Australia, New Zealand & the Pacific Airline and RPT Rumours & News in Australia, enZed and the Pacific

Life without Qantas

Old 9th Feb 2005, 10:07
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Is Qantas Relevant?

There are those (and I am not one of them)who feel that Qantas actually restricts the growth of tourism into Australia.The minister for Qantas,John Anderson protects it,it is not innovative,it is not combative(except toward passengers,travel agents and employees)and it is definitely not competitive.The Qantas network is miniscule(and shrinking)and certainly does not service the needs of the Australian traveller.Qantas cargo is a farce....SIA derives 20% of its profit(not revenue)from cargo
Sure it provides employment for 36,000 Australians,not to mention ancilliary businesses...but there is a looming labour shortage.Aviation agreements would become irrelevant and market forces would reign supreme.
If Qantas folded its tent life would go on.For many it may even be better?
Perhaps this begs the question.....How relevant is Qantas?

Last edited by DEFCON4; 10th Feb 2005 at 13:17.
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Old 9th Feb 2005, 10:34
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Unhappy

QANTAS...QANTAS....QANTAS who??

Seriously though, Australians have been proud of their own airline, which has an enviable Safety recored.

Under Dixon's regime, QANTAS has - and does - continue to be severely diluted, apparently for one reason only, GOD's personal, financial gain.

I'd like to see QANTAS International taken back by the Australian Government - quite frankly, it is now the ONLY way I can see it surviving against the other monolithic, deep-pocketed, state funded airlines.

The JAL's, Singapores, Garuda's, Emirates, Air New Zealand's...are NEVER going to be allowed to fail, regardless of the competition.
QANTAS International needs to be placed on an equal footing, imo!
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Old 9th Feb 2005, 20:37
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Economic theory simply says that the "resources" all 36,000 of them will redeploy themselves in the longer term and make a bigger contribution to the economy than they did at Qantas.


I suspect the Qantas brand name is still valuable and I cannot help thinking that "someone" wants to drive its price down and take it off the current investors hands for a song, then polish it up and slip a new airline under it.

Furthermore, the "city pair" idea is very attractive to Melbournites and Brisbanites. Frequent direct services in smaller aircraft please.
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Old 9th Feb 2005, 21:14
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AH, Kapt M, the orical speaks.
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Old 9th Feb 2005, 22:20
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Could go on for days on this topic. Qantas will be fine for the time being. The brand name is worth a lot and the integration of international and domestic services is not provided by any other airline operating into Australia. However, the fun will be on when:
a) another international airline gets codeshare with VB or another domestic; and,
b) VB, or another domestic, operates useable domestic schedules to places like Darwin (as advised by a colleague).

IMO, when that happens, Qantas needs to target a customer group and focus a little less on trying to outdo every competitors' offerings with little regard to customer impressions. The company is chasing its own tail and trying to be everything to everyone. It's trying to compete and dominate with the LCCs, the luxury services and everything in between. It appears the managers figure they'll eventually find the right mix if they try everything while they continue to try and milk more out of the fixed overheads.

Like many others, I'm still trying to fathom the thought processes behind Jetstar. It's a squeezeplay on VB, QF employees and unions, but it is fraught with all sorts of issues, not least of which is competing against itself. Does it meet the needs and expectations of the customer? Will it take over from Qantas or be a chain around its legs? At this stage, I favour the latter of the two.

Last edited by Lodown; 9th Feb 2005 at 22:31.
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Old 9th Feb 2005, 23:22
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To quote a famous management tome called "Up the Organisation" (which is a seriously good read). the strategy of starting a low cost company to target your lower cost competitor, is called "pissing in the soup". It has the same effect, leaving a bad taste in everyone's mouth.

To be fair, QF has done everything it can to distance the J* product from its own to try and avoid cannibalisation. However it won't work, unless VB makes serious mistakes.

The QF mainline product is seen as expensive and bad value for money. J* is seen as cut price and inconvenient - again bad value for money, and VB is seen as being right in the middle - and good value for money - at least in this punters opinion.

Maybe J* should change their uniforms to match their customers? Addidas tracksuits, moccasins and fake tatoos.

Right on bruvvas!
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Old 11th Feb 2005, 05:16
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Self Destruction

It would appear that Qantas is being redundant by its own myopic management.Management that from all accounts think everthing is running smoothly.They obviously don`t get to hear about the dud IFE system,a/c breakdowns,delays,poor food,chronic understaffing.They are without doubt the most remote bunch that Qantas has ever had as governers.
Qantas is going to self destruct not with a bang but a whimper.Just as with AN Little Johnny won`t give a toss as 36,000 employees lose their jobs.He will no doubt inflict another levy on the travelling public just in case there is a shortfall in funds.
If this happens shouldn`t Dixon and his cronies return their bonuses for failing to meet KPIs.I won`t hold my breathe
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Old 11th Feb 2005, 06:57
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Maybe J* should change their uniforms to match their customers? Addidas tracksuits, moccasins and fake tatoos.
If that were the case the flighties at the other end of the terminal, would be wearing boardies, thongs, $5 T-shirts and belly rings!!

Cheers, HH.

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Old 11th Feb 2005, 07:16
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HH

Bring it on
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Old 11th Feb 2005, 09:52
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Mind if I inject a little bit of reality into this debate???

"Qantas yesterday announced a pre-tax profit of $964.6 million for the year ending June 30, 2004.

This result is a 92 per cent increase on last year’s result, and translates to a profit after tax of $648.4 million."


Yup. Qantas definitely appears to be going to the wall, fast!! With a $320 million tax dividend (not counting the millions of dollars in other taxes Qantas also pays), why would the Aussie Government have any interest in supporting Qantas?

Get real! This may be a rumour network, but a little reality and fact occasionally makes the Moderators job a whole lot less boring!

Woomera

Last edited by Woomera; 11th Feb 2005 at 10:19.
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Old 11th Feb 2005, 10:15
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I don't know if it's done for emphasis, but I am 'definately' tired of 'definitely' being incorrectly spelt on D&G. Methinks there may be some Qtendos, *tendos, or VB tendos masquerading as something else on this forum. I fought you lot were edumacated. Woomera, shape up or move on!!!!!!!!

Sorry, Woomera. Long frustrating day working with penisheads and needed to get my frustration out of the system.

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Old 11th Feb 2005, 10:43
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Quote

There is definitely no such word as definately
Sorry Woomera,I thought we were talking about the demise of the BRAND not its fiscal wellbeing.It is being (quote)cannibalised,euthanised and harvested.The Qantas Group will survive but the Brand "Qantas" as a longhaul carrier appears to have its days numbered.Sorry if I misunderstood.

Last edited by DEFCON4; 11th Feb 2005 at 10:59.
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Old 12th Feb 2005, 23:23
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Woomera, with great respect, the declared profit can be just about anything you want it to be. Telstra have been manipulating theirs for years.

It is simply a matter of the accounting treatment of costs. You can produce what you like. Its all in the assumptions. For example I would expect QF have a series of provisions for frequent flyer point usage, heavy maintenance expense, line maintenance, superannuation expense and so on as well as many "hollow logs" that can be mined for cash to make your figures look the way you want.

For example, you could make zero real profit and just revalue your assets by $900 million and voila! You have $900 million profit provided you can convince your auditors that the revaluation is genuine - and we know how often auditors get it wrong!

In fact when I used to be visited by the external Auditors at AN, I used to talk politely to them for about five minutes, then take them down the hall and through a door - onto the catwalk looking down on B727/B737 in maintenance and watch their jaws drop.. A quick walk through the hangar, a look in the cockpit of a 767, and they would then believe anything I told them.

There is simply no way of knowing without seeing the management accounts. The statutory and taxation accounts tell you very little although some ratio analysis might tell you a little.
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Old 13th Feb 2005, 01:23
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Sunfish, The provisions you raise, if omitted or reduced in balance sheet liabilities, will increase, not decrease pre tax profit.

Asset revaluation reserves require realistic justification and Board consent. Qantas 2002 net debt to capitalisation ratio was 63.4% and total capitalisation Aus$ 11.6 billion.

I suggest you read Moody's 2002 Financial Analysis of Qantas Airways Ltd.

With respect, we're talking a major Australian listed public company with Baa1 rating, 30,000 plus employees, 187 aircraft and 142 destinations in 32 countries, not some GA company........

By comparison, Ansett had two, then one only shareholder - and finally, a lot of unhappy creditors!

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Old 13th Feb 2005, 02:18
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Point of the Thread????

187 Aircraft.142 Destinations.32 Countries.
The majority of those aircraft are deployed domestically.(J*etc.)
The majority of those destinations are code share
The countries serviced directly by Qantas Mainline:
UK
Germany
South Africa
India
Singapore
Thailand
Hong Kong
China
Japan
New Zealand
USA
Manilla
Indonesia
13....... Not 32
The point of this thread I thought was the shrinking mainline operation.The shrinking international network.As a GROUP Qantas is thriving.But the mainline international business is shrinking......Why?
QF(mainline) is not competitive and complains about others who are.Why not just get of your backside Dixon and start by mixing it with the big boys.Use some of that Good Old Australian innovation we USED to be famous for.

Last edited by argusmoon; 13th Feb 2005 at 09:00.
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Old 13th Feb 2005, 10:04
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Woomera

I am certainly reluctant to attract the attention from one of your high standing, however given your last comment I am compelled to aske have you ever heard of Enron.

They managed to circulate and publish figures that were about as far from the truth as you could possibly get. Admittedly it may have been a crime, and I am not suggesting that the Qantas management is anything but legitimate.

I am just making the point that both analysts and accountants can be comprehensively fooled.

Additionally profits are last years news, not next years.

What's more, these profits have been driven to some extent by exactly what coral has suggested. Slashing and burning mainline to create streamlined alternatives. Remeber J* is the second attempt. AO was the first, and given the obvious success of the formula I would expect management to move further toward these models rather than away from them.

This means staff working harder for less. Which means renegotiated EBA's and a finite future for the lucrative jobs that Qantas employees currently enjoy. It won't happen over night but little by little it must happen.

I agree the Qantas name carries enormous brand collateral and will probably never be lost to the World Aviation Scene, but I also agree with other posters that the Qantas of 10 years hence will be but a shell of its current self. It simply has to be if it is to survive the onslaught of overseas carriers.

Given the recent debate about 3rd party access to the Pacific routes, I am guessing that there will be a limit as to how long Q can operate as a sheltered workshop with exclusive rights to the US, which helps create the illusion that Q mainline is able to compete against other carriers. Level playing field or not.


Cop U Later

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Old 13th Feb 2005, 14:12
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"Economic theory simply says that the "resources" all 36,000 of them will redeploy themselves in the longer term and make a bigger contribution to the economy than they did at Qantas."

This may be true, Sunfish. However,you can bet that those who are "redeployed" wont share in the benefits of being a more productive member of the economy. This is all part of the win-lose outcome that is sought by the current batch of capitalist pigs who run the Australian corporate economy; they win, workers lose.

Those who are retrenched make a bigger contribution to the economy by being more thoroughly exploited upon their eventual re-employment.


That is the nature of contempory capitalist ideoloy.
 
Old 13th Feb 2005, 19:51
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And the remedy is don't be a worker.

Get into management. Become head of AIPA...thats a good start.
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Old 13th Feb 2005, 21:09
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Woomera, you don't NOt make provisions in the accounts, you simply vary the amount you provide. And since a "provision" is by nature an amount retained against uncertain future events, the exact amount is for management to discuss.

For example, Telstra in the past hid most of its profits through massive depreciation charges.

Qantas could make its $900+ million profit disappear if it suited it. We have no way of knowing if the figure is reasonable and given the calibre of the Board, anything is possible.

As for QF being a large respected Australian Public Company, so was HIH!
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Old 14th Feb 2005, 05:49
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Conclusion?

The general consensus appears to be that Qantas Mainline has its days numbered.AO is looking at a 3 class operation with overseas bases,and current east west restrictions on its crews now on the negotiating table.This will further intrude on mainline.
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