Jetstar Australia time in the sun expires
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All for what ?
Lower costs and break the employee culture that made Qantas what it once was.
Lower costs and break the employee culture that made Qantas what it once was.
From an outsiders perspective and from people in the employment market that I speak to now QF does not even rate a mention. Once seen as the holy grail now as packrat put it it seen as "second tier" and irrelevant.
Everyone knows that the growth will now be in JQ VB and Tiger. Very sad indeed.
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But what happens to those airlines you just mentioned Mr Hat when Qantas management's tactics succeed and Qantas staff are at LCC terms and conditions? What advantage will the original LCC's have then?
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There is no doubt that the Kangaroo’s Head Shed know that it is Senior Counsel’s view that Jetstar International is a breach of the Qantas Sale Act and suspect Qantas is making vigorous efforts to procure an amendment to it.
How the Government is reacting won’t be known until the aviation white paper is released late this year.
Nevertheless, if it is not clarified as Qantas would like, continuing to grow Jetstar at the expense of Qantas may well turn out to be the folly that eventually replaces continuing obsession with tightening conditions, costs and remuneration with a new strategy to reduce aircraft leasing costs by 40%.
Expect 2010 will be a very ‘exciting’ year in many, many respects.
How the Government is reacting won’t be known until the aviation white paper is released late this year.
Nevertheless, if it is not clarified as Qantas would like, continuing to grow Jetstar at the expense of Qantas may well turn out to be the folly that eventually replaces continuing obsession with tightening conditions, costs and remuneration with a new strategy to reduce aircraft leasing costs by 40%.
Expect 2010 will be a very ‘exciting’ year in many, many respects.
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blown , this is what you get: Mike's Blog #1: 'Pilots on Food Stamps' | MichaelMoore.com
From a thread in the GA section.
From a thread in the GA section.
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Future tickets will read
MEL-LAX JQ93 *(OPERATED BY QANTAS AIRWAYS LIMITED)
*Jetstar flights to the USA are operated using subsidiary airline Qantas Airways Limited A380 aircraft in a 650 seat configuration
MEL-LAX JQ93 *(OPERATED BY QANTAS AIRWAYS LIMITED)
*Jetstar flights to the USA are operated using subsidiary airline Qantas Airways Limited A380 aircraft in a 650 seat configuration
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.....'the' book is already at final ed stage
from the cover artwork:
from the cover artwork:
"WHO PULLED THE WINGS OFF THE FLYING KANGAROO"
[author's name] jumps the Q with an insider's view
of the demise of an Aussie Icon.
of the demise of an Aussie Icon.
from the synopsis I briefly saw I think there's more than a few that will squirm - not just those at the Exec level either !
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"But what happens to those airlines you just mentioned Mr Hat when Qantas management's tactics succeed and Qantas staff are at LCC terms and conditions?"
They start cutting costs again to maintain the comparative advantage. Wages will go even lower. Take a look at how Virgin America and Jetblue have undercut the traditional low cost carriers. Its started again.
"What advantage will the original LCC's have then"
Lower overheads. Less complexity. Ability to change within the market place.
LCC's are here to stay. In the future, there will be no HCC's.
They start cutting costs again to maintain the comparative advantage. Wages will go even lower. Take a look at how Virgin America and Jetblue have undercut the traditional low cost carriers. Its started again.
"What advantage will the original LCC's have then"
Lower overheads. Less complexity. Ability to change within the market place.
LCC's are here to stay. In the future, there will be no HCC's.
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LCC's are here to stay. In the future, there will be no HCC's.
There will always be people who have money and are not only willing to spend it but will demand full service....
Thread Starter
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The amazing part of this rubbish is that the aren't any such thing as low cost carriers or high cost carriers, it is all management BS. It is really a LOWER WAGE carrier. Ponder if you will,
Aircraft costs- Fixed
Navigation Charges- Fixed on route
Fuel Charges- Fixed
Ground handling Mostly fixed
The list goes on, the aircraft carry roughly the same passengers. These airlines may stimulate demand (at the margin) However the very passengers who are enticed to fly at $50 are incredibly price sensitive. (elastic) The real variable we are playing with is crewing costs and they actually aren't that much different. The irony is Dixon succeeded at something; He convinced people there is no need to pay a premium to fly.Price expectations of the travelling public for flights are now lower than catching a bus to Sydney. How that increases future profitability is beyond me.
At least "management" can reinvent the wheel and look spectacularly busy whilst they flounder with the real business of "running"an airline. At least the consultants are busy...I doubt Joyce could boil an egg without consultants.
So just how much is the crewing cost differential? Me thinks that there are plenty of ways to ensure the J* Australia pilots are "competitive". Just move the flying offshore....Sadly the time in the sun has expired for you chaps(ettes) at J*. How you tackle it is up to you, but with a former BCG consultant "running" J* who has sufficient knowledge of aviation to fill the back of a postage stamp it may prove an interesting battle...
Funny that all the executives at Q love swanning around in P class, whilst espousing the virtues of so called low cost.........
Aircraft costs- Fixed
Navigation Charges- Fixed on route
Fuel Charges- Fixed
Ground handling Mostly fixed
The list goes on, the aircraft carry roughly the same passengers. These airlines may stimulate demand (at the margin) However the very passengers who are enticed to fly at $50 are incredibly price sensitive. (elastic) The real variable we are playing with is crewing costs and they actually aren't that much different. The irony is Dixon succeeded at something; He convinced people there is no need to pay a premium to fly.Price expectations of the travelling public for flights are now lower than catching a bus to Sydney. How that increases future profitability is beyond me.
At least "management" can reinvent the wheel and look spectacularly busy whilst they flounder with the real business of "running"an airline. At least the consultants are busy...I doubt Joyce could boil an egg without consultants.
So just how much is the crewing cost differential? Me thinks that there are plenty of ways to ensure the J* Australia pilots are "competitive". Just move the flying offshore....Sadly the time in the sun has expired for you chaps(ettes) at J*. How you tackle it is up to you, but with a former BCG consultant "running" J* who has sufficient knowledge of aviation to fill the back of a postage stamp it may prove an interesting battle...
Funny that all the executives at Q love swanning around in P class, whilst espousing the virtues of so called low cost.........
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The other part of the rubbish is that if you check the fares they are not cheaper if you are booking a flight at the last minute....
On top of that is that a number of Legacy carriers have holiday packages that are basically the same price as those so called LCC's...and you don't have to pay for a pillow or a cup of tea let alone a meal....
On top of that is that a number of Legacy carriers have holiday packages that are basically the same price as those so called LCC's...and you don't have to pay for a pillow or a cup of tea let alone a meal....
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QF Insider
You could add:
• Single seat layout all economy getting more punters per flight
• Higher crew productivity ( and very simple training pipeline) due single type
• Simplified work rules allowing higher overall labour productivity
• Shorter turn times and much higher aircraft utilization
• Many fewer layers of management
• Handling innovations such as the power push back with a single person
• “B” scale labour rules without union interference
• Use of second-tier airports
• Simple web based distribution channels
• “User pays” focus for services and add-ons
• Ability to access the “parents” resources at marginal rather than average cost
• “Can do” attitudes at all levels allowing routes and initiatives to open and close without months of planning
Much of this is not without pain or predatory behaviour by overly zealous management ideologues and it may or not be sustainable in the longer term. It is not for every passenger and nor should it be.
But….these are the things that make LCCs work….and as you know very well it is a great thing for the Qantas Group that it has Jetstar inside the tent pissing out rather than outside the tent pissing in (to paraphrase LBJ).
And Lowerlobe...it has been and always will be true that big legacy carriers canoffer specials at the lowest market rate. Look at the fares QF has been sellling to fill the 380 to LAX recently. They do not meet the long run average cost of providing the service but they cover the marginal cost and that, for a very perishable commodity...is fine. Don't confuse that with the economics of LCCs though.
Hope this helps our collective understanding of a difficult issue. I didn't invent the LCC concept....I don't even always support it and often feel ill at some less lovely parts of what I see....but it's a fact of life and Qantas has at least its own LCC rather than just being beset by them.
You could add:
• Single seat layout all economy getting more punters per flight
• Higher crew productivity ( and very simple training pipeline) due single type
• Simplified work rules allowing higher overall labour productivity
• Shorter turn times and much higher aircraft utilization
• Many fewer layers of management
• Handling innovations such as the power push back with a single person
• “B” scale labour rules without union interference
• Use of second-tier airports
• Simple web based distribution channels
• “User pays” focus for services and add-ons
• Ability to access the “parents” resources at marginal rather than average cost
• “Can do” attitudes at all levels allowing routes and initiatives to open and close without months of planning
Much of this is not without pain or predatory behaviour by overly zealous management ideologues and it may or not be sustainable in the longer term. It is not for every passenger and nor should it be.
But….these are the things that make LCCs work….and as you know very well it is a great thing for the Qantas Group that it has Jetstar inside the tent pissing out rather than outside the tent pissing in (to paraphrase LBJ).
- If Qantas had tried to carry the 32 million Jetstar passengers at its long run average cost it would have slowly gone broke.
- If Qantas hadn’t carried those passengers but VB and Tiger had….it would have been a holocaust, not just a bankruptcy.
And Lowerlobe...it has been and always will be true that big legacy carriers canoffer specials at the lowest market rate. Look at the fares QF has been sellling to fill the 380 to LAX recently. They do not meet the long run average cost of providing the service but they cover the marginal cost and that, for a very perishable commodity...is fine. Don't confuse that with the economics of LCCs though.
Hope this helps our collective understanding of a difficult issue. I didn't invent the LCC concept....I don't even always support it and often feel ill at some less lovely parts of what I see....but it's a fact of life and Qantas has at least its own LCC rather than just being beset by them.
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Much of this is not without pain or predatory behaviour by overly zealous management ideologues and it may or not be sustainable in the longer term.
....I don't even always support it and often feel ill at some less lovely parts of what I see....but it's a fact of life and Qantas has at least its own LCC rather than just being beset by them.
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However "Brother" the tent is still segmented and one side is not allowed to enter the other!
Imagine how different all this would be if Management had worked with staff rather than against them!
Imagine how different all this would be if Management had worked with staff rather than against them!
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Lowerlobe,
I don’t think you understand my point.
“There will always be people who have money and are not only willing to spend it but will demand full service....”
This is true however nowhere in my post did I suggest that full service would become a thing of the past. You are assuming that a lowering cost base implies a reduction in service level.
I don’t think you understand my point.
“There will always be people who have money and are not only willing to spend it but will demand full service....”
This is true however nowhere in my post did I suggest that full service would become a thing of the past. You are assuming that a lowering cost base implies a reduction in service level.
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nowhere in my post did I suggest that full service would become a thing of the past.
LCC's are here to stay. In the future, there will be no HCC's.
You are assuming that a lowering cost base implies a reduction in service level.
Cutting costs in a legacy airline is a different matter to a LCC....You are talking apples and oranges
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Why companies fail 
"The poor performance or even bankruptcy of companies is caused by the failure of employees to work more for less in order to compensate for the mismanagement of the executives."
Not my quote but I like it!
"The poor performance or even bankruptcy of companies is caused by the failure of employees to work more for less in order to compensate for the mismanagement of the executives."
Not my quote but I like it!
Last edited by bonvol; 14th Oct 2009 at 10:34.