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Government Loan to Virgin Australia

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Government Loan to Virgin Australia

Old 21st Apr 2020, 11:33
  #961 (permalink)  
 
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Donít worry, Geoffrey says itís OK

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Old 21st Apr 2020, 11:56
  #962 (permalink)  
 
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I'll try and raise you mail-man. "People lets work the problem failure is not an option".
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Old 21st Apr 2020, 11:57
  #963 (permalink)  
 
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Hearing that bloke talk is cringeworthy. He thinks they’ll get picked up because they have good onboard service. Do you really think potential buyers care about that, or do they care about potential profitability? It’s all well and good to be a good airline, but you have to be a good business. No mention of its debt or 8 years of consecutive losses. Under the right leadership with the right shareholders hopefully this can be recovered.
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Old 21st Apr 2020, 12:03
  #964 (permalink)  
 
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So if they can walk away from their debt can I walk away from mine?
Always someone else’s fault.
As I said playing with other people’s money.
Please don’t use Rod E’s words.
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Old 21st Apr 2020, 12:06
  #965 (permalink)  
 
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Originally Posted by Vref+5
Convening period goes for 20 days after that meeting, then the second creditors meeting must be held no later than 5 days after the end of that period. .
The convening period can be extended by application to the Supreme Court
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Old 21st Apr 2020, 12:20
  #966 (permalink)  
 
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Originally Posted by markontop
Please donít use Rod Eís words.
sorry, it was a subconscious paraphrasing of that famous quote, not trying to claim it as an idea of my own. I just find it staggering that GT rambled for 7 minutes without bringing up anything resembling an understanding of basic economics.

Accountants donít give a sh!t that you have a good onboard product if it losses money.

They should get John Borghetti on sky news and ask him how he sleeps at night. Iím so pissed at that bloke and I donít even work at VA.
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Old 21st Apr 2020, 12:39
  #967 (permalink)  
 
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Didnít Ansett MkII last about 14 days?

If GT said theyíre fine then Iím worried as heís normally totally clueless about most things aviation (I hope he reads this)
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Old 21st Apr 2020, 12:42
  #968 (permalink)  
 
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Originally Posted by RampDog
Spot on Buster!

Most people in this game never made the connection but it was such a good business model that it reappeared in 2004 as Jetstar Domestic.

And it was no coincidence that there were a number of ex-Ansett execs involved in making it fly for Qantas (can you guess just one?)


Is there anyone out there who was involved who would care to describe how that plan arose and was sold within QF, it would be very interesting and timely
Sure! I will let some tidbits out. I know because I was Ďaroundí. Geoff Dixon, Alan Joyce and Bill Jauncey were the architects. Obviously Geoff was at QF and Alan and Bill were ex Ansett. In fact, once up and running Bill Jauncey could/was almost the JQ CEO but they wanted a Ďcleanerí looking CEO image, a clean shaven suit wearing mincer like AJ was perfect. Bill was a gravelly whisky drinking ciggie smoker, but a very smart man. The original plan was simple - QF to do international and just the highly profitable business class domestic routes - BNE/SYD/MEL. The rest was to go to JQ. Cheap cheap cheap! Get rid of those pesky $300k pilots and have the majority of flights done by Onestar Pilots on around $120k. Thatís the short version.

As for Virgin (Blue), they shouldíve stuck with the intended business model - all 737 fleet and aimed at low fares and filling planes. Simple. But by the time JQ was hitting the tarmac VB had a fat workforce and was far from lean. JQ was the opposite and most times it was ridiculously lean. VB were never going to be able to operate cheaper than JQ and shouldíve started trimming fat back in 2005 but they didnít. They became a floated company and decided to chase QFís business model/lounges/ rewards card structure, but it was only ever a half arsed product that sat in between cattle classs and business. Big, costly mistake. Then when they morphed from an all 737 fleet to an entity with b737, A320, A330, ATR and the list goes on, it was Ďgame overí not Ďgame changerí. You wouldíve thought that the ghost of Ansett and itís ridiculous fleet variation thanks to Sir Peter Abeles going to Tolouse and getting a hard-on and opening the cheque book could be repeated. You would think that Ansett would have still been fresh in the minds of anyone operating an airline in Australia, but nah. That was the day Ansett died, the end result was inevitable and occurred a number of years later. Same has happened to Virgin Australia, it started out with an identity but lost its way and never got comfortable with who it wanted to be and what it had eventually become.






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Old 21st Apr 2020, 12:44
  #969 (permalink)  
 
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Originally Posted by coaldemon
Well the debt will have to be dealt with prior to a new buyer being happy with it. Question is what do you sell and what can you hand out as haircuts to the Bond Holders and Lenders? Also I thought that they had stood down most of the workers so they aren't paying a lot of them so there is no need to make anyone redundant at this point. Whichever way the business will be slimmed down and lean is the approach so there will be less jobs there it seems. Sad to watch in the circumstances. Looks like they are not the only ones right now with Norwegian, South African and it looks like Atlantic all looking for saviors.
South African probably has a week left to go at best. This is the beginning. Many more will fail.
The industry has never seen anything like this before. 9/11 was just a blip and was probably the only thing to really measure the COVID aviation crisis against. And even then, itís apples and oranges.



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Old 21st Apr 2020, 12:52
  #970 (permalink)  
 
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The key players in this are Singapore Airlines, Air China plus Cathay Pacific (30% cross shareholding) and Alliance plus industry super funds. Cathay leaves One World and joins Star. Singapore makes the running with Air China and Cathay Pacific in the background. Alliance takes VARA and a holding company with the above shareholders re-launches VAH as Star Alliance Airlines. Administrators return all leased aircraft. There will be no shortage of aircraft in the above fleets to supplement growth. Possibly the Government allows some wet lease cabotage for widebodies to do transcontinental. There is a loyal customer base that will remain loyal, especially if AJ continues at Qantas.
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Old 21st Apr 2020, 13:07
  #971 (permalink)  
 
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Right, so listening to PS today, and his administrator....no job losses expected.

Can someone explain how the 777 and A330 crew are going to be kept on? Just curious if some has a better radar than mine?
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Old 21st Apr 2020, 13:07
  #972 (permalink)  
 
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Originally Posted by VR-HFX
The key players in this are Singapore Airlines, Air China plus Cathay Pacific (30% cross shareholding) and Alliance plus industry super funds. Cathay leaves One World and joins Star. Singapore makes the running with Air China and Cathay Pacific in the background. Alliance takes VARA and a holding company with the above shareholders re-launches VAH as Star Alliance Airlines. Administrators return all leased aircraft. There will be no shortage of aircraft in the above fleets to supplement growth. Possibly the Government allows some wet lease cabotage for widebodies to do transcontinental. There is a loyal customer base that will remain loyal, especially if AJ continues at Qantas.
According to all media reports none of that will occur. Westfarmers or some hedge funds are the early contenders out of the gate. No Asian interest at the moment.
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Old 21st Apr 2020, 13:08
  #973 (permalink)  
 
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Originally Posted by Paragraph377
Sure! I will let some tidbits out. I know because I was Ďaroundí. Geoff Dixon, Alan Joyce and Bill Jauncey were the architects. Obviously Geoff was at QF and Alan and Bill were ex Ansett. In fact, once up and running Bill Jauncey could/was almost the JQ CEO but they wanted a Ďcleanerí looking CEO image, a clean shaven suit wearing mincer like AJ was perfect. Bill was a gravelly whisky drinking ciggie smoker, but a very smart man. The original plan was simple - QF to do international and just the highly profitable business class domestic routes - BNE/SYD/MEL. The rest was to go to JQ. Cheap cheap cheap! Get rid of those pesky $300k pilots and have the majority of flights done by Onestar Pilots on around $120k. Thatís the short version.

As for Virgin (Blue), they shouldíve stuck with the intended business model - all 737 fleet and aimed at low fares and filling planes. Simple. But by the time JQ was hitting the tarmac VB had a fat workforce and was far from lean. JQ was the opposite and most times it was ridiculously lean. VB were never going to be able to operate cheaper than JQ and shouldíve started trimming fat back in 2005 but they didnít. They became a floated company and decided to chase QFís business model/lounges/ rewards card structure, but it was only ever a half arsed product that sat in between cattle classs and business. Big, costly mistake. Then when they morphed from an all 737 fleet to an entity with b737, A320, A330, ATR and the list goes on, it was Ďgame overí not Ďgame changerí. You wouldíve thought that the ghost of Ansett and itís ridiculous fleet variation thanks to Sir Peter Abeles going to Tolouse and getting a hard-on and opening the cheque book could be repeated. You would think that Ansett would have still been fresh in the minds of anyone operating an airline in Australia, but nah. That was the day Ansett died, the end result was inevitable and occurred a number of years later. Same has happened to Virgin Australia, it started out with an identity but lost its way and never got comfortable with who it wanted to be and what it had eventually become.
You pretty much nailed as to why Virgin has never made money. It really boggles my mind as to why people need to complicate things in business. But then again, nothing surprises me anymore.
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Old 21st Apr 2020, 13:31
  #974 (permalink)  
 
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Originally Posted by VR-HFX
There is a loyal customer base that will remain loyal, especially if AJ continues at Qantas.
Outside of the narrow world of aviation enthusiasts no one knows (or cares) who the CEO of a company is when making a decision on who to fly with. Loud mouths on social media may think they influence a lot of people. They don't. I doubt more than 0.1% of VA's customers fly them because they hate Joyce. There's probably more who fly QF because they find the name "Virgin" inappropriate.
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Old 21st Apr 2020, 14:27
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dr dre. I respectfully disagree. Most people who travel know who the CEO of Qantas is while they may never have never heard of Paul Scurrah. Wesfarmers is too smart to go into aviation longer term although they have the balance sheet to fund a transition. There will definitely be an anchor airline involved. Parargraph 377 is on the money. John Borghetti was the wrong person to run VAH, especially with the shareholder register he had. He spent more time managing shareholders than running the business. Best of luck to all the VA front line staff.
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Old 21st Apr 2020, 15:22
  #976 (permalink)  

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Originally Posted by Mail-man
Donít worry, Geoffrey says itís OK
Umm, as a side note, is that a Concorde model in the background with an amateur 70's QF tail???
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Old 21st Apr 2020, 22:48
  #977 (permalink)  
 
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Time to shut it down, Talk about thread drift.

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Old 22nd Apr 2020, 01:22
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Originally Posted by Flava Saver
Right, so listening to PS today, and his administrator....no job losses expected.

Can someone explain how the 777 and A330 crew are going to be kept on? Just curious if some has a better radar than mine?
"no job losses" is simply playing down what is to happen as that's the last thing the governments want people to hear.

Private equity are all about buying distressed companies with good assets (planes etc) at a huge discount and then selling these, loading the company with new debt and then selling it back to retail and pension funds at a huge profit. Anyone that understands this will then see that:

1- Job losses are inevitable in the short to medium term as VA will come back as a leaner operation flying on mostly profitable routes,
2- International flying will likely be made through code sharing rather than own metal,
3- QF are not going to sit idly and watch a leaner VA eats its share of the cake,
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Old 22nd Apr 2020, 02:48
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I wouldn't hang my hat on Westfarmers being smart. Did they not take Bunnings to the UK then after it being a disaster pulled out?
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Old 22nd Apr 2020, 02:53
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Like people having the idea that SIA are savvy business people and that all that money is just going to be poured into yet another failed business investment.
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