

Have a read of Section 5.3A of the Corporations Act 2001, explains what happens during VA, and that the company is protected from civil proceedings unless the administrator gives consent, or a court grants leave, S440D refers. I’m certainly no expert, but reading that is probably more reliable than most of the comments here.
Good luck to all those at VA, including many friends and colleagues from over the years.

[log0008]

Of course, travel will take a long time to return to the prices of the last decade, but with one company owning every single seat on the domestic market, they can literally change what ever they want.

[Section28- BE]

Ex "tail wheel" - "You are now a Creditor of Virgin: your refund and Frequent Flyer points are in limbo."

'Secured or Not', be 'the' question- the Credit Card gig, Has been shut-down for weeks (allegedly/apparently...???)

Good Luck- stay safe & well.
Look after/think of each other.
Rgds
S28- BE

[WillieTheWimp]

https://www.afr.com/street-talk/meet-virgin-australia-s-co-pilots-in-waiting-20200420-p54lam

Paywall.. Can someone post the article

[rattman]

Paywall.. Can someone post the article

View in porn mode

[34R]

Chicken littles everywhere.

They have not folded.
In the current situation, this is not unexpected and is a positive step.

There will be a Virgin MKII. It may be smaller and leaner, but it will survive.

[invertedpancake]

Couldn't agree more

[Lookleft]

It was a bad time before but now it is worse for the staff at Virgin. There are no guarantees as to how this all ends and thats the problem for the staff. You end up going from one news item to the next looking for what the facts are. In 2002 all was looking rosy on the 28 of Feb yet by the 4th of March it was game over.

[Telfer86]

Going into administration is folding ; it is an admission that a business is insolvent
Very few businesses in Australia emerge from administration & continue trading < 5 % & likely closer to 1 or 2 %

How is it positive to be placed into administration ? , where you almost never emerge from

Why are you confident that this business which has lost $ 2B over the last 6 or 7 years will survive

Maybe you know something that not many other people seem to know ?

Anyone know what happened to the $1B in cash that wishful thinking employees seemed so keen to tell everyone about six weeks ago sort of
"we will be right because we have that in cash in the bank" , did they ever actually have it

Goodluck to the Virgin employees I hope you get your entitlements

[Turnleft080]

Goodluck to the Virgin employees I hope you get your entitlements

No, we are getting our jobs back.

[John Citizen]

Yes, the success rate is under 10%. Good luck.

Success rate (https://sklawyers.com.au/success-rates-voluntary-administration/)

success rate 2 (https://www.dissolve.com.au/blog/voluntary-administrations-dont-get-too-excited-about-the-chances-of-success/)

success rate 3 (https://www.smartcompany.com.au/finance/cashflow/using-a-voluntary-administration-to-save-a-company-the-statistics-are-against-you/)

[Sunfish]

The Directors had no choice because trading while insolvent would destroy them personally. This is why Directors and CEOs get paid big bucks, not that it is any consolation.

What I would hope for now is that the Australian Government leans over backward to ensure Virgin survives. The shareholders have lost pretty much everything, as is always their risk.

What concerns me now is that Qantas will be lobbying every decision maker in Government and Treasury - all the ******* ANU trained economists, to “let Virgin go” because “Australia can only afford one airline - economies of scale, you know”. Furthermore they will use every dirty trick in the book to destroy what’s left of Virgin. Probably already offering to honor their tickets, take their slots, rent their terminal space, etc., etc.

The critical issue now is the AOC and the continuing airworthiness of the aircraft and certification of crews. Once that gets affected Virgin is gone.That is where CASA comes in, they can either help keep Virgin on life support or be uncompromising and destroy it as they had to do to Ansett when they pulled the AOC.

God bless you all.

[Telfer86]

I hope you are right TL

But I don't think that will happen if you go into administration

[Colonel_Klink]

Going into administration is folding ; it is an admission that a business is insolvent
Very few businesses in Australia emerge from administration & continue trading < 5 % & likely closer to 1 or 2 %

How is it positive to be placed into administration ? , where you almost never emerge from

Why are you confident that this business which has lost $ 2B over the last 6 or 7 years will survive

Maybe you know something that not many other people seem to know ?

Anyone know what happened to the $1B in cash that wishful thinking employees seemed so keen to tell everyone about six weeks ago sort of
"we will be right because we have that in cash in the bank" , did they ever actually have it

Goodluck to the Virgin employees I hope you get your entitlements


It’s actually about 1 in 4 companies that come out of administration.

What VA employees are probably sick of reading here is users who post well wishes to employees after having just told them how the place is completely stuffed and should be closed down / not be given a loan / not allowed to have foreign entities buy in.

[topend3]

It’s actually about 1 in 4 companies that come out of administration.

What VA employees are probably sick of reading here is users who post well wishes to employees after having just told them how the place is completely stuffed and should be closed down / not be given a loan / not allowed to have foreign entities buy in.

first sound advice would be to a VA employee if they’re looking for reassurance they’d be best not to come anywhere near PpRune anyway !

[Fonz121]

Going into administration is folding ; it is an admission that a business is insolvent
Very few businesses in Australia emerge from administration & continue trading < 5 % & likely closer to 1 or 2 %

How is it positive to be placed into administration ? , where you almost never emerge from

Why are you confident that this business which has lost $ 2B over the last 6 or 7 years will survive

Maybe you know something that not many other people seem to know ?

Anyone know what happened to the $1B in cash that wishful thinking employees seemed so keen to tell everyone about six weeks ago sort of
"we will be right because we have that in cash in the bank" , did they ever actually have it

Goodluck to the Virgin employees I hope you get your entitlements


Normally I’d agree that VA is the kiss of death for a company. Especially one that relies on being paid so far ahead of actually providing the product or service. Customers won’t touch you with a ten foot pole once they hear those words uttered. But if you were going to pick a time in the last century for an airline to go into voluntary administration, this is it.

Virgin’s bookings after this announcement tomorrow will be the same as they were yesterday. Yes those bookings are zero but it’s an unheard of scenario and one which will help rather than hinder. Imagine if this had happened 6 months ago when airlines were operating normally. There would be less reason for hope than now.

[krismiler]

Once a company is in administration any debts incurred from that point onwards are guaranteed by the administrator so there shouldn't be any problem with essential suppliers such as fuel and NAV charges, and with $700+ million in the bank Deloittes will probably allow limited flights to resume as long as the income from them exceeds the cost of operating them. They will want to keep the basics on life support just incase there is any chance of selling the airline as a going concern so the required post holders CP, HOT etc will be kept on for now.

Standby for the official announcement and see who makes a move once the creditors are formally put a bay.

[Turnleft080]

Oh! JB I hope you get a good night sleep tonight you derserve it. I hope your proud of your 10 years. Hope your shiny cars are sparkling as well.
They are so much more important than my heart attack I'm about to have. But don't worry about that JB you'll be fine.

[Buster Hyman]

Korda Mentha must be mad that they missed out on another mother load...:mad:

[The Bullwinkle]

Oh! JB I hope you get a good night sleep tonight you derserve it. I hope your proud of your 10 years. Hope your shiny cars are sparkling as well.
They are so much more important than my heart attack I'm about to have. But don't worry about that JB you'll be fine.
I hope he wraps his McLaren around a lamppost! :mad:

[chance]

Let's se how the VIRGIN VA pans out. On a much smaller scale accountants Ferrier Hodgson managed to sell Flight West Airlines to Qld Airline Holdings after 9 months in Administration as going a concern. QAH became Alliance Airlines which is still running in their niche market, despite having contracts with Virgin and an unwelcomed 19% Qantas shareholding. A revamped Virgin is possible and liquidation is not the sole course of action available one would hope.

[RodH]

Will VA still continue flying the restricted routes that the Federal Government has subsidised until 7th June.?

[KRviator]

Will VA still continue flying the restricted routes that the Federal Government has subsidised until 7th June.?Depends if their suppliers, fuel, catering, etc think they will get paid or move to rescind their contracts.

And now it is official. Here's the ASX announcement (https://www.asx.com.au/asxpdf/20200421/pdf/44h3kq7kcb12fl.pdf)

[machtuk]

"IF" VA come back in some form remember they won't be competing in a pre CV19 market. It will be a LOT tougher for a long time so any new operation has a high chance of failing (again), QF are in the same environmental boat but obvioisly where not going down the toilet pre CV19.

[Matt48]

I was told by a friend that I had to cancel my flight before VA announced voluntary administration. That way my flight would of gone into credit and id get some sort of refund back as id be a creditor. But seeing as though I didnt do that - my flight still stands as normal and scheduled for November and i will lose money on the airfare cos VA have now announced voluntary administration. Bear in mind that my flight was a cheap airfare and non-refundable.

So does it matter either way? I lose out anyway regardless if i cancelled flight and asked to put flight into credits or left it as it was which i did? Is this correct?
Spare a thought for the good folk at Virgin who will likely lose way more than a return fare.

[krismiler]

Depends if their suppliers, fuel, catering, etc think they will get paid or move to rescind their contracts.

They have less to worry about now as the administrator guarantees payment from their own pocket for any debts incurred once they take over. Note that certain entities can't have contracts with a company in administration, I remember that Australia Post was one of them but stand to be corrected by anyone with more up to date information as I'm going back 20+ years.

[smiling monkey]

Depends if their suppliers, fuel, catering, etc think they will get paid or move to rescind their contracts.

And now it is official. Here's the ASX announcement (https://www.asx.com.au/asxpdf/20200421/pdf/44h3kq7kcb12fl.pdf)

Flights still operating from what I see on FR24.

[topend3]

From TWU : “There is still time for the federal government to work on an investment plan to get through this period of crisis and taxpayers will get a double benefit. The government will retain a competitive aviation market and they will get a return on their equity stake.”

Will we get a return on our equity stake? When? The current shareholders haven't had much of a return for 10 years.

[Dark Knight]

CASA did no have to pull Ansetts AOC: they were complicit in Ansett;s demise when they failed to properly and correctly undertake their obligatory oversight of Ansett, in particular Ansetts engineering responsibilities.

I.e. it is CASA's responsibility to ensure manufacturers modifications are carried out where in the case of the Ansett Boeing 767 they did not ensure Ansett carried out the rear pressure bulkhead modification; only when Boeing checked to see if this was done by the due date did the whatsit hit the fan when Boeing was obliged to tell
Ansett and CASA whereupon CASA had no option but to ground the aircraft. QED.

(Boeing was obliged i,e Boeing had to protect themselves)

[markontop]

For the TWU,
How can you formulate an “investment plan” when you don’t know when domestic travel will resume let alone international?
So people expect businesses to invest when you have no idea when revenue will start.

[ANstar]

From TWU : “There is still time for the federal government to work on an investment plan to get through this period of crisis and taxpayers will get a double benefit. The government will retain a competitive aviation market and they will get a return on their equity stake.”

Will we get a return on our equity stake? When? The current shareholders haven't had much of a return for 10 years.
If the TWU think there is a return on an equity stake why don't they put their money where their mouth is and let TWU Super invest in Virgin to preserve jobs?

[RodH]

From VA’s statement To passengers and to the Stock Exchange. ( not word perfect but correct info )
” We know you might be worried about what the Voluntary Administration news means for us and your flights.”
Rest assured, we’re continuing to operate scheduled flights as normal which are helping to transport essential workers ,maintain important freight corridors and return Australians home. Your travel credits also remain valid.”

Looks like I might be able to get home to Brisbane from Perth after all.
I sure hope so , it’s’ been a long unscheduled stay here!

[markontop]

Before you buy your tickets on said route, find out about the refund options.

[RodH]

Already have a return ticket and allocated seat for flights home 26 May.

[t_cas]

Yes, the success rate is under 10%. Good luck.

Success rate (https://sklawyers.com.au/success-rates-voluntary-administration/)

success rate 2 (https://www.dissolve.com.au/blog/voluntary-administrations-dont-get-too-excited-about-the-chances-of-success/)

success rate 3 (https://www.smartcompany.com.au/finance/cashflow/using-a-voluntary-administration-to-save-a-company-the-statistics-are-against-you/)

I think you should read your articles again.

[Icarus2001]

https://www.asx.com.au/asxpdf/20200421/pdf/44h3kq7kcb12fl.pdf

So VA enters the next phase.

[John Citizen]

I think you should read your articles again.

Maybe you should read them again, otherwise let me quote them:

1st article:

Voluntary administrations that enter into DOCAs 28.5% DOCAs
that are successfully completed and deliver a trading enterprise within a year ~25% (writer’s estimate)
Overall result: estimate of percentage of insolvent companies that use voluntary administration to successfully restructure business (0.13*0.285*0.25)% 1%

2nd article:
We track a number of statistics and one of those is the success, or otherwise, of Voluntary Administrations. Here are the facts:

15% of corporate insolvencies are Voluntary Administrations – the rest are liquidations or receiverships;
around 33% of VAs successfully execute a Deed of Company Arrangement (“DOCA”);
so only 5% of insolvent companies successfully executing a DOCA

3rd article:

Unfortunately, a close analysis of the facts reveals that voluntary administrations (https://www.smartcompany.com.au/finance/cashflow/using-a-voluntary-administration-to-save-a-company-the-statistics-are-against-you/finance/43958-perfect-storm-warning-as-voluntary-administration-rates-set-to-soar.html) are actually very expensive and, in the vast majority of cases, fail in their stated objective of saving a business.
undertaken by the insolvency practitioners’ professional body, ARITA, to determine the success rate. It’s not good news:

15% of corporate insolvencies are voluntary administrations;
33% of voluntary administrations result in a DOCA;
28% of DOCAs have some sort of “creative outcome”, such as saving the business.

So what does that devolve into? Voluntary administrations save around 2% of insolvent businesses. Ouch!

[From a distance]

Why don't you come to Australia and theatrically tear a 200M dollar cheque for Virgin, Branson.

And yes I am aware of the current ownership structure. Branson always cashes out at others expense. I hope to see a renamed airline, phoenix like emerge from the ashes.
Virgin Atlantic is next.

[markontop]

Ex Ansett.
Is Paul S ex Ansett? As he channeled is inner Rod E. “Great airline into a good business “

[markontop]

No Branson would rather fleece a whole new bunch of people. Virgin Galatic

[B772]

I doubt we will ever see Branson in Australia again. Good riddance show pony.

[Section28- BE]

Mark:

"Is Paul S ex Ansett? As he channeled is inner Rod E. “Great airline into a good business “ "

Yes.

Rgds
S28- BE

[Paragraph377]

No Branson would rather fleece a whole new bunch of people. Virgin Galatic
Living the good life on his tax free Island. How fortunate. And of course, as he tells us, his wealth is mostly in assets and businesses so it’s not like he can use cash to help his staff. I’m just glad the bloke is finally seen for what he is - just another billionaire businessman in it for himself.

[wondrousbitofrough]

Paragraph377 what's your employment history? Ever employed by Virgin?

[TBM-Legend]

The Directors had no choice because trading while insolvent would destroy them personally. This is why Directors and CEOs get paid big bucks, not that it is any consolation.

What I would hope for now is that the Australian Government leans over backward to ensure Virgin survives. The shareholders have lost pretty much everything, as is always their risk.

What concerns me now is that Qantas will be lobbying every decision maker in Government and Treasury - all the ******* ANU trained economists, to “let Virgin go” because “Australia can only afford one airline - economies of scale, you know”. Furthermore they will use every dirty trick in the book to destroy what’s left of Virgin. Probably already offering to honor their tickets, take their slots, rent their terminal space, etc., etc.

The critical issue now is the AOC and the continuing airworthiness of the aircraft and certification of crews. Once that gets affected Virgin is gone.That is where CASA comes in, they can either help keep Virgin on life support or be uncompromising and destroy it as they had to do to Ansett when they pulled the AOC.

God bless you all.

So pious !

[wheels_down]

Administrators talking a good game at the press conference today. Way too upbeat for my liking, usually indicates large problems.

Come back in 3 months folks. We will find out if it’s salvageable later once they have run their knife through it.

[Icarus2001]

Mr Strawbridge said there were "no plans to make any redundancies". The airline will continue to operate its scheduled international and domestic flights.

Mr Strawbridge said he did not plan to make any of the airline's 10,000 employees redundant, but how many aircraft it kept, and how many routes it continued to fly on, would not be clear until the new owners took over.

"We'll come back leaner, stronger and fitter."

The word games begin.

[normanton]

Hard to believe what he says when they drop in the word "leaner".

[Ex FSO GRIFFO]

'Slight' Thread Drift.......

Strange isn't it....How 'everybody' is currently preaching that Aust NEEDS the competition of a two airline policy to encourage competition...etc etc

How easily do people forget that without a viable GENERAL AVIATION Industry - which would employ far more 'Aussie TAX PAYERS' than Virgin, The Airline Industry is F*$KED.
Where do your future pilots come from?
Not only has G/A been allowed to 'wither on the vine' courtesy of its supposed 'regulator'...............It has been DECIMATED!

What about all of the Flying Schools, Charter /Airwork Operators, LAMES, Instrument Suppliers / Maintainers, Country Airports....etc etc etc and the various 'downstream' industries...e.g. Aircraft Refuellers, Aircraft Painters, Aircraft Upholsterers.....

Need I go ON..?????

NO CHEERS HERE ! NOPE! NONE AT ALL!!!

[krismiler]

KordaMentha must be mad that they missed out on another mother load...https://www.pprune.org/images/smilies/censored.gif

After seeing how long the Ansett collapse was strung out for, the board of Virgin probably didn't want the airline to be someone's cash cow. Now is obviously not the best time to be selling an airline so it will be interesting to see how long the period of administration goes on for. Once flying resumes with some sort of regularity, the company can operate if more money is coming in than going out and creditors may prefer this option as they have more chance of getting their money back compared to a fire sale, though obviously this can't go on indefinitely. Waiting a year or two and getting 30% back would be preferable to pushing for an immediate winding up and getting 15% back.

The administrators need more time and information to assess the post COVID - 19 aviation market. If a rapid improvement is likely then restructuring into a smaller going concern is likely to be the preferred option where as long term stagnation would mean winding up or taking the best offer they could get in the circumstances.

[Buster Hyman]

Hard to believe what he says when they drop in the word "leaner".
Perhaps he was talking about free gym membership.

[Paragraph377]

Paragraph377 what's your employment history? Ever employed by Virgin?
Work it out for yourself, English boy.

[SHVC]

Well PS and Co looked pretty happy with themself at that conference today. They’re either telling porkies that no will will be made redundant or they do have a legitimate buyer/s coming along. Either way I bet Allan Joyce and Co will be sleeping in the war rooms tonight planning their come back on how they can keep the new competitor at arms length.

One would think they will give the high end market away for now and tackle JetStar head on.

[coaldemon]

Well the debt will have to be dealt with prior to a new buyer being happy with it. Question is what do you sell and what can you hand out as haircuts to the Bond Holders and Lenders? Also I thought that they had stood down most of the workers so they aren't paying a lot of them so there is no need to make anyone redundant at this point. Whichever way the business will be slimmed down and lean is the approach so there will be less jobs there it seems. Sad to watch in the circumstances. Looks like they are not the only ones right now with Norwegian, South African and it looks like Atlantic all looking for saviors.

[PoppaJo]

Well PS and Co looked pretty happy with themself at that conference today. They’re either telling porkies that no will will be made redundant or they do have a legitimate buyer/s coming along. Either way I bet Allan Joyce and Co will be sleeping in the war rooms tonight planning their come back on how they can keep the new competitor at arms length.

One would think they will give the high end market away for now and tackle JetStar head on.

I found it quite disturbing actually, I actually felt quick sick watching that. Having dealt with these people in a previous life, the vultures are circling. The Administrations appear well and truly behind the desk going off that footage.

All the failed billionaires will be out and about right about now raising their profile and wasting time pushing their ego.

The serious contenders, if there is any, and it would be Virgin going to them and fighting for itself, will come to light near the end of the process. Which will be July or August.

Nathan Tinkler Airlines anyone? Yep. Out they come.

[ozbiggles]

I’m not sure why Virgin X would bother coming back as a LCC against Jetstar when if there is a buyer out there they are going to get an airline all set up for the normal yield at a fire sale price with cheaper leases. The only thing they might change is the seat pitch at the back of the plane.
it could go many ways but I reckon this is the worst outcome for Qantas.

[SHVC]

I’m not sure why they ensured no redundancy either but anything is possible, maybe a stand down for a few years and recalled as needed.

330 has been mentioned but what about the ATR also, such a small fleet at high operating cost.

[Vref+5]

Administrators must convene the first creditors meeting within 8 days of their appointment. Convening period goes for 20 days after that meeting, then the second creditors meeting must be held no later than 5 days after the end of that period. Then they get to make the decision - finish the admin, wind it up, or execute a deed of company arrangement, or something else. Creditors call. S436 through 439 of the Corporations Act refers. So more news in about 33 days.

[Ollie Onion]

So Virgin goes into administration and people are saying this is the best thing that could happen and Qantas must be scared?

[Half Baked]

Shovel...........well said!

Sorry to hear of your own circumstances.

Your health is your wealth!

[ECAMACTIONSCOMPLETE]

So Virgin goes into administration and people are saying this is the best thing that could happen and Qantas must be scared?

Agreed. My prediction is that virgin come out of this with a 15-20% market share and are a permanent minority player, JetBlue style business. Leaning the business was PS’ plan anyway, voluntary administration will at least make that possible, if a buyer can be found.

Hopefully VA is an Ansett Mk II, but a bit bigger and successful of course!

Trying to take on QF was what got it into this mess in the first place.

[Alfie.floor]

I’m not sure why they ensured no redundancy either but anything is possible, maybe a stand down for a few years and recalled as needed.

330 has been mentioned but what about the ATR also, such a small fleet at high operating cost.

TT crew were also told that there would be no redundancies when they first announced cutbacks.

[myturn]

Can you be a failed Billionaire ??

[ANstar]

So Virgin goes into administration and people are saying this is the best thing that could happen and Qantas must be scared?

I can see the theory. For years Virgin have been constrained with their debt etc and lack of profitability, meaning a weak competitor for QF. If VA go bust and a better managed airline comes into the market then QF may not be as strong. Better to compete against a weak competitor than a strong one I guess.

[Buster Hyman]

Ansett MKII was actually a decent business model, built around the A320's. It's a shame that two opportunists didn't really plan for it to succeed.

[Half Baked]

People on here seem to forget that borders are still closed except for essential travel.

Public confidence and demand will be weak if at all!

There's no switch to flick and "she'll be right mate".

The game and playing field has changed.

It's uncharered waters and nobody knows how this will play out!

The only certainty is uncertainty!

[KABOY]

Agreed. My prediction is that virgin come out of this with a 15-20% market share and are a permanent minority player, JetBlue style business. Leaning the business was PS’ plan anyway, voluntary administration will at least make that possible, if a buyer can be found.

Hopefully VA is an Ansett Mk II, but a bit bigger and successful of course!

Trying to take on QF was what got it into this mess in the first place.

This is no longer about taking on competitors after a rebirth, this is about being a viable entity in a travel market that has all but evaporated.

You can lean this business to the bone, but until the market returns or somebody with BILLIONS to burn comes along, administration is the only harbour from creditors. When the rebound occurs, QF are not going to shudder. They already have 60% of the market, and that was always their line in the sand.

I suspect after this, the next line will be far lower and how many investors want to be marginalised in a market where the return on investment is so low...

[RampDog]

Ansett MKII was actually a decent business model, built around the A320's. It's a shame that two opportunists didn't really plan for it to succeed.


Spot on Buster!

Most people in this game never made the connection but it was such a good business model that it reappeared in 2004 as Jetstar Domestic.

And it was no coincidence that there were a number of ex-Ansett execs involved in making it fly for Qantas (can you guess just one?)


Is there anyone out there who was involved who would care to describe how that plan arose and was sold within QF, it would be very interesting and timely :ok:

[Lookleft]

Ansett MKII was actually a decent business model, built around the A320's. It's a shame that two opportunists didn't really plan for it to succeed.

And this was after months of meetings and requirements that Vref+5 described. It is the emotional roller coaster from hell where you go from news item to news item and then even at the last minute it can all come to nothing. I understand the staff at Virgin hoping that it will all turn out for the best as a lot of them have been emotionally invested in the company in the same way Ansett staff were and QF staff still are. The unfortunate reality though is that even if it does survive, there will be a lot of people who will end up on the outside looking in at an aviation career.

[Mail-man]

https://youtu.be/OfklvdLzkyY

[Turnleft080]

https://youtu.be/Tid44iy6Rjs

I'll try and raise you mail-man. "People lets work the problem failure is not an option".

[ECAMACTIONSCOMPLETE]

Hearing that bloke talk is cringeworthy. He thinks they’ll get picked up because they have good onboard service. Do you really think potential buyers care about that, or do they care about potential profitability? It’s all well and good to be a good airline, but you have to be a good business. No mention of its debt or 8 years of consecutive losses. Under the right leadership with the right shareholders hopefully this can be recovered.

[markontop]

So if they can walk away from their debt can I walk away from mine?
Always someone else’s fault.
As I said playing with other people’s money.
Please don’t use Rod E’s words.

[Kiwiconehead]

Convening period goes for 20 days after that meeting, then the second creditors meeting must be held no later than 5 days after the end of that period. .

The convening period can be extended by application to the Supreme Court

[ECAMACTIONSCOMPLETE]

Please don’t use Rod E’s words.

sorry, it was a subconscious paraphrasing of that famous quote, not trying to claim it as an idea of my own. I just find it staggering that GT rambled for 7 minutes without bringing up anything resembling an understanding of basic economics.

Accountants don’t give a sh!t that you have a good onboard product if it losses money.

They should get John Borghetti on sky news and ask him how he sleeps at night. I’m so pissed at that bloke and I don’t even work at VA.

[topend3]

Didn’t Ansett MkII last about 14 days?

If GT said they’re fine then I’m worried as he’s normally totally clueless about most things aviation (I hope he reads this)

[Paragraph377]

Spot on Buster!

Most people in this game never made the connection but it was such a good business model that it reappeared in 2004 as Jetstar Domestic.

And it was no coincidence that there were a number of ex-Ansett execs involved in making it fly for Qantas (can you guess just one?)


Is there anyone out there who was involved who would care to describe how that plan arose and was sold within QF, it would be very interesting and timely :ok:

Sure! I will let some tidbits out. I know because I was ‘around’. Geoff Dixon, Alan Joyce and Bill Jauncey were the architects. Obviously Geoff was at QF and Alan and Bill were ex Ansett. In fact, once up and running Bill Jauncey could/was almost the JQ CEO but they wanted a ‘cleaner’ looking CEO image, a clean shaven suit wearing mincer like AJ was perfect. Bill was a gravelly whisky drinking ciggie smoker, but a very smart man. The original plan was simple - QF to do international and just the highly profitable business class domestic routes - BNE/SYD/MEL. The rest was to go to JQ. Cheap cheap cheap! Get rid of those pesky $300k pilots and have the majority of flights done by Onestar Pilots on around $120k. That’s the short version.

As for Virgin (Blue), they should’ve stuck with the intended business model - all 737 fleet and aimed at low fares and filling planes. Simple. But by the time JQ was hitting the tarmac VB had a fat workforce and was far from lean. JQ was the opposite and most times it was ridiculously lean. VB were never going to be able to operate cheaper than JQ and should’ve started trimming fat back in 2005 but they didn’t. They became a floated company and decided to chase QF’s business model/lounges/ rewards card structure, but it was only ever a half arsed product that sat in between cattle classs and business. Big, costly mistake. Then when they morphed from an all 737 fleet to an entity with b737, A320, A330, ATR and the list goes on, it was ‘game over’ not ‘game changer’. You would’ve thought that the ghost of Ansett and it’s ridiculous fleet variation thanks to Sir Peter Abeles going to Tolouse and getting a hard-on and opening the cheque book could be repeated. You would think that Ansett would have still been fresh in the minds of anyone operating an airline in Australia, but nah. That was the day Ansett died, the end result was inevitable and occurred a number of years later. Same has happened to Virgin Australia, it started out with an identity but lost its way and never got comfortable with who it wanted to be and what it had eventually become.

[Paragraph377]

Well the debt will have to be dealt with prior to a new buyer being happy with it. Question is what do you sell and what can you hand out as haircuts to the Bond Holders and Lenders? Also I thought that they had stood down most of the workers so they aren't paying a lot of them so there is no need to make anyone redundant at this point. Whichever way the business will be slimmed down and lean is the approach so there will be less jobs there it seems. Sad to watch in the circumstances. Looks like they are not the only ones right now with Norwegian, South African and it looks like Atlantic all looking for saviors.
South African probably has a week left to go at best. This is the beginning. Many more will fail.
The industry has never seen anything like this before. 9/11 was just a blip and was probably the only thing to really measure the COVID aviation crisis against. And even then, it’s apples and oranges.

[VR-HFX]

The key players in this are Singapore Airlines, Air China plus Cathay Pacific (30% cross shareholding) and Alliance plus industry super funds. Cathay leaves One World and joins Star. Singapore makes the running with Air China and Cathay Pacific in the background. Alliance takes VARA and a holding company with the above shareholders re-launches VAH as Star Alliance Airlines. Administrators return all leased aircraft. There will be no shortage of aircraft in the above fleets to supplement growth. Possibly the Government allows some wet lease cabotage for widebodies to do transcontinental. There is a loyal customer base that will remain loyal, especially if AJ continues at Qantas.

[Flava Saver]

Right, so listening to PS today, and his administrator....no job losses expected.

Can someone explain how the 777 and A330 crew are going to be kept on? Just curious if some has a better radar than mine?

[neville_nobody]

The key players in this are Singapore Airlines, Air China plus Cathay Pacific (30% cross shareholding) and Alliance plus industry super funds. Cathay leaves One World and joins Star. Singapore makes the running with Air China and Cathay Pacific in the background. Alliance takes VARA and a holding company with the above shareholders re-launches VAH as Star Alliance Airlines. Administrators return all leased aircraft. There will be no shortage of aircraft in the above fleets to supplement growth. Possibly the Government allows some wet lease cabotage for widebodies to do transcontinental. There is a loyal customer base that will remain loyal, especially if AJ continues at Qantas.

According to all media reports none of that will occur. Westfarmers or some hedge funds are the early contenders out of the gate. No Asian interest at the moment.

[777Nine]

Sure! I will let some tidbits out. I know because I was ‘around’. Geoff Dixon, Alan Joyce and Bill Jauncey were the architects. Obviously Geoff was at QF and Alan and Bill were ex Ansett. In fact, once up and running Bill Jauncey could/was almost the JQ CEO but they wanted a ‘cleaner’ looking CEO image, a clean shaven suit wearing mincer like AJ was perfect. Bill was a gravelly whisky drinking ciggie smoker, but a very smart man. The original plan was simple - QF to do international and just the highly profitable business class domestic routes - BNE/SYD/MEL. The rest was to go to JQ. Cheap cheap cheap! Get rid of those pesky $300k pilots and have the majority of flights done by Onestar Pilots on around $120k. That’s the short version.

As for Virgin (Blue), they should’ve stuck with the intended business model - all 737 fleet and aimed at low fares and filling planes. Simple. But by the time JQ was hitting the tarmac VB had a fat workforce and was far from lean. JQ was the opposite and most times it was ridiculously lean. VB were never going to be able to operate cheaper than JQ and should’ve started trimming fat back in 2005 but they didn’t. They became a floated company and decided to chase QF’s business model/lounges/ rewards card structure, but it was only ever a half arsed product that sat in between cattle classs and business. Big, costly mistake. Then when they morphed from an all 737 fleet to an entity with b737, A320, A330, ATR and the list goes on, it was ‘game over’ not ‘game changer’. You would’ve thought that the ghost of Ansett and it’s ridiculous fleet variation thanks to Sir Peter Abeles going to Tolouse and getting a hard-on and opening the cheque book could be repeated. You would think that Ansett would have still been fresh in the minds of anyone operating an airline in Australia, but nah. That was the day Ansett died, the end result was inevitable and occurred a number of years later. Same has happened to Virgin Australia, it started out with an identity but lost its way and never got comfortable with who it wanted to be and what it had eventually become.

You pretty much nailed as to why Virgin has never made money. It really boggles my mind as to why people need to complicate things in business. But then again, nothing surprises me anymore.

[dr dre]

There is a loyal customer base that will remain loyal, especially if AJ continues at Qantas.

Outside of the narrow world of aviation enthusiasts no one knows (or cares) who the CEO of a company is when making a decision on who to fly with. Loud mouths on social media may think they influence a lot of people. They don't. I doubt more than 0.1% of VA's customers fly them because they hate Joyce. There's probably more who fly QF because they find the name "Virgin" inappropriate.

[VR-HFX]

dr dre. I respectfully disagree. Most people who travel know who the CEO of Qantas is while they may never have never heard of Paul Scurrah. Wesfarmers is too smart to go into aviation longer term although they have the balance sheet to fund a transition. There will definitely be an anchor airline involved. Parargraph 377 is on the money. John Borghetti was the wrong person to run VAH, especially with the shareholder register he had. He spent more time managing shareholders than running the business. Best of luck to all the VA front line staff.

[Buster Hyman]

Don’t worry, Geoffrey says it’s OK
Umm, as a side note, is that a Concorde model in the background with an amateur 70's QF tail???:confused:

[ampclamp]

Time to shut it down, Talk about thread drift.

[TACQANAVIAVEC]

Right, so listening to PS today, and his administrator....no job losses expected.

Can someone explain how the 777 and A330 crew are going to be kept on? Just curious if some has a better radar than mine?

"no job losses" is simply playing down what is to happen as that's the last thing the governments want people to hear.

Private equity are all about buying distressed companies with good assets (planes etc) at a huge discount and then selling these, loading the company with new debt and then selling it back to retail and pension funds at a huge profit. Anyone that understands this will then see that:

1- Job losses are inevitable in the short to medium term as VA will come back as a leaner operation flying on mostly profitable routes,
2- International flying will likely be made through code sharing rather than own metal,
3- QF are not going to sit idly and watch a leaner VA eats its share of the cake,

[mostlytossas]

I wouldn't hang my hat on Westfarmers being smart. Did they not take Bunnings to the UK then after it being a disaster pulled out?

[Lookleft]

Like people having the idea that SIA are savvy business people and that all that money is just going to be poured into yet another failed business investment.

[DanV2]

Like people having the idea that SIA are savvy business people and that all that money is just going to be poured into yet another failed business investment.

Not to mention the fanboys still treating SIA as some "so-called messiah" of airlines, when in reality SIA can't organise a p^$$up in a brewery outside their own backyard (as shown by the mouting losses from their overall dismal record in investing in overseas arilines from Virgin Atlantic to the Air New Zealand group).

SIA are best to stick to their 'knitting', which is running their own group of airlines in Singapore.

[PoppaJo]

Wesfarmers have its own issues with Target at the moment I don’t think they want another. Target and Kmart could have earnings issues post this if spending slows. That will spread to leisure travel also, so highly risky taking on an airline, and having large stakes in discretionary spending businesses.

[George Glass]

Sure! I will let some tidbits out. I know because I was ‘around’. Geoff Dixon, Alan Joyce and Bill Jauncey were the architects. Obviously Geoff was at QF and Alan and Bill were ex Ansett. In fact, once up and running Bill Jauncey could/was almost the JQ CEO but they wanted a ‘cleaner’ looking CEO image, a clean shaven suit wearing mincer like AJ was perfect. Bill was a gravelly whisky drinking ciggie smoker, but a very smart man. The original plan was simple - QF to do international and just the highly profitable business class domestic routes - BNE/SYD/MEL. The rest was to go to JQ. Cheap cheap cheap! Get rid of those pesky $300k pilots and have the majority of flights done by Onestar Pilots on around $120k. That’s the short version.

As for Virgin (Blue), they should’ve stuck with the intended business model - all 737 fleet and aimed at low fares and filling planes. Simple. But by the time JQ was hitting the tarmac VB had a fat workforce and was far from lean. JQ was the opposite and most times it was ridiculously lean. VB were never going to be able to operate cheaper than JQ and should’ve started trimming fat back in 2005 but they didn’t. They became a floated company and decided to chase QF’s business model/lounges/ rewards card structure, but it was only ever a half arsed product that sat in between cattle classs and business. Big, costly mistake. Then when they morphed from an all 737 fleet to an entity with b737, A320, A330, ATR and the list goes on, it was ‘game over’ not ‘game changer’. You would’ve thought that the ghost of Ansett and it’s ridiculous fleet variation thanks to Sir Peter Abeles going to Tolouse and getting a hard-on and opening the cheque book could be repeated. You would think that Ansett would have still been fresh in the minds of anyone operating an airline in Australia, but nah. That was the day Ansett died, the end result was inevitable and occurred a number of years later. Same has happened to Virgin Australia, it started out with an identity but lost its way and never got comfortable with who it wanted to be and what it had eventually become.

Para is pretty well spot on. I will add however that Virgin never really grasped how brutal QF management is , even with its own people.
Dixon initially offered JQ flying to mainline QF pilots but on a new cheap and nasty contract. The geniuses at AIPA demanded that the flying be done on existing awards. Management laughed. Enter the JQ $120ker”s , many left over from Ansett just happy to have a job and even happier to undercut Virgin. QF dumped Tasmania , Gold Coast etc. because they were loss makers , hived them off to JQ , and again ignored the bleating from Mainline pilots.
Virgin then tried to take on QF in mining contracts in WA. They got some, but only the ones QF knew were duds.
And then there was Business Class. Oh dear.....
Etc. etc.
The moral is that anybody who take on QF in a new entity better know what they are doing or we will be back here in a few years time.

[SandyPalms]

Just a quick correction George. QF never offered the JQ flying to Qantas pilots. Never. It had already been claimed by impulse pilots by the time AIPA was any the wiser. The impulse pilots offered to fly the A320 for the same money the we’re flying the 717’s. QF couldn’t resist. I was there. AIPA actually helped them get more money, but the only thing QF (and the fat bastard) would agree to was a fairly useless MOU.

[markontop]

SP, didn’t mainline QF pilots end up working for Jetstar?

[SandyPalms]

A decade later, yes. Some did. It’s not relevant in the context of this thread. I’m just setting the record straight about another uninformed attack on AIPA. Carry on.

[George Glass]

Just a quick correction George. QF never offered the JQ flying to Qantas pilots. Never. It had already been claimed by impulse pilots by the time AIPA was any the wiser. The impulse pilots offered to fly the A320 for the same money the we’re flying the 717’s. QF couldn’t resist. I was there. AIPA actually helped them get more money, but the only thing QF (and the fat bastard) would agree to was a fairly useless MOU.

Agreed, initially at least , but when the Impluse pilots were all taken up discussions were entered into. I remember the meetings in Melbourne clearly.

[krismiler]

If the new Virgin Australia wants to go head on at QF they need to do it as part of a major airline such as SQ or Air China. Before the major corporations shift their travel accounts they would want to be sure that the airline they switch to is solid, has all the perks such as lounges, membership of an alliance and a proper business class, and will be around long term. If this can't be guaranteed then don't even think about it.

If it's an Australian private equity take over then respect QF's 65% line in the sand, have a single type on domestic routes (possibly NZ, Fiji and DPS), business class similar to JQ if at all, and stick to profitable routes with a lean operation.

Don't bring a knife to a gun fight.

[DanV2]

Neither SQ or Air China has formally expressed interest in VAH to administrators.
The current SIA board wouldn't be that stupid to throw away money at a "4th attempt" at the Australian market after the fails of their first 3 attempts under previous management teams.

[dr dre]

If the new Virgin Australia wants to go head on at QF they need to do it as part of a major airline such as SQ or Air China.
Don't bring a knife to a gun fight.

What's with all this talk on the day VA goes into administration of another upcoming major capacity war? The last one that happened put VA into a decade of losses they never recovered from. For the next few years it'll be solely about survival and return to profitability in a smaller form. Given what happened last time not a single investor is going to back another exercise to burn cash, especially in the market environment that will exist for the next few years.

[Buster Hyman]

PS. The QLD Govt. are using Bazookas in gun fights now...:rolleyes:

[WillieTheWimp]

Ha! I wouldn’t exactly call $200 mil a bazooka in this business.

[ifylofd]

Virgin then tried to take on QF in mining contracts in WA. They got some, but only the ones QF knew were duds

Really George?

[Fliegenmong]

I doubt more than 0.1% of VA's customers fly them because they hate Joyce.

Oh...thats me then.??..., We haven't flown QF since the 2011 'shutdown'....

[PPRuNeUser0198]

https://www.afr.com/companies/transport/a-simpler-virgin-can-be-a-phoenix-from-loss-making-ashes-20200421-p54ltx

[Icarus2001]

https://cimg5.ibsrv.net/gimg/pprune.org-vbulletin/700x394/12168934_16x9_700x394_7d8ffeda6d2c6a36020c4f7034563d9e604874 dc.jpg
Sir Richard ripping up a cheque for $240 million from SIA wanting to buy VB. Oh how the world changes.

[George Glass]

Really George?

Its of no consequence to me if you believe me or not , but I know for a certain fact that Virgin acquired contacts by under-quoting QF to the point that they were not worth a pinch of the proverbial. That’s why they are where they are. Virgin had no corporate memory of the fact that regional aviation , RPT and Mining , has been a graveyard in every state in Australia for 40 years. The never ending search for a cheaper contractor is a sick joke. Witness the demise of Airlines of SA , MMA , Air Queensland, National Jet ,LLoyd Aviation etc. etc. Now , sadly many more will follow in their wake. Creative destruction! The free market has done its work. Services to regional Australia are worse than the were 30 years ago. Brilliant.

[PPRuNeUser0198]

https://www.youtube.com/watch?v=HnY8OSJ11mI

[Fliegenmong]

"PS. The QLD Govt. are using Bazookas in gun fights now...https://www.pprune.org/images/smilies2/icon_rolleyes.gif"

You are aware of that saying about 'keeping your mouth closed and letting people think you are an idiot rather than opening your mouth and confirming it' right? :rolleyes:

[burned_out]

Thank God(us tax payers) that the govt held strong and didnt bail out VA. This would have been a bad signal to interfere way to much into the market and for tax payer money to be very badly spent on a risky loan to VA.
Now VA says they have 10+ buyers in the winds! So that magically happened overnight? I think Scurrah was taking the piss out of the tax payer, and quite frankly the piss out of Tigerair and VANZ staff that he just sacked on a dime.
What an arse IMHO.