Government Loan to Virgin Australia
It's also quite possible that a doomsday rescue package has already been worked out and is currently locked in a filing cabinet in Canberra. At the last minute, after weeks of pleading when it's obvious the airline is about to go under it will be unveiled. A reduction in size, redundancies, pay and conditions slashed, take it or leave it. A deal that would probably be voted down at the moment as unacceptable would be welcomed by employees and shareholders.
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The doomsday rescue package HAS been worked out. It’s called 2001 REPLAY.......
The market will take years to recover, why have 2 players painfully limping on rather than one moderately strong player?
Control the monopoly with regulation.
Guarantee VAH employee entitlements.
What Scurrah & co don’t get is the sound of silence. If govt were ready with a definitive solution, we would have it. The lack of one indicates there will likely not be a rescue.
Its kinda getting awkward now, I suspect many in govt & elsewhere are just wanting VA to go away and quietly disappear. Then they can focus on entitlements and controlling QF. Maybe Scurrah does in fact get that, hence the ads, but it ain’t going to change anything.
Meanwhile, the poor bloody employees are seeing their entitlements whittled away week by week.
Hope won’t help pay bills, redundancy will.
The market will take years to recover, why have 2 players painfully limping on rather than one moderately strong player?
Control the monopoly with regulation.
Guarantee VAH employee entitlements.
What Scurrah & co don’t get is the sound of silence. If govt were ready with a definitive solution, we would have it. The lack of one indicates there will likely not be a rescue.
Its kinda getting awkward now, I suspect many in govt & elsewhere are just wanting VA to go away and quietly disappear. Then they can focus on entitlements and controlling QF. Maybe Scurrah does in fact get that, hence the ads, but it ain’t going to change anything.
Meanwhile, the poor bloody employees are seeing their entitlements whittled away week by week.
Hope won’t help pay bills, redundancy will.
Guarantee VAH employee entitlements.
https://www.ag.gov.au/industrial-rel...s/default.aspx
Meanwhile, the poor bloody employees are seeing their entitlements whittled away week by week.
I can see further industry support on the way...a package that supports the airports as critical infrastructure as well as the airlines. SYD airport will not be allowed to fail and it has massive debt repayments approaching. I note QF have stopped paying the airports. I suspect a package that addresses this will be forthcoming. It's not what Virgin want, but it controls more of the fixed costs for airlines and the lost revenue for the airports.
Spoiler
They are already guaranteed.
Makes a certain member of the executive teams $9 000 000 bonus last year just because they bought back their amazing Frequent Flyer program look pretty galling. I wonder what they value it at now?
ampclamp. Whilst being interviewed on ABC breakfast radio Paul Scurrah effectively said 90% of the shareholders in VA indicated there were no funds available for VA. He went on to say VA were attempting to raise from other sources. In my opinion the only option would be to sell owned assets such as aircraft. If the assets were required in the future it could be a sale and leaseback. As there is uncertainty re the future of VA the lease rates would be prohibitive on a sale and leaseback arrangement.
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The Morrison government appears to have ruled out any further support for the aviation sector, having already piled millions of dollars into an industry that has suffered at the hands of coronavirus.
Deputy Prime Minister Michael McCormack insists he wants all of Australia's airlines to come through the other side of the pandemic.
"We realise it's going to be very, very tough for them. COVID-19 is having a devastating effect on regional, domestic and international travel and we want to make sure that our aviation industry is protected," he told parliament on Wednesday.
"That's why the federal government is providing and has provided more than a billion dollars of support for aviation."
But Labor is urging the Morrison government to extend an additional financial lifeline to Virgin Australia, otherwise it will put hundreds of jobs at risk and damage the two major airline structure that has successfully supported the economy.
Virgin Australia, which is foreign owned, is seeking a $1.4 billion line of credit and a "statement of confidence" similar to what the government would grant the major banks.
Labor's transport spokeswoman Catherine King told parliament, during a debate on the $130 billion JobKeeper package, the government must extend a lifeline to Virgin.
"If it does not, it is taking an active decision to see one of our major airlines fail in this country, and that will have significant consequences for hundreds of workers in the aviation sector and across our economy to come," she said.
Virgin Australia boss Paul Scurrah warned the nation cannot afford to emerge from the pandemic with just a monopoly airline.
"We are not looking for a bailout," he said in an interview with The Australian.
"We are asking the government for a bridging facility and working with them to make sure there is confidence that people can look forward with certainty that there will be a competitive and robust airline industry coming out of the crisis."
Virgin Australia is 90 per cent owned by Etihad, Singapore Airlines, two Chinese conglomerates and Richard Branson's Virgin group.
Prime Minister Scott Morrison has previously cast doubt on the prospect of a lifeline.
Ms King welcomed the cash injection the government has already offered to around a dozen regional airlines and said it indicates the government is prepared to cushion businesses through this crisis.
"Labor believes the government must be flexible and be open to financially supporting our large aviation companies, including extending or guaranteeing lines of credit or taking an equity stake in the industry," she said.
"Such interventions will ensure that when the industry bounces back - and it will - government can recoup on its investment.
Mr Scurrah said the future of carrier's 9500 staff was dependent on the government's support.
"The federal government wants to emerge from this crisis with two airlines," he said.
"And without us, it is not going to have one. We all know what would happen if there was a monopoly."
Deputy Prime Minister Michael McCormack insists he wants all of Australia's airlines to come through the other side of the pandemic.
"We realise it's going to be very, very tough for them. COVID-19 is having a devastating effect on regional, domestic and international travel and we want to make sure that our aviation industry is protected," he told parliament on Wednesday.
"That's why the federal government is providing and has provided more than a billion dollars of support for aviation."
But Labor is urging the Morrison government to extend an additional financial lifeline to Virgin Australia, otherwise it will put hundreds of jobs at risk and damage the two major airline structure that has successfully supported the economy.
Virgin Australia, which is foreign owned, is seeking a $1.4 billion line of credit and a "statement of confidence" similar to what the government would grant the major banks.
Labor's transport spokeswoman Catherine King told parliament, during a debate on the $130 billion JobKeeper package, the government must extend a lifeline to Virgin.
"If it does not, it is taking an active decision to see one of our major airlines fail in this country, and that will have significant consequences for hundreds of workers in the aviation sector and across our economy to come," she said.
Virgin Australia boss Paul Scurrah warned the nation cannot afford to emerge from the pandemic with just a monopoly airline.
"We are not looking for a bailout," he said in an interview with The Australian.
"We are asking the government for a bridging facility and working with them to make sure there is confidence that people can look forward with certainty that there will be a competitive and robust airline industry coming out of the crisis."
Virgin Australia is 90 per cent owned by Etihad, Singapore Airlines, two Chinese conglomerates and Richard Branson's Virgin group.
Prime Minister Scott Morrison has previously cast doubt on the prospect of a lifeline.
Ms King welcomed the cash injection the government has already offered to around a dozen regional airlines and said it indicates the government is prepared to cushion businesses through this crisis.
"Labor believes the government must be flexible and be open to financially supporting our large aviation companies, including extending or guaranteeing lines of credit or taking an equity stake in the industry," she said.
"Such interventions will ensure that when the industry bounces back - and it will - government can recoup on its investment.
Mr Scurrah said the future of carrier's 9500 staff was dependent on the government's support.
"The federal government wants to emerge from this crisis with two airlines," he said.
"And without us, it is not going to have one. We all know what would happen if there was a monopoly."
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PS being honest that the owners - whose political/business crossovers are extensive - will not kick in funds could be seen as laying the (final) cards on the table.
There will never be a monopoly if VA go bust - first of all you need a travelling public TO monopolise, either government will facilitate the growth/induction of a new player (Alliance/Lion/PussyVirgin returning to its basics under the Tiger AOC....you know, the good old days when VA made money before delusions of adequacy/capability set in...whomever) and probably force QF to play nice until the market is better represented.
The owners aren't prepared to shore up their investment and wait/hope better days - yet the Australian govt should??
Yeah/nah....IMHO.
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SMH storey up now, labour has put pressure on the Government to bail VA out with the 1.4B they asked for. Why should the Australian tax payer bail out a foreign owned business!
In my junk email this morning was this incredible offer! Not quite up there with a Nigerian scam, but surely sailing close to the wind to be encouraging any expenditure on travel at the moment? I suppose the odd mug will see this as a deal not to be missed...
Dear Velocity member,
We want to let you know about some important changes we’re making to Velocity Global Wallet® from 4 May 2020 under our new Product Disclosure Statement (PDS).
* We’re reducing fees you pay when using your Velocity Global Wallet® card, including removing the 2.25% currency conversion fee2 (foreign exchange rates apply), supplementary card issue fee, and the $1.95 ATM transaction fee.
* You’ll earn 1 Velocity Point for every AU$4 spent in Australia on qualifying purchases.1
* No more ATM transaction fees when withdrawing cash in Australia and overseas.3
* We’re introducing a new load method via VISA/ Mastercard which will have a 0% load fee when loading into a foreign currency wallet, or 0.5% when loading into your AUD.
The updated PDS also includes the following important changes:
* Your Overseas earn rate remains the same, 2 Velocity Points for every AU$1 spent, on Qualifying Purchases.
* You will now earn 1 Velocity Point for every AU$4 spent, on Qualifying Purchases in Australia.1
* The Inactivity Fee will change to 0.5% of the Available Balance, with a minimum of AU$1 for accounts that have been inactive for 12 months.
* BPAY will still be FREE when you load into a Foreign Currency Wallet, and will have a fee of 0.5% of Funds Credited when you load into your Australian Wallet, with a minimum of AU$1 per Load.
* We’ve updated section 17.5 to indicate the assumptions you might be liable for losses arising from Unauthorised Transaction if you contributed to those losses through fraud, theft, illicit use or by inappropriate use of the card and PIN. These assumptions only apply to a very small number of transactions, losses will still be covered for most customers.
* We’ve updated the definition of Qualifying Purchases that allow you to earn Velocity Points, and included a section to explain you might stop earning Velocity Points if you use the product in a fraudulent or illicit way.
* We’ve updated the section where we describe what happens with Card Inactivity and Account Closure
Dear Velocity member,
We want to let you know about some important changes we’re making to Velocity Global Wallet® from 4 May 2020 under our new Product Disclosure Statement (PDS).
* We’re reducing fees you pay when using your Velocity Global Wallet® card, including removing the 2.25% currency conversion fee2 (foreign exchange rates apply), supplementary card issue fee, and the $1.95 ATM transaction fee.
* You’ll earn 1 Velocity Point for every AU$4 spent in Australia on qualifying purchases.1
* No more ATM transaction fees when withdrawing cash in Australia and overseas.3
* We’re introducing a new load method via VISA/ Mastercard which will have a 0% load fee when loading into a foreign currency wallet, or 0.5% when loading into your AUD.
The updated PDS also includes the following important changes:
* Your Overseas earn rate remains the same, 2 Velocity Points for every AU$1 spent, on Qualifying Purchases.
* You will now earn 1 Velocity Point for every AU$4 spent, on Qualifying Purchases in Australia.1
* The Inactivity Fee will change to 0.5% of the Available Balance, with a minimum of AU$1 for accounts that have been inactive for 12 months.
* BPAY will still be FREE when you load into a Foreign Currency Wallet, and will have a fee of 0.5% of Funds Credited when you load into your Australian Wallet, with a minimum of AU$1 per Load.
* We’ve updated section 17.5 to indicate the assumptions you might be liable for losses arising from Unauthorised Transaction if you contributed to those losses through fraud, theft, illicit use or by inappropriate use of the card and PIN. These assumptions only apply to a very small number of transactions, losses will still be covered for most customers.
* We’ve updated the definition of Qualifying Purchases that allow you to earn Velocity Points, and included a section to explain you might stop earning Velocity Points if you use the product in a fraudulent or illicit way.
* We’ve updated the section where we describe what happens with Card Inactivity and Account Closure
They’re still employing someone to come up with that crap?
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[QUOTE][ampclamp. Whilst being interviewed on ABC breakfast radio Paul Scurrah effectively said 90% of the shareholders in VA indicated there were no funds available for VA. He went on to say VA were attempting to raise from other sources/QUOTE]
Thanks B772, that is the first I've heard. Interesting.
Given it is a publicly traded company, that info, even if implied, is surely market sensitive.
If it is the case, the market needs to be equally informed. I think most holders likely assume the major holders will not support VAH any longer, but revealing that in an interview could be a breach of asx rules.
Thanks B772, that is the first I've heard. Interesting.
Given it is a publicly traded company, that info, even if implied, is surely market sensitive.
If it is the case, the market needs to be equally informed. I think most holders likely assume the major holders will not support VAH any longer, but revealing that in an interview could be a breach of asx rules.
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[QUOTE=ampclamp;10743585]
He didn’t say those words exactly. It’s more how you think it was to be interpreted, in your words. It was neither confirm or denial you could draw many strings from that.
[ampclamp. Whilst being interviewed on ABC breakfast radio Paul Scurrah effectively said 90% of the shareholders in VA indicated there were no funds available for VA. He went on to say VA were attempting to raise from other sources/QUOTE]
Thanks B772, that is the first I've heard. Interesting.
Given it is a publicly traded company, that info, even if implied, is surely market sensitive.
If it is the case, the market needs to be equally informed. I think most holders likely assume the major holders will not support VAH any longer, but revealing that in an interview could be a breach of asx rules.
Thanks B772, that is the first I've heard. Interesting.
Given it is a publicly traded company, that info, even if implied, is surely market sensitive.
If it is the case, the market needs to be equally informed. I think most holders likely assume the major holders will not support VAH any longer, but revealing that in an interview could be a breach of asx rules.
I’ve got many friends with Virgin and I really feel for them and their coworkers. I wish them the best out of all of this and hope they do make it through.
But let’s get real: we have a liberal government in power who are notorious for privatising everything and anything they can get their hands on. Government ownership of an airline goes against everything they believe in.
But it will be a Monopoly you say? Yes I’m sure that was a big concern when they privatised our airports, power stations, etc etc.
But let’s get real: we have a liberal government in power who are notorious for privatising everything and anything they can get their hands on. Government ownership of an airline goes against everything they believe in.
But it will be a Monopoly you say? Yes I’m sure that was a big concern when they privatised our airports, power stations, etc etc.
Plenty of good mates in VA. It’s not their fault. But a foreign owned outfit that hasn’t been able to get their stuff sorted after how long, beggars belief. If their OWN investors won’t stump up to keep their interest afloat, why the F should my tax paying dollars do it? Does it pass the pub test. Hell no.
Bit over the campaign on social media to lobby the government too. Bloody upset so much for my mates, but at the end of the day you flog something so much, it will stop.....most will comprehend this.
Bit over the campaign on social media to lobby the government too. Bloody upset so much for my mates, but at the end of the day you flog something so much, it will stop.....most will comprehend this.
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Plenty of good mates in VA. It’s not their fault. But a foreign owned outfit that hasn’t been able to get their stuff sorted after how long, beggars belief. If their OWN investors won’t stump up to keep their interest afloat, why the F should my tax paying dollars do it? Does it pass the pub test. Hell no.
As it currently stands as a business, VA has negative value. The shareholders know this better than everyone else and dont want to throw in more good money in after bad money. If they thought it had positive value they would be willing to try to save the business by injecting capital. If they didnt have the funds available then they would monetise their "valuable" shareholding by selling to another investor - but you cant sell something that has negative value.
Scurah is doing what any good minded CEO would do - trying to save the company for the benefit of the staff.
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we have a liberal government in power who are notorious for privatising everything and anything they can get their hands on.
Privitisation in Australia
Actually privitisation in Australia was started by the Hawke Labor government.
Privitisation in Australia
Privitisation in Australia
I think you’ll find monopolies like Sydney Airport Corp have Liberal fingerprints all over it. But I could be wrong.
And for the record, I’ve voted AGAINST both sides over the years and dislike them all. Sorry for the politics.