Virgin Syd-Canberra-Syd Services Under Threat
Thread Starter
Join Date: Nov 2003
Location: Melbourne Aus
Posts: 156
Likes: 0
Received 0 Likes
on
0 Posts
Virgin Syd-Canberra-Syd Services Under Threat
Virgin's Canberra-Sydney link under threat
7:27 PM July 14
Virgin Blue is renewing its threats to axe flights out of Canberra unless the Federal Government increases its share of the lucrative Commonwealth travel market.
Public servants currently use Qantas for around 85 per cent of their travel, with only around 15 per cent of flights going to budget airlines.
Virgin Blue chief executive Brett Godfrey says the Commonwealth travel market is worth around $300 million and he wants the Government to use his airline 30 per cent of the time.
With the airline only attracting about 5 per cent of all government travel, Mr Godfrey says the Canberra to Sydney daily flight is now under review.
"I believe yes, that's (30 per cent) very attainable," he said.
"If that's our market share - we're very relevant for the top corporates in this country, we're very relevant for budget travellers in this country, and pretty much for everyone in the middle - that's our national percentage, we believe that should also apply for Federal Government.
"We're only one flight now, we had three, we had to pull it back.
"Again, when the biggest business in town doesn't support you, which they didn't a couple of years ago, it just doesn't make any business sense whatsoever to continue those services."
Source: ABC
7:27 PM July 14
Virgin Blue is renewing its threats to axe flights out of Canberra unless the Federal Government increases its share of the lucrative Commonwealth travel market.
Public servants currently use Qantas for around 85 per cent of their travel, with only around 15 per cent of flights going to budget airlines.
Virgin Blue chief executive Brett Godfrey says the Commonwealth travel market is worth around $300 million and he wants the Government to use his airline 30 per cent of the time.
With the airline only attracting about 5 per cent of all government travel, Mr Godfrey says the Canberra to Sydney daily flight is now under review.
"I believe yes, that's (30 per cent) very attainable," he said.
"If that's our market share - we're very relevant for the top corporates in this country, we're very relevant for budget travellers in this country, and pretty much for everyone in the middle - that's our national percentage, we believe that should also apply for Federal Government.
"We're only one flight now, we had three, we had to pull it back.
"Again, when the biggest business in town doesn't support you, which they didn't a couple of years ago, it just doesn't make any business sense whatsoever to continue those services."
Source: ABC
Join Date: Jun 2001
Location: Sydney, Australia
Posts: 78
Likes: 0
Received 0 Likes
on
0 Posts
Can't win market share any more so start demanding it! Typical of the Virgin management, I'm surprised that whinging Huttner character wasn't wheeled out to give yet another 'poor us' story to the media. Just shows how poorly they understand the Commonwealth travel market.
Join Date: Aug 2003
Location: UAE
Age: 55
Posts: 119
Likes: 0
Received 0 Likes
on
0 Posts
BCD, nice bit of cut'n'paste ... here's what DJ had to say on their website.
Virgin Blue Federal Government Information Day
Virgin Blue Chief Executive, Brett Godfrey and the Department of Transport Secretary, Ken Matthews, will today co-facilitate an airline information day for Federal Government executives in Canberra.
The day has been specifically organised to allow Federal Government employees to meet with other Governments and private companies that have managed to substantially improve their bottom line by adopting a ‘Best Fare of the Day’ Policy for air travel.
The low fare airline recently welcomed moves by the Commonwealth Government to change its one-airline travel strategy to a policy of ‘Best Fare of the Day’ including Virgin Blue, following recommendations from the Len Early Report.
Since this time Virgin Blue has been working closely with the Department of Finance and Administration’s newly formed "Travel Forum" to assist Government Departments to effortlessly book Virgin Blue as part of their travel policy.
Virgin Blue Chief, Brett Godfrey, said, “Virgin Blue is an award winning airline offering convenient services, an extensive network and cost effective solutions for corporate travellers and we are very happy our federal public servants now have the opportunity to seek the best value for taxpayer’s money when making their travel bookings.”
Since Virgin Blue launched nearly four years ago it has achieved unprecedented growth and now operates more than 280 flights a day to 21 destinations, including every state and territory capital city and many regional ports.
As Virgin Blue continues to expand both its fleet and network, the people of Canberra have benefited with the increase of direct flight options from Canberra to Melbourne, Brisbane, Adelaide and the Gold Coast, and through fares to most of the carrier’s Australian, New Zealand and Pacific Island destinations.
A number of keynote speakers will be present at today’s information day to discuss important factors in relation to corporate and government travel strategy, cost effective solutions for travel purchasing and competition in Australia’s domestic airline market.
Brett Godfrey added, “I’m pleased to be attending this information day to personally showcase our airline’s products and services to those who represent the interests of the people of Australia."
Virgin Blue Federal Government Information Day
Virgin Blue Chief Executive, Brett Godfrey and the Department of Transport Secretary, Ken Matthews, will today co-facilitate an airline information day for Federal Government executives in Canberra.
The day has been specifically organised to allow Federal Government employees to meet with other Governments and private companies that have managed to substantially improve their bottom line by adopting a ‘Best Fare of the Day’ Policy for air travel.
The low fare airline recently welcomed moves by the Commonwealth Government to change its one-airline travel strategy to a policy of ‘Best Fare of the Day’ including Virgin Blue, following recommendations from the Len Early Report.
Since this time Virgin Blue has been working closely with the Department of Finance and Administration’s newly formed "Travel Forum" to assist Government Departments to effortlessly book Virgin Blue as part of their travel policy.
Virgin Blue Chief, Brett Godfrey, said, “Virgin Blue is an award winning airline offering convenient services, an extensive network and cost effective solutions for corporate travellers and we are very happy our federal public servants now have the opportunity to seek the best value for taxpayer’s money when making their travel bookings.”
Since Virgin Blue launched nearly four years ago it has achieved unprecedented growth and now operates more than 280 flights a day to 21 destinations, including every state and territory capital city and many regional ports.
As Virgin Blue continues to expand both its fleet and network, the people of Canberra have benefited with the increase of direct flight options from Canberra to Melbourne, Brisbane, Adelaide and the Gold Coast, and through fares to most of the carrier’s Australian, New Zealand and Pacific Island destinations.
A number of keynote speakers will be present at today’s information day to discuss important factors in relation to corporate and government travel strategy, cost effective solutions for travel purchasing and competition in Australia’s domestic airline market.
Brett Godfrey added, “I’m pleased to be attending this information day to personally showcase our airline’s products and services to those who represent the interests of the people of Australia."
Guest
Posts: n/a
VB may whinge a bit but I think that the taxpayers have a right to be sure that the public servants aren't patronizing a higher cost carrier simply so they can keep up their FF points and enjoy the scotch in the Qantas lounges. Surely the auditor-general could keep track of what fares were used vs what was available on other carriers?
Join Date: Feb 2002
Location: Sydney, Australia
Posts: 590
Likes: 0
Received 0 Likes
on
0 Posts
Elektra I agree, but the fact remains that the contracts signed between airlines and the Public Service guarantee them a set low cost fare as part of the contractual agreement.
Couple that with the fact that they are getting a known level of service with QF domestic and the fact that most Pubes like to have a hot meal tends to sway the argument.
Look at when Ansett replaced A320/B737 services with Regional Jets with no hot meal facilities.
The public service travellers almost revolted in Vic/Tas!!!
I agree with Slim.
Here they are now demanding market share and take the standard hard done-by whingeing stance as always.
The opposition is growing, they are starting to feel the pinch in terms of competition and guess who doesnt like it????
But then again thats just what public servants need - Brett Godfrey addressing them and whingeing about lack of patronage on his behalf!!
Couple that with the fact that they are getting a known level of service with QF domestic and the fact that most Pubes like to have a hot meal tends to sway the argument.
Look at when Ansett replaced A320/B737 services with Regional Jets with no hot meal facilities.
The public service travellers almost revolted in Vic/Tas!!!
I agree with Slim.
Here they are now demanding market share and take the standard hard done-by whingeing stance as always.
The opposition is growing, they are starting to feel the pinch in terms of competition and guess who doesnt like it????
But then again thats just what public servants need - Brett Godfrey addressing them and whingeing about lack of patronage on his behalf!!
Join Date: Jul 2003
Location: Planet Plazbot
Posts: 1,003
Likes: 0
Received 0 Likes
on
0 Posts
I work fo a Government psuedo business type thing. We used to soley book the Qantas negotiated fully changeable super tickets. The contract has recently expired. Now we have been given direction to check the internet or call the other carriers to see if we can get a cheapie first.
Perhaps the fact that Dj only operate one single flight per day has something to do with it? After all, I'd imagine that one thing that is desirable for public servants is some sort of flexibility. To me, this would be one of the greatest factors working against DJ in this market.
Godfrey will no doubt argue that if the government patronised the service more, that Virgin would be more willing to add extra flights, while the governments point of view is most likely that it will provide greater patronisation once there is a greater number of flights.
So - who's going to make the big decision that will lead to change? Judging by the
, it will obviously not be Godfrey & his team at DJ....
Godfrey will no doubt argue that if the government patronised the service more, that Virgin would be more willing to add extra flights, while the governments point of view is most likely that it will provide greater patronisation once there is a greater number of flights.
So - who's going to make the big decision that will lead to change? Judging by the
, it will obviously not be Godfrey & his team at DJ....
Join Date: Aug 2000
Location: Dunedin, NZ
Posts: 280
Likes: 0
Received 0 Likes
on
0 Posts
If VB has one flight each day into Canberra from Sydney, it shows that no one was using them to fly into Canberra either, and that is not the Government's fault. The fact is a 737-700 is too much aeroplane for a short flight, and VB could not make money between Canberra even with three full planes per day.
VB management does not like turboprops, which are what Qantas uses for most CBRSYD flights.
Even the VB CBRBNE flights are not well timed to give a Canberra person a good day's business in BNE
VB management does not like turboprops, which are what Qantas uses for most CBRSYD flights.
Even the VB CBRBNE flights are not well timed to give a Canberra person a good day's business in BNE
Join Date: Aug 2002
Location: Canberra Aust
Posts: 108
Likes: 0
Received 0 Likes
on
0 Posts
The problem with Canberra/Sydney for DJ is simply frequency... or lack of it. Not just for Government travel but also leisure.
QF has at least one flight an hour. At peak times more. DJ has one flight ALL day.
In addition they only cater for CBR/SYD travel. There is no AM flight SYD/CBR. Thats makes it impossible for business travel.
Even give away prices dont necessarily work if the time is so inconvenient. I recently had the opportunity to purchase a ticket CBR/SYD with DJ for $19. But their only flight was at 0645. I didnt need to be in Sydney until late in the day so rather then lose a days work I paid a much higher fare to travel when I wanted too.
QF has at least one flight an hour. At peak times more. DJ has one flight ALL day.
In addition they only cater for CBR/SYD travel. There is no AM flight SYD/CBR. Thats makes it impossible for business travel.
Even give away prices dont necessarily work if the time is so inconvenient. I recently had the opportunity to purchase a ticket CBR/SYD with DJ for $19. But their only flight was at 0645. I didnt need to be in Sydney until late in the day so rather then lose a days work I paid a much higher fare to travel when I wanted too.
Join Date: Jul 2001
Location: Qld
Posts: 176
Likes: 0
Received 0 Likes
on
0 Posts
I, as a tax payer, help to fund the the public servants!
I expect the majority of Gov. air travel to use the cheapest available, no 1st, no Bus. class or whatever, ECONOMY and FF points accured go into a pool, to help fund other public servant travel.
They have no right to use the FF points, as we, the taxpayers have paid for the tickets, not them.
If they don't like it, lets start a forum, to get together a concerned group to bring pressure on the Gov. prior to the election.to bring this about. Also, Virgin Blue must be used at least 50% if not more.
QF, are still far to protected, they are no longer an Australian Airline, ( Aust. Gov. owned, US, YOU and I , that is ) and if the foreign owners and local management end up going down the same path as AN, then tough. The solution, the Oz. Gov. should reclaim our ( TAXPAYERS ) old airline, and change the QF management, ASAP.
As to you Virgin Blue knockers, BELT UP, GET A LIFE!!!!
Credentials, Recently retired, long time International Boeing Captain, ( glass cockpit ) with a bit of Douglas, Lockheed, NA and the good old DH82 to start the ball rolling.
Cheers
I expect the majority of Gov. air travel to use the cheapest available, no 1st, no Bus. class or whatever, ECONOMY and FF points accured go into a pool, to help fund other public servant travel.
They have no right to use the FF points, as we, the taxpayers have paid for the tickets, not them.
If they don't like it, lets start a forum, to get together a concerned group to bring pressure on the Gov. prior to the election.to bring this about. Also, Virgin Blue must be used at least 50% if not more.
QF, are still far to protected, they are no longer an Australian Airline, ( Aust. Gov. owned, US, YOU and I , that is ) and if the foreign owners and local management end up going down the same path as AN, then tough. The solution, the Oz. Gov. should reclaim our ( TAXPAYERS ) old airline, and change the QF management, ASAP.
As to you Virgin Blue knockers, BELT UP, GET A LIFE!!!!
Credentials, Recently retired, long time International Boeing Captain, ( glass cockpit ) with a bit of Douglas, Lockheed, NA and the good old DH82 to start the ball rolling.
Cheers
Join Date: Feb 2002
Location: Sydney, Australia
Posts: 590
Likes: 0
Received 0 Likes
on
0 Posts
Imagine them whingeing on an International basis;
"You wont give us any slots into XXXXX but if you did we would fly there....OK?"
Robroy, the fact is that VB couldn't make the services pay to Canberra with good loadings - pure and simple.
Public servants only cater for a certain percentage of loadings to Canberra and believe it or not the families of Canberra residents keep the route alive in terms of patronage.
As someone said, if VB were to put on more suitable flights that would cater for the business traveller/public servant then that would help their cause.
Re -privatise QF Robroy?
Now there would be a great way for public servants to piss mega-bucks down a hole and improve competition !!
The fact is that VB's costs are escalating, the competition is getting harder and their share price is depressed with little industry/shareholder confidence otherwise.
Now is the time a truly skillful and gifted CEO earns his keep and not by using the old and worn out whinge factor about how they are being hard done by.
It reaks of amateurism the way they patronise the public by expecting them to believe every little thing they squeal about.
Stop bleating Huttner and Godfrey and start doing the jobs you're paid for, for Gods sake!!
"You wont give us any slots into XXXXX but if you did we would fly there....OK?"
Robroy, the fact is that VB couldn't make the services pay to Canberra with good loadings - pure and simple.
Public servants only cater for a certain percentage of loadings to Canberra and believe it or not the families of Canberra residents keep the route alive in terms of patronage.
As someone said, if VB were to put on more suitable flights that would cater for the business traveller/public servant then that would help their cause.
Re -privatise QF Robroy?
Now there would be a great way for public servants to piss mega-bucks down a hole and improve competition !!
The fact is that VB's costs are escalating, the competition is getting harder and their share price is depressed with little industry/shareholder confidence otherwise.
Now is the time a truly skillful and gifted CEO earns his keep and not by using the old and worn out whinge factor about how they are being hard done by.
It reaks of amateurism the way they patronise the public by expecting them to believe every little thing they squeal about.
Stop bleating Huttner and Godfrey and start doing the jobs you're paid for, for Gods sake!!
Join Date: Feb 2003
Location: Australia
Posts: 337
Likes: 0
Received 0 Likes
on
0 Posts
Today's 'Canberra Times' carries an article by David Seale, the short version of which is that Regional Express (REX) CEO Geoff Breust says his airline is having significant difficulty in attracting public service bookings despite offering a plethora of cheap seats.
The article goes on to say that REX started in Canberra with 11 return services to Sydney each day; it now has six and that if bookings don't pick up in the next two months, it will be forced to leave the market.
Although not stated, there would doubtless be job losses if REX left the Canberra market.
I've flown to and from Canberra via REX on several occasions. I found the schedule to be convenient, the aircraft clean, the service good and the staff friendly and efficient.
There's a suggestion that public servants prefer QANTAS because it offers QANTAS Club membership packages at discount rates in return for business loyalty. This conveniently ignores the fact that public service running costs are met from public funds. There's an obligation on public servants to spend taxpayers' funds economically and efficiently. Unfortunately, in the 'my rights and entitlements' mindset endemic in the public sector, economy and efficiency seem to be beyond the capacity of many public servants to comprehend.
Put another way, it simply beggars belief that senior public sector managers, most of whom have never been exposed to commercial risk, can condone more perks for 'fat cats' at the taxpayers' expense with scant regard for the jobs of fellow Australians.
I'm not normally a fan of management by direction. But in this case, it seems that a KITA needs to be administered to those in charge of public service travel to ensure that there's a fair go all round, including the taxpayer.
The article goes on to say that REX started in Canberra with 11 return services to Sydney each day; it now has six and that if bookings don't pick up in the next two months, it will be forced to leave the market.
Although not stated, there would doubtless be job losses if REX left the Canberra market.
I've flown to and from Canberra via REX on several occasions. I found the schedule to be convenient, the aircraft clean, the service good and the staff friendly and efficient.
There's a suggestion that public servants prefer QANTAS because it offers QANTAS Club membership packages at discount rates in return for business loyalty. This conveniently ignores the fact that public service running costs are met from public funds. There's an obligation on public servants to spend taxpayers' funds economically and efficiently. Unfortunately, in the 'my rights and entitlements' mindset endemic in the public sector, economy and efficiency seem to be beyond the capacity of many public servants to comprehend.
Put another way, it simply beggars belief that senior public sector managers, most of whom have never been exposed to commercial risk, can condone more perks for 'fat cats' at the taxpayers' expense with scant regard for the jobs of fellow Australians.
I'm not normally a fan of management by direction. But in this case, it seems that a KITA needs to be administered to those in charge of public service travel to ensure that there's a fair go all round, including the taxpayer.
Join Date: Jul 2000
Location: Aust
Posts: 114
Likes: 0
Received 0 Likes
on
0 Posts
Timee could you explain to us how VB's costs have escalated? If I wasn't mistaken, VB's $ASK actually dropped this year as announced to the stock market a few months ago. Its down below that of J* I believe.
Its been 4 years now and you guys are still Whinging about Godfreys Whinging. Its never gonna stop so GET OVER IT
Its been 4 years now and you guys are still Whinging about Godfreys Whinging. Its never gonna stop so GET OVER IT
Join Date: Apr 2002
Location: Done Under
Posts: 56
Likes: 0
Received 0 Likes
on
0 Posts
Its a problem when facts get in the way of a good whine isn't it.
Most if not all C'wealth agencies have an "outsourced" travel provider - AMEX Travel, Carlson Wagon-Lits etc - which was forced on them by the Government. In the bad old days they used to have one or two "Travel Clerks" doing the same thing, only cheaper.
These "providers" are tasked in ticketing travellers on the best fare of the day - simple as that. Doesn't matter which carrier. And very few of the travellers are in Business Class. And FF points which accrue to the traveller, not the ticket purchaser, are used where possible to travel thus saving the government money. Of course, we all know just how easy it is to redeem these points don't we. Oh, and that FF or Club membership - it comes out of the individual's pocket - only the very upper echelon get any perks like that.
The bottom line is that if Rex or Virgin have the best fare that day, they get the business.
Here's a classic example of "best fare" - try to travel SYD-SEL and you'll gat a quote from QF and OZ with a price differential of around $800 with OZ being the cheaper. Its a QF/OZ codeshare so whichever fare paid its the same aircraft. And QF complains that they don't get as much government business as they used before.
Most if not all C'wealth agencies have an "outsourced" travel provider - AMEX Travel, Carlson Wagon-Lits etc - which was forced on them by the Government. In the bad old days they used to have one or two "Travel Clerks" doing the same thing, only cheaper.
These "providers" are tasked in ticketing travellers on the best fare of the day - simple as that. Doesn't matter which carrier. And very few of the travellers are in Business Class. And FF points which accrue to the traveller, not the ticket purchaser, are used where possible to travel thus saving the government money. Of course, we all know just how easy it is to redeem these points don't we. Oh, and that FF or Club membership - it comes out of the individual's pocket - only the very upper echelon get any perks like that.
The bottom line is that if Rex or Virgin have the best fare that day, they get the business.
Here's a classic example of "best fare" - try to travel SYD-SEL and you'll gat a quote from QF and OZ with a price differential of around $800 with OZ being the cheaper. Its a QF/OZ codeshare so whichever fare paid its the same aircraft. And QF complains that they don't get as much government business as they used before.
Bugsmasha
Fuel prices would be a very large increase in DJ’s bottom-line and ASK’s because of their lack of any fuel hedge. Most carries in the region SQ, CX, QF, hedged fuel before it got really high but not DJ. This could be for a number of reasons. They didn’t think that they would get this high and/or remain this high for this long and/or the most likely reason is that their cash reserves are not yet sufficient enough (they have only been around 4 years) to hedge fuel on a meaningful scale.
Fuel prices would be a very large increase in DJ’s bottom-line and ASK’s because of their lack of any fuel hedge. Most carries in the region SQ, CX, QF, hedged fuel before it got really high but not DJ. This could be for a number of reasons. They didn’t think that they would get this high and/or remain this high for this long and/or the most likely reason is that their cash reserves are not yet sufficient enough (they have only been around 4 years) to hedge fuel on a meaningful scale.
Join Date: Feb 2003
Location: Australia
Posts: 337
Likes: 0
Received 0 Likes
on
0 Posts
DOME
Nice try. Unfortunately, you omitted to mention that Qantas too, has a vested interest in the bookings process. Through its subsidiary Qantas Business Travel, QF is, to use your words, also an "outsourced travel provider" to the Commonwealth.
The Canberra Times report I mentioned notes that Qantas Business Travel administers a domestic air travel contract with the Department of Defence, estimated to be worth around $150 million per year. The report also mentions that QF enjoys a similar contract with the Department of Transport and Regional Development. Nice work if you can get it - especially with guaranteed account payment from public funds.
But what really raises the eyebrow is the lack of transparency and arm’s lengthness in such an arrangement - a critical issue given jobs are on the line and that the whole operation is financed from the public purse.
What independent guarantee is there that QF Business Travel, when booking public service travel, doesn't exploit its glaring conflict of interest to the detriment of its competitors?
Its a problem when facts get in the way of a good whine isn't it.
The Canberra Times report I mentioned notes that Qantas Business Travel administers a domestic air travel contract with the Department of Defence, estimated to be worth around $150 million per year. The report also mentions that QF enjoys a similar contract with the Department of Transport and Regional Development. Nice work if you can get it - especially with guaranteed account payment from public funds.
But what really raises the eyebrow is the lack of transparency and arm’s lengthness in such an arrangement - a critical issue given jobs are on the line and that the whole operation is financed from the public purse.
What independent guarantee is there that QF Business Travel, when booking public service travel, doesn't exploit its glaring conflict of interest to the detriment of its competitors?
Join Date: Apr 2002
Location: Done Under
Posts: 56
Likes: 0
Received 0 Likes
on
0 Posts
Argus,
It might be appropriate to ask whether the QANTAS travel providers were contracted thru a tender process by the organisations which use them - I suspect so; and perhaps those organisations might be asked what their oversight provisions are.
If you are a C'wealth employee you would know that travel is very well overseen - much more so than for a politician for example - and the penny pinching forced on agencies usually means that travel budgets are first to go.
All that said and getting back to the point - if Virgin don't have a product, it won't sell.
On a personal note I booked a flight BNE and return yesterday - QF were A$3 (yes 3!) cheaper - and more importantly had better departure and arrival times.
It might be appropriate to ask whether the QANTAS travel providers were contracted thru a tender process by the organisations which use them - I suspect so; and perhaps those organisations might be asked what their oversight provisions are.
If you are a C'wealth employee you would know that travel is very well overseen - much more so than for a politician for example - and the penny pinching forced on agencies usually means that travel budgets are first to go.
All that said and getting back to the point - if Virgin don't have a product, it won't sell.
On a personal note I booked a flight BNE and return yesterday - QF were A$3 (yes 3!) cheaper - and more importantly had better departure and arrival times.