RIP Bonza

[Capn Rex Havoc]

Good while it lasted…..

https://www.afr.com/companies/transport/bonza-flights-cancelled-as-aircraft-repossessed-20240430-p5fnjf

I know it’s on a paywall - but you can get the drift ….

[flopzone]

The parent company that owns the aircraft leased to Bonza has repossessed the Fleet. Bonza may be the meat in the sandwich here. Seems that company was not making the payments but Bonza was. I dont know who owns who.

[73to91]

In an interview with the ABC (https://www.abc.net.au/news/2024-04-30/bonza-flights-cancelled-business-viability-question/103783236),a man from the Sunshine Coast, whose wife works for the airline, claimed 20 cabin crew were called into a meeting early on Tuesday and told the airline had “finished”.

“She went to work this morning, as per usual, they just went in — there were two crews there — they were just basically told that Bonza has finished,” he told the ABC. (https://www.abc.net.au/news/2024-04-30/bonza-flights-cancelled-business-viability-question/103783236)

“They’ve been told that they’re not flying until further notice.

“They’ve all been told that the bottom line is that Bonza will no longer be flying

https://www.news.com.au/travel/travel-advice/flights/bonza-cancels-flights-across-the-country-amid-airline-scaling-back-routes/news-story/47a957cf642564921502e27e473a4cf7

[nomess]

The parent company that owns the aircraft leased to Bonza has repossessed the Fleet. Bonza may be the meat in the sandwich here. Seems that company was not making the payments but Bonza was. I dont know who owns who.
777 offloaded its fleet to AIP recently. Bonza send payments to AIP. 777 don’t own aircraft anymore.

Tim Jordan has been running an insolvency firm. Lies lies and lies for months.

Watch him try to blame this on someone else.

[Sameoldsameold]

Are we really surprised? Honestly this was doomed from the start. All it did was give some jet hours to those that needed them and they can now move on to better prospects. Never been a better time to be made redundant.

[dr dre]

Are we really surprised? Honestly this was doomed from the start. All it did was give some jet hours to those that needed them and they can now move on to better prospects. Never been a better time to be made redundant.

Weren't a lot of Bonza crew ex VA with a right of return? Hopefully can back into VA soon if that's the case.

[markis10]

777 offloaded its fleet to AIP recently. Bonza send payments to AIP. 777 don’t own aircraft anymore.

Tim Jordan has been running an insolvency firm. Lies lies and lies for months.

Watch him try to blame this on someone else.


Not quite, the Aircraft have been with AIP from day dot, with AIP being almost 50:50 owned by management and 777partners. On April 9 a new entity called phoenix aviation capital (interesting name) took over the 777 partners share. Phoenix is owned 100% by a U.S-based insurance and financial services holding company with approximately $11 billion of assets under management.

[TBM-Legend]

Those with short memories have probably forgotten Tim’s statement just before launch that Bonza needed a load factor of 80% to pay all the bills and was very confident that would happen.

making a go of a couple of routes won’t support a network. I saw his BP before he secured 777Partners and it was pitching rapid growth tapping un or non serviced markets.

shades of JetGo, Strategic, Sky World, Air Australia

[DeltaT]

Australian airline Bonza cancels all flights amid reports planes repossessedAmelia McGuireApril 30, 2024, • 09:22am

All flights by Australian carrier Bonza have been cancelled.
Reports say some aircraft have been repossessed.
It is the first high-capacity, low-cost carrier to launch in Australia since now-defunct Virgin subsidiary Tigerair took off 15 years ago.

All flights operated by budget carrier Bonza (https://www.stuff.co.nz/travel/news/129721245/australian-airline-bonza-goes-hardcore-aussie-in-naming-of-new-plane)have been wiped from Australia’s departure boards on Tuesday as the outlook for the country’s smallest airline grows more uncertain.

Passengers attempting to fly from the Sunshine Coast, Melbourne, Gold Coast and Avalon arrived at the respective airports on Tuesday morning to find their flights had been cancelled.

Bonza chief executive Tim Jordan apologised to customers in a statement and said he was considering the viability of the business, but did not confirm or deny whether any of its aircraft had been repossessed as reported (https://www.afr.com/companies/transport/bonza-flights-cancelled-as-aircraft-repossessed-20240430-p5fnjf) by The Australian Financial Review.

“Bonza has temporarily suspended services due to be operated today (Tuesday April 30) as discussions are under way regarding the ongoing viability of the business,” said Jordan.

“We apologise to customers who are impacted by this, and we’re working as quickly as possible to determine a way forward that ensures there is ongoing competition in the Australian domestic aviation market.”
Australian discount airline Bonza is in strife after multiple domestic flights were cancelled.
SUPPLIED

Bonza has previously denied engaging restructuring firm KordaMentha to work on its future.

The airline launched its ambitious plan to fly to largely unserviced parts of Australia with low-cost fares in January last year (https://www.stuff.co.nz/travel/news/300812307/good-on-ya-mate-aussie-airline-names-new-737-jet-after-blenheim-man). Since then, it has cut a swathe of routes last year due to a lack of demand in an attempt to boost reliability on its more popular services.

Bonza’s fleet was originally owned by its parent company, 777 Partners, but the private equity group’s creditors have since created a new vehicle which now owns the company’s 30 Max-8 aircraf

Over the past year, Bonza has been hamstrung by fleet issues, with multiple Bonza branded planes redirected to one of 777 Partners’ other airlines.
Bonza’s fleet of four Boeing 737 Max-8s has been struggling to service its route map and also cater to pilot training requirements. This has resulted in many frustrated customers experiencing last-minute cancellations or delays, while aspiring pilots are unable to complete their training as scheduled.

It is the first high-capacity, low-cost carrier to launch in Australia since now-defunct Virgin subsidiary Tigerair took off 15 years ago. It has positioned itself as a leisure carrier targeting tourism destinations in regional Australia, rather than competing with Qantas or Virgin, which service high-frequency routes.

Although it is a model that has worked well across Europe and Asia, critics have expressed concern Bonza’s structure is unsustainable due to Australia’s size and small population.
- Sydney Morning Herald

https://www.stuff.co.nz/travel/350261823/australian-airline-bonza-cancels-all-flights-amid-reports-planes-repossessed

[LostWanderer]

It’s a shame, I think it’s great they gave it a go. But sadly seems to prove that Australia just does not have the market to support another major(ish) airline. It’s now been tried more times than I care to think about and always ends like this.

Hope the staff all land on their feet quickly. As someone else said, it’s probably the best time to be a qualified jet jockey in Australia.

[dragon man]

Very sad day for the staff and suppliers who are owed money as well as the public that even more so now are at the mercy of the Qantas close to monopoly.

[TBM-Legend]

Commercial suicide not caused by those other parties.

the market speaks and those relatively small markets cannot sustain 185 seat jets that cost a bundle to run even with low maintenance but there are reserves and lease payments not to mention the fuel bills

[Talkwrench]

Yes, looks like it's a bust. History repeats.
Sorry for the staff that have to find a new job, however, I assume the head honchos have managed to add a couple zeros to their bank balances during Bonza's existence.

[FlyingUpsideDown]

Any Bonza guys/gals looking for an immediate opportunity in the USA, I have a good contact in Atlas. Please PM me.

[volare_737]

Just for info. Texel was looking desperately for 737-800 crew in Darwin !!!

[wheelyfunny]

Now in VA...

Korda didnt want it - as was high risk

[nomess]

Unlikely to see any new entrants for a long long time now. Financials will obviously be released shortly from the administrators, but the analysis I did in the prior month indicated it was bleeding heavily. That was at odds with Bonza had been claiming, and I held a strong belief they had been lying, to staff, suppliers and likely even its backer.

I do recall Tim Jordan tipped in some of his own cash, in the millions. I wonder where he sits on the creditor list.

[Ollie Onion]

The business plan was always madness, you can’t put a high density Jet in thin routes like that at a low cost point.

[Stationair8]

One of Australia’s resident aviation expert has been busy hitting the airwaves, with the demise of Bonza.

Thankfully Australia has Qantasflot to keep us flying!

Remember how Qantas led by Geoff Dixon stepped up and saved the day when Ansett stopped operating. Brought a tear to my eye, not to mention the hip pocket!

RIP Bonza.

[Mach2point7]

The business plan was always madness, you can’t put a high density Jet in thin routes like that at a low cost point.
Maybe the E-190 or similar might have worked. I have no knowledge of how this business plan was developed for Australian operations, but one suspects that with 777 Partners, as both airline owner and initial lessor, there was little choice of aircraft involved as they had many 737 Max 8 aircraft on order. That is an inherent conflict. Perhaps somebody with real knowledge of the situation will soon be able to deny or confirm my armchair speculation. But 186 seats on routes such as Mildura to Sunshine Coast or Toowoomba to Townsville is extremely ambitious.

[tail wheel]

The number of airline skeletons in the Australian airline closet has inevitably increased by another one. A much larger closet is called for.

There are two factors common to almost all those skeletons - being grossly and obscenely undercapitalised and fanciful business plans based on totally fictitious, unachievable traffic projections. Anything to do with the business of aviation is very capital intensive, compounded by a low 25 million population with 70% plus domicile in three or four coastal cities and Australia being a very expensive tourist destination.

And unless an airline has cast iron operating cost guarantees from the aircraft manufacturers (which is most unlikely), forget the manufacturers aircraft operating cost projections, inevitably authored by Aesop himself!

I remember many years ago running into Bryan Grey at Brisbane Airport shortly after he formed Compass. When I asked how business was going, his answer "Loadings are great, load factors over 90%. On current air fares our break even load factor is around 115%". Having known Bryan for many years I was very surprised he didn't see an air fare war looming!

Even in a duopoly airline structure, since the demise of the two airline policy and legislated protection for the players, historically one of the duopoly airlines has always been financially disadvantaged, right back to AN - TN days and up to today's QF - VA.

Spanish philosopher and novelist George Santayana once wrote: "Those who cannot remember the past are condemned to repeat the mistakes (in the future)".

Bonza will not be the last skeleton into the greatly enlarged closet of demised airlines.

[dragon man]

IMO the only hope for aviation in Australia is a government with balls to neuter the largest carrier by restricting slots or maybe forcing the divestment of Jetstar. I dream , it will never happen.

[helispotter]

It’s a shame, I think it’s great they gave it a go. But sadly seems to prove that Australia just does not have the market to support another major(ish) airline...

REX is presumably still doing ok, including on its 737 routes?

[Mr Google Head]

REX is presumably still doing ok, including on its 737 routes?

At least Rex have older (thus presumably cheaper) planes on trunk routes - quite different to the thread in question

[ozbiggles]

IMO the only hope for aviation in Australia is a government with balls to neuter the largest carrier by restricting slots or maybe forcing the divestment of Jetstar. I dream , it will never happen.

That is the Australian way. Get something that works and pays for itself, employs thousands of people and get the government involved to hobble it. When people pay more to park their cars at an airport than they are willing to pay for an airline ticket then the problem lies elsewhere.

[dragon man]

That is the Australian way. Get something that works and pays for itself, employs thousands of people and get the government involved to hobble it. When people pay more to park their cars at an airport than they are willing to pay for an airline ticket then the problem lies elsewhere.


Pays for itself, just like the money they received to survive during Covid?

[MickG0105]

REX is presumably still doing ok, including on its 737 routes?
If by "still doing ok", you mean still losing at least $1 million a week on jet ops, then yes. For April, they just closed out easily their worst month of the current FY (and April is generally one of the stronger months for domestic travel in H2).

[43Inches]

That is the Australian way. Get something that works and pays for itself, employs thousands of people and get the government involved to hobble it. When people pay more to park their cars at an airport than they are willing to pay for an airline ticket then the problem lies elsewhere.

What you just described is the great con of 'cheap' travel. The airline ticket itself may be cheaper, but by breaking down all the costs into small manageable amounts the consumer does not realize how much they are actually spending. Spend on transport to the airport/parking, food, mindless shopping at the terminal, spend on in-flight items and upgrades, destination expenses, before you know it you have spent double or triple what you expect to and the credit card is maxed out for you to slowly pay off until the next 'cheap' holiday, but hey you enjoyed it, did you not? Also think of all the cash people spend preparing for a holiday, new luggage, new phone/camera for those perfect pics/reels, and new outfits, fake tan (even when going somewhere to get a tan) etc etc etc etc.... Most people are pretty lost when bamboozled with multiple costs and just go with it, instead of working out how much they are spending. All the airline is doing is cutting their margins to enable all the others to profit from it.

[ozbiggles]

Pays for itself, just like the money they received to survive during Covid?

Just like every other business did to survive Covid. I’m no fan of Jetstar but I’m over people asking the government to fix everything to their liking.

To stay on topic, I am yet to meet anyone who thought this was a business model that had any long term survival prospect. I’m sure people smarter than I can tell you flying into places with a small population at below cost tickets just isn’t going to last long, but everyone wants a government subsidy don’t they.

[DeltaT]

Australia's Bonza goes bust as AIP Capital seizes aircraft
By Andrew Curran30APR2024
Editorial Comment: Updated to add information about Bonza entering into voluntary administration. - 30APR2024 - 06:56 UTC
https://www.ch-aviation.com/news/139721-australias-bonza-goes-bust-as-aip-capital-seizes-aircraftBonza (https://www.ch-aviation.com/airlines/04W)

(AB, Sunshine Coast (https://www.ch-aviation.com/airports/316)) has suspended all flights after its aircraft were repossessed. Following weeks of speculation about the airline's future, Bonza pulled the plug early on April 30, axing that day's flights. CEO Tim Jordan said flights had been put on hold but did not reveal that aircraft asset manager AIP Capital (https://www.ch-aviation.com/entities/AIPC) had seized his fleet overnight.

"Bonza has temporarily suspended services due to be operated today, as discussions are currently underway regarding the ongoing viability of the business," he said via a statement. Bonza's booking app and website have also blanked out all future flights, but neither platform currently mentions the service suspension.

In recent weeks, Bonza has refuted reports it was in trouble, with a spokesperson telling ch-aviation the airline was "not showing signs of stress." This was despite confirmation that Bonza's financiers had retained KordaMentha to advise on whether they should keep supporting the carrier.

Bonza launched into the Australian market (https://www.ch-aviation.com/news/124017-australias-bonza-commences-scheduled-passenger-ops) in early 2023, backed by 777 Partners (https://www.ch-aviation.com/entities/PRTN), and headed by Jordan, who had established his aviation reputation as the CEO of FlyArystan (https://www.ch-aviation.com/airlines/KC) (KC, Astana Nursultan Nazarbayev (https://www.ch-aviation.com/airports/6795)) during its successful launch. However, his model of deploying 777 Partners-supplied B737-8 (https://www.ch-aviation.com/aircraft-variants/B007378)s onto thin Australian secondary routes, often to airports with limited local population catchments, immediately raised eyebrows. It later emerged that many airports had offered Bonza a 12-month holiday from landing fees and charges. However, those holiday periods have started to expire, rendering already economically challenging routes unviable.

Bonza was also constrained by a lack of aircraft (https://www.ch-aviation.com/news/139669-australias-bonza-constrained-by-aircraft-availability). Jordan said he needed ten to break even, but he never got more than half that amount. 777 Partners diverted aircraft due to Bonza to its other airline, Flair Airlines (https://www.ch-aviation.com/airlines/FLR) (Edmonton), which was experiencing fleet problems of its own. A recent deal to convert two wet-leased Flair aircraft (https://www.ch-aviation.com/news/135252-australian-caa-okays-bonzas-max-8-wet-lease-plans) into longer-term dry leases fell apart in recent months, with one returning to Canada and the other parked at Sunshine Coast (https://www.ch-aviation.com/airports/316) awaiting flight clearance by the Civil Aviation Safety Authority and local registration. However, after conducting a test flight on April 29, its first flight in two months, C-FLHI (msn 61804) is believed to be returning to Canada imminently.

Excluding the parked Flair B737-8, Bonza had four aircraft in its fleet when flights stopped, including VH-UIK (msn 43975), VH-UJK (msn 43974), VH-UJT (msn 62533), and VH-UKH (msn 61864). All are managed by AIP Capital, 777 Partner's asset manager, which until recently owned a 51% stake in the thirty B737-8s linked to the Miami-based alternative investment platform. AIP now retains management rights and ch-aviation understands the company made its move to seize the four aircraft after they returned to their bases at Sunshine Coast Airport, Gold Coast Coolangatta (https://www.ch-aviation.com/airports/190), and Melbourne Tullamarine (https://www.ch-aviation.com/airports/263) late on April 29, informing air traffic control of the action and barring their departures. The snap action reportedly took Bonza's management by surprise.

In early April, AIP transferred its stake in the 30 aircraft to a new investment vehicle called Phoenix Aviation Capital. Insurance company A-Cap owns 100% of Phoenix. After news of the groundings and seizures broke, Jordan said he remained in talks to resolve the problem as "quickly as possible to determine a way forward that ensures there is ongoing competition in the Australian domestic aviation market.”

Qantas (https://www.ch-aviation.com/airlines/QF), Jetstar Airways (https://www.ch-aviation.com/airlines/JTS), and Virgin Australia (https://www.ch-aviation.com/airlines/VOZ) have stepped in to offer stranded passengers complimentary flights to the airport nearest to their final destination, subject to space availability. However, there is relatively little route overlap between Bonza's routes and those operated by its bigger competitors.

Later on April 30, ch-aviation learned that Bonza will file for voluntary administration in the Australian courts and has appointed Hall Chadwick as administrator. The airline is also expected to announce an ongoing suspension of flights shortly.

[Hollywood1]

For any Bonza crew looking to move on;

https://career.jetstar.com/jobview/expression-of-interest-bonza-employees/810ef91b-6fb3-4296-88d8-15125b4581fa/

[MickG0105]

...
Bonza was also constrained by a lack of aircraft (https://www.ch-aviation.com/news/139669-australias-bonza-constrained-by-aircraft-availability). Jordan said he needed ten to break even, ...

And there's a big part of Bonza’s problem, right there. Delusional! With their pricing, they would conservatively need to move 7,500 pax a day to break even with ten MAX 8s.

[tail wheel]

Delusional! With their pricing, they would conservatively need to move 7,500 pax a day to break even with ten MAX 8s.

Inevitably at a load factor somewhere vaguely in excess of 100%!!

[hotnhigh]

Pays for itself, just like the money they received to survive during Covid?

let’s continue with the fiction over facts. The hand out is called the dole. That’s what the company did and the government called it something else to hide the fact that management and government installed a government hand out. The dole or let’s use the catch phrase “jobkeeper”.
But this is off track,
good luck to all those that are at Bonza.
Unfortunately history isn’t kind to airlines that believe they have a rescue package or new
investors in line to continue the operation.

[LostWanderer]

REX is presumably still doing ok, including on its 737 routes?

Not from the data I’ve seen. I assume Rex will live on but be interesting to see how long the 737 operation lasts

[nomess]

It’s all happening in 777 land!

https://amp.theguardian.com/football/2024/apr/30/everton-call-in-insolvency-restructuring-advisers-777-takeover-doubt

[antheads]

That is the Australian way. Get something that works and pays for itself, employs thousands of people and get the government involved to hobble it. .

Dealing with anti-competitive behaviour in a duopoly to ensure a free and fair market is hardly 'hobbling it'.

[AI23B]

Jeesus vomit inducing stuff - we screwed your previous employer into the ground - but maybe you might want to work for us - using the skills they taught you so we won't have to

[ClipperClimax]

Low cost airlines just encourage poor people to travel. The VFR/point to point leisure market is even worse.They should be working, not visiting Aunt Betty in Mildura on a $69 fare.

When they do, all they do is spread diseases like STIs or COVID..... Bring back a regulated airline industry, increase airfares so YSSY-YMML is back around $500 each way. Safety will improve and carbon emissions will reduce.

Alfred E. Kahn publicly commented that the deregulation the American airline industry in the late 1970's was the worst recommendation he ever made.

I am sorry for the Bonza staff - but the spread of Syphilis and COVID will reduce and the environment will also be better for it...

Air travel should be on a cost plus basis and only those who work hard and earn a decent income should be allowed to fly...

[Ladloy]

let’s continue with the fiction over facts. The hand out is called the dole. That’s what the company did and the government called it something else to hide the fact that management and government installed a government hand out. The dole or let’s use the catch phrase “jobkeeper”.
But this is off track,
good luck to all those that are at Bonza.
Unfortunately history isn’t kind to airlines that believe they have a rescue package or new
investors in line to continue the operation.
The dole is for someone who doesn't work. Jobkeeper have companies free productivity paid for by the taxpayer.

[AerialPerspective]

Very sad day for the staff and suppliers who are owed money as well as the public that even more so now are at the mercy of the Qantas close to monopoly.

63% isn't even close to a 'monopoly'. 100% is an actual monopoly.

People need to stop saying this. Of course, the predictable response from the brainless media has been that it's all Qantas' and Virgin's fault for their duopoly. Except that this airline did not operate on any routes that I can see that either QF or VA operated on and the whole thing appears to have been stymied by a new owner of the aircraft who's decided that they can make more money leasing them to someone else.

If Qantas or Virgin had anything like a monopoly, there wouldn't be an Air North or a Rex.

Rex in particular has proven that if you pick the right market, by in their case, combining two previous regional carriers into one, giving them scale, then take your time and move into mainline flying on trunk routes, you can build and expand a sustainable business.

The media and others need to stop blaming Qantas and Virgin for bad business models and lack of planning.

Take out the Qantas portion of the market and Virgin Australia has nearly all the rest, so it's not a Qantas monopoly. I seem to remember part of Virgin's demise during Covid can be traced in part back to it's former CEO deciding to initiate a fare war with Qantas, along with introducing A330s on exorbitant leases that ran at a loss, parking major parts of the fleet then paying Alliance to do the flying, dumping the A320 from TT and introducing the 737, letting most of the A320 drivers go then realising that hadn't got the 737 on the AOC yet, having 737 drivers sitting around with no flying to do - to say nothing of the utter cluster**k that was TT operating into DPS, ignoring Indonesian government directions v.v. not subcontracting the route(s), even to a 100% subsidiary.

Pathetically bad business decisions stopped Virgin from steadily increasing it's market share and clawing back more of the market from QF.

I just wonder when the penny is going to drop in this country with the realisation that a population of 27M people cannot sustain more than 2 major carriers other than smaller ones with pretty much niche markets.

Remind me, how many major airlines are there in Canada again, with population not much more than ours (5-10M more)? Seem to remember them once having AC and CP, CP basically collapsed and had to be absorbed into AC, then WS emerged and back to no more than 2 major carriers (yes, I know TS exists but it's a minnow compared to WS and AC, a bit like Rex but international focused).

[AerialPerspective]

One of Australia’s resident aviation expert has been busy hitting the airwaves, with the demise of Bonza.

Thankfully Australia has Qantasflot to keep us flying!

Remember how Qantas led by Geoff Dixon stepped up and saved the day when Ansett stopped operating. Brought a tear to my eye, not to mention the hip pocket!

RIP Bonza.

Bonza's business model was never going to work and they didn't fly anywhere that QF or VA flew so QF and/or VA's market share is irrelevant.

Ansett was a great airline but pathetically managed, raped for any asset of value by the two amigos during the late 70s and 80s so when things went bad there was nothing to sell, especially since those two removed things like the media assets, TV networks, etc. and road transport, sold the DC-9s to a shelf company in the Caymans allegedly for a 10th of their value then on-sold them and pocketed the rest, all while lumbering it with high wages by rolling over every time the unions threatened action and a mix-match of different aircraft, many of which were designed to do the same job - like A320s and 737s. On top of that, apart from the original five 767-277s, ALL the other 767s were different, down to their seating configurations and ACARS units, size of the cargo doors, etc. Don't get me started on the ludicrous FE on a 767.

Abeles poured millions into the Islands with no prospect of every achieving a payback on investment and while withering on the vine, they went on a spending spree buying every other half-collapsed airline.

An arrogant Air NZ moving in and buying the second half for a ridiculous price just set the scene to finish off what was half dead anyway.

None of that was Qantas' fault. I remember after the difficult merger with TN, AN had the clear majority of the market for a number of years. Both airlines had their chances, one of them blew it.

[minigundiplomat]

If Qantas or Virgin had anything like a monopoly, there wouldn't be an Air North or a Rex.

Rex in particular has proven that if you pick the right market, by in their case, combining two previous regional carriers into one, giving them scale, then take your time and move into mainline flying on trunk routes, you can build and expand a sustainable business.

I'll have a pint of whatever you're smoking. Air North operates in places QF don't really care about because its just sand and flies, and Rex only exists because the previous government handed them ans QF a dumpster full of cash during covid to maintain regional routes, that they spunked on jet operations.

[helispotter]

My presumption about Rex 737 operations in #23 was clearly optimistic based on the several more well informed responses.
It makes me wonder what "economies of scale" can be achieved by larger operators of mainline jets such as Qantas/Jetstar and VA compared to say Bonza or Rex, each with only a handful of 737s?
I am also curious if there are cost models out there that could assess the impact on average load factors as the number of competing airlines in the Australian domestic market is increased from 2 to 3 to 4 etc. Surely, the more there are, the less viable the industry becomes for all of them, or the higher the airfares would need to become. Perhaps '3' is the 'sweet spot' for major airlines in our market?

[nomess]

It’s a great question, and scale is important, but being another someone else won’t work. Which is why Bonza did what it did, but a low cost, sustainable regional like aircraft isn’t available, likely in the far future, just nothing at the moment. It will likely be something electric, but not in our lifetime.

Rex is now operating on all these high margin routes, it’s just they don’t know how to chase that margin, they are loss making. They need new management in order to move that place towards profitability, it appears they are heading for bankruptcy. They have little in the way of corporate accounts, next to no corporate revenue, so they fly lighter during the week, and heavier on leisure weekends. It is very strange, as they appear to be just doing absolutely nothing and watching the place burn down. I assume they want government handouts to save the Saab bit?

[KRUSTY 34]

REX is presumably still doing ok, including on its 737 routes?

Mmmm?

[KRUSTY 34]

If Qantas or Virgin had anything like a monopoly, there wouldn't be an Air North or a Rex.

Rex in particular has proven that if you pick the right market, by in their case, combining two previous regional carriers into one, giving them scale, then take your time and move into mainline flying on trunk routes, you can build and expand a sustainable business.

I'll have a pint of whatever you're smoking. Air North operates in places QF don't really care about because its just sand and flies, and Rex only exists because the previous government handed them ans QF a dumpster full of cash during covid to maintain regional routes, that they spunked on jet operations.

An interesting read is REX's submission to ASIC outlining their business plan for the domestic Jet operation. Especially the opportunity that presented itself in making the investment a long term viable prospect?

[nomess]

Certainly all happening in 777 land!

https://www.afr.com/companies/transport/bonza-s-sister-airline-cuts-777-partners-restructures-debt-20240502-p5foes

[MalcolmReynolds]

Why post links to AFR articles when we all know they are behind a paywall?

[TBM-Legend]

Malcolm don’t look at it then. Simple or subscribe.

its an alert

[nomess]

Google 12ft ladder, I’ll leave the rest to you.

[airdualbleedfault]

On reflection, there was probably a good reason nobody else was flying those obscure routes in a hi cap jet.................

[MalcolmReynolds]

Malcolm don’t look at it then. Simple or subscribe.

its an alert

Well then its a fairly useless alert. That's all I'm saying. I have no interest in subscribing to a rag like AFR. If you want to disseminate the article to all on PPRUNE then post the text itself.

[FruitSnack]

The comments from the CEO of the maintenance provider AVCRO, as published in Australian Aviation this afternoon, are incredible. Bonza was close to attracting a local buyer before its aircraft were suddenly grounded on Tuesday, the company’s maintenance partner has claimed. Speaking exclusively to Australian Aviation, Bradley Davren, CEO of AVCRO, which has provided MRO services to Bonza since the airline’s inception, said that the stricken low-cost carrier was a viable business before entering voluntary administration on Tuesday afternoon due to a lack of aircraft. Davren’s claims come as Bonza’s administrator, Hall Chadwick, is understood to be still searching for new backers for the low-cost carrier, with Bonza flights now grounded until at least next Tuesday. It is the first time a company this intimately connected to Bonza has spoken on the record about the airline’s situation. Davren told Australian Aviation that, in his understanding, a “very serious commitment” had been made by the unnamed local backer before the aircraft were taken. “They were in a position where ultimately the current owner could have just shifted that liability away from themselves and the airline would have kept moving fat, dumb and happy without issue,” he said. “To the best of my interaction with Bonza, a new investor would have simply shifted liability from 777 Partners to another entity and Bonza would have continued trading with the four MAX 8s still leased by AIP under the fiduciary responsibility and control of local investors. “The lead backer, to my understanding, is very well-known and would absolutely do wonders for multiple reasons. Yet to be seen if that eventuates, but had that outcome come to fruition, I suspect you would have seen Bonza kick into overdrive.” According to Davren, Bonza’s business model was working and it was not in financial trouble before the abrupt seizure of its fleet, which was carried out by AVCRO on behalf of the repossessors. “The airline was trading with absolutely no credit issues. Obviously, we would be one of their largest creditors. They were never on stop credit with us. They never even appeared to be trending in that direction, and in fact, it’s unfair to the employees if this is wound up, to suggest that this is the reason why,” he said. “Reading a lot of the articles that suggest there are 300 insolvent airline operations in the country, it’s quite disingenuous to put this one in that same category. “Their load factors are fantastic. Their model works brilliantly, the aircraft are not too big. In my personal opinion, I think they should charge more for what they’re doing, but that’s neither here nor there. That’s a commercial decision on their behalf. And ultimately, there’s no reason that they would be insolvent outside of not having aircraft. That’s never happened in Australia, ever.” Davren told Australian Aviation his understanding was that Bonza’s problem, far from being a lack of money, was solely the lack of aircraft after its four operating 737 MAX 8s were grounded. “Effectively, [Bonza] was a carrier without aircraft. Without access to aircraft, of course they’re naturally going to be insolvent from that day onwards,” he said. “That’s the next logical step – without an opportunity for revenue, obviously, payroll alone is going to be in enormous burden for you. So absolutely, they were not insolvent and it’s quite disingenuous to consider or suggest that they were.”

[MalcolmReynolds]

:confused: what the hell is he smoking?

[brokenagain]

According to The Australian today, Bonza was warned two weeks before the aircraft were repo’d that it was at risk of defaulting on its lease payments.

[nomess]

Employees should be able to pull back the lost wages via the FEG, but I believe it needs to move liquidation for that lever to be pulled. Regardless that will take time to process.

Trust nobody once the Administration process starts. You will get long winded stories and lies. The key players are now trying to work out how they can reimburse themselves. Employees, Suppliers, Customers, take a step back please.

Do yourself a favour and don’t even waste your time tuning into Timbo web catchups.

[dragon man]

Just shows how a monthly pay roll , in this case the 5th of each month is such a risk for staff. I feel for them.

[TBM-Legend]

Bonza was well in arrears on lease payments and reserves payments too. They have probably been trading insolvent for some time. Tim’s grand plan was a dream and smoke and mirrors sadly for great staff and others including pax who paid for travel that never had a chance of happening particularly after the April notice. What about TJ announcing the 300,000 ticket sale??!

[Colonel_Klink]

Gold Coast airport has placed concrete bollards behind and in front of one of the Bonza 737s parked there.

Rumour has it that they are owed quite a lot of money.

I can’t believe there is someone out there claiming that Bonza was actually going along alright!

[transition_alt]

Gold Coast airport has placed concrete bollards behind and in front of one of the Bonza 737s parked there.

Rumour has it that they are owed quite a lot of money.

I can’t believe there is someone out there claiming that Bonza was actually going along alright!

Just another pro-Bonza Australian Aviation article

[TBM-Legend]

AA trying to spin the Bonza line again. They were behind on lease payments before they were issued with a default. Also behind in maintenance reserves which all adds up to big money each month. Could be AU$500-600k per aircraft per month so times 4 is ~$2.0m per month and I understand it was much more than a month plus other commitments like 125 staff payments for April of say $900k. Go figure

[markis10]

Just shows how a monthly pay roll , in this case the 5th of each month is such a risk for staff. I feel for them.

No different to fortnightly in terms of risk

[Mr Google Head]

No different to fortnightly in terms of risk

Mmmm fortnightly vs monthly is about 2 and a bit weeks different I would have thought…?

[MickG0105]

Gold Coast airport has placed concrete bollards behind and in front of one of the Bonza 737s parked there.

Rumour has it that they are owed quite a lot of money.

I can’t believe there is someone out there claiming that Bonza was actually going along alright!
Leasing companies are generally let's just say "challenging" to deal with but they are rarely capricious. Lessors just do not go to the lengths of terminating a lease and repossessing aircraft on a whim. Almost all Events of Default have a notification and rectification period, typically ranging from as short as a few days to as long as maybe two weeks (it is rare to see a lengthy grace period). So, the notion that all of this just struck like a bolt from the blue, catching management completely unawares, is rank nonsense. As a minimum they would have received at least one default notice, and almost certainly a notice of intent to repossess. They knew this was coming.

[nomess]

The latest analysis from the AFR, unpaywalled.

How 777 Partners bad marriage doomed Bonza from the start

Australian Financial Review
Ayesha de Kretser (safari-reader://www.afr.com/by/ayesha-de-kretser-p535y1) May 3, 2024

https://static.ffx.io/images/$zoom_0.467%2C$multiply_2%2C$ratio_1.5%2C$width_756%2C$x_70% 2C$y_0/t_crop_custom/c_scale%2Cw_620%2Cq_88%2Cf_auto/9564150d2d9ace1e456b077581ea838cac33e110

Jordan’s business model, sighted by AFR Weekend, was predicated on flying 72-seat planes (twin-engine turboprops), 83 per cent full, between townships left behind by the Qantas and Virgin duopoly. It relied on scaling up its fleet quickly and extracting about $50 per passenger in income from booze, snacks and baggage.

His plan was roundly dismissed by the local aviation market as pure insanity.

But in 2020, as the world shut down and planes stopped flying, Jordan finally found a receptive backer: 777 Partners, a Miami-based private equity firm that had a small interest in a Canadian low-cost carrier.

“Prior to the pandemic, we were able to show that we could grow the Canadian market quite substantially by offering fares that were 40 per cent to 50 per cent lower than the incumbents,” 777 Partners’ co-founder Steve Pasko told AFR Weekend in February 2023.

“That’s what drove us to Australia. We think we can do the same thing”

That wasn’t the whole truth. In fact, 777 Partners, co-founded by convicted cocaine trafficker Joshua Wander, had come into an order book that gave them the right to buy 20 737 Max-8 jets from Boeing.

The Seattle-based plane manufacturer would not hand its aircraft over to an unknown quantity like 777 Partners and demanded that it set up start-up airlines with Boeing planes – meaning 777 saw Bonza as an ideal progression of its aviation experiment.

“The pricing for that order book from Boeing was given on the basis that 777, as a private investment firm, would not act as the lessor but would basically incubate airlines as the world exited the pandemic,” says one well-placed source.

“For example, 777 has a minority interest in Flair, which was 24 per cent until this week. Then they have a majority interest in Bonza and that all fits within the agreement with Boeing as part of the conditions over the order book.”

If Bonza’s plan for 72-seat planes was never going to succeed, it made even less sense with the 180-seat 737 Max-8s.

“It’s like wearing size 12 boots when you’ve got size 3 feet,” says Ellis Taylor from aviation analytics firm Cirium. “There’s too much capacity to soak up the demand that was there, which meant they would have to discount the fares below cost to get enough people flying.”Funding questionsThere were always question marks over where 777 Partners was getting its funding, some of which are now being answered.

In the same 2023 interview with AFR Weekend, Pasko claimed: “This is actually money that Josh [Wander] and I, and some of the other senior management have. We don’t have third-party money – we treat it like our own money because it is our own.”

Since February, when 777 Partners’ reinsurance arm 777 Re suffered a credit downgrade to “C minus” – or junk quality in bond market parlance – because of its reliance on illiquid assets, 777 Partners’ real source of financing has become much clearer. Seemingly, a privately held $US11 billion ($16.7 billion) New York-based insurer, ACap, is at the centre of everything.

The credit downgrade was the beginning of the unravelling of a structure that spans airlines and football teams around the world. Bonza is now part of the collateral damage.

Three aviation industry sources confirmed that Bonza stopped paying its bills around February 2024, when ACap – feeling regulatory heat itself – cut the flow of funds to 777 Partners.

It is believed that ACap held ultimate security over 777 Partners’ planes and called them in last month, when a related entity called AIP Capital – the leasing company that repossessed Bonza’s planes on Tuesday – issued a cryptic announcement about funding structures that didn’t name ACap.


AIP Capital’s ownership had changed too: 777 Partners’ 49 per cent stake now belonged to an unnamed US insurer, confirmed by Bonza spokeswoman Tatiana Day to be ACap. ACap held 100 per cent of a newly established vehicle, Phoenix Aviation Capital, which it said now owned an order book of 30 Boeing 737 Max-8 jets.

When asked how 777 Partners, which no longer had any money coming in the door, would pay for the leases, Day said: “777 Partners are committed to supporting Bonza as they have done for the past 2.5 years.”

Questions to Bonza’s voluntary administrator Hall Chadwick went unanswered.Plane mysteryIn the past 12 months, many planes that were meant to be directed by 777 Partners to Bonza to help grow its fleet from four to 10 and inch closer to profitability never arrived, or were repeatedly redirected to more profitable carriers.

This week, AIP Capital, in which 777 Partners no longer has any interest, is said to have struck a deal with LOT Polish Airlines and is now going through legal proceedings to have Bonza’s planes flown to Europe. (https://www.afr.com/link/follow-20180101-p5dbil)

AIP Capital’s move to repossess sent ripples across the world. Canadian tax and ministerial authorities have been raising questions about 777 Partners’ involvement in Flair for years. They have also been chasing 777 Partners for $C67.2 million ($74.7 million) in unpaid GST since last November, and in January started proceedings to seize assets.

On Thursday, Flair said it refinanced 777 Partners’ loan (https://www.afr.com/link/follow-20180101-p5foes) and redistributed 777 Partners’ equity stake and board seats in a bid to quell speculation about its future and operating leases. The identity of its financier is unknown, but industry speculation has landed on AIP Capital.

AIP Capital’s managing partner Mathew Adamo declined to answer AFR Weekend’s questions about his organisation’s role in the restructuring of Flair’s debt, saying only that “AIP is not an affiliate of Flair, we are a lessor to Flair”.

Curiously, a LinkedIn post by Flair CEO Stephen Jones explaining the financial arrangement was reposted by Adamo’s co-founder at AIP Capital, Jared Alistock, on Thursday.

“Flair has always been on the edge when it comes to trying to get away with getting the regulations to bend in their way,” says John Gradek, a McGill University lecturer in supply chain and aviation.

Gradek told Canadian media two weeks ago that he believed Flair would not last until Thanksgiving. On Wednesday, after news of Bonza’s demise broke, he brought forward his prediction.Racked up billsIn Australia, Bonza has been trading since February, leaving behind a trail of unpaid leases and unpaid bills at regional airports across the country.

Bonza strenuously denied The Australian Financial Review’s report on April 18 that it was working with KordaMentha. However, Transport Minister Catherine King told ABC TV on Tuesday “we have been talking to them during the course of the week”. What came of that is unclear.


A spokeswoman for the minister on Friday clarified: “The Minister did not meet with Bonza, representatives of her department engaged with them.”

Late on Thursday night, Hall Chadwick revealed Bonza had received default notices from AIP Capital as far back as April 16. When Bonza met with the minister, the airline was still raising revenue through $99 sale fares in the interceding period until this week.

Travellers have been told they are not entitled to refunds and industry sources describe the ordeal – in particular, Hall Chadwick’s refusal to declare Bonza officially dead – as a blight on Australian aviation.

Bonza staff were told at a town hall on Thursday that they wouldn’t have jobs as the mess of the airline’s financial affairs were being worked through.

Another described talks with Hall Chadwick as “shambolic”, saying the administrator appeared to have “no idea” about planes. A third source said Hall Chadwick had been in talks with lenders of last resort earlier in the week.

“Even they wouldn’t touch it,” he said.

[markis10]

Mmmm fortnightly vs monthly is about 2 and a bit weeks different I would have thought…?
Err not quite, if your on monthly pay it’s 50% in arrears and 50% in advance, fortnightly it’s all arrears, it’s against the law to pay monthly in arrears afaik, having said that I was on monthly for years and hated it, but reality is there is no greater risk.

[Mr Google Head]

Err not quite, if your on monthly pay it’s 50% in arrears and 50% in advance, fortnightly it’s all arrears, it’s against the law to pay monthly in arrears afaik, having said that I was on monthly for years and hated it, but reality is there is no greater risk.

I stand corrected - I didn’t realise the half in arrears and half in advance legal requirement…

[Icarus2001]

As a minimum they would have received at least one default notice, and almost certainly a notice of intent to repossess. They knew this was coming.

So is it legal to be selling tickets knowing your fleet would be grounded within days?

[MickG0105]

So is it legal to be selling tickets knowing your fleet would be grounded within days?
If you are trading, such as selling tickets, when you know that you cannot meet a debt, such as a lease payment, when it falls due, you are contravening the insolvent trading provisions of the Corporations Act; a civil offense. If dishonesty is found to be a factor in insolvent trading, a director may also be subject to criminal charges.

[nomess]

It’s a crime in Australia to be trading while insolvent.

Directors will have personal liability issues also if proven….well only if anyone can be bothered dragging the directors through the courts which costs a bomb, unlikely.

It does seem like only bread crumbs remain. If they extend the deadline again next week you can bet egos are at play behind closed doors fighting who gets what 5 bucks remains. Certainly won’t be the employees, suppliers or customers. Anyone who thinks they are genuinely trying to find a buyer needs their head checked.

No doubt the story will change as each day passes. Much more to come yet.

[Mach E Avelli]

If you are trading, such as selling tickets, when you know that you cannot meet a debt, such as a lease payment, when it falls due, you are contravening the insolvent trading provisions of the Corporations Act; a civil offense. If dishonesty is found to be a factor in insolvent trading, a director may also be subject to criminal charges.
True, but rare for our pissweak legal system to actually prosecute to the extent where a jail term is imposed. The dishonesty bit is hard to prove, the authorities don’t dig deep enough, and directors get, at worst, the civil offence charge.

[nomess]

Directors often go missing during these processes, shortly you can expect nothing but silence as they sail off into the sunset, while the administrators pick through the smouldering remains.

At best they will be banned for running any companies for xx years.

[MickG0105]

True, but rare for our pissweak legal system to actually prosecute to the extent where a jail term is imposed. The dishonesty bit is hard to prove, the authorities don’t dig deep enough, and directors get, at worst, the civil offence charge.
They happen but unless it's a big name, it never makes the papers. I think Endeavour/Linchpin/Investport was the most recent one where directors were charged; failing to exercise care and diligence, and failing to act in the best interests of the members. A couple of $100K fines for individual directors came out of that one.

Here's (https://asic.gov.au/about-asic/asic-investigations-and-enforcement/asic-enforcement-outcomes/summary-of-enforcement-outcomes-july-to-december-2023/#summary) the summary of ASIC prosecutions for the last half of last calendar year; a few criminal convictions in there. I recall that there were seven or eight criminal proceedings brought by ASIC against directors in the first half of 2023.

[Trevor the lover]

So very sorry to be a duckhead................but it's actuallly spelt "gaol"in Australia. Sorry....I'm a bit pissed. But I can still spell.

[tOnneau51]

Did anyone actually think this business model was
going to work? There’s a reason the big boys don’t service those routes. Employees will be fine thanks to the FEG (probably the only thing the government is good at), someone useless will end up walking into the sunset with a fistful of cash, I don’t know who, don’t care enough to find out

[markis10]

So is it legal to be selling tickets knowing your fleet would be grounded within days?

Bonza were not selling tickets, they were selling a bundle of rights with alternative options should cancellation occur, hang on, that’s the other mob LOL

[antheads]

There’s a reason the big boys don’t service those routes.
The yank big boys don't service the routes that Avelo and Breeze are pioneering either. Kalamazoo to Orlando is not that different from Albury to Gold Coast.

The business model could have worked if things were done differently. (smaller aircraft, access to Sydney, approval of the aussie aviation clique, investors not getting high on their own supply.)

[Capn Rex Havoc]

Hey Trevor,

Actually, actuallly, is only spelt with 2 Ls.

Lub you long time

[MickG0105]

...
The business model could have worked if things were done differently. (smaller aircraft, access to Sydney, approval of the aussie aviation clique, investors not getting high on their own supply.)
Most of the factors you've listed in parentheses describe a fundamentally different business model to their regional-regional, low-cost, jet model; you're essentially saying that their business model would have worked if they had had a different one. No one would argue with that.

[esreverlluf]

Just heard GT say that Bonza had a "great business model" - so there it must be true . . .

[Trevor the lover]

A drunken typo Fungulu

[Spudly]

Surely Bonza didn’t have to come in so cheap? Places like Tamworth/Gladstone/Port Macquarie to Melbourne which can be easily $400-$600 (and a stopover) with the red roo did not need to be $79 direct.

Bonza could’ve charged $200-$250 and had just as many people wanting to fly direct at half the price of competitors, right?

[antheads]

Most of the factors you've listed in parentheses describe a fundamentally different business model to their regional-regional, low-cost, jet model; .
Your definitions may vary but I don't regard the routes that were showing the most promise as regional-regional, rather unserved regional to tourist destination. Sydney would fall into that category. Avelo and to a lesser extent Breeze are using this model and achieving profitability. (or close to). The E-190/E2 would have been an appropriate choice, Embraer would have prob offered a nice deal to have the E2 in the Australian market.

Also having a sane investor that hangs around for a polite two years would have helped.

[TBM-Legend]

You obviously don’t understand that 777 had to find homes for some new B737max8’s like they did with Flair.
up pops Tim with a bonza of an idea and changes his original turboprop model to the 737.

777 drink the koolaid and away we go. 80% LF and other great ideas like $50 fares which less GST is $45 and for a time cheap landing charges and the rest has become history

[nomess]

Digging deeper into the eye watering cash burn, and the general cost headwinds any new startup faces, including the likes of Rex.

Bonza claimed to fly 750,000 passengers in the first year. Its average LF seemed to be 65%, average fare plus ancillary, let’s say $120, reviewing the pricing Bonza had far and close to departure, that figure seems reasonable. So it’s revenue minus taxes and airport charges, and being more conservative due to airport ‘deals’, let’s say $80m revenue in the first year.

Let’s look at some yearly costs.

$10m They had 20 months worth of lease bills across the fleet before they even started operations.

$10m Startup costs

$10m Staff Delayed start wages

Operations go…..

$20m Ground Ops, 700 flights/month. Industry average figure.

$30m Wages. Direct only. Going off its headcount and average industry salaries.

$30m Lease costs for the first year including 2x4 month wet lease terms at a price premium.

$40m Fuel for 8000 flights, and based off average block hour.

$??? Wet leasing costs. Too scared to even look into that having seen invoices across my desk before.

So you can see why 10 aircraft / 90% loads has been quoted.

Fiddling around with some numbers at 10 aircraft and let’s say this 90% breakeven figure, still very much impossible to get this in the green.

Perhaps the ATR was the right choice here.

I still don’t know how anyone could sign off on such a plan. I’d love to see the plans and forecast, if they even exist, to get this thing profitable and sustainable. Charging $150-$200 isn’t going to work.

The bigger this got, the worse the cash burn was going to get.

[TBM-Legend]

Pretty good numbers nomess.
The original BP was presented to me by the way with ATR’s and offered a switch to 100 seat jets ala 146/F100 and still the numbers were dodgy and key assumptions in the market numbers were simple extrapolation of demographics which again can be very misleading. 777 was the piggy bank but like Virgin Mk1 and VA Mk2 it’s very expensive to go broke in the air. No guaranteed income but guaranteed expenses. Cross-hiring Nauru comes at a hefty price and no charity from them.

[nomess]

Fixed costs today are much higher vs when looking back a decade when this BP was sketched.

Seeing huge cost increases recently across ground handling contracts, largely connected to wage and equipment hikes. Pressure with airport charges now also starting to roll through. Engineering is another scary invoice that hits the desk, it’s all double what it was only a few years ago.

It’s a tough ask these days to launch a new business. Quite scary actually when you sit back and look at the realistic numbers. It’s not really a ‘low cost’ airline as such, you still have a million costs coming your way like everyone else, you really can’t afford for a single seat to go out empty.

Rex is facing similar cost headwinds with its narrow body operation. I think Mick has done good analysis on that previously, still don’t know what the future is for that arm of its business, cost hikes seem to be killing any chance of success with that.

Icarus was right. Tiger was on drugs for starting here according to one airline boss, and it’s seem Bonza is on the same stuff. Nothing low cost about starting operations in the Oz domestic market.

[markis10]

The E-190/E2 would have been an appropriate choice, Embraer would have prob offered a nice deal to have the E2 in the Australian market.

Theres been a E2 presence here for a while, doesn’t fly much.

[TBM-Legend]

From Bloomberg:

Lenders to 777 Partners (https://www.bloomberg.com/quote/1457381D:US) accused it of fraud, claiming that the Miami-based investment firm borrowed against $350 million of assets that either it didn’t own or didn’t exist.

Josh Wander, co-founder of 777 Partners, doubled-pledged assets backing loans to the firm and admitted to fundamental breaches of agreements, according to the complaint filed late Friday in New York federal court.

Plaintiffs Leadenhall Capital Partners LLP (https://www.bloomberg.com/quote/0227847D:LN) and Leadenhall Life Insurance Linked Investments Fund PLC are seeking unspecified damages and a court order barring 777 Partners from violating its obligations.

“To induce Leadenhall to fund their operation, Wander, along with his group of alter ego entities, ‘pledged’ over $350 million in assets as collateral to Leadenhall, knowing all along that the assets either did not exist, were not actually owned by Wander’s entities, or had already been pledged to another lender,” according to the complaint.

and involving Flair:

However, four of Flair’s leased aircraft were repossessed in March 2023 and earlier in 2024 it emerged that a group of aircraft lessors claimed 777 Partners owed them nearly $30 million in unpaid fees related to Boeing (https://aviationweek.com/term/boeing) 737 aircraft previously leased by the airline.

A joint statement from the lessors at the time said: “777 Partners cannot just ignore its financial and contractual obligations. This legal action is a last resort.” 777 Partners described the litigation as “egregious behavior.”

[MalcolmReynolds]

What a s#it fight! If true, no other outcome possible. Bonza was toast from Jan 2023. Tim deserves life in gaol!

[nomess]

All starting to come out now, unpaywalled for you.

Interesting, the discussions with the current administrator go back to last November, with PwC also having a sniff. Which would indicate in October they would have started talking about seeking financial advice, that was the time when the CCO resigned.

In August 2023 777 Partners put out in the public arena a $100m Valuation on it. Seems to be code for ‘someone come and buy this please’.

It’s clear a rejection for any further funding likely goes back longer than previously thought. Seems like Bonza was well aware of its limited financial position since mid last year, yet blew high amounts of cash on wet leasing and new bases.

They have knowingly just burnt it to the ground, with whatever forward revenue was left to keep it alive. It was likely dead before it even started, when looking at the cash burn accumulated with its delayed launch.

Budget airline Bonza in chaos ‘for months’

Herald Sun
May 5, 2024 - 3:56PM

The administrators of failed budget airline Bonza discussed its parlous financial state with representatives of the company at least 11 times since November, new documents filed with ASIC reveal.

Bonza (https://www.heraldsun.com.au/business/companies/travel/bonza-ceo-tim-jordans-future-in-doubt-as-flights-grounded-airline-goes-into-administration/news-story/e61df3896cbaf530d2d69d8146afcf0b) continued to sell tickets after first meeting with partners at accounting firm Hall Chadwick to discuss appointing them “as advisers to review the financial position of the company” on November 10, and throughout discussions and email correspondence that continued until last month.
This includes continuing to sell tickets after April 17, which is when the administrators say Bonza received a notice from the owner of its fleet of six planes, AIP Capital, claiming it had defaulted on its lease.

Last week the administrators cancelled all flights until at least next Tuesday and stood down 302 out of Bonza’s 323 workers. (https://www.heraldsun.com.au/business/companies/travel/bonza-airlines-us-owners-as-customers-face-flight-cancellations/news-story/3de0c3b7a4adff50a8c967d9b74b2dc8)

AIP Capital has seized the planes amid reports that at least some of them have already been re-leased to an airline in Poland.

Customers cannot presently get a refund from the airline - although those who paid using a credit card may be able to get it charged back.

“Administrators are still working with a number of key stakeholders to provide funding in order to resume flight operations and will continue to do so over the weekend,” the administrators said in a statement on Friday.

Bonza’s directors appointed Hall Chadwick partners Richard Albarran, Kathleen Vouris, Brent Kijurina, and Cameron Shaw as administrators last Tuesday after AIP Capital terminated the aircraft leases overnight.

Details of meetings and phone calls between Hall Chadwick staff and Manish Raniga, the head of airline investments at Bonza’s owner, Miami-based investment group 777 Partners, are revealed in documents Mr Albarran filed with the corporate regulator on Friday.

As administrators, Mr Albarran, Ms Vouris, Mr Kijurina, and Mr Shaw are in charge of the two Australian companies in the Bonza group, Bonza Aviation and 777 Oz Holdco.

777 Partners co-founder Steve Pasko is a director of both companies.

But the documents filed by Mr Albarran, declarations of relevant relationships and indemnities, also show that they were appointed administrators of a third Australian company where Mr Pasko is a director, Ops In A Box, on the same day as they took on the Bonza job.

In the declarations, Mr Albarran said this was not a conflict of interest because Ops In A Box is also owned by 777 Partners and “the nature of the relationship means that the appointments can be conducted more efficiently by the same appointee”.

The declarations show Mr Shaw was introduced to Mr Raniga by “an associate in the aviation industry” on November 9.

Mr Shaw and Mr Raniga spoke by telephone the following day.

On November 20 Mr Albarran and another Hall Chadwick staff member, Jovan Singh, met with Mr Raniga.

“During November 2023, January 2024 and April 2024, Mr Singh had nine calls with Mr.

Raniga, of which Mr Drew Townsend of Hall Chadwick, attended one,” Mr Albarran said in the declarations.

“During this time Mr Singh also exchanged numerous emails with Mr Raniga.”

The meetings, calls and emails “were for the purposes of discussing and understanding” Bonza’s business and to discuss hiring Hall Chadwick as “advisers to review the financial position of the company” or “consultants to assist with an investment and/or acquisition proposal for the company”.

Hall Chadwick was not paid for the discussions, Mr Albarran said.

Sources say KordaMentha and PwC also ran the ruler over Bonza before its collapse.

Hall Chadwick declined to comment.

[KRUSTY 34]

Just shows how a monthly pay roll , in this case the 5th of each month is such a risk for staff. I feel for them.

Yup! Happened to me, the administrator closed the bank the day before payday.

Lovely.

[MickG0105]

First creditors meeting on 10 May via videoconference and at the Sheraton Grand Sydney Hyde Park, Hyde Park Room, 161 Elizabeth Street, Sydney. Hall Chadwick clearly none too interested in a) having to incur travel expenses, and/or b) having to face a room full of disgruntled punters in person at MCY.

[krismiler]

It’s a crime in Australia to be trading while insolvent.

True and you lose the benefits of a limited liability company, basically your personal assets are up for grabs by the creditors.
​​​​​​​

[Global Aviator]

Why wait till May 10th for a creditors meeting? Why not as soon as possible and online?

Every day Hall plays the ball is less money in the pot for any creditors.

Yes I have a disliking to administrators/receivers/liquidators who always do well out of the ****sandwich whilst not even cents on the dollar get paid out.

[antheads]

It’s clear a rejection for any further funding likely goes back longer than previously thought. Seems like Bonza was well aware of its limited financial position since mid last year, yet blew high amounts of cash on wet leasing and new bases.

More likely that 666 partners were supplying cash till Feb 2024, including for the Flair wet leases, to make their sale valuation more appealing.

CASA actions in delaying the agreement with Transport Canada ruined Bonza's reputation over Christmas, funny how history repeats itself; Christmas 1991 and Compass Airlines.

Like Brian Grey and Ewan Wilson (Kiwi Airlines) I hope Tim Jordan writes a book about this infinite cascade of shenanigans.

[MickG0105]

...
Like Brian Grey and Ewan Wilson (Kiwi Airlines) I hope Tim Jordan writes a book about this infinite cascade of shenanigans.
While Timbo is sorting out his book deal, perhaps he could front creditors, staff and customers and explain the series of blatant lies he's been telling since late last year. Too much to ask?

[MickG0105]

Why wait till May 10th for a creditors meeting? Why not as soon as possible and online?
...
At least five business days notice of the meeting must be given to creditors.

[Global Aviator]

At least five business days’ notice of the meeting must be given to creditors.

That’ll do it! Wonder what their day rate is?

I know they are a necessary evil but it just irks me how much money they take, then the rest of nothing that’s left goes to………..

Here’s hoping creditors get something!

[MickG0105]

...
Here’s hoping creditors get something!
I hope I'm wrong but I'd be surprised if there's anything to divvy up.

[DanV2]

According to the News Corpse media, 2 of the 4 Bonza 737s have been de-registered and are reportedly going to Poland. I would not be surprised if they were headed "back" to LOT as the original customer as all 4 Bonza liveried 737s were originally NTU by LOT.

[TBM-Legend]

Good while it lasted…..

https://www.afr.com/companies/transport/bonza-flights-cancelled-as-aircraft-repossessed-20240430-p5fnjf

I know it’s on a paywall - but you can get the drift ….

https://www.nytimes.com/2024/05/04/world/europe/everton-777-partners-lawsuit.html?smid=url-share

[KRviator]

Paywalled, but I think I got the most of it...
Lawsuit Accuses Everton Bidder 777 Partners of $600 Million Fraud

In a suit filed in federal court in New York, a firm that provided hundreds of millions of dollars to 777 accused the company of double-pledging its collateral to other investors.

Everton, the financially strapped English Premier League soccer team, recently said it was seeking alternate investors.
The American investment firm 777 Partners, whose bid to buy the English Premier League soccer team Everton (https://www.nytimes.com/2023/10/18/world/europe/everton-sale-777-partners.html) has been on hold for months amid doubts about the company’s finances, was accused by one of its lenders on Friday of running a yearslong fraud scheme worth hundreds of millions of dollars.

The accusation came in a lawsuit filed Friday in federal court in New York by Leadenhall Capital Partners, a London-based asset management company. It said that it had provided 777 Partners with more than $600 million in financing, only to discover that roughly $350 million in assets serving as collateral for the loans either were not in 777’s control or had already been pledged to other lenders.

The lawsuit is the latest, most serious claim against 777 Partners, which has for years made bold assertions about its financial health — it has previously claimed $10 billion in assets — even as it was trailed by a string of lawsuits (https://www.bloomberg.com/news/articles/2024-03-07/would-be-everton-owner-faces-suit-trying-to-block-asset-transfer?embedded-checkout=true), corporate failures (https://amp.theguardian.com/football/2024/apr/30/blow-to-would-be-everton-owners-777-partners-as-airline-enters-administration) and unpaid bills (https://www.nytimes.com/2023/10/10/world/europe/everton-777-premier-league.html).

The suit could have immediate implications for 777’s stalled bid to buy Everton: The Premier League has not approved the sale, and the financially strapped club recently said it was seeking alternate investors (https://www.nytimes.com/2024/04/22/business/everton-sale-777-partners.html).

But questions about the company’s balance sheet also carry the risk of contagion for the broader world soccer market, given that 777’s portfolio includes ownership stakes (https://www.777part.com/vertical/sports-media-and-entertainment) in teams in Australia, Brazil, Belgium, France and Germany, and because it owes debts at all of them.

[43Inches]

That’ll do it! Wonder what their day rate is?

I know they are a necessary evil but it just irks me how much money they take, then the rest of nothing that’s left goes to………..

Here’s hoping creditors get something!

The bad guys are not the administrators, they are doing their job. You should keep focus on the ones who let their business get to the stage that nothing is left for the honest parties who are owed cash/services. Blaming a administrator is like getting angry at an undertaker, they are just conducting the funeral of a corporate entity.

[Global Aviator]

Again fair points however there seems no end to fees in some circumstances.

https://amp.smh.com.au/business/when-ansetts-balloon-went-up-kordamenthas-star-rose-20111120-1npbg.html

Yes that was certainly very different.

My point is yes the company has done the wrong thing, however as soon as administrators come in a lot of the funds left go to them prior to creditors.

I’ll leave this alone now! Good luck to creditors.

[helispotter]

Fixed costs today are much higher vs when looking back a decade when this BP was sketched.

Seeing huge cost increases recently across ground handling contracts, largely connected to wage and equipment hikes...

Off the topic of this thread, but I wonder what contractual arrangements Qantas put in place for cost of ground handling services in the years ahead once they decided to outsource that work? It might be coming back to bite them now that they are no longer in control of this part of their business? I somehow suspect the cost increases are not so much due to wage increases, rather profit margins(?).

[43Inches]

Off the topic of this thread, but I wonder what contractual arrangements Qantas put in place for cost of ground handling services in the years ahead once they decided to outsource that work? It might be coming back to bite them now that they are no longer in control of this part of their business? I somehow suspect the cost increases are not so much due to wage increases, rather profit margins(?).

Hiring and keeping ground staff is a problem post Covid, I assume that will translate into higher pay as well as profit margins for the contract companies. Same as other areas of aviation, why have to travel to an airport, undergo all the security rigmarole, drug tests, procedures, deafening noise and having morons watching over your shoulder and reporting, when you can earn a lot more in a warehouse or packing job, where you just turn up and load trucks, etc...

However that's the whole point of contracting out, you keep swapping to the lowest tender and let the contractor deal with the problems. Let all the minnows fight over scraps and go broke regularly while the larger corporation gets fatter.

[Australopithecus]

Except that you would need hundreds of millions in ground equipment to bid on a handling contract. Effectively the airlines have surrendered monopoly power to the handling companies, much as they did with catering by selling off the kitchens and service trucks to a single buyer.

[Hoosten]

I wish I paid attention in Commerce and Economics at school instead of looking out the window at planes, but didn't need to pay attention to know that Bonza was a clownshow, led by a clown.

[unobtanium]

Except that you would need hundreds of millions in ground equipment to bid on a handling contract. Effectively the airlines have surrendered monopoly power to the handling companies, much as they did with catering by selling off the kitchens and service trucks to a single buyer.

no you dont when qgs lost the bid all equipment were given to the new contractors swissport menzies etc turns out there lower bid does not include the cost of ground equipmemt's

[flyandski]

Focus on AIP and its co-head: https://brokercheck.finra.org/individual/summary/5360407

[AerialPerspective]

no you dont when qgs lost the bid all equipment were given to the new contractors swissport menzies etc turns out there lower bid does not include the cost of ground equipmemt's

Plural of ground equipment is ground equipment, not 'equipments'.

[AerialPerspective]

According to the News Corpse media, 2 of the 4 Bonza 737s have been de-registered and are reportedly going to Poland. I would not be surprised if they were headed "back" to LOT as the original customer as all 4 Bonza liveried 737s were originally NTU by LOT.

One of them even had the LOT logo writ large on the bulkhead as you entered the cabin from memory.

[AerialPerspective]

If Qantas or Virgin had anything like a monopoly, there wouldn't be an Air North or a Rex.

Rex in particular has proven that if you pick the right market, by in their case, combining two previous regional carriers into one, giving them scale, then take your time and move into mainline flying on trunk routes, you can build and expand a sustainable business.

I'll have a pint of whatever you're smoking. Air North operates in places QF don't really care about because its just sand and flies, and Rex only exists because the previous government handed them ans QF a dumpster full of cash during covid to maintain regional routes, that they spunked on jet operations.

And yet, had they not got that cash, they would still be operating the regional routes profitably, so what's your point?

[markis10]

CH have done a good deep dive into the Bonza house of cards:

https://www.ch-aviation.com/news/139940-bonzas-insolvency-quagmire-deepens-as-murky-details-surface

[antheads]

More disgusting pro Bonza propaganda from those wierdos at Australian Aviation. Don't they know if they want to be part of the Aviation Professionals Clique it's de rigour to kick a dead dog? Someone inform the golf club!

Bonza’s parent company 777 Partners, not the airline itself, was responsible for paying the leases on its aircraft, Australian Aviation understands.

A source with knowledge of the situation said it was never Bonza’s job to pay the leases on its fleet of 737 MAX 8 aircraft, which have sat grounded (https://australianaviation.com.au/2024/05/bonza-remains-in-limbo-as-flights-stay-grounded-until-tuesday/) since Tuesday after being repossessed by the lessor, AIP Capital.


https://australianaviation.com.au/2024/05/exclusive-777-partners-was-responsible-for-paying-bonzas-leases/

As plausible is that Tim Jordan is the devil who should spend the rest of his life in gaol, so too is that the Bonza legends were being strung along by Steve Pasco/777 Oz HoldCo that the lease payments would be paid any day, just waiting for the shipment from Caracas to arrive etc etc.

[nomess]

Next update from the AFR, unpaywalled.

So 777 screwed up, they signed up to a fantasy and will now pay the price.

Bonza’s backers plotted to ‘get the planes out’ and ‘wind this up’

https://static.ffx.io/images/$width_140%2C$height_140/t_crop_fill%2Cq_auto:best%2Cfl_any_format/2bbea568b1bc0f85b0926cca57fe614159fe3031
Ayesha de Kretser (https://www.afr.com/by/ayesha-de-kretser-p535y1)
May 7, 2024 – 9.35am
Australian Financial Review

Bonza’s backers in the United States were secretly plotting to “get the planes out” and “wind this up” more than a month before they abruptly seized the airline’s aircraft and send the carrier into receivership on April 30, leaving thousands of travellers stranded and out of pocket.

Emails sent between the airline’s Miami-headquartered private equity owner, 777 Partners, its financier A-Cap, and an aircraft lessor known as AIP Capital suggest the companies were co-ordinating decision making about Bonza, a low-cost carrier which only began flying early last year.
https://static.ffx.io/images/$zoom_0.113%2C$multiply_4%2C$ratio_1.5%2C$width_756%2C$x_0%2 C$y_0/t_crop_custom/c_scale%2Cw_620%2Cq_88%2Cf_auto/e6f41bfeb605262c687fbb685b263dfcb3cb8118Bonza’s aircraft remain on the ground after they were seized by the airline’s lessors. Louis Trerise

The emails, obtained by The Australian Financial Review, come as other major 777 backers allege that the private equity firm and A-Cap, a New York-based insurer, were so entwined in their dealings that it made it impossible for other lenders to reach an agreement with the company over its debts.

“Through these attempted restructuring negotiations, 777 Partners has admitted time and again that it does not control its own operations and ability to perform,” London’s Leadenhall Capital Partners claimed in one lawsuit filed in New York, alleging the private equity firm borrowed against assets that it did not own or were already promised to someone else.

The emails sent by A-Cap and 777 in relation to Bonza suggest a close relationship between the companies, and AIP Capital, which was partly owned by the private equity firm until it was restructured this month. It is now partly owned by A-Cap and its own management team.
In an email sent on March 22, AIP Capital co-founder Jared Ailstock wrote to A-Cap executive chairman Kenneth King and A-Cap’s special situations portfolio manager Carson McGuffin detailing plans to “get the planes out” and “wind [Bonza] up”. This email was subsequently shared with 777’s Kevin Burgos, one of Bonza’s points of contact with its owner.

In the email, Mr Ailstock wrote: “We’ll need to re-visit next week to keep them calm, but this should help. We are moving full speed ahead to get the planes out of there ASAP and wind this up.”

Several days later, Mr Burgos, however, inadvertently sent the discussion to Bonza’s chief financial officer Lidia Valenzuela. He had been trying to reassure her that 777 had paid the aircraft leases. A source with direct knowledge of the situation said the email sent Bonza into panic, as they tried to confirm whether their leases had been paid by 777.In defaultOther documentation obtained by the Financial Review also suggests the airline and its owner was aware of Bonza’s dire situation well before flights were cancelled at the end of April. On April 17, Bonza received notices of default on its leases – two signed by Joshua Wander, one of 777’s co-founders, and two signed by AIP Capital general counsel Greg Kahn.

One day later, the Financial Review reported that Bonza’s lenders and backers had called on KordaMentha to provide advice about the airline. Bonza spokeswoman Tatiana Day repeatedly denied that the firm had been appointed or was providing any advice to the airline or 777.

[Sue Ridgepipe]

alleging the private equity firm borrowed against assets that it did not own or were already promised to someone else.
Forgive my ignorance here, but how is it possible to do this? Surely the lender would do it's homework to make sure the company they are lending money to owns the asset being offered as collateral, and that it is unencumbered?

[nomess]

Today’s court hearing advised a mere 58,000 customers have forward bookings. That’s about 10 days worth of flights, at full occupancy.

Bonza has no cash if that’s the case. That’s not even $6-7m.

Unsecured Creditors expect nothing. It seems it has limped on if 777 have been paying the leases and simply adding it to debt. It will be very interesting to see how the whole Flair wet lease deal was financed.

[antheads]

Fundraiser page for Bonza Cabin Crew.
https://www.gofundme.com/f/support-bonza-cabin-crew-in-crisis

AFAIK they haven't been able to access Centrelink payments because they haven't lost their jobs, just 'stood down'.

[flyandski]

Not quite, the Aircraft have been with AIP from day dot, with AIP being almost 50:50 owned by management and 777partners. On April 9 a new entity called phoenix aviation capital (interesting name) took over the 777 partners share. Phoenix is owned 100% by a U.S-based insurance and financial services holding company with approximately $11 billion of assets under management.

watch out for AIP; its head has a questionable background. Birds of a feather..

[flyandski]

Forgive my ignorance here, but how is it possible to do this? Surely the lender would do it's homework to make sure the company they are lending money to owns the asset being offered as collateral, and that it is unencumbered?

This whole affair reflects poorly not just on 777P but on Leadenhall. They should have known better than getting involved with 777P. They should have done much more due diligence on 777P.

[TBM-Legend]

So should have Timmie

[MK 4A Tank]

Looks as if 777 Partners have screwed over Everton FC UK Premier League too!!

[airdualbleedfault]

777 partners, a company co founded by a convicted drug trafficker, you just couldn't make this 5hit up

[Mach2point7]

Link to yesterday's update from the Administrator.

https://www.flybonza.com/media/voluntary-administrators-update-7may2024

I wonder if Hall Chadwick has any experience with international aircraft leasing and repossessions. I found the wording quaint.

[nomess]

The lease termination documents got signed prior to entering administration, nothing the administrators can do on that front. Some have tried, it can be a very costly and lengthy legal process, unlikely the administrator has the funds to stomach that.

Bonza Management was second fiddle here. It was never going to enter administration with the leases still active. The strings are being pulled from the other side of pacific now. It’s all over for local decision making.

Airports have form in dropping concrete blocks and farm equipment in front of aircraft due to unpaid bills. The tractor parked in front of one of these aircraft reeks of that occurring here. No idea what the legal is on that, I am sure someone can fill us in. I assume another court date to get the local councils to move the tractor away from my aircraft as it’s starting ops with a polish client of ours next week…comes to mind.

[43Inches]

Airports have form in dropping concrete blocks and farm equipment in front of aircraft due to unpaid bills. The tractor parked in front of one of these aircraft reeks of that occurring here. No idea what the legal is on that, I am sure someone can fill us in. I assume another court date to get the local councils to move the tractor away from my aircraft as it’s starting ops with a polish client of ours next week…comes to mind.

That's to prevent the asset leaving until fees are paid or it goes to court. The airport operator will count on either, if it goes to court it will probably be found in the airports favor that fees be paid. If not then the aircraft owner could sue the airport for losses due to the aircraft not being able to operate. For cars on private property you can block in illegally parked vehicles, just put something in the way that you need there, if they damage it you can recover costs from them. The police can demand you move objects to free them, but they cant force their way out. If its a continual problem write a notice of condition of entry and place it at your property entry including you will be blocked until payment is made, then you can do that and issue a payment notice(not the same as a fine). So It depends what conditions of use the airport has written and its written procedure for non compliance.

[MickG0105]

...
For cars on private property you can block in illegally parked vehicles, ...
You certainly cannot do that in Queensland. If your property is appropriated sign-posted, you can arrange for the vehicle to be towed but you cannot detain or immobilise the vehicle pending towing.

[flyandski]

Citi’s Bonza links emerge in emails showing overdue invoices

Ayesha de Kretser (https://www.afr.com/by/ayesha-de-kretser-p535y1)Senior reporter

May 8, 2024 – 12.25pm

Citi is among lenders with exposure to Bonza’s aircraft lessors and its struggling Miami private equity owner 777 Partners, with leaked emails showing the Wall Street investment banking giant nervous about payments.

The Australian Financial Review reported on Monday that 777, its main financier, A-Cap, and the aircraft lessors AIP Capital appeared to be co-ordinating decision-making about Bonza, the low-cost carrier which only began flying early last year (https://www.afr.com/link/follow-20180101-p5fp87).

AIP was 49 per cent owned by 777 – the private equity firm that controls Genoa and Melbourne Victory football clubs and was trying to buy the English Premier League club Everton – with the balance held by its executives, including former Goldman Sachs banker Jared Ailstock.

In a March restructure, 777’s ownership moved to A-Cap, a major New York-based insurer, which has been accused by other investors of controlling the private equity group despite a purported arms-length relationship.

Emails from Mr Ailstock to A-Cap executive chairman Kenneth King, obtained by the Financial Review, show discussions about paying back Citi and another lender, Ashland Place Finance, which specialises in the aviation sector.

“This will calm Ashland down and gets Citi one of their rents. We’ll need to revisit next week to keep them calm, but this should help,” Mr Ailstock wrote in March of payments due on three aircraft operated by Bonza.

Until February, Bonza’s lease payments to AIP had been supported by Bonza, which was itself sourcing the funds from A-Cap. That month, A-Cap was ordered to cut its exposure to 777 to protect its customers. The Financial Times reported then that $US2.9 billion ($4.4 billion) of A-Cap’s $US11.5 billion in assets was invested in 777-related entities.

One source said A-Cap had soured on aviation investments as far back as July last year, when it put pressure on 777 to find buyers for Bonza (https://www.afr.com/link/follow-20180101-p5doh9).

Mr Ailstock has a colourful history in the United States. He was barred by the Financial Industry Regulatory Authority in 2019 after failing to co-operate with an investigation into the misuse of his expense reimbursements.

He did not admit to or deny the findings of the investigation.

Despite Mr Ailstock’s history, a Citi spokesman said the bank had “completed its due diligence and [know-your-customer check] as it does for every client”.

Sources close to the discussions between Bonza, 777 and AIP, speaking on condition of anonymity, said Citi had financed two aircraft – including Shazza, which Mr Ailstock mentioned in his email to Mr King – and was due about $US600,000 per month.

Shazza is no longer registered to Bonza, and is expected to be flown overseas.

A spokeswoman for Ashland declined to comment.

Hall Chadwick were appointed administrators at Bonza after the carrier’s aircraft were seized on April 30. The company has more than 60,000 creditors, almost all customers who were not repaid after the airline cancelled their bookings.

[43Inches]

You certainly cannot do that in Queensland. If your property is appropriated sign-posted, you can arrange for the vehicle to be towed but you cannot detain or immobilise the vehicle pending towing.

No you can't clamp or tamper with the vehicle, but you can place things on your property that would normally be there, like another car etc. Its one of those things, you are free to do what you want on your private property, but you cant interfere with others private property and so on. That's what I meant about the police can come and ask you to move things.

I did originally mention clamping, but the rules changed in many states around 2020 regarding that, now it's illegal in all states. However there's nothing that can be done if someone parks on your land, and you suddenly need to do some gardening, and a pile of dirt/gravel appears behind said vehicle. Or you park your car behind theirs and then go on holiday, have a week long bender where you cant drive, lose your keys, and so on. You are not allowed to tamper with their private things, but the same in reverse.

[nomess]

First aircraft out at 9am today operated by Flair.

Looks like Jezza is flying the rest out.

[MickG0105]

First aircraft out at 9am today operated by Flair.

Looks like Jezza is flying the rest out.
Yes, it looked like C-FLHI was being readied this morning when I drove past.

[helispotter]

Flight Radar 24 just showed C-FLHI take off from Sunshine Coast (MCY) with destination as Honolulu (HNL). Flair Airlines flight number FLE903.

[TBM-Legend]

All aircraft will depart as the court has ruled against airports given the debts racked up were not by the aircraft owner but by Bonza. Just told by administrator that there are no real assets to sell to recover cash apart from some “pencils and other office stuff”. Everything else was leased or provided by the support contractors so it belongs to them…

Big debts however

[deja vu]

It was never going to end any other way. Dreamers and conmen have always been attracted to the industry.

Off topic maybe but I see an earlier post on this thread that suggested Tiger was a subsidiary of Virgin Blue or Virgin something, any truth to that. I understood they were a subsidiary Singapore.

[markis10]

It was never going to end any other way. Dreamers and conmen have always been attracted to the industry.

Off topic maybe but I see an earlier post on this thread that suggested Tiger was a subsidiary of Virgin Blue or Virgin something, any truth to that. I understood they were a subsidiary Singapore.

Your post makes little sense, VA bought out SQ for $1 iirc back in the day

[deja vu]

Your post makes little sense, VA bought out SQ for $1 iirc back in the day
It was a question, you know, I was asking something. If you know the answer just spit it out, does that make sense.

Aviation has also been inundated with smart alecks as well

[nomess]

Big debts however

How much?

I ran some numbers on this a few months ago and was quite alarmed by what was going on. When airport and government data started coming out after they cycled the first year, it became very clear that some severe cash burn was going on.

$150-$200m here wouldn’t surprise me, above what I forecasted, but I think the numbers here had been much worse vs what they made out. Anything above those numbers, well I have no words. It’s clear bookings fell off a cliff the minute that Korda Mentha rumour surfaced, very disturbingly low amount of forward bookings in the system would indicate people simply stopped booking.

[markis10]

It was a question, you know, I was asking something. If you know the answer just spit it out, does that make sense.


I answered the question, Virgin Australia bought Tiger for $1, FFS

Feel free to catch up https://www.bbc.com/news/business-29655383

[TBM-Legend]

$1.00 for 40% of Tiger PLUS their debt is the true cost.

[nomess]

It was an easy exit option for SQ, they needed to get rid of it, but didn’t want to admit defeat and shut it, while being the main kingmaker in the Borghetti fantasy, they made him take it. He didn’t have a choice, he didn’t want it, but he needed the cash from SQ also. It was all about saving face in the end for the Singaporeans.

Tiger should have been executed a decade prior to when it was. Not that it would have prevented the Virgin bankruptcy, but it wouldn’t have screwed around with so many careers.

[KAPAC]

Which airline that Qantas directly competes against is not owned and regulated by a government? SQ , EK , mainland Chinese carriers , Turkish airlines ? The Americans have strong protections in place . The Australian government understand this and they have to support Qantas to a mm of the law and more if required . That’s why Qantas is the most secure career followed by which ever airline is second , never the third one .
Same goes for the banks .

[lucille]

QF’s only direct competitor is VA. Not much government ownership there.

[TBM-Legend]

A good review of the Bonza saga:https://www.ch-aviation.com/news/139940-bonzas-insolvency-quagmire-deepens-as-murky-details-surface

[C441]

QF’s only direct competitor is VA. Not much government ownership there.
Other than the 30 or 40 international competitors…..

[MickG0105]

QF’s only direct competitor is VA. Not much government ownership there.
Probably worth noting that pre-Bain, VA was effectively owned by a trio of government-owned / government-majority-owned airlines, in EY, SQ and HU.

[nomess]

Total debt will be between $120-130m it seems.

No airline has burnt so much cash in the available timeframe like this has. Holey Moley.

Looks like Airports are owed a fair bit. Nauru airlines also, so that was another lie from Timbo.

Plus some strange statement from the him

A message to creditors from Bonza chief executive Tim Jordan was read out at the start of the meeting, reflecting on the airline’s short-lived operations.

He said Bonza realised his dream of democratising air travel in Australia, and since January 2023 the airline had carried almost one million customers to 22 destinations.

“It’s therefore very hard to balance this with how we find ourselves today,” Mr Jordan said.


Yes. He realised his dream. By operating a high cost, half empty, cash burning, fledging airline. Congratulations.

[dragon man]

Just proving the oldie but a goodie, how do you make a small fortune in aviation? Start off with a big one.

[43Inches]

Probably worth noting that pre-Bain, VA was effectively owned by a trio of government-owned / government-majority-owned airlines, in EY, SQ and HU.

That was also a huge problem for VA, with each 'partner' trying to block the others ideas to prevent one from being stronger than the other, with too many industry large partners you also get mired in what each wants to achieve from the venture. All three were just happy to keep VA afloat at a small loss to keep pressure on QF at home. When the losses mounted too high and SQ was the only one bankrolling it, it was always going to end badly. That is probably why Bain is struggling to find suitors, they are probably put off not only by the viability of the airline, but who will have controlling shares if it floats. I'm sure if SQ could get 50% cheap they might entertain it, but there's not many others who'd have the cash for a long term go at it. You'd be mad to buy into airlines at the moment, there is not much stability of cost base for the future.

[markis10]

Total debt will be between $120-130m it seems.

No airline has burnt so much cash in the available timeframe like this has. Holey Moley.

Looks like Airports are owed a fair bit. Nauru airlines also, so that was another lie from Timbo.

Plus some strange statement from the him



Yes. He realised his dream. By operating a high cost, half empty, cash burning, fledging airline. Congratulations.


Bit more info from the ABC

About 20 parties, including investors, airlines and travel companies, are in talks to save Bonza, administrators have revealed at the first creditors' meeting for the embattled airline.

Representatives from Hall Chadwick told attendees on Friday morning they were hopeful a transaction would happen in the "not too distant future".

The ABC understands the airline's debts total more than $116 million, including $77 million in loans, $16 million owed to trade creditors, $10.5 million to airports, $4.6 million to the plane lessors, $5.3 million in employee wages and entitlements, and $58,000 to customers for cancelled flights.

https://www.abc.net.au/news/2024-05-10/bonza-creditors-meeting-parties-work-to-save-airline/103829502

58k in refunds seems a little low!

[tcas_test]

Bit more info from the ABC





58k in refunds seems a little low!

They've quoted that wrong, it was actually stated as:
- A yet to be determined amount owed to 57,893 passengers.

[nomess]

I don’t know what’s more concerning.

The fact that a tiny startup airline that has burnt 9 figures in little over a year, has ‘interest’ according to the administrators, or the fact Tim Jordan seems keen to have a second crack at this.

Bonza carried nearly 1 million customers to 22 destinations, many of those being large regional centres,” said Jordan.

Let me rephrase

‘Bonza carried nearly 1 million customers to 22 destinations, many of those being large regional centres, and we burnt $120 million achieving that’

[cooperplace]

Reminiscent of Toll Holdings, who had a large share of Virgin, and they valued it so highly they gave it away, to their own shareholders.

[Kiwiconehead]

‘Bonza carried nearly 1 million customers to 22 destinations, many of those being large regional centres, and we burnt $120 million achieving that’

So every passenger carried was on average $120 below cost?

[maxter]

So every passenger carried was on average $120 below cost?
At the prices they were charging that makes sense. Double the average fare they charged and it may have broke even, on paper. Reality not so sure

[nomess]

So every passenger carried was on average $120 below cost?

The most idiotic thing in all this, is they want another crack at it. It’s insane.

The employees are hanging on to claim wages not paid, they can’t do this until the whole place is wound up.

In the meantime, they are at the mercy of Branson wannabes trying to keep it alive.

[MickG0105]

Just when you think you have heard the most idiotic thing ever about Bonza, Australia's leading aviation journalist says, "Hold my pinot grigio!"

https://www.airlineratings.com/news/australia-needs-the-bonza-effect/

AirlineRatings.com understands that several parties have serious interest in the airline as the Bonza model works and most of the airline’s flights have been full.

[nomess]

Just when you think you have heard the most idiotic thing ever about Bonza, Australia's leading aviation journalist says, "Hold my pinot grigio!"

https://www.airlineratings.com/news/australia-needs-the-bonza-effect/

He also mentions, he does not support any government financial assistance for Bonza, scrolling on, it then mentions the government should have bailed out Virgin Australia. :bored:

Also claims Bonza has saved passengers $125m. Failed to mention they have burnt at least $120m doing so.

Why is everyone including the company, trying to cover up how $hit the thing has financially performed?

[longlegs]

Are we forgetting Virgin Australia entered administration owing 6.9 billion and Bain bought it for 3.5 billion. And everyone clapped Deloitte as the prodigal sons and daughters

BILLIONS written down at the expense of the shareholders and creditors.

The US has Chapter 11 to wipe the slate clean, reset and go again with a court tick of approval. Australia, subject to a buyer who values a high capacity AOC that has moved nearly a million bums in just over a year, has Hall Chadwick under the auspices of ASIC. In a ridiculously overpriced domestic market that Texel, ASL, Avia Solutions, Mineral Resources and others are already investing in narrow body capacity and capability.

[MickG0105]

...
Also claims Bonza has saved passengers $125m. Failed to mention they have burnt at least $120m doing so.
...
Interesting, if not instructive, how the purported savings (essentially the aggregate discount on fares offered by airlines that can stay in business) and the Bonza losses pretty well line up. Tells you what you need to know about Bonza's pricing strategy.

[MalcolmReynolds]

As Mick said in the Castle, "Tell 'em they're dreamin'!

[Slippery_Pete]

He also mentions, he does not support any government financial assistance for Bonza, scrolling on, it then mentions the government should have bailed out Virgin Australia. :bored:

Also claims Bonza has saved passengers $125m. Failed to mention they have burnt at least $120m doing so.

Why is everyone including the company, trying to cover up how $hit the thing has financially performed?

I’m not sure what more you expect of someone whose aviation experience totals a year or two chucking bags.

[KRviator]

He also mentions, he does not support any government financial assistance for Bonza, scrolling on, it then mentions the government should have bailed out Virgin Australia. :bored:Wonder if anyone's asked him about the billions in Government assistance for QF? Or would a response there put his CL membership at risk?

[markis10]

First of the original bonza birds is heading to a new home in Europe this morning.
https://www.flightaware.com/live/flight/VHUIK

Cannot see much point in Bonza continuing, I know a process is being followed but they really need to shut it down and at least give staff a chance to move on.

[SHVC]

Where is TJ in all of this? These guys need to be held to account.

[chookcooker]

He also mentions, he does not support any government financial assistance for Bonza, scrolling on, it then mentions the government should have bailed out Virgin Australia. :bored:

Also claims Bonza has saved passengers $125m. Failed to mention they have burnt at least $120m doing so.

Why is everyone including the company, trying to cover up how $hit the thing has financially performed?

bit different advocating for support from a. Government mandated shutdown vs a company collapsing in the free market.

[DanV2]

That was also a huge problem for VA, with each 'partner' trying to block the others ideas to prevent one from being stronger than the other, with too many industry large partners you also get mired in what each wants to achieve from the venture. All three were just happy to keep VA afloat at a small loss to keep pressure on QF at home. When the losses mounted too high and SQ was the only one bankrolling it, it was always going to end badly. That is probably why Bain is struggling to find suitors, they are probably put off not only by the viability of the airline, but who will have controlling shares if it floats. I'm sure if SQ could get 50% cheap they might entertain it, but there's not many others who'd have the cash for a long term go at it. You'd be mad to buy into airlines at the moment, there is not much stability of cost base for the future.

SQ's past dismal record in the Australian market through AN (via NZ), TT and VA 1.0, plus their failed investments elsewhere such as VS (which ended with DL bailing it out) and NokScoot being liquidated (through SQ's ownership in Scoot Tigerair Pte Ltd) suggests SQ should stick to running their own airline group.

Their sole remaining investment in India (25% in the combined AI/UK group) has been giving them mixed results.

The SQ group is a case example of "stick to what you do well", with outside distractions such as investments always tend to end badly for them financially, having to write off their VA 1.0 investment.

[lucille]

Other than the 30 or 40 international competitors…..

This is a Bonza RIP thread, silly old me, thinking we are talking about domestic ops. In that space, Qantas is the 500lb gorilla staunchly defended by every member of the Chairman’s Club. Looks and feels like the worst of third world corruption.

International is whole different ball game, I agree.

[ausflyer]

https://cimg6.ibsrv.net/gimg/pprune.org-vbulletin/920x2000/screenshot_20240511_124640_chrome_1eac9f236f63af41a698988db2 513264b61600f3.jpg
Heading to? Singas maybe?

[markis10]

Heading to? Singas maybe?

Subang for the night then Poland via the middle east

[nomess]

I see they opted to go via Port Hedland, I assume avoiding Darwin and Alice as they are both on the creditor list, behaviour unknown on arrival should one ‘stop by’.

I also note the Gold Coast has barricaded the thing in so much you would think civil unrest is about to unfold. Melbourne Airport have already conceded defeat and has waived its right to payment. Not sure the others will be as accommodating. Often more court dates before they can get released, not uncommon in these events.

[Pinky the pilot]

I also note the Gold Coast has barricaded the thing in so much you would think civil unrest is about to unfold. Melbourne Airport have already conceded defeat and has waived its right to payment.

Which makes me wonder; Say that the Gold Coast dug their heels in and said in effect, "This Aircraft 'aint goin' nowhere until we get paid!!":ooh:

Then what? :confused: I'm not a Lawyer, so I have no idea as to whom has rights etc....

[MickG0105]

Which makes me wonder; Say that the Gold Coast dug their heels in and said in effect, "This Aircraft 'aint goin' nowhere until we get paid!!":ooh:

Then what? :confused: I'm not a Lawyer, so I have no idea as to whom has rights etc....
Gold Coast Airport are exercising their rights under their Conditions of Use.

https://cimg3.ibsrv.net/gimg/pprune.org-vbulletin/952x1673/screenshot_20240511_180729_adobe_acrobat_9d3c9451b523f787a49 c4b9a7e4d3f3f956dc477.jpg



However, their conditions should not prevail over the requirements of the Corporations Act 2001 with regards to paying out creditors; simply put, you cannot contract around the law. The airport cannot obtain preferential treatment regarding payment of their debt; they'll be treated as a unsecured creditor and gets cents on the dollar, maybe nothing, just like every other unsecured creditor. If push came to shove, the Aircraft Lessor will get a court order requiring the airport to release the aircraft, and they would likely get a costs order against the airport as well. If the airport persists it will ultimately be a matter for the court.

[Pinky the pilot]

it will ultimately be a matter for the court.

Which means that ultimately, the only ones who benefit from all that are (expletives deleted) Lawyers!!:mad::ugh:

:ESometimes I nearly think that Shakespeare got it right! :eek:
(HenryVI. Part 2 Act IV Scene 2)

[TBM-Legend]

Interestingly GC Airport conditions refer to the operator. In this case Bonza is not the owner and the costs remain with Bonza not the owner. Courts will agree

[43Inches]

Interestingly GC Airport conditions refer to the operator. In this case Bonza is not the owner and the costs remain with Bonza not the owner. Courts will agree

In clause 9.17.1 it states that the aircraft is detained, "whether or not they were incurred by the person who is the operator of the aircraft at the time...etc". So they have covered that. Bonza may have been the operator at the time, but the detention/lien is against the aircraft. I don't think the court case will be as straight forward. These sorts of actions are to squeeze money out of other parties as they know getting cash from the administrators will be difficult. Any aircraft with a lien against it will be next to impossible to re-register without that cost being met. One of the many downsides to leasing out vehicles. Ie Bonza ran up the bill on your aircraft, they wont pay us, so now you owe us. There's many cases of aircraft with liens against them rotting in the side parks of airports around the world.

[AnotherFSO]

I was working in the briefing office at (then) ASSY in December 1991 when Compass Mark I went bust. There had been lots of rumours of its impending demise. The airline's allocated gate (or one of them, if there were multiple; but I think it was only one) was just outside the briefing office's windows. On this day, one of their A300s arrived and parked at the gate. A few minutes later the pilots came in and said words to the effect of, "Well, that's it. That's our last flight. We're out of a job." Within less than 30 minutes, we saw guards stationed around the aircraft to ensure it didn't escape.

[MickG0105]

At the instant the Administrators were appointed on 30 April 2024 all creditors' claims were put on hold. The Lessor exercised its repossession rights to the aircraft prior to the appointment of the Administrators, so they are not bound by the restrictions placed on other creditors. There were similar lien claims over aircraft made by airports when VA went into administration.

[nomess]

Administration can often bring out the best, and the worst in some. You also get a true reading of who are the nice people, and who are not!

Credit goes to Lorie and the Melbourne Airport team I will say. Came out today and said while they are a large creditor, they will take a back seat and employees, customers can take whatever they can get before them. She didn’t order anyone to clamp the aircraft down at the jet base, and waived right of payment. They also hinted they have been doing a lot behind the scenes in recent months to keep this alive.

[TBM-Legend]

Good gesture

By the way Australia being a signatory to the Cape Town Convention allows a lessor or owner to recover an aircraft from a lessee and country without any restrictions.

[antheads]

Is it as binding and enforceable as the refugee convention?

[markis10]

777 partners cofounders have been booted and Insolvency experts seen at the Miami HQ on Friday.

[TBM-Legend]

The Cape Town Convention is legally binding for the contracting states who signed it.

many reputable leasing companies won’t enter into leases with operators who are in countries that are not signatories

[MickG0105]

https://cimg7.ibsrv.net/gimg/pprune.org-vbulletin/1234x858/screenshot_20240512_092941_chrome_da3bef27d7f3421331f90a6baf 314e1f579108ae.jpg
https://www.goldcoastairport.com.au/latest-news/gold-coast-airport-named-as-bonzas-newest-base

Whilst that aphorism about canines, their wingless parasites, and co-mingling comes to mind, I'm reminded of the line from The Simpson's,

How could this happen? We started out like Romeo and Juliet but it ended up in tragedy!

[nomess]

It will be interesting to see what happens with Flair here. So it’s clear that 777 was funding all the leases, simply adding it to the principle with associated high interest. Bonza was in no position to fund any lease payments, that makes sense as to why Tim Jordan was quoting 10 aircraft by the years end, simply as 777 was enabling the payments to simply add to the loan. Then that option got taken away and it was game over. However, it seemed 777 had lost its appetite for the whole thing long before its leasing portfolio switched hands.

The Everton deal looks dead, and its other airline investment will be walking the tight rope on its own now. Pretty clear they will fall off eventually, just a matter of when.

[megan]

A few minutes later the pilots came in and said words to the effect of, "Well, that's it. That's our last flight. We're out of a job." Within less than 30 minutes, we saw guards stationed around the aircraft to ensure it didn't escapeKnow the two pilots involved, Captain (joined the military together) was really ticked off, had just got his command and managed to log eight hours. FO I had worked with where we were the only line pilots on the payroll.

[TBM-Legend]

A former soccer club president and a company that owns a stadium, both affiliated with Standard Liège, have joined the list of complainants filing lawsuits against 777 Partners (https://www.ch-aviation.com/entities/PRTN), the embattled former minority shareholder in Flair Airlines (https://www.ch-aviation.com/airlines/FLR) (Edmonton) and majority shareholder in the now-insolvent Bonza (https://www.ch-aviation.com/airlines/04W) (AB, Sunshine Coast (https://www.ch-aviation.com/airports/316)).

Immobilière du Standard de Liège, was sold to 777 Partners in 2022 along with Standard Liège, a Belgian professional football club. 777 paid EUR12 million euros (USD12.9 million) for Immobilière, an entity created in 2015 that owns the club's Stade de Sclessin, with former players and former club president Bruno Venanzi holding stakes. The money was to be paid in tranches, and 777 made the first payment but defaulted on the second tranche of EUR3.5 million (USD3.75 million), due on April 15, and a separate payment for the same amount due to Venanzi on April 20.

Venanzi and Immobilière are the club's primary creditors. Both are asking for the seizure of 777’s assets in Belgium, including the shares that Venanzi gave up in 2022. When 777 Partners bought in, it promised to pump capital into the debt-ridden club. Instead, Standard was hit with transfer bans after the club failed to pay transfer fees, bonuses, VAT, and social insurance contributions.

In addition to its fast unravelling aviation interests, 777 Partners' soccer plays are also under pressure as the investment firm - which another complainant in a separate matter calls "a giant shell game at best, and an outright Ponzi scheme at worst" - struggles to make good on its financial obligations. An attempt it made to take over England's Everton Football Club has been described as a farce, and pressure is mounting on majority shareholder Farhad Moshiri not to sell.

The soccer shenanigans parallel 777's aviation woes, which culminated in Bonza going out business last week and a London-based asset management company, Leadenhall Capital, filing a writ against several 777 entities as well as Joshua Wander, Steven Pasko, and Kenneth King. Wander and Pasko are co-founders and managing partners of 777 and several other entities, while King is chairman and CEO of Advantage Capital Holdings LLC (A-Cap) as well as its primary shareholder.
Leadenhall alleges 777 Partners is a ponzi schemeThe writ alleges the respondents pledged over USD350 million in assets (aircraft) as collateral to Leadenhall, knowing that the assets did not exist, or were not owned by the pledging entity, or had been double-pledged. In exchange for the pledges, Leadenhall provided a secured credit facility. In September 2022, the lender received a tip-off that sparked an investigation. It now alleges the respondents had been double-pledging assets as collateral to purportedly secure multiple lines of credit.

"Wander and Pasko are operating a giant shell game at best, and an outright ponzi scheme at worst, that takes money in from investors and lenders and shuffles it around to various money-losing alter egos in the enterprise to disguise their true financial condition," a May 3 filing to the US District Court Southern District of New York reads. "The enterprise is propped up and able to attract new lenders and investors only by the patronage of A-Cap, which pays off the enterprise’s last-minute obligations, including 777 Partners’ own payroll, in a whack-a-mole fashion to keep 777 Partners’ creditors at bay, if only temporarily, and to avoid the entire scheme from being laid bare in public."

In addition to the Belgian and Leadenhall lawsuits, the filing notes that 777 Partners and its affiliates have been named in 16 other lawsuits collectively asking for more than USD130 million.


Change Lending LLC sued 777 Partners in January 2024 seeking USD30 million in damages for breach of contract. The complaint alleges that 777 failed to produce certain financial information to verify its financial condition and operations, thereby triggering a right for the investor to redeem its preferred equity;

Three lessors led by Corvus Lights Aviation sued 777 Partners in December 2023 (https://www.ch-aviation.com/news/137103-lessors-say-c51mn-flair-airlines-lawsuit-is-frivolous) for USD30 million over missed lease payments for four aircraft;

In July 2022, the MALT Family Trust, a shareholder in 777-controlled entity Phoenicia and board member Timothy O'Neil-Dunne, commenced legal action against 777 and one of its aviation subsidiaries, seeking damages of at least USD22 million for an alleged fraud in which the defendants allegedly used corporate entities to deprive the investor of its ownership interest in the subsidiary;

In the same month, two lenders, Vida Longevity Fund and Obra Capital Management, sued 777 for defaulting on a USD59.7 million loan. They managed to auction off USD41.5 million in collateral, leaving an unpaid principal of over USD20 million in debt;

Balanced Management LLC sued 777 Partners in December 2023 to recover an unpaid debt of USD11.2 million;

In March 2024, Nakula Management Limited sued Wander and 777 Partners to stop them from transferring assets pending the finalisation of arbitration concerning a EUR9 million (USD9.7 million) debt;

777's landlord, 1 Madison Office Fee LLC, sued 777 Partners in September 2023 for failing to pay a USD5 million security deposit;

In December 2023, Lasse Meilsoe sued to recover more than USD2 million from two unpaid promissory notes;

Former 777 Partners principal Peter Meyers sued in January 2024, chasing more than USD2 million in unpaid compensation plus unspecified management interests;

American Express Travel Related Services Company sued 777 Partners in March 2023 over USD324,009 in unpaid Amex bills;

A former landlord sued Wander for USD150,000 in 2021 over property damage;

In April 2023, a recruitment firm called Oxbridge sued 777 Partners for USD94,000 in unpaid bills after 777 acknowledged the debt but admitted to slow-rolling them;

In September 2023, 777 Partners investor Timothy O'Neil-Dunne sued for the disclosure of statutory and other documents he alleged should have been provided to all members of Phoenicia's board.

Two class actions, namely Eido Hussam Al-Nahhas v 777 Partners LLC et al., and Joseph Morgan et al. v 777 Partners LLC et al., in which 777 is a co-defendant, allege a predatory lending scheme that violates the US's Racketeer Influenced and Corrupt Organizations (RICO) Act. One of the complainants states that the aggregate amount in controversy exceeds USD5 million, and both complaints seek treble damages for RICO violations.


777 Partners burns BonzaAfter shopping his Bonza business plan around to multiple uninterested potential investors, founder and CEO Tim Jordan got a warmer reception at 777 Partners. After talks across 2021 and 2022, which Jordan previously told ch-aviation were conducted entirely online due to Covid travel restrictions, 777 became a majority shareholder and the principal source of aircraft and funds for Bonza. The airline operated for 15 months before folding in late April 2024 (https://www.ch-aviation.com/news/139721-australias-bonza-goes-bust-as-aip-capital-seizes-aircraft).

Ahead of the first creditor's meeting on May 10, Australia's Financial Review is citing emails between 777 Partners and A-Cap dated March 22 in which they discussed winding up Bonza. In an email, AIP Capital (https://www.ch-aviation.com/entities/AIPC) Managing Partner Jared Ailstock tells Kenneth King that "we are moving at full speed ahead to get out of there ASAP and wind this up." Late on April 29, 2024, AIP seized the four Bonza B737-8 (https://www.ch-aviation.com/aircraft-variants/B007378)s managed by them on behalf of the owner, A-Cap-controlled Phoenix Aviation Capital.

AIP was 777 Partners' aircraft asset manager and was partly owned by them. It is now partly owned by A-Cap. The Financial Review reported that Ailstock inadvertently cc'd Bonza CFO Lidia Valenzuela into the email, which landed with a thud at Bonza HQ but also further undercuts Jordan's claim on the day the airline shut down that the repossessions came out of the blue. As previously reported in ch-aviation, Bonza received lease default notices on April 17. Two of those lease default notices were signed by Wander.

In recent days, all four Bonza aircraft have been assigned to a new entity, a Queensland-based entity called De Lore and Associates Pty Ltd, a company controlled by Jeremy de Lore, a former captain at China Southern Airlines (https://www.ch-aviation.com/airlines/CZ) (CZ, Guangzhou (https://www.ch-aviation.com/airports/1144)). De Lore's LinkedIn profile describes his current business activities as "supporting aircraft owners transitioning aircraft between operators."

In a May 7 statement, Bonza's administrator, Hall Chadwick, said it had held talks with the aircraft lessors but had "regretfully been advised that the lessors will continue to enforce their rights under the termination notices and, subject to their own requirements and arrangements, seek to reposition the fleet elsewhere." ch-aviation understands at least some of the B737-8s are going to LOT Polish Airlines (https://www.ch-aviation.com/airlines/LO) (LO, Warsaw Chopin (https://www.ch-aviation.com/airports/3527)).

[43Inches]

Good gesture

By the way Australia being a signatory to the Cape Town Convention allows a lessor or owner to recover an aircraft from a lessee and country without any restrictions.

Have you read the Cape Town Convention, all it does is spell out the legal rights of process. This paragraph early on, allows the airport to "take possession or control of any object charged to it".1. In the event of default as provided in Article 11, the chargee may, to the extent that the chargor has at any time so agreed and subject to any declaration that may be made by a Contracting State under Article 54, exercise any one or more of the following remedies:

(a) take possession or control of any object charged to it;

(b) sell or grant a lease of any such object;

(c) collect or receive any income or profits arising from the management or use of any such object.

I can't find any article in the convention that states a lessor has any further rights. Since Bonza had agreed to the terms of use of the airport, they have also agreed under the terms of the Cape Town Convention that the airport can take possession/ control of the asset until resonlution. The convention works both ways, it protects the interests of debtors as well as owners. It's all about how it's contracted.

[MickG0105]

...
This paragraph early on, allows the airport to "take possession or control of any object charged to it".
...
No, it doesn't. Article 8, which you have quoted, refers to the rights of the Lessor to repossess their equipment when there has been an Article 11 default. It does not provide any rights to other creditors, such as airports.

As it states in the preamble, the convention deals with "the need to acquire and use mobile equipment of high value or particular economic significance and to facilitate the financing of the acquisition and use of such equipment in an efficient manner" using "asset-based financing and leasing".

[Icarus2001]

A truck parked behind a parked aircraft trumps a legal right to remove it. Not forever but long enough.

[TBM-Legend]

Did not allude to other creditors only aircraft

[43Inches]

No, it doesn't. Article 8, which you have quoted, refers to the rights of the Lessor to repossess their equipment when there has been an Article 11 default. It does not provide any rights to other creditors, such as airports.

As it states in the preamble, the convention deals with "the need to acquire and use mobile equipment of high value or particular economic significance and to facilitate the financing of the acquisition and use of such equipment in an efficient manner" using "asset-based financing and leasing".

Right you are, however in this case the airport has not taken control/repossessed or placed a lien, they have only made it difficult for the asset to be moved. I think Melbourne is right in what they have done as they don't want to appear on any blacklist for lessors.

A truck parked behind a parked aircraft trumps a legal right to remove it. Not forever but long enough.

Well the convention only states the "chargee" has the right to repossess/take control, removal of the object is not mentioned. I assume if you had a malicious lessee they could dig a trench around the asset and being insolvent have no cash to be sued for making the asset usable, who pays then? The lessor still has to pay for costs associated with the retrieval of the asset.

[Icarus2001]

Meanwhile the pre paid passengers and staff can go whistle.

[markis10]

Somewhat ironically the airport that has taken the most action trying to block the aircraft is OOL which are likely to have one of the smaller bills

[43Inches]

Somewhat ironically the airport that has taken the most action trying to block the aircraft is OOL which are likely to have one of the smaller bills

I think Melbourne and Sydney saw the futility of it and need the parking space for actual paying customers. I remember Canberra tried this on with a QF aircraft a while back.

[MickG0105]

Somewhat ironically the airport that has taken the most action trying to block the aircraft is OOL which are likely to have one of the smaller bills
Yes, you had Amelia Evans tripping over herself to spruik Bonza when they decided to base there, but who was apparently then too naive/stupid to have her own Accounts Payable team keep them on a short leash. And then she wants to muscle her way to the front of creditors' queue. Reap as you sow.

... I remember Canberra tried this on with a QF aircraft a while back.
Yes, good corporate citizen Stephen Byron in that case wanted immediate payment, by credit card or similar, of an out of hours diversion fee for a flight that had to divert into CBR due to weather at SYD if I remember it correctly. That wasn't even covered by the airport's Conditions of Use at the time.

[nomess]

OOL/ISA/TSV are under the same owner so likely they are a bit further up the creditor list vs what you think. Regardless, the militant behaviour is childish.

Nauru is owed $1m. Jordan advised they ‘had their own work’ so they stopped servicing his flights. The guy couldn’t lie in bed.

[krismiler]

It shows the risk of joining a start up, if it works out you get an early command and a very high seniority number. If it folds up you hope you got enough time on type for another job.

When Virgin Blue started, turboprop pilots were getting the LHS after about 2 years and a Brisbane base wasn’t too hard to snag. A new joiner these days is looking at about a decade for an upgrade and will be spending much of it in Melbourne with a few more years back there as a skipper before BNE becomes available.

[Colonel_Klink]

Nauru is owed $1m. Jordan advised they ‘had their own work’ so they stopped servicing his flights. The guy couldn’t lie in bed.

Would be interesting to go back and reconcile all of the comments he made and just how far off the mark they were. Especially the comments about the aircraft leases when Bonza execs knew full well the curtain was coming down. Rather than politicians advocating for Bonza to get a lifeline, they should be shouting from the rooftops about how this mob ripped off rural and regional Australians.

Where’s the accountability?

[KAPAC]

Pay your money and take your chances .

[Icarus2001]

A new joiner these days is looking at about a decade for an upgrade and will be spending much of it in Melbourne with a few more years back there as a skipper before BNE becomes available.

​​​​​​​A decade would be very quick.

[kitchen bench]

Nauru is owed $1m.

Word is that allegedly one in management wanted the flying for Bonza to continue against the advice of others who had grave concerns when payments fell behind. Eventually some wisdom prevailed and they pulled the pin - but not for the reasons Jordan claimed.

[ebt]

777 partners cofounders have been booted and Insolvency experts seen at the Miami HQ on Friday.

And now we see why AIP Capital's latest leasing venture is called Phoenix Aviation Capital - it was planned that way all along. Let the 777 dumpster fire burn, take the assets and rise again from the ashes.

[Icarus2001]

take the assets and rise again from the ashes. What are the significant assets?

[ebt]

What are the significant assets?

The aircraft are the only assets worth taking out of 777, and it seems that the guys from there, and their significant backer A-Cap, plus the guys who started AIP Capital, are all-in to take the jets and ride off into the sunset.

[nomess]

Didn’t they finance the Boeing order for 777 Partners?

They have essentially cancelled that finance contract with them and taken back in house, and have started a leasing arm. That wasn’t what Boeing originally wanted, so will be interesting to see if they keep the remaining order for about 20 MAX 200s.

It is clear that 777 did not have the financial capability to fund monthly lease bills for its subsidiaries any longer. Considering the high margin leasing market at the moment, Phoenix was likely born to take advantage of that. Bonza is just collateral in all this. Wouldn’t be surprised if the Bonza and Flair fleets have been shopped around behind closed doors for months. What a time to be a leasing company.

[antheads]

Rather than politicians advocating for Bonza to get a lifeline, they should be shouting from the rooftops about how this mob ripped off rural and regional Australians. Where’s the accountability?
Because rural and regional Australians would just shrug their shoulders and say So what? The Qantas mob has been ripping us off 365 days a year, over the last 25 years.

[markis10]

Wouldn’t be surprised if the Bonza and Flair fleets have been shopped around behind closed doors for months. What a time to be a leasing company.
777 only took 6 aircraft from Boeing in the end, the Flair fleet has two, the other 777 flair birds they leased were repo’d last year.

[FruitSnack]

AFR reporting Vietjet Air was one of the interested parties. Wonder what they were valuing?

[nomess]

The AOC would be attractive, with the 7M8 on it, but you are not buying a AOC, but a poisoned chalice saddled with liabilities, that happens to have a AOC.

[morno]

The AOC would be attractive, with the 7M8 on it, but you are not buying a AOC, but a poisoned chalice saddled with liabilities, that happens to have a AOC.

Sure, but a simple rebrand fixes that.

[A320 Flyer]

Sure, but a simple rebrand fixes that.

Not the liabilities part

[tail wheel]

Not the liabilities part

With Creditor approval, the debts are moved to another Company and the original Company and AOC are sold debt free.

Alliance was formed in a similar manner.

[morno]

Not the liabilities part

$100M worth of liabilities for a ready to go airline is pocket change for someone like Vietjet. Would tie in well with their flights to Australia.

[A320 Flyer]

If they pay the same contract rates as they used to pre covid in Vietnam then they’ll have them running through the door.

[Sue Ridgepipe]

If it was Vietjet I'd be running out the door and far away as fast as possible.

[markis10]

If it was Vietjet I'd be running out the door and far away as fast as possible.
seems they got the memo

The Australian Financial Review has confirmed Vietnam’s VietJet was among (the six companies) looking at Bonza’s aircraft operator certificate, a crucial licence needed to establish a foothold in the domestic aviation market. Bonza, which began flying only last year, has few other assets, with its aircraft heading overseas to other carriers.

Two sources said VietJet had been looking at ways to expand into Australia, with an order of 66 Boeing 737 Max 8 aircraft (https://www.afr.com/link/follow-20180101-p5fek1), the first of which are due for delivery this year.

VietJet confirmed the airline – which arrived in Australia in April and flies 48 flights a week to Melbourne, Sydney, Brisbane, Perth and Adelaide – had walked away from talks.

https://www.afr.com/companies/transport/bonza-hopes-fade-as-vietjet-walks-from-deal-talks-20240513-p5jd35

Quote edited to reflect current suitor numbers

[MickG0105]

-UKH flown out this morning at 8am, currently en route to PHE.

[43Inches]

The Australian Financial Review has confirmed Vietnam’s VietJet was among (the six companies) looking at Bonza’s aircraft operator certificate, a crucial licence needed to establish a foothold in the domestic aviation market. Bonza, which began flying only last year, has few other assets, with its aircraft heading overseas to other carriers.


Didn't the rules change in regard to AOCs, being purchased, that they will basically have to go through most of the process again for a new startup. Unless they of course intend to just do what Bonza was doing, but then it will just end the same way...

[SLFstu]

-UKH flown out this morning at 8am, currently en route to PHE.
[non pilot]. What a damned shame to follow this on FR24 as it will shortly land at an Aussie airport, albeit in the Pilbara, for the final time.
Oh wait, any Bonza enthusiasts can buy a 1:400 replica of "Malc" from your friendly modelling supplier or one of the UK ebay stores for 93 quid. They've even updated the owner to Phoenix Aviation, jeez.

[Lead Balloon]

Didn't the rules change in regard to AOCs, being purchased, that they will basically have to go through most of the process again for a new startup. Unless they of course intend to just do what Bonza was doing, but then it will just end the same way...
The rules haven't changed.

AOC holding entities are and always have been subject to ongoing obligations about, for example, key personnel, chain of command, facilities... If, for example, a whole bunch of key people and important organisational arrangements disappear from within an RPT AOC-holding entity - for whatever reason, including a change of control of the entity - CASA will be all over it like a cheap suit.

[krismiler]

It looks like the administrators are just going through the box ticking checklist in trying to sell the business as a going concern. With the aircraft winging their way out of the country it’s basically all over. I wonder if the government will put an “Ansett ticket tax” on airfares to cover staff entitlements.

[nomess]

This AOC is a just license to print red ink.

Even thinking about the costs to restart this is horrific. You wouldn’t be able to source aircraft for 4-6 months. Not only that, but you would be paying top dollar, but the elephant in the room being the company’s obviously questionable financial past, you just wouldn’t touch it as a lessor. Not to mention trying to restart with a new Management and Flight Ops teams, while somehow trying to convince CASA you know what you are doing.

I somewhat get the feeling that Tim Jordan just doesn’t want to admit defeat on this. Absolute madness if you ask me. Is he trying to look after himself here? Sell it off, and avoid potential action against himself from ASIC, I note he has his own consulting firms, which could be closed if restrictions are thrown at him. Essentially he is bankrupt.

Michael James from Air Australia got taken to the cleaners.

[Lookleft]

I wonder if the government will put an “Ansett ticket tax” on airfares to cover staff entitlements.

​​​​​​​How many staff do Bonza have and what would be their LSL entitlements? Ansett had 16000 staff with a lot of them having been there for decades.

[CSAB]

I somewhat get the feeling that Tim Jordan just doesn’t want to admit defeat on this. Absolute madness if you ask me. Is he trying to look after himself here? Sell it off, and avoid potential action against himself from ASIC, I note he has his own consulting firms, which could be closed if restrictions are thrown at him. Essentially he is bankrupt.


According to his own statements in the past, this has been the main goal of his for a decade. He's in so deep now that he has no option but to fight till A) he finds a buyer or B) the whole thing gets wound up. My money is on B. However, his only faint glimmer of hope is that he can get a buyer over the line, beyond that his future as an executive is bleak to put it mildly, his future as a director could be over in legal terms if action is taken against him. Might seem obvious to us, but he's running on survival instincts at this point. The deadline for bids closes tomorrow, will be interesting to see what eventuates from that if anything at all.

[nomess]

Lost the plot.

https://www.airlineratings.com/news/bonza-is-viable-and-about-to-soar/

[ebt]

$100M worth of liabilities for a ready to go airline is pocket change for someone like Vietjet. Would tie in well with their flights to Australia.

Not quite - VietJet is in dispute with at least one of its lessors, and word has it there is a big deferred payment due in June that could be...stretching, one might say.

If anything is going to come of it, it will require most - if not all - of the debt to be written off, then VietJet will need to raise some capital in order to fund an Oz development. They have talked about raising foreign debt from other Asian markets, so that could be a thing, but I can't imagine throwing that into VietJet Oz.

Look, it may well be serious, but everyone has a look under the hood and few - if any - will put their pen to paper.

[MickG0105]

Lost the plot.

https://www.airlineratings.com/news/bonza-is-viable-and-about-to-soar/
Almost certainly never had it to start with. The fellow is utterly delusional.

[A320 Flyer]

Lost the plot.

https://www.airlineratings.com/news/bonza-is-viable-and-about-to-soar/

that bloke has never “had” the plot

[Icarus2001]

How many staff do Bonza have and what would be their LSL entitlements?

​​​​​​​Are you serious about LSL?

[nomess]

https://youtu.be/RYV3c5iC9tc?feature=shared

[Warragul]

It looks like the administrators are just going through the box ticking checklist in trying to sell the business as a going concern. With the aircraft winging their way out of the country it’s basically all over. I wonder if the government will put an “Ansett ticket tax” on airfares to cover staff entitlements.
No, they legislated protection of some entitlements following that.
https://www.dewr.gov.au/fair-entitlements-guarantee

[CSAB]

Almost certainly never had it to start with. The fellow is utterly delusional.

Yet he's somehow the go-to guy for the news outlets as the 'aviation expert'. When the KordaMentha news broke, he went on record to say he didn't think these rumours had any merit. Less than 2 weeks later when the airline collapsed, he was again on TV running with the line "Bonza was viable but it's squarely 777 that's responsible for the collapse". If Bonza was viable, they would've been able to pay their own leases. If Bonza was operating with the load factors and improving yields referenced in the article, they wouldn't have been running non-stop $39 fare sales.

This guy has been wrong about this situation from the start, appears he's towing the narrative from Bonza without actually verifying the information...

[MickG0105]

Yet he's somehow the go-to guy for the news outlets as the 'aviation expert'. When the KordaMentha news broke, he went on record to say he didn't think these rumours had any merit. Less than 2 weeks later when the airline collapsed, he was again on TV running with the line "Bonza was viable but it's squarely 777 that's responsible for the collapse". If Bonza was viable, they would've been able to pay their own leases. If Bonza was operating with the load factors and improving yields referenced in the article, they wouldn't have been running non-stop $39 fare sales.

This guy has been wrong about this situation from the start, appears he's towing the narrative from Bonza without actually verifying the information...
It's the old story; routinely wrong but never in doubt.

Aviation is a challenging field for news reporting; the people most qualified to offer accurate information and cogent opinions are generally prevented from commenting by their conditions of employment. So journos are often relying on has beens, never weres, "academics", and the like to balance out whatever waffle has come out from some Corporate Communications department.

And the old "immediacy over accuracy" focus of today's news generally means they'll take whatever information they can get quickly.

And then there's what seems to be the prevalent view that decisive, black or white reporting is favoured over more considered and measured commentary. Blaming something or someone seems to trump "at this time we simply do not have enough information to make a call" every day of the week, and twice on Sundays.

In short (and I'm cognisant that we've gone the long way to get there), the fellow in question ticks all the boxes on the Worst Aspects of Reporting News in the Age of Social Media checklist.

Regarding his commentary on Bonza, for starters, I very much doubt he has access to all the information necessary to make the sort of big calls he's making. No one outside of Bonza’s CEO and CFO will have something even vaguely approaching "the full picture", but I'm a bit reluctant to trust anything either of them might say on the matter. Absent having access to the data room that the Administrators have established, everyone (present company included) is guessing, with some guesses somewhat more educated than others.

I would note a few things. First up, when people comment on the "business model", specifically what are they talking about? My reading of the Bonza business model is that it was at its core a low cost carrier model (no frills base offering with on-sells, single class) pitched at almost exclusively regional-to-regional travel. They were looking to largely avoid going toe-to-toe with the majors by focussing on then unserviced routes. A premise, and an important one, was that they could stimulate previously dormant demand; they weren't looking at trying to carve out a piece of the pie, rather they were focussed on growing the pie. Like it or lump it, fleet selection was as important a part of the business model as was route selection.

When you define the "business model" like that, it is pretty clear that it did not work. While they most assuredly did stimulate new demand, it simply wasn't enough to sustain a profitable operation.

On this, it is probably important to note that the fleet choice was probably not as big a factor as some people make out. In the MAX they almost certainly had the cheapest CASK of any narrow body in the country. Going to something like an E-jet sees CASK go up, and you can only make money when RASK exceeds CASK. What going to a smaller, second-hand jet does do is lower the break even point in terms of seats sold but that's not a silver bullet. The whole thing is a bit more complicated than the "it would have worked with a smaller jet" fix.

And on fleet choice, it is worth noting that apparently Timbo built his initial modelling around ATR-72s, I think. I'm not convinced that would have worked either; I think that at least part of the demand they created was because they were offering something other than a turboprop.

Any old how, the last thing I would note is that the amount of "savings" on airfares that the Bonz is claiming their passengers have pocketed is roughly the same as their current debt position. That struck me as potentially a "we don't pay our bills or our staff, and we pass the savings on to you" sort of Peter-Paul construct.

[Deano969]

Something is not adding up to me
Headlines state $100million owed at collapse
Bonza touting almost 1 million seats sold to date even at $80 per seat average, this is $80million in sales of you include BOB

So income around $80 million
Lease 4 Max's at $400k per month for 15 months $24mil
$4k per sector for fuel for around another $24mil
Staff ? $20mil
All the other bits and pieces like taxes, maintenance, airport charges plus many more, lets say $20mil
So expenditure wold be close to $100mil

The above are very loose figures but shows $20mil loss, so how is it $100,000,000.00?

Was it 777 gouging Bonza on leases ?

[nomess]

I did an analysis of costs in a prior post. Have a look. My forecast was $120-140m loss which was fairly close to what was occurring.

Bonza had very high startups costs in the tens of millions due to a very delayed start. Essentially, it was dead before it even started. If you seperate the whole Flair thing, including revenue, that little operation has burnt $15-20m. I won’t scare you with wet leasing costs, don’t forget Nauru.

777 Partners lends cash to its subsidiaries at payday loan rates, 20-30%. It all just builds and builds until it collapses.

You need to seperate Fuel, Airport Ground Handling, and Airport charges, they are all significant items. Ground Handling costs have jumped considerably in the past 5 years. Some carriers are looking at pulling some back in house to get some control over it.

Your total figures are quite off the mark also. Crew Training costs here also significant.

There was a lot happening at Bonza, it’s a startup so costs are coming at you from all corners, but there was nil financial discipline here.

[Deano969]

Nomess I agree with what you have stated yes
However taking out the start up costs which are a one off
Taking out the wet leasing
Taking out 777s gouging
It be fair to say that their ongoing operational profit / loss would be around $20mill loss over 15 months?
A loss is a loss, however, trying a bunch of routes with some wins and losses and culling underperforming to be replaced with better routes would also have been a factor
MCY-CFS, PQQ, TMW hang around for a few months while Bonza gave these routes a chance to mature before cutting them costing money

Personally I believe TJ had a great plan to get established without going toe to toe with the big 2and I get the impression there was momentum, however it stifled by his choice with 777 as a backer which ultimately screwed Bonza over

[nomess]

Even without the wet leasing, and say only average interest rates, it still had a way to run until any green shoots started forming. That wasn’t a trade secret, the quoted 10 aircraft needed.

Pull out the wet leasing, and perhaps running off average market interest rates, I’m still getting figures around $4-5m cash burn monthly. That’s going off the reported loads to market.

Even with an increase in loads, I’m finding it very very hard to get this to breakeven. And that’s breakeven, isn’t the aim to make some margin on this?

A big risk with these smaller operators, even if they do somewhat become profitable, is they can swing to a loss very quickly, one black swan event, one poor or ‘quiet’ season, and the place can become very unprofitable very quick. Before you know it, you are on your knees, despite making money the year before.

[Traffic_Is_Er_Was]

Also lost in the current debate is that on 84% of its routes, Bonza is the only airline and on 89% it is the only low-cost airline.
But not lost in the current debate is that as the only airline flying those routes and as a low cost airline it went broke and failed. So your point is GT?

[Traffic_Is_Er_Was]

However taking out the start up costs which are a one off
Taking out the wet leasing
Taking out 777s gouging
It be fair to say that their ongoing operational profit / loss would be around $20mill loss over 15 months?
But you can't take them out.
if you start from the bottom of a deep hole, then just keep digging only a little deeper each month, you don't get any closer to the surface. You just get deeper.
Personally I believe TJ had a great plan to get established without going toe to toe with the big 2
Well that makes two of you. The evidence would suggest you were both wrong.

[Traffic_Is_Er_Was]

Prophetic perhaps?
I can see the future! (https://www.pprune.org/australia-new-zealand-pacific/650732-bonza-has-its-aoc-46.html#post11637890)

[professorsabena]

Bonza has a lot going for it. Or did have before certain bad things happened to it. That doesn't mean its a bad idea. We have however to play by certain rules of economic theory. Was Bonza done it or did it do it itself? The answer is probably both.
That said - I firmly believe that Bonza deserves a chance. And I think many people here would agree. Feel free to contact me using my user name at Gmail. I would be happy to hear from you. And yes, I am interested in restoring the concept to benefit Australians.
Cheers

[markis10]

Something is not adding up to me
Headlines state $100million owed at collapse
Bonza touting almost 1 million seats sold to date even at $80 per seat average, this is $80million in sales of you include BOB



Deano you have not been getting it right for a long time now lol. $80 average a seat, tell them their dreaming, try sub $50 which was their forward sales ASP

[Deano969]

Oh please
A handful under $40 even......
Plus
Reserve seat
BOB
Checked luggage
And later on kick backs from hotels etc
But plenty over $80 as well

[markis10]

Oh please
A handful under $40 even......
Plus
Reserve seat
BOB
Checked luggage
And later on kick backs from hotels etc
But plenty over $80 as well


Lol again, it was only a few months back they were offering 200k of seats on every route for $49, after their 50% off sale in January. Baggage and seat revenue would be minimal as the market they were catering for is dollar conscious. I few JQ out of MCY Tuesday and seat selection was at 15 seats prior to the flight being handed to airport control for check in, checked bags in total 23 when the belt stopped at the other end, yet the overhead bins were chokers and load factor was 83%.

Doubt they got any kick backs from hotels as they didn’t deal with them, holiday revenue was paid to Awai directly as per the Q&A the admins have released.

When those 58000 forward bookings finally get cancelled I would be surprised if they total more than a few million in new debt

[nomess]

Bonza has a lot going for it. Or did have before certain bad things happened to it. That doesn't mean its a bad idea. We have however to play by certain rules of economic theory. Was Bonza done it or did it do it itself? The answer is probably both.
That said - I firmly believe that Bonza deserves a chance. And I think many people here would agree. Feel free to contact me using my user name at Gmail. I would be happy to hear from you. And yes, I am interested in restoring the concept to benefit Australians.
Cheers

Hi Tim

[antheads]

I am interested in restoring the concept to benefit Australians.
Cheers
Concrete offers were due by Friday, did you submit a bid?

[MacTrim]

Well, ‘SHAZZA’ has left the country for darkest, deepest SE Asia and that was the last man standing.
Why doesn’t JORDON just grow a pair and fess up to the staff that it’s All Over, Not a chance, Get on with your lives.
Before I’m inundated with “it’s not the responsibility of the Provisional Liquidator”, these smartarse ex-airline middle manager types take on an ego driven CEO gig yet are responsible to No One and don’t give a **** about the stress and pain they inflict upon their staff.
I’m sure there would be a couple of experienced pilots there that were not at all surprised, but at the same time there would be wide eyed cabin crew & ground staff who drank the coolaide & rearranged their lives around their new found jobs.
It just ****s me, after 40yrs of flying airline transports here & OS, we all knew BONZA was doomed, and would leave another wreckage of working lives on a heap, out of pocket too I’m sure.