Is QF sufficently diversified
Thread Starter
Join Date: Dec 2002
Location: Third Rock
Posts: 62
Likes: 0
Received 0 Likes
on
0 Posts
Is QF sufficently diversified
Recent media attention has been focused on the foiled terrorist attacks planned in London.
Thankfully nothing has eventuated, for that we all should be eternally grateful. The security services it has been stated have thwarted a number of attempts to use aircraft to attack the UK, including the Heathrow environment and financial districts.
Given the recent departure of QF from CDG, Qantas has but two remaining european ports.
1) EGLL LHR
2) EDDF Franfkfurt (7 per week)
Senior Visitors (management) in order to drive profits higher(hence their bonuses) have decreed "QF will not fly anywhere not profitable"
Investment 101 states, diversify your risk....
So these bean counters are ensuring that QF ignores this basic tenet in order to gain in the short term, one wonders how profitable the Kangaroo route will be into the future??
It still is heard around the halls, that QF should never have pulled out of San Francisco!
But i guess the profit wasnt evident to the bean counters and visitors who relied on bonuses rather than longevity of tenure for prosperity...
I hope I'm wrong
Thankfully nothing has eventuated, for that we all should be eternally grateful. The security services it has been stated have thwarted a number of attempts to use aircraft to attack the UK, including the Heathrow environment and financial districts.
Given the recent departure of QF from CDG, Qantas has but two remaining european ports.
1) EGLL LHR
2) EDDF Franfkfurt (7 per week)
Senior Visitors (management) in order to drive profits higher(hence their bonuses) have decreed "QF will not fly anywhere not profitable"
Investment 101 states, diversify your risk....
So these bean counters are ensuring that QF ignores this basic tenet in order to gain in the short term, one wonders how profitable the Kangaroo route will be into the future??
It still is heard around the halls, that QF should never have pulled out of San Francisco!
But i guess the profit wasnt evident to the bean counters and visitors who relied on bonuses rather than longevity of tenure for prosperity...
I hope I'm wrong
Nunc est bibendum
Technically QF still has a presence in both Paris and Rome. I think we've even upped the frequency to daily code share services now. Of course, nothing beats flying your own aircraft in there and I reckon that we'll see the time when QF returns to both those ports in our own right. It won't happen until we solve a shortage of capacity though. At the moment the capacity is deployed to where it will get the best return. Unfortunately, Paris and Rome ain't it! 
Join Date: Sep 2004
Location: QCC3
Posts: 33
Likes: 0
Received 0 Likes
on
0 Posts
SJ has got a point though Keg.
Our mainline network is now smaller than at any other time during the 19yrs I have been in the company.
15% of QF profits come from just one route - Syd-LA. What happens if EK or SQ get open skies ?
Hubbing everything though SIN also increases our vulnerability.
I realise you are generally 'pro' management, but even you have to acknowledge that with the ongoing segmentation of the group, the mainline operation is looking more & more like a legacy that the board has neither the time or the interest to develop
Our mainline network is now smaller than at any other time during the 19yrs I have been in the company.
15% of QF profits come from just one route - Syd-LA. What happens if EK or SQ get open skies ?
Hubbing everything though SIN also increases our vulnerability.
I realise you are generally 'pro' management, but even you have to acknowledge that with the ongoing segmentation of the group, the mainline operation is looking more & more like a legacy that the board has neither the time or the interest to develop
Nunc est bibendum
I realise you are generally 'pro' management...
What I AM pro though is for a strong and propserous company. It's the only way I can safe guard my future. If that means putting aircraft on better performing routes whilst scouring the world for capcity (at the right price) then so be it. I certainly can't argue with SJs logic on the broad thrust of their point. We certainly don't safeguard the future by code sharing our way around the world. I just reckon that part of the reason for the current lack of diversification is a lack of capacity. Given that an increase in capacity increases the opportunity for all QF drivers to earn more (except maybe the 744 skippers), I'm all for both increased diversification and returning to some of the routes that we've left. What I'd really love to see is us starting to developing some new routes with 777s, A330s or so on. Vienna? Amsterdam? Athens? Chicago? Dallas? There are a truck load more out there!
Join Date: Sep 2004
Location: Gold Coast
Posts: 37
Likes: 0
Received 0 Likes
on
0 Posts
Future of 747 ?
Was chatting with some colleagues about the future of long-haul the other day and one interesting point of view was raised:
Is there a future for the 747 at QF?
Surely this is years down the track, but with the introduction of the A380 (once the numbers of a/c get up there) it will probably be going to most places the jumbo goes now (LHR,LAX,JFK - routes where higher capacity is needed). If an aircraft such as the 777 or A340 were introduced -- would there be a need for the 747 in the fleet?
It is great for high capacity sectors, but not so good for those sectors that we cant fill it (eg PER-JNB, SIN-CDG etc). A smaller aircraft with a similar range could cover most of the routes the jumbo goes to, those routes that wouldnt require the capacity of the A380. If the A380 takes the highest capacity flying, will the jumbo be too big to remain profitable on more marginal routes?
Any thoughts? Could we be more profitable after the introduction of the A380 by replacing the 747 with a smaller aircraft? Could we go from once being an 'all jumbo fleet' to one without any?
Is there a future for the 747 at QF?
Surely this is years down the track, but with the introduction of the A380 (once the numbers of a/c get up there) it will probably be going to most places the jumbo goes now (LHR,LAX,JFK - routes where higher capacity is needed). If an aircraft such as the 777 or A340 were introduced -- would there be a need for the 747 in the fleet?
It is great for high capacity sectors, but not so good for those sectors that we cant fill it (eg PER-JNB, SIN-CDG etc). A smaller aircraft with a similar range could cover most of the routes the jumbo goes to, those routes that wouldnt require the capacity of the A380. If the A380 takes the highest capacity flying, will the jumbo be too big to remain profitable on more marginal routes?
Any thoughts? Could we be more profitable after the introduction of the A380 by replacing the 747 with a smaller aircraft? Could we go from once being an 'all jumbo fleet' to one without any?
Join Date: Sep 2004
Location: QCC3
Posts: 33
Likes: 0
Received 0 Likes
on
0 Posts
Very profitable.
Funny thing is, in the late '80's / early 90's we were told that we were "losing so much money on this route that we are thinking of ceasing flights to LHR".
The point on san-fran is well made also.
Freight from FAAA-KLAX. We were killing it when that was being flown by the combi. Handed it all over (not code share) to a french mob called corsair. Met some of their pilots at the beachcomber 7-8 years ago and they were pissing themselves laughing at how much money they were making on the route.
And thats at french rates of pay, which with respect, are much higher than the staff of QF are on.
Keg, not to get personal, but having read most of your posts on both forums, I cant remember the last time you said something critical of QF mgt. Though to be fair to you, they do know who you are.
Funny thing is, in the late '80's / early 90's we were told that we were "losing so much money on this route that we are thinking of ceasing flights to LHR".
The point on san-fran is well made also.
Freight from FAAA-KLAX. We were killing it when that was being flown by the combi. Handed it all over (not code share) to a french mob called corsair. Met some of their pilots at the beachcomber 7-8 years ago and they were pissing themselves laughing at how much money they were making on the route.
And thats at french rates of pay, which with respect, are much higher than the staff of QF are on.
Keg, not to get personal, but having read most of your posts on both forums, I cant remember the last time you said something critical of QF mgt. Though to be fair to you, they do know who you are.
Thread Starter
Join Date: Dec 2002
Location: Third Rock
Posts: 62
Likes: 0
Received 0 Likes
on
0 Posts
Thats' my point
The current management philosophy is devoid of any forward thinking..As Keg alluded to in a later post, he would like to see some development of other routes.
That is my point exactly. QF is increasing vulnerable to "geograhical shocks" as we focus our flights through LHR and LAX...But in the short term the visitors who will parachute out to thier next "exciting accounting assignment" reap bonuses for the short term bonanza.
Also worth considering is a current rumour doing the rounds that there is a LCC international being considered, mainline becomes increasingly isolated..
...As Geoffrey(Dixon) puts it in media announcement after media announcement "QF is facing increasing competition in our region" Forget the likes of SQ or EK we are being decimated by the likes of AO, J*, J* Asia, Jeet Connect... Mainline shrinks whilst getting loaded with cost from fully owned yet soooo independent subsidiary companies, great way to bring in a low cost model without a Transfer of business case ever being considered.....
Yes the diversification is there, there just isnt sufficient diversity for those in the mainline group
And we pay these "visitors" to take the company in to the future, including all of those whose financial and career longevity is tied to the mainline group. By the time these decisions come home to roost the senior management group will be visiting "thier next exciting adventure" counting beans at another australian icon
That is my point exactly. QF is increasing vulnerable to "geograhical shocks" as we focus our flights through LHR and LAX...But in the short term the visitors who will parachute out to thier next "exciting accounting assignment" reap bonuses for the short term bonanza.
Also worth considering is a current rumour doing the rounds that there is a LCC international being considered, mainline becomes increasingly isolated..
...As Geoffrey(Dixon) puts it in media announcement after media announcement "QF is facing increasing competition in our region" Forget the likes of SQ or EK we are being decimated by the likes of AO, J*, J* Asia, Jeet Connect... Mainline shrinks whilst getting loaded with cost from fully owned yet soooo independent subsidiary companies, great way to bring in a low cost model without a Transfer of business case ever being considered.....
Yes the diversification is there, there just isnt sufficient diversity for those in the mainline group
And we pay these "visitors" to take the company in to the future, including all of those whose financial and career longevity is tied to the mainline group. By the time these decisions come home to roost the senior management group will be visiting "thier next exciting adventure" counting beans at another australian icon
As a member of the great unwashed travelling public, I have a little secret to share with you. Qantas management is merely rearranging the deckchairs on the Titanic.
Qantas is totally vulnerable everywhere for two reasons.
1) The Qantas brand has been continuously devalued for decades.
2) Qantas is a plaything of the Sydney push.
The result of this is that Qantas's monopoly position is seen as an impediment to growth and investment by every state government except NSW. If a foriegn company ever makes a takeoever bid, everyone except Bob Carr will cheer when the little fax from the FIRB comes around. As a traveller, I am sick of not being able to get into and out of my country WITHOUT the obligatory three hour wait on f&*^%$#$ Sydney.
I've said before that this was a conspiracy (at least in the 1970's) and I am quite prepared to make a statutory declaration about what I heard and saw when I pushed for Ansett to get into the business of doing B747 TFC's and line maintenance at Melbourne.
Qantas used to differentiate itself from other international airlines on the basis of superior "australian style" cabin service and a reputation for safety. This meant that Australians were proud of "our" airline and we tolerated outrageously high airfares to some extent for this reason. Sadly, today the Qantas brand is tarnished. Code sharing sends a message that your standards are the same as anyone else's, in other words you are not differentiated anymore. Give me Emirates any day, in fact give me ANYONE but Qantas.
So where is Qantas now? Providing the same old product to customers that everyone else is. Running into economy of scale competition problems because its product is no longer differentiated. Its traditional customers are gradually realising that there are better and cheaper airlines than Qantas, so the old Qantas monopoly is starting to rankle a bit. Did you hear that guys? There are other airlines that provide BETTER VALUE than Qantas.
Eventually Qantas is going to crumble under the weight of continuous bad and Sydney centric management decisions designed to prop up its monopoly position instead of focussing on providing a superior travelling experience for its customers.
If you want to change this, get a REAL Board of Directors. Get rid of the Sydney centric policies and start operating as if you were a National airline instead of a United wannabee.
Its really very very simple - stop f$%#@$#whinging and get managment and all staff focussing on how you would run your business if you did NOT have a god given f$%#@#$# monopoly!
Qantas is totally vulnerable everywhere for two reasons.
1) The Qantas brand has been continuously devalued for decades.
2) Qantas is a plaything of the Sydney push.
The result of this is that Qantas's monopoly position is seen as an impediment to growth and investment by every state government except NSW. If a foriegn company ever makes a takeoever bid, everyone except Bob Carr will cheer when the little fax from the FIRB comes around. As a traveller, I am sick of not being able to get into and out of my country WITHOUT the obligatory three hour wait on f&*^%$#$ Sydney.
I've said before that this was a conspiracy (at least in the 1970's) and I am quite prepared to make a statutory declaration about what I heard and saw when I pushed for Ansett to get into the business of doing B747 TFC's and line maintenance at Melbourne.
Qantas used to differentiate itself from other international airlines on the basis of superior "australian style" cabin service and a reputation for safety. This meant that Australians were proud of "our" airline and we tolerated outrageously high airfares to some extent for this reason. Sadly, today the Qantas brand is tarnished. Code sharing sends a message that your standards are the same as anyone else's, in other words you are not differentiated anymore. Give me Emirates any day, in fact give me ANYONE but Qantas.
So where is Qantas now? Providing the same old product to customers that everyone else is. Running into economy of scale competition problems because its product is no longer differentiated. Its traditional customers are gradually realising that there are better and cheaper airlines than Qantas, so the old Qantas monopoly is starting to rankle a bit. Did you hear that guys? There are other airlines that provide BETTER VALUE than Qantas.
Eventually Qantas is going to crumble under the weight of continuous bad and Sydney centric management decisions designed to prop up its monopoly position instead of focussing on providing a superior travelling experience for its customers.
If you want to change this, get a REAL Board of Directors. Get rid of the Sydney centric policies and start operating as if you were a National airline instead of a United wannabee.
Its really very very simple - stop f$%#@$#whinging and get managment and all staff focussing on how you would run your business if you did NOT have a god given f$%#@#$# monopoly!
Join Date: Dec 2004
Location: Australia
Posts: 112
Likes: 0
Received 0 Likes
on
0 Posts
Answer is No.
The route network is not a priority.
Management Strategy at present is to post profits by cutting costs and decaying working conditions. This is much easier. The Airline is in safe hands, seen the latest addition to the board!!!!
The route network is not a priority.
Management Strategy at present is to post profits by cutting costs and decaying working conditions. This is much easier. The Airline is in safe hands, seen the latest addition to the board!!!!
Join Date: Jan 2001
Location: NSW Australia
Posts: 233
Likes: 0
Received 0 Likes
on
0 Posts
Sunfish,
If you're talking to QF staff - WE KNOW!! I am sure that every staff member says this up the chain every chance they get. Management JUST DON'T CARE!! Somewhere in the ivory tower is a big sign with a big $$$ symbol on it that they all bow down to. Makes for a better bonus at the end of each year.
If the staff morale goes down the toilet and the product suffers, then THEY JUST DON'T CARE!!! Roll on this year's bonus.
If you're talking to QF staff - WE KNOW!! I am sure that every staff member says this up the chain every chance they get. Management JUST DON'T CARE!! Somewhere in the ivory tower is a big sign with a big $$$ symbol on it that they all bow down to. Makes for a better bonus at the end of each year.
If the staff morale goes down the toilet and the product suffers, then THEY JUST DON'T CARE!!! Roll on this year's bonus.
Apparently there's this excellent long range twin around called the A330 or something like that... Word has it that it can fly 250 pax non-stop into all sorts of European destinations from an Asian hub.
The fact that QF has only 2 European destinations is nothing short of pathetic compared with the likes of Emirates and Singapore's 20+.
They have the means to compete against EK and SQ but prefer to put the tools which can do it on short domestic hops instead.
The bottom line won't look nearly so rosy when QF's two routes (LAX & LHR) face even more competition in the future.
The fact that QF has only 2 European destinations is nothing short of pathetic compared with the likes of Emirates and Singapore's 20+.
They have the means to compete against EK and SQ but prefer to put the tools which can do it on short domestic hops instead.
The bottom line won't look nearly so rosy when QF's two routes (LAX & LHR) face even more competition in the future.
Join Date: Dec 2004
Location: rocky
Posts: 4
Likes: 0
Received 0 Likes
on
0 Posts
"Met some of their pilots at the beachcomber 7-8 years ago and they were pissing themselves laughing at how much money they were making on the route."
So I take it that you are know the details about corsair's cost structure compared to qantas's.
"And thats at french rates of pay, which with respect, are much higher than the staff of QF are on"
Are you suggesting that the tech crew salary difference is what makes or breaks the deal?
So I take it that you are know the details about corsair's cost structure compared to qantas's.
"And thats at french rates of pay, which with respect, are much higher than the staff of QF are on"
Are you suggesting that the tech crew salary difference is what makes or breaks the deal?
Thread Starter
Join Date: Dec 2002
Location: Third Rock
Posts: 62
Likes: 0
Received 0 Likes
on
0 Posts
as i said
As i stated in the orginal post
The company is not diversified at least the mainline operation isn't. We are indeed facing increased competition, much of it the result of own operations taking routes from the "legacy" mainline.
One way to avoid the battle over a transmission of business is by drying up the opportunities by handing them to these so called independent yet wholly owned subsidiaries..The key is to do it slowly.
Wikth mainline smaller, not diversified it becomes a great way to lower the over all cost base.
"Oh Mr S/O, FA etc you want a promotion? FO slot going at Jetstar Asia- the money is less, move yourself there and endorse yourself...."
Sunfish thanks for your input on an airline that dsoesnt exist anymore, we are sorry about it but telling us what we already know doesnt help..You couldn't save AN,we depsite the company literature mentioning outr status of repsonsible officers-we cant do a damn thing either.
Ultimately i would love to see a corporate culture where these so called leaders are held accountable for the errors..The sad thing as I said at the outset is by the time these problems come home to roost the visitors have slinked themselves into another bonus driven job, the employees are left to try andfpick up the pieces and wait for their entitlements, if the company manages to survive...
The company is not diversified at least the mainline operation isn't. We are indeed facing increased competition, much of it the result of own operations taking routes from the "legacy" mainline.
One way to avoid the battle over a transmission of business is by drying up the opportunities by handing them to these so called independent yet wholly owned subsidiaries..The key is to do it slowly.
Wikth mainline smaller, not diversified it becomes a great way to lower the over all cost base.
"Oh Mr S/O, FA etc you want a promotion? FO slot going at Jetstar Asia- the money is less, move yourself there and endorse yourself...."
Sunfish thanks for your input on an airline that dsoesnt exist anymore, we are sorry about it but telling us what we already know doesnt help..You couldn't save AN,we depsite the company literature mentioning outr status of repsonsible officers-we cant do a damn thing either.
Ultimately i would love to see a corporate culture where these so called leaders are held accountable for the errors..The sad thing as I said at the outset is by the time these problems come home to roost the visitors have slinked themselves into another bonus driven job, the employees are left to try andfpick up the pieces and wait for their entitlements, if the company manages to survive...
Join Date: Apr 2003
Location: Where people don't care
Posts: 210
Likes: 0
Received 0 Likes
on
0 Posts
Too right it is! How may other airlines in the modern world have cannibilised its own business in order to set up a variety of so-called independent subsidiaries? Are there any that have been sucessful and thrived.
Qantas management has found it easier to squander millions of dollars setting up these lesser companies rather than fix the problems afflicting the core airline and allow it to grow and prosper as what is undoubtedly one of the world's best known and highly respected brands.
Rather than take some initial hard knocks and consolidate so that everyone has a win, it is easier to 'divide and rule'. A good example of this philsophy is the recent duspute with the cabin crew. Management has had lord knows how many years to 'straighten out' the cabin crew but it's just too hard for them and easier to set up off-shore bases at great cost. With sensible and patient negotiation with the various unions, there would not be any need for JQ and AO. How may airlines have its crew unions (pilots and cabin attendants) industrially divided into several work groups with totally different terms and conditions and work rules? Qantas has had 10+ years since merger with TN to rectify this but nothing has happened. A great shame and opportunity lost.
The same applies to market and route development. How many times have Qantas been in and out of China, for example? Would it not have been a better investment to have stayed, incurred some operating losses in order to cement one's place in the market rather than to spend literally millions closing down and then starting up again a couple of years later? Look at the mess that's been made of the Taiwan route? Muck around with equipment and freuency, and then hand it to AO with a Cairns operation when the Tiwan market is in the south of the country. SARS comes along and Taiwan is now dead so far as an Australian presence is concerned. . We could go on - South America is another example. At great cost, Qantas was in and out but Lan Chile and Aerolineas are now operating the route 6 or 7 times a week. Perhaps they are charities?
Yes, Qantas is too diversified with a management focussed solely on a short term agenda. It used to be obsessed with Ansett. Now that it has gone, it thinks no further than the next truckload of money in the form of a bonus. From the Board down.
Qantas management has found it easier to squander millions of dollars setting up these lesser companies rather than fix the problems afflicting the core airline and allow it to grow and prosper as what is undoubtedly one of the world's best known and highly respected brands.
Rather than take some initial hard knocks and consolidate so that everyone has a win, it is easier to 'divide and rule'. A good example of this philsophy is the recent duspute with the cabin crew. Management has had lord knows how many years to 'straighten out' the cabin crew but it's just too hard for them and easier to set up off-shore bases at great cost. With sensible and patient negotiation with the various unions, there would not be any need for JQ and AO. How may airlines have its crew unions (pilots and cabin attendants) industrially divided into several work groups with totally different terms and conditions and work rules? Qantas has had 10+ years since merger with TN to rectify this but nothing has happened. A great shame and opportunity lost.
The same applies to market and route development. How many times have Qantas been in and out of China, for example? Would it not have been a better investment to have stayed, incurred some operating losses in order to cement one's place in the market rather than to spend literally millions closing down and then starting up again a couple of years later? Look at the mess that's been made of the Taiwan route? Muck around with equipment and freuency, and then hand it to AO with a Cairns operation when the Tiwan market is in the south of the country. SARS comes along and Taiwan is now dead so far as an Australian presence is concerned. . We could go on - South America is another example. At great cost, Qantas was in and out but Lan Chile and Aerolineas are now operating the route 6 or 7 times a week. Perhaps they are charities?
Yes, Qantas is too diversified with a management focussed solely on a short term agenda. It used to be obsessed with Ansett. Now that it has gone, it thinks no further than the next truckload of money in the form of a bonus. From the Board down.
