QANTAS - WHERE TO NOW?
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In this case, your enemy's enemy will not be your friend. Singo may get some excited with his anti AJ rhetoric but be fearful if that consortium is making its move.
He and Dixon are circling for the kill. The last thing I want for QANTAS is these grubs getting their hands on the company and then using it for their own financial benefit.
Get rid of the current board, and replace them with people (preferably QANTAS people) who have an idea about the airline and how to run it properly.
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With EK essentially calling the shots for most of the east bound QF sectors, would not be surprised if QF is used on markets that EK has used all their allotted traffic rights. Doubt it would be a market like YYZ but similar to that... Germany, France ...
Its increasingly obvious what the Dixon/Singleton plan for Qantas was - put an incompetent idiot in charge (Joyce) drive the share price into the ground and buy the airline for a song.
After purchase, get rid of Joyce and do exactly what Singleton just told you he would do: trade on Australias fondndess for the Qantas brand, cut the guts out of the bloated Qantas management, by killing Jetstar (which has exactly zero brand value) and folding all the elements of "The group" back into one airline - thereby getting rid of the duplication, or triplication inherent in multiple layers of group general managers, and of course use Qantas superb lobbying capabilities to knobble overseas competitors.
What Singleton has just realised is that Emirates has beaten them to the punch. His only chance now is to lobby the Government to kill the deal.
Let me tell you what happens next, Singleton already knows, to put it bluntly - Emirates will "Partner" Qantas to death, I've seen it done, so has Singo:
Comparisons are odious according to the old saying, but that is what is going to happen.
Joyce hinted the the deal goes beyond code share - and it does. You are going to see a great deal of people from Emirates "consulting" to Qantas, you are also going to see various Qantas managers "learning" from Emirates. To put that another way, no door in Qantas will be closed to Emirates - not one.
If Clarke gets his way, I wouldn't be surprised if he is offered a seat on the Qantas Board, perhaps with a quid pro quo to Clifford.
What will then happen is that Emirates develops an in depth understanding of the strengths and weaknesses of Qantas, Qantas will also develop an extremely painful understanding of just how dysfunctional its management has been and just how unpleasant its future is likely to become if it ever tries to detach itself from Emirates. In my experience, this will take a year to Eighteen months.
At some point there will be a heart to heart secret talk by the chairmen of both companies about the matters referred to above, followed by Board meetings, followed by the absorbtion of Qantas into Emirates after suitable lobbying to Government. It would be easy to do, with credit markets now dysfunctional with no prospect of improvement (the ratings agencies just downgraded Qantas by the way) the Arabs might like to make an "investment" in Qantas in return for a rather large share issue, thus solving Qantas need for capital for a better fleet. I'm sure such action could be easily sold to the public.
Qantas management will have no idea what is happening until its too late. They will have been suitably blinded by the prospect of secondments to Emirates. Some may even think there are permanent management jobs available there.
After purchase, get rid of Joyce and do exactly what Singleton just told you he would do: trade on Australias fondndess for the Qantas brand, cut the guts out of the bloated Qantas management, by killing Jetstar (which has exactly zero brand value) and folding all the elements of "The group" back into one airline - thereby getting rid of the duplication, or triplication inherent in multiple layers of group general managers, and of course use Qantas superb lobbying capabilities to knobble overseas competitors.
What Singleton has just realised is that Emirates has beaten them to the punch. His only chance now is to lobby the Government to kill the deal.
Let me tell you what happens next, Singleton already knows, to put it bluntly - Emirates will "Partner" Qantas to death, I've seen it done, so has Singo:
Comparisons are odious according to the old saying, but that is what is going to happen.
Joyce hinted the the deal goes beyond code share - and it does. You are going to see a great deal of people from Emirates "consulting" to Qantas, you are also going to see various Qantas managers "learning" from Emirates. To put that another way, no door in Qantas will be closed to Emirates - not one.
If Clarke gets his way, I wouldn't be surprised if he is offered a seat on the Qantas Board, perhaps with a quid pro quo to Clifford.
What will then happen is that Emirates develops an in depth understanding of the strengths and weaknesses of Qantas, Qantas will also develop an extremely painful understanding of just how dysfunctional its management has been and just how unpleasant its future is likely to become if it ever tries to detach itself from Emirates. In my experience, this will take a year to Eighteen months.
At some point there will be a heart to heart secret talk by the chairmen of both companies about the matters referred to above, followed by Board meetings, followed by the absorbtion of Qantas into Emirates after suitable lobbying to Government. It would be easy to do, with credit markets now dysfunctional with no prospect of improvement (the ratings agencies just downgraded Qantas by the way) the Arabs might like to make an "investment" in Qantas in return for a rather large share issue, thus solving Qantas need for capital for a better fleet. I'm sure such action could be easily sold to the public.
Qantas management will have no idea what is happening until its too late. They will have been suitably blinded by the prospect of secondments to Emirates. Some may even think there are permanent management jobs available there.
Last edited by Sunfish; 8th Sep 2012 at 23:34.
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If Clarke gets his way, I wouldn't be surprised if he is offered a seat on the Qantas Board, perhaps with a quid pro quo to Clifford.
Although
Qantas management will have no idea what is happening until its too late. They will have been suitably blinded by the prospect of secondments to Emirates. Some may even think there are permanent management jobs available there.
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Rubbish! Tim Clarke does not need a seat on the Board to know whats going on in QF. And Sheikh Ahmed is way too smart to want Clifford anywhere near his train set!
Hilarious!
Last edited by Squawk-7600; 9th Sep 2012 at 04:00.
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Have done a quick search of what you’ve posted Squawky and suspect you’re not an airline pilot. Not to worry, I reckon what you have to say is frightfully close to the truth in quite a few areas.
Indulge me if you would and share with those who read this site what you would say if asked to interested bystanders already thinking about-
· Qantas and Emirates getting into bed together to fill in global network holes Emirates on its own can’t access. I.e. Asia/China nonstop Europe and Asia/China nonstop North America.
Indulge me if you would and share with those who read this site what you would say if asked to interested bystanders already thinking about-
· Qantas and Emirates getting into bed together to fill in global network holes Emirates on its own can’t access. I.e. Asia/China nonstop Europe and Asia/China nonstop North America.
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Have done a quick search of what you’ve posted Squawky and suspect you’re not an airline pilot. Not to worry, I reckon what you have to say is frightfully close to the truth in quite a few areas.
Indulge me if you would and share with those who read this site what you would say if asked to interested bystanders already thinking about-
· Qantas and Emirates getting into bed together to fill in global network holes Emirates on its own can’t access. I.e. Asia/China nonstop Europe and Asia/China nonstop North America.
Indulge me if you would and share with those who read this site what you would say if asked to interested bystanders already thinking about-
· Qantas and Emirates getting into bed together to fill in global network holes Emirates on its own can’t access. I.e. Asia/China nonstop Europe and Asia/China nonstop North America.
Regarding the second question, I would have to answer "don't know", sorry it's not something I have really considered until you asked. As far as the QF side, they're pulling out of the full-service side of Asia to Europe (at least as it stands at the moment), so I reckon they would be as useful to EK in that regard as a tissue paper canoe! The J* hubbing model isn't at all useful to that aim, and besides EK wouldn't go near it with a 20 ft barge pole!
America (both north and south) yes absolutely. It would enable an EK/QF global service. BUT, the problem is QF's (international) cost base, it simply won't maintain the critical mass of hull numbers to maintain the extraordinarily bloated back-office it tries to maintain. This is where it really needs to focus attention if it has even the slightest hope of surviving. Any imbecile (as has been proven) can cut costs by cutting away at the service offered. But the real costs are "behind the scenes" and this is what needs to be addressed, not by under-catering A$5 business class noodles! Possibly one of the funniest things (in a morbidly tragic kind of way) I've seen from this is AJ saying that QF will expand back into Europe once it has it's poo back in a pile. Trust me, once QF loses the (premium) customers to EK, they'll never see them again. The one upshot out of this, that nobody seems to have mentioned, is that this stops the customers leaving the FF program. It's often the only thing that keeps passengers tied to an airline.
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Hmmm! Makes sense.
Assuming a new venture with its centre of gravity in Asia can freely access adequate capital and secure the necessary route rights, expect any such venture can also resolve much that you have raised.
You can’t possible be a pilot. Your spelling is far too good.
Assuming a new venture with its centre of gravity in Asia can freely access adequate capital and secure the necessary route rights, expect any such venture can also resolve much that you have raised.
You can’t possible be a pilot. Your spelling is far too good.
Last edited by LondonSloop; 9th Sep 2012 at 06:30.
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At some point there will be a heart to heart secret talk by the chairmen of both companies about the matters referred to above, followed by Board meetings, followed by the absorbtion of Qantas into Emirates after suitable lobbying to Government. It would be easy to do, with credit markets now dysfunctional with no prospect of improvement (the ratings agencies just downgraded Qantas by the way) the Arabs might like to make an "investment" in Qantas in return for a rather large share issue, thus solving Qantas need for capital for a better fleet. I'm sure such action could be easily sold to the public.
We all love our 'Aussie' icons. Such icons as Vegemite (owned by Kraft), Golden Circle (owned by Heinz), Holden (owned by General Motors since 1391, not that Holden fans thank you for mentioning it
), Arnott's (owned by Campbells, the ginger nuts have never been the same since 
) ... the list goes on. Arguably, a well run foreign owned Qantas would be in keeping with most of our national 'icons' and at least we'd be spared seeing it flail around dying like a beached whale, which is all the Aussie management seem to have been able to accomplish. A part of me would rather see the Arabs have a crack at it than Singo, Dixon et al. At least they know how to run airlines. IR? Well, they'll learn. We'll learn. It'll be a learning experience for everyone.
You can’t possible [sic]be a pilot. Your spelling is far too good.
Last edited by Worrals in the wilds; 9th Sep 2012 at 09:28.
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What would be wrong with a strong and viable Australian icon airline owned and run by Australians? That was, after all, the whole intent of the Qantas Sales Act
The tragedy of all this, at least in my eyes, is that there is no particular reason that this all needs to be this way. Qantas has (had?) a brand recognition and consumer confidence that most companies would kill for. Yet it's been totally squandered. Case in point, take the latest advertising campaign. At a time when the majority of its revenue is from domestic sales, and there was an Olympic games on with unequivocal patriotism what did the Qantas Einsteins roll out? The tried and trusted "Still call Australia home" to tug at its Australian customers' heart-strings and get them feeling great about booking flight with "their" airline? No. Instead it was a bunch of barely known athletes looking up into the sky (presumably to try to discover just what bird had taken a crap on their head). It was a shoker! Yet I'd hate to be paying the bill for it. Singleton spent 30 minutes in the booth and coughed up something better using just a half dozen scenes! Yet another example, in a very long list, of dreadful management decisions by executives who have absolutely zero idea what exactly it is they're trying to sell and to whom they're trying to sell it, never mind how they're going to run the company itself.
The tragedy of all this, at least in my eyes, is that there is no particular reason that this all needs to be this way. Qantas has (had?) a brand recognition and consumer confidence that most companies would kill for. Yet it's been totally squandered. Case in point, take the latest advertising campaign. At a time when the majority of its revenue is from domestic sales, and there was an Olympic games on with unequivocal patriotism what did the Qantas Einsteins roll out? The tried and trusted "Still call Australia home" to tug at its Australian customers' heart-strings and get them feeling great about booking flight with "their" airline? No. Instead it was a bunch of barely known athletes looking up into the sky (presumably to try to discover just what bird had taken a crap on their head). It was a shoker! Yet I'd hate to be paying the bill for it. Singleton spent 30 minutes in the booth and coughed up something better using just a half dozen scenes! Yet another example, in a very long list, of dreadful management decisions by executives who have absolutely zero idea what exactly it is they're trying to sell and to whom they're trying to sell it, never mind how they're going to run the company itself.
Guys, it's over.
Qantas as an independent Australian entity is gone.
When I penned my post above, I hadn't read about Clarke and Joyces "Bonding session" in May. Bushwalking and fireside chats indeed. It just reinforces my own opinion.
Folks, I've been to these sort of sessions at very expensive country retreats, drinking fine wines with multiple Directors of merging companies long past midnight. Joyce was a supplicant - "Will you still respect me in the morning?". The answer is always no.
Emirates will build a detailed picture of the Qantas business. They will offer to take as much operational control as Joyce feels free to give them.
Once they have a clear picture, there will be a heart to heart talk at chairman level, Joyce will be excluded. Emirates will make a value proposition to the Qantas Board about their future as part of Emirates and explain the painful truth to Qantas about their demise were they to reject Emirates advances.
Folks, i've been through this crap from the "Flowers and chocolates" phase, as my Lawyer calls it, through to the "Divorce court" phase. Joyce obviously hasn't. Ask any successful professional services firm about how we do this. Singo will have done it multiple times absorbing advertising rivals. Every successful management consultant has been through this on both sides of the table at least once.
To put that another way: "The partnership of XXX and YYY will lead to new customer experiences, blah blah blah", "Leveraging the synergies between XXX and YYY", with XXX strength in ZZZ markets and YYY strength in WWW markets we will offer our customers a seamless experience, etc. etc."
The reaiity, to paraphrase my former boss, is that Qantas and Emirates will collaborate tooth and claw, and Emirates will win.
Don't bother to blather on about how Qantas has these slots to gift to Emirates and all that technical airline stuff. Emirates will take what it wants as it absorbs Qantas. When I was young I thought the same as you do right now - "but surely Emirates will need me and my unique Australian experience" the answer is sadly No. They don't need you and they don't want you - you will "pollute the Emirates culture".
You are finished.
Qantas as an independent Australian entity is gone.
When I penned my post above, I hadn't read about Clarke and Joyces "Bonding session" in May. Bushwalking and fireside chats indeed. It just reinforces my own opinion.
Folks, I've been to these sort of sessions at very expensive country retreats, drinking fine wines with multiple Directors of merging companies long past midnight. Joyce was a supplicant - "Will you still respect me in the morning?". The answer is always no.
Emirates will build a detailed picture of the Qantas business. They will offer to take as much operational control as Joyce feels free to give them.
Once they have a clear picture, there will be a heart to heart talk at chairman level, Joyce will be excluded. Emirates will make a value proposition to the Qantas Board about their future as part of Emirates and explain the painful truth to Qantas about their demise were they to reject Emirates advances.
Folks, i've been through this crap from the "Flowers and chocolates" phase, as my Lawyer calls it, through to the "Divorce court" phase. Joyce obviously hasn't. Ask any successful professional services firm about how we do this. Singo will have done it multiple times absorbing advertising rivals. Every successful management consultant has been through this on both sides of the table at least once.
To put that another way: "The partnership of XXX and YYY will lead to new customer experiences, blah blah blah", "Leveraging the synergies between XXX and YYY", with XXX strength in ZZZ markets and YYY strength in WWW markets we will offer our customers a seamless experience, etc. etc."
The reaiity, to paraphrase my former boss, is that Qantas and Emirates will collaborate tooth and claw, and Emirates will win.
Don't bother to blather on about how Qantas has these slots to gift to Emirates and all that technical airline stuff. Emirates will take what it wants as it absorbs Qantas. When I was young I thought the same as you do right now - "but surely Emirates will need me and my unique Australian experience" the answer is sadly No. They don't need you and they don't want you - you will "pollute the Emirates culture".
You are finished.
Last edited by Sunfish; 9th Sep 2012 at 12:54.
short flights long nights
Sunfish...Emirates Domestic between capital cities?
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The one question I always ask when reading your posts Sunfish is "why is it that someone who apparently rose to the upper echelons of management feels the need to post 4385 times on an anonymous bulletin board?"
Ramius:
Dear Ramius, I thought the answer was obvious - because I can, and as a very junior private pilot I learn a bit here and there, very occasionally I can provide a different. and perhaps useful, perspective from a different point of view from the cockpit.
I have been through these "Partnerships" three times before, once I even had the hilarious task of negotiating one. There is always a senior partner and a junior partner. They all open with bonding sessions, nice country resort strategy conferences, professions of undying love, pictures of a beautiful future together and honeyed words about how this is a "win/win" situation, as a corporate lawyer aptly put it "The flowers and chocolates stage".
Unfortunately Mr. Clarke has a business to run, and once the ink is dry on the various agreements, he will depart, leaving you to the tender mercies of the various Emirates managers that Qantas must engage with as Qantas middle management get told to "make this partnership work..or else". At this point the blood starts to be shed because the Board of Qantas, and Alan Joyce will be talking shared facilities, cost savings by reducing duplication, etc. and making life a living hell for middle management as they try to avoid their little empires being swallowed by the Emirates octopus.
Pretty soon Qantas management, trying to reach decisions, finds themselves always asking "what will Emirates think"? Pretty soon strategic paralysis sets in - "What will we do about this? What does Emirates think? How can we make this decision without asking Emirates?" It eventually dawns on management that they are captured. It doesn't dawn on the Board until later - after the aforementioned fireside chat by the Two Chairman, because middle and senior management in the junior partner are too scared for their own jobs to tell the boss what their "partners" are doing to them, and the business.
To put that another way, Emirates business interests are not the same as Qantas business interests and will eventually diverge, even if they do appear parallel right now.
For example, Emirates is based in Dubai - what happens to Qantas when, not if, there is another geopolitical explosion in the Middle East? What happens when the Shia in Saudi arc up, let alone their brothers on the other side of the Strait of Hormuz? Thought about that one Alan?
To be fair, it is possible that the Government may put conditions on the deal that preserve some Qantas infrastructure in Australia, but those will be honored in the breach because the Australian Government doesn't have the tools or experience necessary to make them stick.
All I can say is: you poor kids having this wished on you, the only thing worse is bankruptcy.
The one question I always ask when reading your posts Sunfish is "why is it that someone who apparently rose to the upper echelons of management feels the need to post 4385 times on an anonymous bulletin board?"
I have been through these "Partnerships" three times before, once I even had the hilarious task of negotiating one. There is always a senior partner and a junior partner. They all open with bonding sessions, nice country resort strategy conferences, professions of undying love, pictures of a beautiful future together and honeyed words about how this is a "win/win" situation, as a corporate lawyer aptly put it "The flowers and chocolates stage".
Unfortunately Mr. Clarke has a business to run, and once the ink is dry on the various agreements, he will depart, leaving you to the tender mercies of the various Emirates managers that Qantas must engage with as Qantas middle management get told to "make this partnership work..or else". At this point the blood starts to be shed because the Board of Qantas, and Alan Joyce will be talking shared facilities, cost savings by reducing duplication, etc. and making life a living hell for middle management as they try to avoid their little empires being swallowed by the Emirates octopus.
Pretty soon Qantas management, trying to reach decisions, finds themselves always asking "what will Emirates think"? Pretty soon strategic paralysis sets in - "What will we do about this? What does Emirates think? How can we make this decision without asking Emirates?" It eventually dawns on management that they are captured. It doesn't dawn on the Board until later - after the aforementioned fireside chat by the Two Chairman, because middle and senior management in the junior partner are too scared for their own jobs to tell the boss what their "partners" are doing to them, and the business.
To put that another way, Emirates business interests are not the same as Qantas business interests and will eventually diverge, even if they do appear parallel right now.
For example, Emirates is based in Dubai - what happens to Qantas when, not if, there is another geopolitical explosion in the Middle East? What happens when the Shia in Saudi arc up, let alone their brothers on the other side of the Strait of Hormuz? Thought about that one Alan?
To be fair, it is possible that the Government may put conditions on the deal that preserve some Qantas infrastructure in Australia, but those will be honored in the breach because the Australian Government doesn't have the tools or experience necessary to make them stick.
All I can say is: you poor kids having this wished on you, the only thing worse is bankruptcy.
Last edited by Sunfish; 9th Sep 2012 at 19:58.
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Folks, I've been to these sort of sessions at very expensive country retreats, drinking fine wines with multiple Directors of merging companies long past midnight.
FFS!Sunfish the scenario as you've described it isn't possible for 2 reasons. The first is the Qantas Sales Act, which would, in a round about way, prohibit board representation as you've described it. The other is the ACCC, and they are not the complete push-over some suppose they are.
Both the above presume however that Qantas still exists. I am confident that, despite the circus act running it, QF domestic will actually increase capacity. Sooner or later the Singaporeans will admit the Tiger is toothless and close up shop, Virgin will move increasingly upmarket instead of not really knowing what it's trying to be (that's already happening). Virgin is bringing with it it's lower cost base, so they should do very well as long as they don't get too ambitious. Jetstar will continue to fleece welfare payments out of unsuspecting dole bludgers making their way to Bali/Thailand to renew their hair braids. Australia will be back to a 2 premium + one no-frills country; what is should have always been all along.
Last edited by Squawk-7600; 9th Sep 2012 at 23:18.