Jetstar v Virgin Blue...I hate to say it, but I told you so...
Thread Starter
Join Date: Dec 1999
Location: Adelaide, South Australia, Australia
Posts: 44
Likes: 0
Received 0 Likes
on
0 Posts
Jetstar v Virgin Blue...I hate to say it, but I told you so...
Here is a copy of my post dated 25th Feb 2004. Virgin Blue are stuck in the middle. QF are doing a sandwich job on them and they really don't know who they should satisfy.
The A320's, and all of the cost benefits contained therein, have only just started arriving. Is this the top of a long downward spiral for DJ?
"Folks, this is all very interesting, particularly the negative replies on this post.
Not long ago I read an article on the results of a study in Europe regarding the low cost phenomenon and secondary airports. It showed that passengers were prepared to drive up to an EXTRA 90 minutes to a secondary airport if the airfares were lower than that at the primary airport. The interesting thing was that fares didn't need to be much lower - the extra cost of driving didn't seem to be a factor. Its about as logical as on time departures being more important than on time arrivals, but in the end people thought only about the airfare and not the extra time or cost in getting to and from the airport!
In Melbourne it takes about 25 minutes to Tulla from the CBD. Avalon takes about 50 - ie only 25 minutes extra. The extra cost of petrol is negligible and it is true there are savings on tolls (you still need to go through the domain tunnel to get to Avalon from the southeast, but there are more tolls to Tulla), but I don't think either of these is relevant. As per the European experience, if the price of the ticket is less the result will be similar. The fact that the demographic centre of Melbourne is to the southeast won't be relevant.
IMHO, Jetstar will kill em. Plenty of people will wear the extra 25 minutes travel and fly from Avalon in search of a cheaper fare. These are the same bread and butter price sensitive battler who is prepared to accept a lesser level of service, inflight entertainment and no catering on Virgin. The extra travel to Avalon will be just another inconvenience that translates into more savings. In Europe they will soon be without headrests, seat pockets, checked luggage and window shades! All this will strike a savage blow right at the they heart of Virgin Blue. They will be caught in no-mans land because if they try to go to Avalon to protect their traditional heartland they will leave themselves exposed at Tulla as any reduction in services could possibly alienate their growing business clientele. So who do they try and satisfy - the battler or the businessman? As Godfrey said during the attempted re-launch of Ansett, with low cost carriers the brand is price as they offer nothing else, so rarely can two carriers survive in this sector flying similar networks. They were his words, not mine, and they may come back to haunt him because if he's correct, then only one of Jetstar or Virgin can survive. As I said, his words, not mine....
PS...am not employed by either Virgin or Impulse, nor have I been rejected by either. No axe to grind, just calling it as I see it.
[Last edited by Flying Tiger on 25th February 2004 at 08:44]"
The A320's, and all of the cost benefits contained therein, have only just started arriving. Is this the top of a long downward spiral for DJ?
"Folks, this is all very interesting, particularly the negative replies on this post.
Not long ago I read an article on the results of a study in Europe regarding the low cost phenomenon and secondary airports. It showed that passengers were prepared to drive up to an EXTRA 90 minutes to a secondary airport if the airfares were lower than that at the primary airport. The interesting thing was that fares didn't need to be much lower - the extra cost of driving didn't seem to be a factor. Its about as logical as on time departures being more important than on time arrivals, but in the end people thought only about the airfare and not the extra time or cost in getting to and from the airport!
In Melbourne it takes about 25 minutes to Tulla from the CBD. Avalon takes about 50 - ie only 25 minutes extra. The extra cost of petrol is negligible and it is true there are savings on tolls (you still need to go through the domain tunnel to get to Avalon from the southeast, but there are more tolls to Tulla), but I don't think either of these is relevant. As per the European experience, if the price of the ticket is less the result will be similar. The fact that the demographic centre of Melbourne is to the southeast won't be relevant.
IMHO, Jetstar will kill em. Plenty of people will wear the extra 25 minutes travel and fly from Avalon in search of a cheaper fare. These are the same bread and butter price sensitive battler who is prepared to accept a lesser level of service, inflight entertainment and no catering on Virgin. The extra travel to Avalon will be just another inconvenience that translates into more savings. In Europe they will soon be without headrests, seat pockets, checked luggage and window shades! All this will strike a savage blow right at the they heart of Virgin Blue. They will be caught in no-mans land because if they try to go to Avalon to protect their traditional heartland they will leave themselves exposed at Tulla as any reduction in services could possibly alienate their growing business clientele. So who do they try and satisfy - the battler or the businessman? As Godfrey said during the attempted re-launch of Ansett, with low cost carriers the brand is price as they offer nothing else, so rarely can two carriers survive in this sector flying similar networks. They were his words, not mine, and they may come back to haunt him because if he's correct, then only one of Jetstar or Virgin can survive. As I said, his words, not mine....
PS...am not employed by either Virgin or Impulse, nor have I been rejected by either. No axe to grind, just calling it as I see it.
[Last edited by Flying Tiger on 25th February 2004 at 08:44]"
Join Date: Jan 2001
Location: BN
Posts: 60
Likes: 0
Received 0 Likes
on
0 Posts
You don't sound biased at all...
Your only talking one airport , can't see it making that much difference. Perhaps you should be after Huttner's job?
Hate to see you front up to Trump with that construction
Your FIRED!!!
Oh by the way, have you travelled to Europe???
The roads are far superior to ours, thus a more efficient means of transport compared to our marvellous superhighways!
You seem to be putting too much weight on your left leg with this one.
Your only talking one airport , can't see it making that much difference. Perhaps you should be after Huttner's job?
Hate to see you front up to Trump with that construction
Your FIRED!!!
Oh by the way, have you travelled to Europe???
The roads are far superior to ours, thus a more efficient means of transport compared to our marvellous superhighways!
You seem to be putting too much weight on your left leg with this one.
Join Date: Aug 2003
Location: Oz
Posts: 3
Likes: 0
Received 0 Likes
on
0 Posts
You sound a little biased yourself there, Jerry. I'm neither J* or VB, so I'm possibly a little more objective here, and it certainly does seem to me that VB are a little stuck in no mans land.
I've no doubt that they offer a good product, but who do they really specifically cater to? Personally, they should open up a semi-business class IMHO.
I've no doubt that they offer a good product, but who do they really specifically cater to? Personally, they should open up a semi-business class IMHO.
Join Date: Jun 2001
Location: Qld,Aust
Posts: 52
Likes: 0
Received 0 Likes
on
0 Posts
This is more of a presonal preference, however after a recent return trip YBMk - YBBN- YBMK one way on J* the other on virgin, I have to say that i would prefer Virgin, hands down. Virgin dosent seem as bujet as J* I think the punters will eventualy decide.
Join Date: May 2000
Location: Oz -Sometimes
Posts: 182
Likes: 0
Received 0 Likes
on
0 Posts
Who wants to fly on a EFIS DC-9 with no working ovens? How scummy can you get!
DJ will finish them off when "GOD" (aka Dickson) works out theres no profit; just like Rod did when BA tried it with GB Airlines. Legacy carriers have never made a parallel LCC work. As usual Dumb Aussie's are the last man on the team to know. J* will be about as profitable as the A330 stuff up.
DJ will finish them off when "GOD" (aka Dickson) works out theres no profit; just like Rod did when BA tried it with GB Airlines. Legacy carriers have never made a parallel LCC work. As usual Dumb Aussie's are the last man on the team to know. J* will be about as profitable as the A330 stuff up.
Join Date: Jan 2001
Location: BN
Posts: 60
Likes: 0
Received 0 Likes
on
0 Posts
Cactus,
A few things if you would.
Whether you think I'm biased or not , it does not matter.
Can you list the factual points leading to your statement of VB being in "No mans land" I'd be keen to obtain a clearer view.
As you don't work at VB list your references that draws a logical conclusion to your opinion.
Just gotta love these industry experts...
A few things if you would.
Whether you think I'm biased or not , it does not matter.
Can you list the factual points leading to your statement of VB being in "No mans land" I'd be keen to obtain a clearer view.
As you don't work at VB list your references that draws a logical conclusion to your opinion.
Just gotta love these industry experts...
Join Date: Nov 2003
Location: Australia
Posts: 73
Likes: 0
Received 0 Likes
on
0 Posts
Who wants to fly on a EFIS DC-9 with no working ovens?
As for;
DJ will finish them off when "GOD" (aka Dickson) works out theres no profit;
Fact 1: DJ's profits are down and consequently so to the share price. Some analysts have set a target price of $1.40!!!!
Fact 2: Jetstar is actually turning a profit (at the expense of the employees perhaps)
Don Quixote Impersonator
Join Date: Jul 1999
Location: Australia
Age: 77
Posts: 3,403
Likes: 0
Received 0 Likes
on
0 Posts
LetsGoRated
I can still remember being seriously impressed with the homesick angel type performance on my first DC-9 pax journey in the old TAA days and and was recently reaquainted with the quieter BMW/Rolls version and it was just as much fun and with EFIS yet.
Horses for courses a great Donald Douglas product.
VB v Jetstar, ? we live in interesting times.
Now about Pan Am.
Flying Tiger
Well thought out and a dillema for both eh>
I can still remember being seriously impressed with the homesick angel type performance on my first DC-9 pax journey in the old TAA days and and was recently reaquainted with the quieter BMW/Rolls version and it was just as much fun and with EFIS yet.
Horses for courses a great Donald Douglas product.
VB v Jetstar, ? we live in interesting times.
Now about Pan Am.
Flying Tiger
Well thought out and a dillema for both eh>
Join Date: Aug 2003
Location: Oz
Posts: 3
Likes: 0
Received 0 Likes
on
0 Posts
Lets not get too sexed up about all this, Jerrry. It's a rumour network, after all. I'm not going to drag up a list of references, because, frankly, I just don't care that much.
But using your logic, you should be able to list certain references which clearly indicate that VB isn't in 'No Man's Land'. Now I don't expect you to do that, because after all is said and done on PPrune, it's just opinions.
So there's mine. And yours appears to be the opposite. Now rather than just tell me (and others) that I'm wrong, tell me why. No references allowed!
It's a rumour network, after all. I'm not going to drag up a list of references, because, frankly, I just don't care that much.But using your logic, you should be able to list certain references which clearly indicate that VB isn't in 'No Man's Land'. Now I don't expect you to do that, because after all is said and done on PPrune, it's just opinions.
So there's mine. And yours appears to be the opposite. Now rather than just tell me (and others) that I'm wrong, tell me why. No references allowed!
Join Date: May 2004
Location: Newcastle
Posts: 12
Likes: 0
Received 0 Likes
on
0 Posts
BankAngle50
I think your missing the suttle differences between BA's attempt at a LLC and Jetstar. GO was competing directly with BA on alot of routes for market share, thus eating into their higher yielding parents traffic.
Whereas Jetstar is doing one of two things:
Operating on routes where they don't compete with the mother company.
Or where they both operate out of the same port you will generally find Jetstar is deliberately not timed for the business traveller, so as they only attract the lower yielding tshirt and thong brigade, a good example of this is operations out of Newcastle airport.
This explains why Jetstar doesn't serve the following:
SYD-BRIS
SYD-TULLA
Alot of the routes that Jetstar has taken on and Qantas pulled out of or all but would have been marginal if any profits for Qantas, so Jetstar with their lower cost base should pay dividends for them.
Cheers
I think your missing the suttle differences between BA's attempt at a LLC and Jetstar. GO was competing directly with BA on alot of routes for market share, thus eating into their higher yielding parents traffic.
Whereas Jetstar is doing one of two things:
Operating on routes where they don't compete with the mother company.
Or where they both operate out of the same port you will generally find Jetstar is deliberately not timed for the business traveller, so as they only attract the lower yielding tshirt and thong brigade, a good example of this is operations out of Newcastle airport.
This explains why Jetstar doesn't serve the following:
SYD-BRIS
SYD-TULLA
Alot of the routes that Jetstar has taken on and Qantas pulled out of or all but would have been marginal if any profits for Qantas, so Jetstar with their lower cost base should pay dividends for them.
Cheers
Join Date: Jul 2002
Location: The dark corner of the bar
Posts: 351
Likes: 0
Received 0 Likes
on
0 Posts
The 717 really is a great machine to fly. Much like the 9 but with a bit more kick. Douglas does make a good performing product. Its a shame that boeing didnt see it.
Lets go rated, dont forget to take your luch box.
DM
Lets go rated, dont forget to take your luch box.
DM
BankAngle50
'Never' is one of those great words in the english language. Whenever anyone uses it, someone proves them wrong.
quote: "Legacy carriers have never made a parallel LCC work. As usual Dumb Aussie's are the last man on the team to know"
How disappointing that you are such a pessimist!
'Never' is one of those great words in the english language. Whenever anyone uses it, someone proves them wrong.
quote: "Legacy carriers have never made a parallel LCC work. As usual Dumb Aussie's are the last man on the team to know"
How disappointing that you are such a pessimist!
Join Date: Dec 2002
Location: Perth
Age: 41
Posts: 82
Likes: 0
Received 0 Likes
on
0 Posts
Lets remember that the majority of the JQ network are routes that QF sourced out to QFLink operators (predominantly Impulse).
The way I see it, QF have refined there model to make the price/seat even cheaper than it was before, thus generating more business.
This is hardly a parallel LCC, but just a more refined version of what was already in place. Not to mention, a new brand name.
Interesting to note, regarding Avalon, it is cheaper to get the skybus to Avalon than it is to get the skybus to Tulla. Furthermore the parking at Avalon is 50% the price of Tulla, quite a considerable saving.
The way I see it, QF have refined there model to make the price/seat even cheaper than it was before, thus generating more business.
This is hardly a parallel LCC, but just a more refined version of what was already in place. Not to mention, a new brand name.
Interesting to note, regarding Avalon, it is cheaper to get the skybus to Avalon than it is to get the skybus to Tulla. Furthermore the parking at Avalon is 50% the price of Tulla, quite a considerable saving.
