How long before Qantas goes into VA

[chance]

Qantas was supposed to have circa $2.00 B in cash and borrowed another circa $1.2 B against the B 787 fleet that they owned. Supposedly X 3 the size of Virgin who had $ 700 M in cash and debts now revealed of circa $6,8 B. Given the Government imposed recession/depression on airline activity because of the pandemic, how long can Qantas last before they are like VAH and will have to appoint an Administrator as potential insolvency looms? If the Government imposed recession/depression continues as distinct from the market drive version in the1930s it is indeed worrying times and QF could be under threat?

[-41]

Never - Its the national carrier.

Our Federal Government has no problem supporting Rex - without a chairmans lounge and other perks, so QF has nothing to be worried about.

[Ollie Onion]

In an update call recently they said they have reduced cashflow to 1/12th of what it was 6 weeks ago, the freight part of the business is booming, they expect a return to domestic operations soon and have the option of another $3bn in debt raising should it be needed. Looks like they can get Jetstar domestic and Qantas domestic going with Tasman also expected shortly. They said the modelling is now better than what they initially thought and they would be bullish in trying to gain market share. They said well in excess of 12 months at this level of operation before they are in trouble with all flights that get up and running from here extending that timeline. So don’t expect VA anytime soon.

[wheels_down]

They will obviously exit with larger debt and reduced cash. The issue at hand is going to be International for the next 2 years, and fleet replacement bills. 110 Neo project is the largest finance project in the books. Those bills started last month.

Its clear they wont need that many Neos in the next 2-3 years. Airbus and Boeing are not overly friendly when it comes to pushing back or cancelling. Unless you buy more which they already did, to adjust timeframes.

Depends how many Neos are tied to leasing companies. If the contracts are signed they are going to be up the gutter.

Paying Airbus over a Billion bucks a year going forward is going to be tough.

[Icarus2001]

Never - Its the national carrier.
What do you think that actually means?

[normanton]

They will obviously exit with larger debt and reduced cash.
Yes and no. More debt from the $1b cash raised. Lots of LSL/AL burned. Wiping the books of the liabilities.

I expect the postponed shareholder payout to be cancelled. $150m there.

The kicker will be how long international is out for.

Will be interesting to see come September once Jobkeeper finishes.

[ozbiggles]

I wouldn’t put to much faith in the trans Tasman helping much
With no other viable International flying with in 18 months other than that you will have Air NZ operating 777s on every route, Qantas running 330s, Jetstar running 787s and Virgin....well who knows. If VA aren’t there, the alliance QA have with AirNZ will be torn up.
it will be an economic bloodbath 2nd to only a certain virus we are all aware of now.
I imagine Air NZ will operate direct Darwin, Cairns and a few others we never thought about too and they are government owned now.

[DirectAnywhere]

30,000 staff at $750 per week for 26 weeks is 585 million in Jobkeeper paid to QANTAS.

Some of that will flow to the staff, a lot won’t. A third of staff haven’t been stood down so there’s roughly 200 million straight to the company.

Other staff are on full time paid leave, others are using a mix of paid leave and Jobkeeper so the true benefits will be somewhere north of 200 million. Not huge but significant in the current environment.

[Paragraph377]

I wouldn’t mind seeing some of their freight statistics. I’ve read numerous business articles stating that although freight is down, it is really cycling at the moment. COVID has reduced capacity as aircraft are grounded, but due to everyone being stuck at home there is lots of online shopping taking place. As a result of the increase in freight but decrease in available aircraft, some freight transport costs have increased by 20 to 30% per kilogram. Qantas has a robust freight network and infrastructure so I would be curious to see what the current revenue dollars are from their freight division.

[wheels_down]

30,000 staff at $750 per week for 26 weeks is 585 million in Jobkeeper paid to QANTAS.

Some of that will flow to the staff, a lot won’t. A third of staff haven’t been stood down so there’s roughly 200 million straight to the company.

Other staff are on full time paid leave, others are using a mix of paid leave and Jobkeeper so the true benefits will be somewhere north of 200 million. Not huge but significant in the current environment.
I highly doubt that would go down well with Canberra.

The lawyers in Canberra might like that one. The government will soon be forward thinking corona reimbursement, shelling out a few hundred million for QFs bottom line wouldn’t cut it.

[Bug Smasher Smasher]

I highly doubt that would go down well with Canberra.

The lawyers in Canberra might like that one. The government will soon be forward thinking corona reimbursement, shelling out a few hundred million for QFs bottom line wouldn’t cut it.
Why? That’s exactly what it’s designed for.

[ECAMACTIONSCOMPLETE]

I highly doubt that would go down well with Canberra.

The lawyers in Canberra might like that one. The government will soon be forward thinking corona reimbursement, shelling out a few hundred million for QFs bottom line wouldn’t cut it.

everything that direct anywhere says is exactly correct and is the intent of the Jobkeeper scheme. its a wage subsidy to help businesses through COVID 19 and to ensure it’s workers wages don’t fall below $1500 a fortnight. everything QF is doing is completely legal.

[chookcooker]

everything that direct anywhere says is exactly correct and is the intent of the Jobkeeper scheme. its a wage subsidy to help businesses through COVID 19 and to ensure it’s workers wages don’t fall below $1500 a fortnight. everything QF is doing is completely legal.

the job keeper needs to passed onto the employee. The employer doesn’t get to keep it.

each eligible emolyee needed to register for it as an in dividing.

[Ragnor]

I wouldn’t mind seeing some of their freight statistics. I’ve read numerous business articles stating that although freight is down, it is really cycling at the moment. COVID has reduced capacity as aircraft are grounded, but due to everyone being stuck at home there is lots of online shopping taking place. As a result of the increase in freight but decrease in available aircraft, some freight transport costs have increased by 20 to 30% per kilogram. Qantas has a robust freight network and infrastructure so I would be curious to see what the current revenue dollars are from their freight division.

Last weeks dial in they gave the impression freight was supporting the business well and demand was increasing, shortly after that a LWOP email followed for 767 and 321 type rated Capt and FOs. Seems they need to get those express freighters up and running now with their 321P2F aircraft to keep up.

[DirectAnywhere]

The employer doesn’t get to keep it.

Yes they do.

Eligible employers (30 or 50% reduction in turnover depending on the size of the business) get $1500 per eligible employee. The employee has to fill out their own paperwork.

If the employee is stood down without pay the employee gets the full $1500 pre tax.

If the employee is still working but getting less than $1500 per fortnight the employer has to make up the difference using Jobkeeper and keeps the remainder. eg. a casual barista who has been employed for more than 12 months, who normally gets paid $1000 per fortnight will now earn $1500. The employer pays them their normal $1000, tops it up with 500 from Jobkeeper and keeps the remaining $1000. This is why the system is a windfall for some low paid employees who are getting a payrise funded by the government.

If the employee is still working or, importantly in QANTAS’s case, accessing paid leave while stood down at a rate of greater than $1500 per fortnight, the employer pays the employee as normal and banks the $1500. This is a real windfall for the employer. QANTAS is currently getting tens, it not hundreds, of millions of dollars in leave off the books, subsidised by the government.

QANTAS will get roughly 600 million from the federal government between now and September. It’s not possible to determine how much of that will go to the company and how much to employees. Back of the envelope, given 10,000 people are still working and the remainder are accessing a mix of Jobkeeper and their leave, I would expect QANTAS to keep perhaps half of that amount.

[normanton]

I hate to say it, and I don't agree with it, but Jobkeeper goes to the employee and employer.

Don't want your employer to get it? Simple, go on centerlink Jobseeker instead.

It's true if you are on LSL / AL then Qantas effectively get to keep your $1500. But according to the government, that is what it is designed for.

[TT738]

Quote:
Never - Its the national carrier.

What do you think that actually means?So is VA, just as much as QF.

[normanton]

So is VA, just as much as QF.
So when the administrators wipe the current shareholders from VA and Aussie Twiggy buys 100% of VA Mach 2, is QF still a national carrier just as much as VA Mach 2?

[TT738]

Last weeks dial in they gave the impression freight was supporting the business well and demand was increasing, shortly after that a LWOP email followed for 767 and 321 type rated Capt and FOs. Seems they need to get those express freighters up and running now with their 321P2F aircraft to keep up.freight is booming out of China. Week ago had a yank who couldn't find a freighter to fly PPE from China to USA(typical yank, he'd only tried U.S. companies). Found one owned by a UK outfit that could do it at reasonable cost. It was a pax aircraft with all the seats ripped out. Sounds like lots of "freighters" going into China light or empty, coming out heavy. Wonder why Australian exporters aren't getting onto this.

Someone in China is making a lot of money out of PPE.

[Rabbitwear]

I think QF international will be closed and all made redundant, with a new startup by Qantas when it’s required to outsource the International flying at slave labour rates !

[SHVC]

I think QF international will be closed and all made redundant, with a new startup by Qantas when it’s required to outsource the International flying at slave labour rates !

I would almost agree, QF will be using this opportunity to cut future operating cost in all parts of the business.

[novice110]

The Jobkeeper subsidy was brought in on projections for a six month lockdown.

The rapid reduction in COVID cases has far exceeded the early projections of a hibernation until September.

With most businesses expected to operate now at the three month point, the overspend could well be stopped earlier than six months.

[Anti Skid On]

I wouldn’t put to much faith in the trans Tasman helping much
With no other viable International flying with in 18 months other than that you will have Air NZ operating 777s on every route, Qantas running 330s, Jetstar running 787s and Virgin....well who knows. If VA aren’t there, the alliance QA have with AirNZ will be torn up.
it will be an economic bloodbath 2nd to only a certain virus we are all aware of now.
I imagine Air NZ will operate direct Darwin, Cairns and a few others we never thought about too and they are government owned now.

You clearly do NOT know the trans-Tasman market. Air NZ are standing down their B777 fleet until LH picks up, once they have done the various repatriation and freight trips. The B777's also did the ULH to IAH, it and the proposed JFK are gone for some time.

The B787 and the A321 neos will do Trans-Tasman; not many Kiwi's have a need, nor desire to go to Darwin direct. The key trunk routes between AKL and MEL, SYD and BNE will continue, and if anything the smaller aircraft will allow greater flexibility for travellers. The WLG and CHC flights to Australia will also pick up and the QK B737's and Air NZ's 320's will be a good fit for that.

Cairns was only a couple of times per week pre Covid (as was OOL and Sunshine Coast), so can't see the frequencies being increased there.

I think there will be a gentleman's agreement to help each other out

[Paragraph377]

Some good posts in here regarding freight. Qantas has the upper hand over VA without doubt. It certainly will be an area that the QF top tier will be exploring as to whether they can increase volume with new or expanded contracts. Now it’s not passenger uplift and it doesn’t keep all the flight crews and cabin crews employed, but if QF was able to source more freight it will at least keep the sheckles coming in, perhaps long enough to see the company through the worst of COVID. It really is times like these that a company needs to be innovative and look at areas or ideas that perhaps it hasn’t looked at in the past? VA don’t have a fallback source of income in their structure hence the fast demise of their financial viability.

[Chris2303]

I imagine Air NZ will operate direct Darwin, Cairns and a few others we never thought about too and they are government owned now.

I don't know how many times it has to be said but the NZ Government own 52% of Air NZ. It does not own the whole airline.

[1a sound asleep]

Its all good. Jetstar is now taking your money for flights to HNL from June. Please book now and pay in advance. Pay in Advance. Please pay now and keep us afloat. False hope but give us the cash


https://cimg4.ibsrv.net/gimg/pprune.org-vbulletin/2000x656/image_179caa5c308ca537b764e39a680b81d8db47728c.png

[crosscutter]

As others have said, I doubt QF is anywhere near VA. All those buybacks mean a capital raising would be a reasonable outcome if debt repayment issues arose.

However, the delayed 3rd quarter update may have a few surprises. It is after all a report on JAN-MAR but all eyes and ears will be on QF’s strategic response. One can speculate that the reason for the delay is restructure planning. After the tremendous expense the isolation measures have caused, the Australian government is not going to open the border to countries with widespread cases. Obviously, that rules out USA, Asia and Europe for quite a while. With Jobkeeper ending in September and more businesses open again in Australia it is an ideal time to reduce headcount in the Death Star. Likewise, the requirement for operational staff is reduced for the next 12 months at least. Fortunately, the stood down provisions and flexibility in the new EA’s should allow the pain to be shared. I hope so.

[Ragnor]

Its all good. Jetstar is now taking your money for flights to HNL from June. Please book now and pay in advance. Pay in Advance. Please pay now and keep us afloat. False hope but give us the cash


https://cimg4.ibsrv.net/gimg/pprune.org-vbulletin/2000x656/image_179caa5c308ca537b764e39a680b81d8db47728c.png

The problem with this is what?? JQ also have a full domestic schedule for sale June 1st. How else are they to gauge demand if they don't sell tickets?
Virgin are selling international flights via code share with Delta from June 2nd, Pay in Advance. Please pay now and keep us afloat. False hope but give us the cash
Qantas are selling international flights from June 1st cheaper than Virgin. Pay in Advance. Please pay now and keep us afloat. False hope but give us the cash

[2020Balance]

Any truth in the rumour QF are talking to KordaMentha now with regards to restructuring advice? I heard it from an internal QF mate yesterday not hearsay .

[DHC8 Driver]

Any truth in the rumour QF are talking to KordaMentha now with regards to restructuring advice? I heard it from an internal QF mate yesterday not hearsay .

“I heard it from an internal QF mate yesterday” - what is your definition of hearsay?

[2020Balance]

“I heard it from an internal QF mate yesterday” - what is your definition of hearsay?

Not pulling it out of my A..

[OneDotLow]

That sort of discussion is an ongoing theme for any large business. COVID would be right up there in discussions at the moment, but it would be naive to think they aren’t always looking for ways to restructure.

[The Baron]

I wish Qantas all the best. I hope they survive on their own merits. They are not a national carrier any more though. I hope they get the same consideration that the Federal Government gave to Virgin. it would be quite hyprocritical of Joyce to ask for a government handout after throwing such a tantrum over sugestions that the opposition was going to get one.

[Ragnor]

I wish Qantas all the best. I hope they survive on their own merits. They are not a national carrier any more though. I hope they get the same consideration that the Federal Government gave to Virgin. it would be quite hyprocritical of Joyce to ask for a government handout after throwing such a tantrum over sugestions that the opposition was going to get one.


Not really, Virgin is a loss making business, Qantas makes money I wouldn't have a problem the government loaning money to QF. After all it is making a profit and they could pay it back.

[ozbiggles]

Well allow me to retort
Air NZ are owned 52% by the government plus 900million Which odds on will become equity plus whatever else they need and will get in the near future....Are you really suggesting they are not effectively owned by the government now? Maybe we compromise on majority share holder plus some?
But line of the day is definitely gentleman’s agreement on the trans Tasman, the only funnier thing I’ve seen recently is the Virgin downfall video.
As for not knowing the Tasman, maybe SO, Only been flying over it for 25 years now. 777 or 787 we will see, but who cares? What was said last week will change next week anyway. Where else are the 777s going in the next two years? Sure Kiwis in the past may not have gone to Darwin direct but if you only have one other island you can travel to and lots of aircraft maybe you might give it a crack in something of an appropriate size.
Correction Ragnor, Qantas used to make money.

[chookcooker]

Not really, Virgin is a loss making business, Qantas makes money I wouldn't have a problem the government loaning money to QF. After all it is making a profit and they could pay it back.

hmmmm.
also you:


If VA get the special treatment so should we. Current position that VA is in is due to its own mismanagement. I don’t want to see anyone loose their job, needs to be a level playing field.

[The Bullwinkle]

QANTAS will never go into administration.
They have the world’s best CEO, survival of the fittest, blah, blah, blah..........

[Chris2303]

Well allow me to retort
Air NZ are owned 52% by the government plus 900million Which odds on will become equity plus whatever else they need and will get in the near future....Are you really suggesting they are not effectively owned by the government now? Maybe we compromise on majority share holder plus some?

The $900M is a loan made available IF required. The company, very much to it's credit, has not yet drawn on it.

However it is election year here and already NZ First are murmuring about re-nationalising Air NZ.

[industry insider]

SHVC wrote:

I would almost agree, QF will be using this opportunity to cut future operating cost in all parts of the business.

The cloak of Covid 19 has provided many businesses with an unscheduled restructuring opportunity and from what I am seeing, many are using the opportunity to reset terms and conditions.

[normanton]

If Qantas wanted to reset T&C they wouldn't have pushed ahead with the most recent EBA, which once voted up by the pilots, Qantas then submitted to fair work. The agreement was then approved only 2 weeks ago.

They are not a national carrier any more though.
They actually are. When the government needs help they always flock to Qantas. It's majority Australian owned, and believe it or not they actually make money.

[neville_nobody]

They actually are. When the government needs help they always flock to Qantas. It's majority Australian owned, and believe it or not they actually make money.

Not in the true sense of a national carrier. There is no ownership. Military transport is always done by some sub-contracted charter outfit. Many other operators charter for the Australian government too. Alliance goes flat out during an election. I would hazard a guess that the political blowback from not using Australian Carriers in the last 3 months were why they went with QF. China Southern would have been cheaper but they wouldn't want the publicity. Qantas Pilots likes to think of it as a National Carrier but it isn't by any stretch of anyone's imagination.

[exfocx]

Its all good. Jetstar is now taking your money for flights to HNL from June. Please book now and pay in advance. Pay in Advance. Please pay now and keep us afloat. False hope but give us the cash


https://cimg4.ibsrv.net/gimg/pprune.org-vbulletin/2000x656/image_179caa5c308ca537b764e39a680b81d8db47728c.png

It doesn't take much to see what the game is here. Take the payment (have a look at your refund rights!) and cancel the flight and refuse the refund and give the sucker a voucher.

[zanthrus]

Gimmee the Kasshhh! AJ 😂

[Ragnor]

It doesn't take much to see what the game is here. Take the payment (have a look at your refund rights!) and cancel the flight and refuse the refund and give the sucker a voucher.


But it’s ok for Virgin and QF to take your money and do the same, they’re doing exactly the same.

[normanton]

Not in the true sense of a national carrier. There is no ownership. Military transport is always done by some sub-contracted charter outfit. Many other operators charter for the Australian government too. Alliance goes flat out during an election. I would hazard a guess that the political blowback from not using Australian Carriers in the last 3 months were why they went with QF. China Southern would have been cheaper but they wouldn't want the publicity. Qantas Pilots likes to think of it as a National Carrier but it isn't by any stretch of anyone's imagination.
And that's your opinion.

The overwhelming majority of the Australian public would say Qantas. Most wouldn't even know who Alliance is.

[-41]

Qantas is the national carrier. ownership restrictions and public + political sentiment dictate this.

[mates rates]

It’s hard to believe that there is no conversation about Qantas’ financial position.I’m not sure how many aircraft they have dedicated to international operations,but there is unlikely to be any flying for them in 2020.If Virgin survive, the government will have to unsure that Qantas does not engage in predatory operations by flooding the domestic market with a surplus supply of seats.So how long can Qantas sustain their international fleet grounded?

[Lookleft]

Longer than Virgin can. So its not hard to believe at all.

[slats11]

Boeing states will take years for travel to recover to preCOVID levels.

Even if the pandemic is brought under control, many people have lost their jobs and are otherwise not spending, so fewer leisure travel. Same with business travel.

https://www.marketwatch.com/discover?url=https%3A%2F%2Fwww.marketwatch.com%2Famp%2Fstory %2Fguid%2Fbfade690-889c-11ea-9937-a568192fffcb&link=sfmw_tw#https://www.marketwatch.com/amp/story/guid/bfade690-889c-11ea-9937-a568192fffcb?mod=dist_amp_social

[crosscutter]

It’s hard to believe that there is no conversation about Qantas’ financial position.

It’s not that hard, although this thread is talking about it. It’s not big news because there’s not much to say. Anyway, Qantas said it had A$2.95 billion of cash, another A$1 billion undrawn credit facility and a further A$3.5 billion of unencumbered assets available. They have capital raising options as well as further debt options. Also the FF business to trade against not that they would. Nevertheless, some sort of restructure is likely to preserve their financial position.

[Going Boeing]

Qantas is releasing a market update today which should give an idea of how they are travelling - all Joyce's previous statements have been "smoke & mirrors" so this update will need significant forensic examination.



Just in:

https://www.qantasnewsroom.com.au/media-releases/qantas-group-market-update-increasing-resilience-for-long-term-recovery/

[SandyPalms]

AJ has told us that the group has enough cash to last until December 2021.

[crosscutter]

AJ has been quite open and accurate with his statements and the latest update confirms Qantas’ strong financial position under near impossible circumstances.

‘Fleet, network and capital expenditure will all have to be reviewed’. No smoke and mirrors...pretty clear change is on the way, you wouldn’t expect anything else.

[SandyPalms]

AJ has been quite open and accurate with his statements and the latest update confirms Qantas’ strong financial position under near impossible circumstances.

‘Fleet, network and capital expenditure will all have to be reviewed’. No smoke and mirrors...pretty clear change is on the way, you wouldn’t expect anything else.

Now that we know QF won’t enter VA anytime soon, maybe we can use this thread to speculate on the above quote from this mornings update.

My Speculation: 747’s will never fly again, and JQ won’t operate the 787 again

[cloudsurfng]

I would say the 380’s are toast as well.

in a low demand, price sensitive market, and with a weakened/refocused (and hopefully still operating!) virgin, JQ domestic could be first to start bouncing back.

agree about the 787.

[LostWanderer]

I doubt the ever loving and caring AJ has it in his heart to keep all the pilots and FAs on the books til flying picks up again. Sincerely hope it's not the case but my guess is that significant redundancies at international will be virtually a given and as previously pointed out, likely end game is to be majorly restructured with some less than stellar wages/conditions for crews when things pick up again in a few years time...basically managements wet dream for pilot pay.

They know very well that they have the pilots by the beanbags now in this economic environment and god knows they will capitalise on it down to the last cent. There will be some big and nasty change coming. No pilot at any airline has any leverage anymore, I'm generally an optimist believe it or not! but being a realist now, gotta accept the inevitable for our industry.

[Rabbitwear]

On the contrary if VA doesn’t get started this year JQ will need the 787s or some of them for domestic.
everything hinges on the strength of the competition if and when it comes .

[Blueskymine]

On the contrary if VA doesn’t get started this year JQ will need the 787s or some of them for domestic.
everything hinges on the strength of the competition if and when it comes .

If the Jetstar 787s operate domestically - it won’t be with a star on the tail.

[Ragnor]

If JQ and QF have extended stand down due to demand until July, this would not be good for Virgin either, hard to sell a business that's not making money right?

[f1yhigh]

I doubt the ever loving and caring AJ has it in his heart to keep all the pilots and FAs on the books til flying picks up again. Sincerely hope it's not the case but my guess is that significant redundancies at international will be virtually a given and as previously pointed out, likely end game is to be majorly restructured with some less than stellar wages/conditions for crews when things pick up again in a few years time...basically managements wet dream for pilot pay.

They know very well that they have the pilots by the beanbags now in this economic environment and god knows they will capitalise on it down to the last cent. There will be some big and nasty change coming. No pilot at any airline has any leverage anymore, I'm generally an optimist believe it or not! but being a realist now, gotta accept the inevitable for our industry.

Is that to speculate the 747 and possibly A380 won't be flying for a long time, if ever?

[slats11]

Over many decades, this guy has got far more calls right than he has got wrong. He is very negative on airlines. Note these airlines have extensive domestic operations, so Buffett is not that confident that domestic ops will return to normal levels.

https://markets.businessinsider.com/news/stocks/big-4-airline-stocks-plunge-warren-buffett-berkshire-hathaway-sell-2020-5-1029160193

[Popgun]

I agree that we are not likely to see the 380 or 747 for quite a while.

However, I think the JQ787 will continue to be utilised. It has a footprint that the A321 cannot get near and a cost base that mainline cannot get anywhere near.

Speaking to friends and family throughout this lockdown, many in wealthy, well-to-do situations, has me believing that many travellers will be looking for the lowest fares when things start picking up again. If that’s the case, then the JQ787 is a quite a potent tool.

i also think that, domestically, the 737 won’t bounce back as quickly as it might. Again, many of these friends and family across a wide range of industries, who used to be very frequent business travellers, have stated that Tele-conferencing will be likely to permanently replace a lot of the travel they used to conduct..

PG

[SandyPalms]

AJ has stated this morning that they are looking at removing “some A380’s. How many have been reconfigured? Or at least, the reconfiguration paid for? Also almost confirmation that the 747 is done.

[slats11]

https://www.theguardian.com/world/20...ember-retested (https://www.theguardian.com/world/2020/may/04/french-hospital-discovers-covid-19-case-december-retested)

France has now tracked down a case of COVID in a guy who was sick on December 27. That man had no travel history.

So by December 27, the virus had travelled from China to Paris, and had infected a Paris resident - who had become sick enough to go to a hospital and have a test for the 'flu.

This all happened 4 days before the WHO was 1st notified by China.

Does make you wonder how many cases we imported into Australia during December and January.

[normanton]

I think QF will try to avoid costly redundancy pay outs. It just doesn't make sense right now when cash is king. They will instead use time to their advantage.

Firstly as per the latest FSO there is no training slots for the year.

737 will drop to minimum divisor, which also means no training can happen i.e. no one from LH can come over. If there is still a surplus here it will result in rotating stand downs and natural attrition.

As people hit the international retirement age of 65, they will be forced into retirement. 737 is no longer a plan B. LH numbers will reduce from natural attrition and some just throwing in the towel. Some will take LWOP and go elsewhere. Others will quit the industry all together.

330 and 787 will slowly pickup. Country by country at a time (the "travel bubble"). The 380 and 747 is done. Forget it. It sucks. Expect the 380s to be parked up somewhere. Maybe even with the Singapore 380s in Alice.

The interesting thing is what will happen to the excess 380 and 747 crew? A RIN? Further stand downs? Redundancy's off the tail end of the seniority list?

Again, I think Qantas will just buy themselves time. I can't see Qantas throwing all this cash at training and movements.

The company will eventually go to AIPA with some sort of offer on conditions to avoid redundancy, training movements, and allowances. It will go to a vote. If it gets voted down by the pilots, expect Qantas to submit a challenge in the courts to fight the RIN process in the EBA. They will argue it's not financially viable and will send the company into administration.

Interesting times.

[crosscutter]

You started reasonably then aliens came or you got carried away

[slats11]

From the horses mouth...

https://www.smh.com.au/business/companies/qantas-takes-on-550m-more-debt-extends-covid-19-cancellations-20200505-p54ptr.html

[Ragnor]

Very noble of AJ to help stimulate the economy by offering flights as cheap as $19 on JQ network.

[machtuk]

Very noble of AJ to help stimulate the economy by offering flights as cheap as $19 on JQ network.

oh the little Leprechaun is cunning! -) Joe public will believe anything that comes out of the Roos mouth!

[Ragnor]

oh the little Leprechaun is cunning! -) Joe public will believe anything that comes out of the Roos mouth!

I think he will do it, on selected T&Cs of course.

[Blueskymine]

Very noble of AJ to help stimulate the economy by offering flights as cheap as $19 on JQ network.

Its not about being charitable. It’s about stimulating the market to get the jets going and of course letting any investors in VA know that they will need lots of cash to participate.

[ozbiggles]

I’m sure the ACCC is taking notes....if the ACCC will have a role in a post COVIDS world remains to be seen.
I don’t see it as much more than the normal 2 seats per aircraft and 10x times the price to get back old trick.

[TT738]

Its not about being charitable. It’s about stimulating the market to get the jets going and of course letting any investors in VA know that they will need lots of cash to participate.
Qantarse wants to lock away as many domestic pax as possible before virgin 2 even gets going. So doesn't matter what fares V2 come out with, if you're booked on JQ, you won't be flying V2. Yes if V2 does a lot of loss leaders, they will get some pax, but loss leaders are just for free advertising.

[ExtraShot]

Just an off the cuff thought, but what are the Redundancy provisions in Jetstar? Perhaps A fraction the cost of those in QF I would assume? They most likely don’t have a massively complex and expensive RIN process either.

Consider the Jetstar 11 787s get a repaint with a Roo on the tail, the 5 747s and 6 (possibly more) of the 380s get retired, and then crews directed to the now enlarged 787 fleet, which would have a mix of -8 and -9 versions going forward, avoiding a lot of expensive displacement in a RIN.

The result is a super efficient twin engine wide body fleet to replace the 4 engine money guzzlers, with two sub types to use in various roles as demanded by capacity, which is much more suited to the market predictions going into the next two years.

It also potentially avoids a massive amount of cost of displacement and retraining of the RIN process, AND QFs likely much more expensive Redundancy process as a result. All the while also minimizing any potential legal wrangling QF might have to do around approval to be working outside of EAs etc.

Not a great thought for those in JQ, but as much as I don’t see full A380s flying around any time soon, I don’t see 300 plus punters in one hit from multiple Capital cities heading to Bali, Vietnam, Hawaii in 787s either.

Hopefully it just a pointless brain fart and we find a way out this mess without anyone losing out.

[Fatguyinalittlecoat]

Just an off the cuff thought, but what are the Redundancy provisions in Jetstar? Perhaps A fraction the cost of those in QF I would assume? They most likely don’t have a massively complex and expensive RIN process either.

Consider the Jetstar 11 787s get a repaint with a Roo on the tail, the 5 747s and 6 (possibly more) of the 380s get retired, and then crews directed to the now enlarged 787 fleet, which would have a mix of -8 and -9 versions going forward, avoiding a lot of expensive displacement in a RIN.

The result is a super efficient twin engine wide body fleet to replace the 4 engine money guzzlers, with two sub types to use in various roles as demanded by capacity, which is much more suited to the market predictions going into the next two years.

It also potentially avoids a massive amount of cost of displacement and retraining of the RIN process, AND QFs likely much more expensive Redundancy process as a result. All the while also minimizing any potential legal wrangling QF might have to do around approval to be working outside of EAs etc.

Not a great thought for those in JQ, but as much as I don’t see full A380s flying around any time soon, I don’t see 300 plus punters in one hit from multiple Capital cities heading to Bali, Vietnam, Hawaii in 787s either.

Hopefully it just a pointless brain fart and we find a way out this mess without anyone losing out.

and this could all be done In agreement with the current EA, RIN and bypass provisions.

[neville_nobody]

Its not about being charitable. It’s about stimulating the market to get the jets going and of course letting any investors in VA know that they will need lots of cash to participate.

It's really more about free advertising and getting people talking. He offers two seats at $19 and the other 178 for $150+. At $19 Jetstar are paying the airport taxes and landing/enroute fees for you.

[ExtraShot]

and this could all be done In agreement with the current EA, RIN and bypass provisions.


Yep. As far as I can see nothing would need changing. No expensive lawyers involved.

[Buster Hyman]

So, if we're playing Nostradamus Bingo, I still think JQ will do the bulk of DOM sectors & limited Bogan Holiday INTL sectors, and QF will do the opposite.

[sundaun]

All Joyce is doing is terrifying potential.bidders for the Virgin going concern. He should be prosecuted downstream for these tactics..

[neville_nobody]

All Joyce is doing is terrifying potential.bidders for the Virgin going concern. He should be prosecuted downstream for these tactics..

If he sold entire aircraft at $19 then he probably will. The reality is only a handful of people will buy $19 tickets.

[Ragnor]

I’m sure the ACCC is taking notes....if the ACCC will have a role in a post COVIDS world remains to be seen.
I don’t see it as much more than the normal 2 seats per aircraft and 10x times the price to get back old trick.

So the Virgin brigade start a campaign that flights will be to expensive if the Gov don’t step in and save it from collapsing and keep the air fair. Soon as AJ says $19 flights still cheap all of a sudden the ACCC have to be taking notes. Talk about wanting it both ways.

[Ragnor]

Consider the Jetstar 11 787s get a repaint with a Roo on the tail, the 5 747s and 6 (possibly more) of the 380s get retired, and then crews directed to the now enlarged 787 fleet, which would have a mix of -8 and -9 versions going forward, avoiding a lot of expensive displacement in a RIN.

The result is a super efficient twin engine wide body fleet to replace the 4 engine money guzzlers, with two sub types to use in various roles as demanded by capacity, which is much more suited to the market predictions going into the next two years.

Not a great thought for those in JQ, but as much as I don’t see full A380s flying around any time soon, I don’t see 300 plus punters in one hit from multiple Capital cities heading to Bali, Vietnam, Hawaii in 787s either.

Hopefully it just a pointless brain fart and we find a way out this mess without anyone losing out.

I very much doubt it, those 78s are useless to QF, talking millions to get a nice bed and refurbish them to QF standards. Also, as long as international crews are stood down what cost is it to QF and JQ? Very minimal I think just acquiring AL and sick days

[SecretAngel]

All Joyce is doing is terrifying potential.bidders for the Virgin going concern. He should be prosecuted downstream for these tactics..
If potential bidders couldn't figure out for themselves that a massively over capacity market coming out of COVID would mean low airfares as both QF and VA try to reduce cash burn, by filling every possible seat, then they don't know enough about airline economics to be bidding.

Similarly, if Joyce pointing out that obvious fact scares them, then they lack the balls to be in business.

What Joyce achieves by talking up $19 fares is getting people to start even thinking about flying again, both by pointing out it will be affordable even in the middle of a recession, and by getting people to want to book fast so they don't miss great fares. At a time like this, airlines (and other businesses) need to find ways to stop people focusing on the health and economic trainwreck, and start thinking about returning to a semi normal life. If dirt cheap airfares help with that (and help get me back in a job...) then I'm all for it.

[ozbiggles]

Ragnor, I know what he is doing....you know what he is doing. If he sells tickets from A to B and back again at $19 for months on end then I will celebrate too....but that’s not what is going to be on offer is it. But I wouldn’t worry what effect VA is or is not going to have on your job, that is all down to your boss and how he fits a square peg into a round hole that is far to big for the hole in the first place now. My interest comes from being old enough to remember how much it used to cost to fly from BNE to MEL and if there is no competition there won’t be any need for fantasy fares.

[ExtraShot]

I very much doubt it, those 78s are useless to QF, talking millions to get a nice bed and refurbish them to QF standards. Also, as long as international crews are stood down what cost is it to QF and JQ? Very minimal I think just acquiring AL and sick days

Im not so sure they’re ‘useless’ to QF.

They dont absolutely need a crew rest, yet, if ever...

​​​​​​​They don’t absolutely have to be refurbished, yet... ie: just sell a premium economy/economy product for the time being, possibly better suited to the recovery phase anyway.

The cost of re painting the exteriors is a drop in the ocean in the scheme of things.

Eventully the stood down crews will be stood up. In what capacity and at what cost?
I’d say a RIN resulting from a massive fleet reduction at the very top of the seniority tree (380/747), and the displacement and possible redundancies following that could cost A LOT more than 11 new coats of paint.

​​​​​​​