Australian Domestic Market

[sthaussiepilot]

With the "financal crisis" domestic flights have apparantly declined...

I just herd on the news the goverment has ruled out any bailouts what so ever... Shouldnt the government offer to be helping our airlines out in the worst case scenario?
Not closing its doors before it has happened?

Or is this just the government cracking the whip to teach domestic airlines a tough lesson?

[DanArcher]

Maybe the airlines should start building cars...... then they would get a $130m 'grant' from the guvamint

[Wellhung Unit]

Shouldnt the government offer to be helping our airlines out in the worst case scenario?

No...Why Should They...

What about the local Pizza Shop..?..Petrol Station..?..Milk Bar..?..Brothel..?

It's called Business.......

[sthaussiepilot]

So your comparing the entire domestic airline market as a Pizza shop?

....wow...


They had been making such a big deal about tourism, "travel, travel, travel".. yet refuse to offer any kind of bailout should the worst happen...

Do we need a repeat of the Ansett collapse?

[Xeptu]

nah! there's too many small operators going to fall over in 2009. Where do you draw the line particularly in an industry which isnt going to make any difference anyway. The viable routes will be picked up by the more viable operators. Our Airline Industry, particularly in such a large country with such a small population is very vulnerable to market forces, in the boom times they pop up all over the place, in the doom times they fall over, can the taxpayer be expected to bail them out. I think not.

[framer]

Why on earth should they bail them out? If they can't survive they shouldn't be there. Thats how markets work isn't it? If there is demand another operator will fill the gap and if they are any good they will survive.
If we just bailed out a company (we as in tax payers), everytime there was a downturn and one went to the wall ,then companies would be extremely inefficient.Thirty years down the track we would run out of tax dollars to bail them out with and the country would be an economic wreck.
Framer

[argusmoon]

Which Airline Will Fail?

None of the majors...Virgin Qantas Jetstar.
Some of the secondary airlines may struggle.
My tax dollars should not be spent on bailing any airline out.
Rudd would be stupid to even consider it.Spend it on schools and health not on privately run and owned airlines

[Captain.Que]

Bailout?

Looks like someone has a financial interest in an airline that requires assistance.
Too bad......if you cant survive in the current market you shouldnt be in the current market

[Skystar320]

Hmmmmm car manufacture...... hmmmm car manfacture....

[Mr. Hat]

Or is this just the government cracking the whip to teach domestic airlines a tough lesson?

Well with thier tax/fees on everything aviation related and decreases in Air Services I'd say most airlines have been getting a "lesson" from the government day in day out for years now.

The taxes and levys increase the fares go down something will have to give one day (wages thats it!). As for bailouts I don't think its the way to go.

[waren9]

Airline owners/shareholders take the profits and dividends in the good times. They take the losses in the bad times.

Unless its in the national interest to keep something afloat tax dollars should not be used. National interest shouldnt be confused with protectionism either.

The example if the US propping up the outdated and inefficient product manufactured by their automotive industry is not the way forward for their economy in the longer term. And should not be followed.

Al Gore is right to query why the manufacturers were allowed to sue state legislators that sought to bring in efficiency requirements that would have required those makers to make cars 10 years from now as efficient as Japanese cars are now.

[framer]

The example if the US propping up the outdated and inefficient product manufactured by their automotive industry is not the way forward for their economy in the longer term. And should not be followed.

Spot on . Same applies here.

[always inverted]

With the US situation, you guys are forgetting that the cost to the country if those car makers went tits up would be far in excess to that spent on hte bail out and it would effect way more than just the immediate companies, whole towns would fold and the poverty would follow on.
It seems that the govt have accepted the bailout not to keep the manufacturers open as the primary issue, but the implications if they were to close...
Arent there alot of trems and conditions linked to it tho.
I agree that the gov should not prop up failing businesses but in the case of the US it was waranted. Australia is not by any stretch in the same boat as the US. The govt could always look to buy into the companies as they did here.
I think that if it was Qantas mainline then the Aust govt would probably look differently about keeping the national carrier flying tho.

[sthaussiepilot]

Any reason (aside from cost) why the government wont purchase a large stake (or controlling stake) in Qantas? or "too risky" for them?

I'm sure there are hundereds of reasons why not... but I'm sure theres a number of "fors" aswell

Sorry.. this has probably been done to death..

[Ka.Boom]

Done 2 Death

You are right it has
Qantas is not about to go belly up any time soon.
Its profit forecasts are still healthy and it has plenty of cash.
An enviable position

[sthaussiepilot]

I wasnt referring to "purchasing" Qantas for a debt/ bust reason..

I was more talking about "just having it there."

Other Governments have Airlines, cant really see why the Australian Govt. wouldnt want a piece of the Qantas "Cake".... being that is was and probably still is one of the top 5 Airlines in the world, if they were in a position to grab some I cant see why not?

but thats just me..

[Mach E Avelli]

Sthaussie, Governments definitely should not run airlines. If the Belgians, Italians, Swiss, Scandinavians etc couldn't do it successfully, then we should not.
It is not the taxpayers' responsibility to prop up unviable businesses.
It wouldn't matter if even the great Qantas went bust (which it won't) because there is always someone out there high on kerosene fumes who will step into the breach. When Ansett fell over Virgin just picked it up and ran. If Virgin were to fall over, Tiger would get bigger, Lion would arrive on the scene etc. Given our relatively small population, domestic Australia is well serviced, so if a company like say ******, Skywest, Rex or Ozjet (all of which are probably at some risk) went tits-up, the main people to suffer in the short term would be the employees. Short term because most would eventually find work with whoever else had the kerosene dream. In fact if all of the above folded simultaneously (unlikely) something would soon emerge from the ashes as some-one else keen to impress his secretary rushed out to borrow money to lease aeroplanes and step in. Or one of the stronger survivors would just get bigger overnight.
Creditors are the most affected by an airline failure, but in some ways anyone who extends too much credit to an airline - of all businesses - almost deserves to get dudded. Charles Darwin at work.....

[Mach E Avelli]

Interesting - when I typed the name of a certain regional operator of Saabs and ATRs, the auto-edit stuck in ****. WTFIGO?

[shadowoneau]

Governments definitely should not run airlines. If the Belgians, Italians, Swiss, Scandinavians etc couldn't do it successfully, then we should not.

Counterpoint: So if the Singaporians and UAE (Emirates) do it really successfully, we should do it?

I doubt the Minister for Qantas would allow a situation develop where Qantas would be in position to fail. Take f'instance the maintenance of the Aus<->US routes.

[Skystar320]

.....Emirates