stop fifth freedom rights?
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As mentioned by Halas, the ditch flights started because of idle frames sitting in Oz and because Kiwi exporters could put their stuff on a jet in AKL and have it reloaded once to reach the rest of the world. For produce that was a huge incentive to use EK freight and it has paid ever since. Of the low load factor, more than enough stay on and continue beyond Oz. EK is not competing with just across the ditch, those pax get an experience and when they save up enough of their Oz provided welfare they will more than likely spend it on EK. Good commercial business.
Gobbledock are you saying QF paid its managers incentives and bonuses to the tune of USD500m, as that's close to what EK paid the government... I would be pretty confident in saying EKs Managment incentive and bonus plan would trump QFs in a heart beat. For a muslim country there are alot of pigs at the trough. Wish I was one......
Gobbledock are you saying QF paid its managers incentives and bonuses to the tune of USD500m, as that's close to what EK paid the government... I would be pretty confident in saying EKs Managment incentive and bonus plan would trump QFs in a heart beat. For a muslim country there are alot of pigs at the trough. Wish I was one......
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I also disagree with the accusation that Emirates receives free funding.
Emirates launches $1 bln 5-year bond
Wed Jun 1, 2011 11:47am EDT
Emirates launched a five-year $1 billion bond in an upsized offering at the lower end of its initial price guidance.
The company said the bond launched at 330 basis points over midswaps, as reported earlier by Reuters, with a coupon of 5.125 percent.
Final price guidance for the bond had been in the range of 330 basis points to 337.5 bp over midswaps and carried a reoffer price of 99.904.
The deal was increased to $1 billion on strong demand. Reuters earlier reported that the airline was planning to raise $750 million from the sale.
Wed Jun 1, 2011 11:47am EDT
Emirates launched a five-year $1 billion bond in an upsized offering at the lower end of its initial price guidance.
The company said the bond launched at 330 basis points over midswaps, as reported earlier by Reuters, with a coupon of 5.125 percent.
Final price guidance for the bond had been in the range of 330 basis points to 337.5 bp over midswaps and carried a reoffer price of 99.904.
The deal was increased to $1 billion on strong demand. Reuters earlier reported that the airline was planning to raise $750 million from the sale.
It's about freight and parking
I remember reading about this when the EK 777s first came on the trans-tasman run.
It said that the main incentive was to increase utilisation and avoid Sydney parking charges. Because most of the QF / NZ flights are now 737, there is no useful cargo capacity, so a widebody was very welcome indeed to the freight forwarders. As I remember, it said that all these factors made a 25% load factor very nicely profitable, thank you.
It said that the main incentive was to increase utilisation and avoid Sydney parking charges. Because most of the QF / NZ flights are now 737, there is no useful cargo capacity, so a widebody was very welcome indeed to the freight forwarders. As I remember, it said that all these factors made a 25% load factor very nicely profitable, thank you.
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Yarra,
Reply to earlier post.
DXB may have open skies but 5th freedom requires a third country to sign up to the Air Service Agreement (ASA).
So SYD-DXB-CDG requires the French to sign up to the deal.
Not much luck over many years in getting the French to sign up to anything worthwhile!
Current ASA with France limits Aussie carriers to a total seat count limit per week, not enough to sustain a daily service from Aus except with a B787. 5 year delay in delivery has stuffed that.
France is only one example of negotiatiing 5th freedom from an end point carrier point of view.
Have a look at the Australian ASA issues from HKG to LHR. 50% of load must be Australian origin for QF. No such limit on BA operating 3rd and 4th freedom on that sector.
Regards
Reply to earlier post.
DXB may have open skies but 5th freedom requires a third country to sign up to the Air Service Agreement (ASA).
So SYD-DXB-CDG requires the French to sign up to the deal.
Not much luck over many years in getting the French to sign up to anything worthwhile!
Current ASA with France limits Aussie carriers to a total seat count limit per week, not enough to sustain a daily service from Aus except with a B787. 5 year delay in delivery has stuffed that.
France is only one example of negotiatiing 5th freedom from an end point carrier point of view.
Have a look at the Australian ASA issues from HKG to LHR. 50% of load must be Australian origin for QF. No such limit on BA operating 3rd and 4th freedom on that sector.
Regards
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Kiwi Grey makes a valid point.
A few years ago, either Flanagan or Clark (can't recall which) was asked why EK didn't run single-aisles on Gulf short-hauls. He replied that they made so much money on the freight that they'd happily run 777s empty (ie. no SLF) to Bahrain (for example) & back; in fact fewer punters = more space available for freight.
Re the broader argument, I recall back in the Hawke era, when the Button car plan was unveiled, the received wisdom was that Australia had to embrace free trade because, as a country, it could not afford to subsidise ad-infinitum as, for example, Europe does via the Common Agricultural Policy; as a small economy, we had no choice but to trade, but we could not preach free trade, if we did not ourselves practice it. So down came many barriers.
Funny thing is, 25 years on and the free trade we espoused, seems only to have let Johnny Foreigner in with the result that he's now helping himself to the family jewels...
A few years ago, either Flanagan or Clark (can't recall which) was asked why EK didn't run single-aisles on Gulf short-hauls. He replied that they made so much money on the freight that they'd happily run 777s empty (ie. no SLF) to Bahrain (for example) & back; in fact fewer punters = more space available for freight.
Re the broader argument, I recall back in the Hawke era, when the Button car plan was unveiled, the received wisdom was that Australia had to embrace free trade because, as a country, it could not afford to subsidise ad-infinitum as, for example, Europe does via the Common Agricultural Policy; as a small economy, we had no choice but to trade, but we could not preach free trade, if we did not ourselves practice it. So down came many barriers.
Funny thing is, 25 years on and the free trade we espoused, seems only to have let Johnny Foreigner in with the result that he's now helping himself to the family jewels...
Halas, further to
gee, QF might decide to drop Dallas next 
AA takeover could see American-less OneWorld
AA takeover could see American-less OneWorld - Airline News - etravelblackboardasia.com
On another issue is the alliance QF belongs to. I have said it before, alliances are good for the leading member and no-one else
AA takeover could see American-less OneWorld
The OneWorld global airline alliance could find itself without a representative U.S. carrier if a takeover bid by Delta Air Lines for beleaguered American Airlines (AA) were to eventuate and be successful.
According to media reports, Delta, which is a member of SkyTeam, is amongst the potential buyers assessing bids for AA’s parent company, AMR Corporation, which also include private equity firm, TPG Capital and US Airways Group.
“Clearly it would be quite negative for all the OneWorld alliance carriers because you’d assume American would be converted to SkyTeam, leaving Oneworld without a U.S. representative airline,” Macquarie analyst Russell Shaw told Deal Journal in Australia, whose flag carrier Qantas is a founding member of the alliance.
Similarly, a successful bid for AA by US Airways could see American Airlines converted to the world’s largest alliance, Star Alliance, of which US Airways is a member carrier.
Meanwhile, AA has announced that it will be ending flights between Dallas and Burbank, CA on February 9, as well as flights between Chicago and New Delhi on March 1, leaving American Airlines without a presence on the Indian subcontinent.
In addition to closing operations at Burbank and New Delhi airports, AA said it would be separately cutting a further 150 jobs in February.
American Airlines and AMR Corporation, which filed for Chapter 11 protection on November 29, said the changes weren’t related to its bankruptcy but rather in response to market pressures to become more efficient.
According to media reports, Delta, which is a member of SkyTeam, is amongst the potential buyers assessing bids for AA’s parent company, AMR Corporation, which also include private equity firm, TPG Capital and US Airways Group.
“Clearly it would be quite negative for all the OneWorld alliance carriers because you’d assume American would be converted to SkyTeam, leaving Oneworld without a U.S. representative airline,” Macquarie analyst Russell Shaw told Deal Journal in Australia, whose flag carrier Qantas is a founding member of the alliance.
Similarly, a successful bid for AA by US Airways could see American Airlines converted to the world’s largest alliance, Star Alliance, of which US Airways is a member carrier.
Meanwhile, AA has announced that it will be ending flights between Dallas and Burbank, CA on February 9, as well as flights between Chicago and New Delhi on March 1, leaving American Airlines without a presence on the Indian subcontinent.
In addition to closing operations at Burbank and New Delhi airports, AA said it would be separately cutting a further 150 jobs in February.
American Airlines and AMR Corporation, which filed for Chapter 11 protection on November 29, said the changes weren’t related to its bankruptcy but rather in response to market pressures to become more efficient.
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What Vorsicht said - thumbs up.
I have read that Australia needs its automotive industry to support the military industry. Neither is big enough to stand on its own in terms of providing support and income for high technology and highly skilled engineers and designers. Think economies of scale and all that.
Subsidies to keep a home-grown automotive industry, according to the reporter whose name I long ago forgot, are actually a form of indirect support to having a decent military capability.
Look to NZ to see what happens to the military ten years after you give up all heavy industrial capability...
I have read that Australia needs its automotive industry to support the military industry. Neither is big enough to stand on its own in terms of providing support and income for high technology and highly skilled engineers and designers. Think economies of scale and all that.
Subsidies to keep a home-grown automotive industry, according to the reporter whose name I long ago forgot, are actually a form of indirect support to having a decent military capability.
Look to NZ to see what happens to the military ten years after you give up all heavy industrial capability...
This whole subject of capacity dumping into Australia needs taking up with our federal Government and opposition parties. It needs to become a burning political issue for them. Australia has gone too far in allowing foreign interests to control our estate and industry. Foreigners can buy our companies, real estate, farms and markets. They can also stipulate that their own companies get the bulk of work related to investment projects in Australia. All this is a way of enriching a minority and burdening the mainstream Australian public with higher prices and less enterprise. This doubles up as lower wages and higher costs reduce the bulk of local enterprise and assets. More people need welfare and support and the cycle gains more and more momentum as incomes and job numbers decline. We need governments that will resist selling 'the farm' for quick and expedient results. In recent times the pilots have found support in the parliament from Senator Nick Xenophon and outside the parliament (on this particular issue) from Dick Smith. I urge all pilots, engineers and airline workers to lobby not only the two people mentioned, but all politicians to address the frittering away of jobs, engineering and wealth by the continual undermining of the local Australian Aviation industry. Competition and looting are two entirely different things. Almost everything can be done more cheaply from overseas by low taxing, low wages competitors. However the advantages they enjoy in operating to Australia should be tempered by the size of the active flying market they can provide in return. Unlimited capacity dumped on the Australian market will not advance any Australian carreers or industry. Talking about the subject can only help if it is followed up with communication with our politicians and business leaders.
Interesting.
"Protectionism comes at the expense of tourism and trade. If you own a hotel in Toronto, do you really care who the guest flew in with?"
Read more: Australia key to Emirates' overall strategy | News.com.au
EMIRATES has grown enormously in Australia as our national flag carrier has struggled to keep its passengers.
At the same time, the foreign airline has a Down Under flavour.
Richard Vaughan, Emirates divisional senior vice-president (commercial), has gained much of his professional experience in Australia.
He is among a coterie of Australians now using their experience in senior roles at Emirates and its regional competitor, Etihad.
Mr Vaughan is a regular visitor home, sometimes seeing friends and family but more often doing business - and making contacts as a genial host of events sponsored by the airline.
From its Melbourne Cup sponsorship to the backing of Collingwood, the Australian Open golf and state symphonies, the airline has spent up big and ensconced itself in Australian life.
Welsh-born Mr Vaughan emigrated here 30 years ago and built up a travel company in Perth, Consolidated Wholesalers.
He was approached by Emirates after he sold out of the business "and it seemed quite a good fit". "In all facets of our business we have Australians working in important roles," he says. "Emirates has 3600 Aussies in Dubai in a variety of disciplines -- pilots, cabin crew, engineers, sales and marketing."
In Australia, the airline has its own catering operation, owns the Hudsons Coffee chain and the luxury Wolgan Valley resort in the Blue Mountains.
"Australia is extremely important to Emirates. It is now our third biggest market, and an important trade and tourism destination with the United Arab Emirates becoming an increasingly important partner," he says.
Since starting with three weekly flights to Melbourne in 1996, Emirates now flies 70 services weekly and has about 11 per cent of the Australian market.
A keen supporter of Australia's "open skies" policy, Mr Vaughan takes a swipe at the protectionism of German and Canadian regulators restricting Emirates' landing rights.
"Protectionism comes at the expense of tourism and trade. If you own a hotel in Toronto, do you really care who the guest flew in with?" he asks. "We've had a good relationship with various Australian governments since 1996. We've not pushed too hard to get more than necessary in regard to traffic rights and we've been treated fairly."
Emirates has consistently spoken officially about access to Adelaide, but Mr Vaughan said he was satisfied with existing cities for at least two years.
"Australia's been good to us, but we've been good for Australia too," he says.
Emirates flights are generally 80 per cent full, and the airline will not be harmed by the introduction of the Airbus A380 service to Melbourne later this year.
A keen rugby man, Mr Vaughan tackles head-on industry suggestions that Emirates leverages the wealth of its Dubai Government owner to gain a commercial advantage.
He points out the airline buys its aviation fuel from Singapore at the same market rates as everyone else, plus pays full landing charges at its Dubai base.
"We give value for money but that doesn't mean discount crazy. As a company we are expected to be profitable," he says. Emirates made a record net profit of $1.5 billion last year.
"In Australia, we're not in this business to undercut what Qantas are doing. Our strength is the number of points we fly to - and our competitors don't."
Emirates serves more than 110 cities, including 29 in Europe. It has the priceless natural advantage of being based within eight hours' flying time of three quarters of the world's population. This will hold it in good stead with the expected rise of Chinese carriers in coming years.
Partly to combat the threat of Emirates, Qantas and Virgin Australia have based future strategy on alliance networks -- Qantas with British Airways, American Airlines and Malaysia.
"To us, alliances are anti-competitive," Mr Vaughan says. "They can get grips on certain markets and in the end the consumers suffers.
"Alliances are like having 10 wives or husbands - if you have to make a business decision you're hindered by the number of people affected by it. When we make a decision, it's our decision and what's good for us is good for our customers."
