So you need a new fleet Leigh?

[IsDon]

Originally Posted by angryrat

Don’t forget the 744 had an unnecessary RIN at the same time as the 767 which complicated things even more. Within 6 months of the RIN starting they were investigating if they could stop the 744 RIN because they were now short on the 744.

From a hazy memory, they could have most likely accommodated all but a handful from the 767 on the 330 if they followed the rules and were looking to use the paragraph quoted by Isdon to accommodate all. The 744 RIN came out of left field. The whole RIN and what we have today is and was a c*ck up.

That’s correct AR I remember the hand wringing. There was also a superfluous RIN on the 380 in recent history.

There’s one thing we can all agree on. A RIN process will always be a c0ck up. After every RIN I’ve seen, those left on the fleet ended up flying high divisors, no leave and riot claused. They are just incapable of managing the process.

Without doubt the root cause of this whole debacle has been short term thinking. Unfortunately that’s what you have with a siloed business model full of empires looking to knife another empire at every opportunity. Each empire only cares about this months KPIs and associated bonus. There also seems to be no scope to learn lessons from the past. Those that fail to learn from their mistakes are doomed to repeat them.

HR are, without doubt, the biggest promoters of this system and present management don’t have the knowledge, skill set, or intestinal fortitude to wrest control from these industrial parasites and actually do what they’re getting paid handsomely for. Running the business for now, and for the future. Planning in advance for things like a pilot shortage and associated training and managing it in good time to avoid the situation we’re now faced with. As I said before, the evidence was always there. The pilots have been screaming at them for years to pull their collective heads from their respective rectums and get ahead of the curve. No. Taking advice is a sign of weakness that won’t be tolerated. There’ll be none of that.

[Rated De]

Mr Montgomery is looking at metrics that matter.

As we approach the reporting season Qantas will state;

• Profit Before Tax:

This is a non statutory measure. This number is not audited, as it is non GAAP/IFRS. It is detailed in the notes to the financial statements.(it is decided by the Chief decision maker..Guess who?) It conveniently leaves out things that management would rather not deduct from 'profit'. There is nothing illegal in this, but it is nothing real about it, simply a bigger number...

• The sale of the catering arm is an extraordinary item which will lessen the impact of the fuel rise, but it is a one off. As it was with the sale of the terminal leases.

First, while the company’s cash flows look great, they have benefited in recent years from generally declining oil prices. In July 2008, West Texas Intermediate crude oil traded at $US147 a barrel. By February 2016, the oil price had fallen to less than $US26. But since then oil has almost tripled to over $US70 and analysts at UBS now believe Qantas could be hit with a $700m negative shift in fuel costs from FY18 levels to the current spot price.

Jet fuel is priced much higher than the current USD$74.39, and will affect Qantas disproportionately as their fleet metrics are much worse than their competitors. As Qantas saved' $597 million in fuel expense in FY15 (the transformation year) when prices fell, they now are exposed as has been repeatedly stated. They are hedging into higher fuel prices with more price risk further eroding the 'transformation'.

Their fleet metrics are shocking. Executive management have wasted a decade. The board is duplicitous. The Chairman is, as the tide goes out, exposed as the self professed 'lightweight' he admitted to being.. Stick to rocks Leigh.

On that matter, having served as CEO for almost a decade, it’s time to wonder whether Alan Joyce will stick around through the next potentially more challenging period, or perhaps leave that job to Alison Webster, who runs Qantas International.

Whichever way you spin it, investment bank UBS notes Qantas’s “fleet age has increased from 7.7 years in 2015 to a current 10.2 years”. They also note that the fleet is now older than the last peak of nine years in 2007. According to the same report, Qantas has introduced just nine new aircraft or 3.7 per cent of group seat capacity over the last three years and so a minimum of $1.4bn a year will be required to maintain a constant fleet age, with an additional $300m spend on the nonaircraft asset base making $1.7bn.

As we stated at the outset, Share buy backs and capital give back were not prudent use of shareholder funds. They spent $1.75 billion.

Take out the JQ hero (creation) myth Alan Joyce repeats to any journalist flying Y class looking for an upgrade, and the Qantas fleet is over 11 years old.
The fleet metrics are shocking and the tide is receding. Like all great 'leaders' Little Napoleon will parachute out and with all of five minutes as an 'airline CEO' sure throw Alison in there, the bus is coming.








Qantas need a new fleet.

[IsDon]

Alison Webster!!!

Please save us from yet another politically correct appointment. How about someone that actually knows what they’re doing for a change? Is that too much to ask???

Then again, anyone with half a clue would be across the fleet metrics that RD mentioned above and would rightly see Qantas as the poison challis that it would be after the raping and pillaging that has happened during AJs tenure. The present management have run the company purely for their own self serving reasons with a view purely towards what they can legally steal. There’s nothing left.

[ruprecht]

Is Don,

What 743 RIN were you named on? Because if you were named, then I certainly was, and I don’t recall being on a RIN with your name on it.

If I recall correctly you bid for and were awarded a 767 FO slot. No RIN required. Or was it before my time?

ruprecht.

[IsDon]

Originally Posted by ruprecht

Is Don,

What 743 RIN were you named on? Because if you were named, then I certainly was, and I don’t recall being on a RIN with your name on it.

If I recall correctly you bid for and were awarded a 767 FO slot. No RIN required. Or was it before my time?

ruprecht.

Rupe check PMs.

[PPRuNeUser0198]

Doesn't Qantas report on 'underlying PBT', which takes into account one-off transactions (so not to skew the numbers)?

[blow.n.gasket]

Definition of underlying basis a measure of "underlying" profits or sales tends to strip out items that distort a company's trading performance, such as exchange rate movements or acquisition costs.

It can be a more helpful metric for investors than pre-tax profits or top-line sales. However, there is no formal, universally recognised, definition, which means companies can choose what items to include and exclude.

Investors should therefore be aware that companies can use the measure to present themselves in a favourable light. It can also make comparisons, both across time for an individual company or between companies, rather hazardous. [1]

[AerialPerspective]

Originally Posted by dragon man

If my memory serves me correctly is it not a requirement for the holding of an AOC to have adequate crew, aircraft and spares to run a scheduled airline operation?

It is a requirement to demonstrate that sufficient resources are available to conduct planned operations and that mechanisms are in place to ensure proper management of resources to ensure operational personal are not put under undue pressure.

[Rated De]

Definition of underlying basis a measure of "underlying" profits or sales tends to strip out items that distort a company's trading performance, such as exchange rate movements or acquisition costs.

Precisely.

As a 'management generated number' it is not audited, has no statutory application and is irrelevant.
It is worth noting that United States experience with non-GAAP 'management numbers' sees many 'analysts' report and use such fictional measures as recommendations for particular companies.
As Gordon Gekko correctly stated, "Their analysts don't know preferred stock from livestock'



And of course don't forget the Catering business sale. One off items, like terminal leases cashed in, catering unit sales and other 'compensation' one offs are not evidence of a good management.

[Rated De]

Thank you for the PM

The industry has seen a fifty percent jump in jet fuel prices compared to last year, with the price now hovering around US$90 a barrel

When the 'high office' of the Chief Pilot finally comments on a 50% higher fuel price, which surely must be eating into his KPI bonus, it needs to be said....

Dick, Qantas need a new fleet

[Street garbage]

https://www.smh.com.au/money/banking...16-p4zrq5.html

Again, I think this article sums up Qantas and it's management... "walking over their mother to get to money" certainly rings a few bells.

[What The]

Two thing affect the KPIs of all corridor creepers. None of which they have any real control over. I believe Hail Storm and Just for Men were rewarded handsomely last year for:
1 On Time Performance
2 Fuel

Negatively impact on either of those and the hissy fits will start. Hail Storm appears to be trying to start the hard luck stories now that pay negotiations are on.

[Rated De]

Originally Posted by What The

Two thing affect the KPIs of all corridor creepers. None of which they have any real control over. I believe Hail Storm and Just for Men were rewarded handsomely last year for:
1 On Time Performance
2 Fuel

Negatively impact on either of those and the hissy fits will start. Hail Storm appears to be trying to start the hard luck stories now that pay negotiations are on.

Not sure to whom you refer, but the nick names are hilarious! That is the pilot leverage. To be precise, overt action will be met aggressively by IR, subtle yet increasing passive disobedience is difficult to counter.

[Rated De]

Originally Posted by Street garbage

https://www.smh.com.au/money/banking...16-p4zrq5.html

Again, I think this article sums up Qantas and it's management... "walking over their mother to get to money" certainly rings a few bells.

This article is a summation of the times in which we live. Usually regulatory oversight is increased following the big failure. Humans being what we are, we collectively forget: Regulation is wound down,vigilance is erratic. Before long the regulators (all of whom never saw it coming) are answering for the next crisis. Wind forward 80 years and repeat the cycle.

"Well, no. But what was it Gough Whitlam said? You always want to back a horse called Self Interest, because you know it's going to go well."

The allure of easy money, when a transformation was simply a falling fuel price and a stroke of a pen (to change the fleet value) was too much to resist. Far easier to pull off when you knew that a 'manufactured decline' and lockout were never thoroughly investigated and the court system gags a woman who wrote the speech for that day in October 2011 months before...

[Rated De]

Originally Posted by Street garbage

https://www.smh.com.au/money/banking...16-p4zrq5.html

Again, I think this article sums up Qantas and it's management... "walking over their mother to get to money" certainly rings a few bells.

Thank you for the link to this story.
It puts exactly into context the ills of our time. Apologies for three posts...This one has been waiting to be written for a while and bears no resemblance to any person

Imagine growing up poor. Imagine seeing your parents struggle in lower class employment, in a country that over its history has been stricken by poverty, trapped by its oppressors and at times starved.
Imagine being an intelligent boy watching your parents struggle. Struggle for you and your siblings. It is quite possible the grey skyline matched your parents mood. Like all parents they laboured for their children. Hoping that the next generation fared better than they. That is largely what peace loving people the world over long for: to leave it better for those you love. It is highly probable that a sense of community, a sense of looking after each other was ingrained very early on. Together you got through.

That boy learns his lesson. He gets educated, He finds the way out! He finds his way to aviation, not through flying, but in the office. He leaves the grey skyline, arrives in the other side of the world.
He rises to CEO. A big achievement.

The forlorn hope of the community of the airline (the greatest team sport there is) is that you will bring humility, you from your humble roots represent a departure from the old greed. Hopefully you will remember that every one of those people depends on you. This is your chance, show the company, show the community, you are a big man. Big of deed.

Missing in this story is empathy.

But let's try for empathy – or at least inquiry. Let's try, for a moment, to imagine ourselves in this situation. Imagine you've just made $32,000 for an hour's work, filling out a few forms for an 86-year-old lady. Now – best case scenario – let's imagine that the old lady actively wanted this plan, and that you genuinely believed your advice would be to her advantage.

Without empathy, any connection to your fellow community is lost. Sure you can insulate yourself, surround yourself with those who tell you it is all fair. Empathy though is something that drags you back, it reminds you people all need each other. No one is perfect, so you ended up being more of the same. Sad really, you could have changed it for the better.

Society is used to dealing with individual bad behaviour. We have systems – legal, social, emotional – to understand it, punish it, and recover from it. But we're far less certain about how to feel about – and what to do with – group wrongdoing. We know something has gone awry in this story – and with much of the behaviour we're discovering at the Royal Commission – but what? Psychologists, philosophers and ethicists have all sorts of theories. The banks have only one. They call it "culture".

When you set the culture and the culture is still wrong, it takes a big man to say it.


Qantas still need a new fleet

[CurtainTwitcher]

Originally Posted by Rated De

But we're far less certain about how to feel about – and what to do with – group wrongdoing.

Fortunately badly behaving individuals are mortal and and have a guaranteed long term obsolescence mode, ie death to somewhat limiting the damage they may inflict to the rest of society.

On the other hand, Companies do not. The legal change in the mid to late 1800's that guaranteed this immortality was the recognition of the right of a company to have the same rights as a human, but without the built in mechanism of obsolescence. Managers then seized control of these immortal aggregations of capital and power for their own gain.

An excellent historical work on the subject: Gangs of America The Rise of Corporate Power and the Disabling of Democracy in pdf format from the authors website.

[Chris2303]

Ah, but specifically what airplanes, how many of each type and for what routes?

[Rated De]

Originally Posted by Chris2303

Ah, but specifically what airplanes, how many of each type and for what routes?

Qantas 'worst major airline' for fuel efficiency on trans-Pacific flights, study suggests - ABC News (Australian Broadcasting Corporation)

Start there.

With respect to the domestic network it lacks a 767 twin aisle replacement. Qantas tried the 'liquid overhaul' approach of the 767. The 767 was a gift from the Australian taxpayer, prior to privatisation. The A330 is insufficient in numbers and neither designed nor configured for high frequency domestic operations.

Qantas ordered 14 788 for mainline operations

For reasons best known to little Napoleon, in another random walk, all of them (now 11) were instead given to JQ. Mr Buchanan believed that he needed a lower unit cost as the metrics on low fare Long haul were not working. Telling the board of the reality cost him his career. He was shortly thereafter sent on gardening leave. This is the reason why JQ International is not segmented yet Qantas is: JQ International was and remains a basket case.

So Qantas is left with a domestic 737 operation, where the first batch approaching 16 years old and no word of a replacement.

A 788 running between Sydney and Melbourne with dual aisle and say 260 passengers in Y and J class needs nearly two airframes of the 737 and double the pilots (more cabin crew) in an already congested airspace, with limited tarmac and gate space, to carry the same passenger count. It requires more flight planning support, fuel, engineers and generates double the Air Navigation charges.
Add in the marketing bonanza and higher yielding J class options and Qantas had a real point of difference between itself and VAH.

Add in what Roger Montgomery was politely describing was that cheap fuel is not a given and Qantas fleet metrics only look fine while yields generate a sufficient operating cashflow surplus.
Heck even their Chief Pilot (probably from self interest as his KPI is likely linked to fuel savings) has pointed out that fuel price has risen 50% in the last year.

Finally, nearly every other airline sees higher fuel efficiency and fleet strategy as key determinants. Why doesn't the self professed world's smartest airline management?

Qantas need a new fleet.

[Rated De]

From another financial newsletter in Australia...

If nothing else, it makes me wonder about Qantas Airway Ltd’s [ASX:QAN] future. It’s likely going to face continual cost pressure on wages. Not only that, it’ll have to contend with higher fuel bills if oil continues to stay at this level or go higher.One note I saw suggests that Qantas could see a $700 million negative shift in fuel costs over this financial year at around the current spot price of oil. The next financial year could be even worse if the trends in oil I’m tracking play out as expected.This could prove to be a massive problem for Qantas.

But there’s more…

Qantas’ fleet of planes is now older than at the previous peak in 2009.That means the company is going to need to spend a lot of money replacing these planes — if they can even get the aircraft. There’s hot demand all over the world for new planes. And delivery times are lengthening. Qantas is also on track to start paying tax again and has finished its recent stock buyback.For now, the market appears unworried about any of this. The outlook for the Aussie economy is good. That drives a lot of Qantas’ earnings.Let’s wait for the next set of numbers to see how the market reacts.
There could be a very good shorting opportunity setting up here. At the very least, it’s a stock probably best avoided.

Stay tuned for more on this.

Net out the JQ fleet and Qantas fleet age is closing on 11 years, which is at the higher end.
Jetstar sits at 8. Curiously little napoleon has committed to JQ fleet renewal (remember the fanfare order for 110 A320?)

Having spent over $1.75 billion pumping their own pockets full of options bloated with buy back leverage...
As the tide goes out, imagine the wrinkled carcass of Mr Leigh Clifford and little napoleon swimming around naked..What is seen cannot be unseen.

Qantas need a new management

[V-Jet]

I watched ‘The Drum’ last night for the very first time ever (because the TV was on) and was struck with the insight of Andrew Jaspan. I’m 100% certain I’d disagree with his politics and he’s no doubt never actually employed people himself, but I could not help but see the similarities to Qf in his comments. Can anyone imagine a current or ex Chief Pilot saying similar???

Why is it the media is so easy to bribe in matters of QF (G/A?) and yet have people in their midst who do actually have insight?

Gerard Henderson’s piece in the Oz today could have intersposed Andrew Jaspers comments for ‘most anyone’ working for Qf proper:

FAIRFAX MEDIA’S DEATH FOLLOWED CONTEMPT FOR ITS TRADITIONAL BASE

It’s just five years since MUP published Colleen Ryan’s Fairfax: The Rise and Fall. This seemed a somewhat presumptuous proposition at the time. But yesterday the death of Fairfax Media became a reality.

There are many and varied reasons for the demise of a media company early in the 21st century — primarily, of course, the decline of advertising in its traditional forms.

But perhaps the unfashionable point is that, years ago, the likes of the Sydney Morning Herald and The Age lost contact with their base. Traditionally both newspapers sold well in Coalition voting areas in the suburbs of Sydney and Melbourne as well as in rural and regional areas of NSW and Victoria respectively.

The problem was that in recent decades Fairfax Media’s proprietors allowed left-wing journalists to attack the company’s base of support. Namely Coalition voters, social conservatives who were Christian and sent their children to non-government schools — along with businesses that were big, medium and small. In short, the Sydney Morning Herald and The Age ran stories that demeaned the actions and beliefs of their readership and advertising base. At times, The Age in particular read a bit like the Green Left Weekly.

On the ABC TV’s The Drum last night, one-time Age editor Andrew Jaspan conceded that, unlike News Corp, Fairfax Media did not really know what it was about. Rupert Murdoch is sometimes accused of being tribal — but at least he has a tribe. Mr Jaspan identified Fairfax Media’s lack of direction — but failed to recognise that when Age editor between 2004 and 2008 he was part of the problem.

There is diversity in News Corp’s media outlets — including Fox News in the United States. But News Corp journalists do not spend their days and nights beating-up on the activities and views of readers and viewers who buy its product by purchasing newspapers in print or online or who pay for subscription viewing.

The death of a media company is invariably sad. But the fact is that Fairfax Media mastheads lost contact with their traditional supporters many years ago. And, in time, the inevitable happened.