Steve Purvinas, legend
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Outstanding article. Congratulations Steve.
short flights long nights
20 out of 10 Steve. Well done. !!!!
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Maybe helps explains why 42% of pilots actively work against the companies interets.
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Virgin cops a lot on the financial front and rightly so for some questionable decision making, but they have replaced 737s in the last 7/8 years 2 vs 1 against QF.
Going into mid next decade Virgin will have a 737 fleet age 1/3 that of QF.
This is the time Virgins capex will slow down for 10–15 years while QF has large fleet bills in the back half of this decade, and this is the point where I expect him to handover the reins to some poor body who is faced with impending fleet bills that will wipe the profitability of the company for many years and trying to work out how they are going to pay for all these neo’s and max replacements.
Going into mid next decade Virgin will have a 737 fleet age 1/3 that of QF.
This is the time Virgins capex will slow down for 10–15 years while QF has large fleet bills in the back half of this decade, and this is the point where I expect him to handover the reins to some poor body who is faced with impending fleet bills that will wipe the profitability of the company for many years and trying to work out how they are going to pay for all these neo’s and max replacements.
My admiration for Steve knows no bounds. This article, free from bias and hyperbole resists the temptation of becoming partisan. No mean feat, when as a leader he would be faced with regular frustrations from his political opponents.
Geoff Dixon wasn’t the most popular bloke, but that wasn’t his job. Steve has let the facts of Dixon’s time at the helm speak for itself, and equally those of Joyce.
The apparent transfer of $60 mil from the pockets of the rank and file into those of senior management, and the blatant pretense of it, really highlight the depths of dishonesty that is rife in corporate Australia.
Time for a change? Yeah right!
Geoff Dixon wasn’t the most popular bloke, but that wasn’t his job. Steve has let the facts of Dixon’s time at the helm speak for itself, and equally those of Joyce.
The apparent transfer of $60 mil from the pockets of the rank and file into those of senior management, and the blatant pretense of it, really highlight the depths of dishonesty that is rife in corporate Australia.
Time for a change? Yeah right!
Last edited by KRUSTY 34; 21st Oct 2019 at 02:58.
Beautifully put Steve, well done 
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After Qantas announced a $2.8 billion loss in 2014, staff were all called on to freeze their wage levels for 18 months, a call that my union was first to heed in order to help the struggling airline.
Dear Mr Purvinas,
A small but pertinent point.
- The loss in FY14 was a result not of deteriorating trading conditions, rather the write off for the International fleet; The loss was on paper only.
- As a result, the following year QF reduced depreciation by circa $326 million (also didn't tax) This is the source (when combined with fuel price falls (totalling $527 Million) of the "transformation profit".
- Senior insiders had "performance incentives" your staff did not. The pay freeze your staff took (and management too) did not include any transformation upside. The insiders had them: Millions of options with issue prices at less than $1.00 vesting post FY15.
- The transformation profit say the share price surge and"amazingly coincidentally" those same insiders could cash in their options.
Be vigilant for a similar play.
It is a straight out transfer, and a robust regulatory environment would not only have investigated the claims of "terminal decline" in CY11, but also the very rapid "transformation" FY15 as well as the "incredibly well timed option vesting dates.
Otherwise eloquently written...
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Cathay Pacific 8.5 years, Singapore Airlines 6.9 years, Air New Zealand 6.9 years, Emirates 6.6 years and Etihad 5.9 years.
Emirates and Etihad can’t be compared simply because they have very different agendas; operate on very different financial structures etc.
Maintaining a reasonable age of fleet ensures comfort and on-time performance are at an acceptable standard.
I don’t agree the age of an aircraft results in poorer OTP as quoted by Steve. Rex seems to manage an ageing fleet (average of 26 years) with the some of the best OTP performance in the country (usually second after QantasLink - and how old are those ex AA 717’s and DHC-300’s?). How is that possible with such an ‘old’ fleet...
Yes, the airline is now profitable again, as it always was under previous CEOs
I do hold the shared opinion that Qantas needs an upgraded fleet however.
Cherry picked airlines that have fleet sizes less than a quarter or at least half of the Qantas fleet size, accelerating the favourable age curve with less deliveries required. Not a good comparison, even if they are in the region.
Emirates and Etihad can’t be compared simply because they have very different agendas; operate on very different financial structures etc.
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Emirates and Etihad can’t be compared simply because they have very different agendas; operate on very different financial structures etc.
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You sure about that?
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I included subsidiaries. Deployed Group capital is an important consideration. QF deployed capital to JQ for JQ’s fleet and renewals. Money was spent. It has invested. Not to the desired brand for some.
I went through an airport recently and watched him scurry into the QF first class lounge.
The Business class lounge was like an dirty overcrowded zoo.
Any decent CEO with some personality and leadership might have used such an opportunity to see the coal face and check the feedback from his customers firsthand.
The QF product is in decline.
Qantas prices and Jetstar quality while gouging Australians who have to travel internationally. Credit to those staff that keep smiling and delivering a great service but they are getting harder to find.
QF is my last choice while he is in charge.
The Business class lounge was like an dirty overcrowded zoo.
Any decent CEO with some personality and leadership might have used such an opportunity to see the coal face and check the feedback from his customers firsthand.
The QF product is in decline.
Qantas prices and Jetstar quality while gouging Australians who have to travel internationally. Credit to those staff that keep smiling and delivering a great service but they are getting harder to find.
QF is my last choice while he is in charge.
Last edited by ramble on; 22nd Oct 2019 at 02:11.
If you look at the Group capacity in the International market now versus 2008 when Joyce took over as CEO, the airline has shrunk massively - not only in the number of hulls but also in Available Seat Kilometres (ASK's). Steve's article is very good but would have been stronger if he gave the figures of how much capacity has been lost.
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Alan and his faceless men
Well written Steve. As you point out, it’s all about juggling books. The airline does not make the cash profit it makes out to people that it does. Not upgrading an airlines fleet, running fuel and maintenance costs between both of its airlines and a host of other financial tools at its disposal helps it to paint the whatever picture it wants at any given time.
But I digress. Alan Joyce worked for Ansett. There were meetings between himself, Geoff Dixon and a few other players which included another Ansett man, Bill Jauncey. Together they hatched Jetstar, an LCC that was meant to take up all the low yielding routes and leave the cream to Qantas. Profits galore at both end of the spectrum - Qantas a premium service and Jetstar the bogus service. Jauncey once described Joyce as ‘one of the smartest money men you will ever meet’. That is the only compliment I will give Joyce; he has a brilliant business mind. But he is a selfish, self centered, self indulging narcissist. A weak little man with no backbone.
Of late, most of Alan’s “protected species”, faceless men and women who link back beyond the JQ machine to the Ansett days, are leaving, and getting big redundancies of course. Alan is preparing to bail. It’s all in the timing. He is looking after his loyalists as he prepares to exit the beginning. Timing is everything, and Joyce is going to truly leave behind a steaming turd for someone else to massage. Just like Borghetti has done to Scurrah. A steaming pile of nothing that is so brittle that when the next financial, health or oil crisis hits, there will be financial ruin. These airlines are like helium balloons. Just a thin skin protecting an empty void. Joyce is not worth the $100m he has been paid. It is obscene. However the weasels on the Board and the greedy capitalist shareholders love him. And hey, who can stop him??
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when Joyce took over as CEO, the airline has shrunk massively - not only in the number of hulls but also in Available Seat Kilometres (ASK’s)
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I think your fleet sizes are not quite correct, a quick search shows EK- 240 /CX-146/QF-129/EY-115/SQ-107/NZ-69?
Hardly Cherry picked airlines That have fleet sizes less than a quarter or half of the qantas fleet size.
Hardly Cherry picked airlines That have fleet sizes less than a quarter or half of the qantas fleet size.