idea out of left field-new domestic airline
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idea out of left field-new domestic airline
was reading about Neeleman & his new Breeze airline in USA, which was going to use super cheap E195 jets from his Brazilian airline, as a start until his 60 x A220s arrived.
With Breeze start date now postponed, could Neeleman see one huge opportunity in Australia, if VA mark 2 doesn't get off the ground ?
He has the knowhow, he has the jets, he has the pilots/crew & other critical staff.
Are the Azul E195 jets similar to what VA used to fly around OZ ?
Or maybe he just picks up some very cheap B738s/A320s. Plenty of Australian crew available if no VA mark 2.
Everything Neeleman seems to touch in aviation, seems to turn to gold. 1stly Morris air bought out by Southwest, then he was involved somehow with start up of Westjet, then Jetblue, then Azul, then TAP Portugal.
With Breeze start date now postponed, could Neeleman see one huge opportunity in Australia, if VA mark 2 doesn't get off the ground ?
He has the knowhow, he has the jets, he has the pilots/crew & other critical staff.
Are the Azul E195 jets similar to what VA used to fly around OZ ?
Or maybe he just picks up some very cheap B738s/A320s. Plenty of Australian crew available if no VA mark 2.
Everything Neeleman seems to touch in aviation, seems to turn to gold. 1stly Morris air bought out by Southwest, then he was involved somehow with start up of Westjet, then Jetblue, then Azul, then TAP Portugal.
Last edited by BNEA320; 10th May 2020 at 03:11.
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Ok will do. Am starting quite a few threads this week. Nothing else to do. Have painted the house, decluttered. Cleaned out the home office. Got finances, what's left in order. Sold shares. Sold stuff I don't need. Got rid of one car. What else ?
I actually don’t think it sounds overly left field.
Who was the bloke who started VB in the first place?
A brand that at one point was gold.
Neeleman clearly knows the game, has the contacts.
At this stage wouldn’t we want someone with a great industry knowledge to get up and going?
Who was the bloke who started VB in the first place?
A brand that at one point was gold.
Neeleman clearly knows the game, has the contacts.
At this stage wouldn’t we want someone with a great industry knowledge to get up and going?
A real hard-core low cost airline won't work here as there are no secondary airports. The airports in Australia will just eat your competitive edge and hand it to QF. Whoever the second player is in the future will have to be some sort of full service carrier with all the trimmings.
was reading about Neeleman & his new Breeze airline in USA, which was going to use super cheap E195 jets from his Brazilian airline, as a start until his 60 x A220s arrived.
With Breeze start date now postponed, could Neeleman see one huge opportunity in Australia, if VA mark 2 doesn't get off the ground ?
With Breeze start date now postponed, could Neeleman see one huge opportunity in Australia, if VA mark 2 doesn't get off the ground ?
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QUOTE:
"He has the knowhow, he has the jets, he has the pilots/crew & other critical staff.."
Knowhow? Could very well have, but in Australia's unique environment?
A toxic, inept regulator to navigate. Monopoly airports gouging anyone and everyone they come in contact with. Maintenance costs almost double that in the US environment, militant unions and disinterested government. Excise inflated fuel costs.
QUOTE:
"With Breeze start date now postponed, could Neeleman see one huge opportunity in Australia, if VA mark 2 doesn't get off the ground ?"
If he is as smart as you say he is, he's likely to consider Australia not worth touching with a forty foot barge pole.
"He has the knowhow, he has the jets, he has the pilots/crew & other critical staff.."
Knowhow? Could very well have, but in Australia's unique environment?
A toxic, inept regulator to navigate. Monopoly airports gouging anyone and everyone they come in contact with. Maintenance costs almost double that in the US environment, militant unions and disinterested government. Excise inflated fuel costs.
QUOTE:
"With Breeze start date now postponed, could Neeleman see one huge opportunity in Australia, if VA mark 2 doesn't get off the ground ?"
If he is as smart as you say he is, he's likely to consider Australia not worth touching with a forty foot barge pole.
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A real hard-core low cost airline won't work here as there are no secondary airports. The airports in Australia will just eat your competitive edge and hand it to QF. Whoever the second player is in the future will have to be some sort of full service carrier with all the trimmings.
Neeleman seems to love tech as long as it works properly & save airline money.
>>>>
"Breeze business model
Breeze professes that it wants to offer a low cost product - but says it also plans to offer a first class product; so it will not be operating a true low cost carrier (LCC) model.The proposals do include some LCC features (such as a point-to-point route network, extra fees for additional services, and (originally) a single class of aircraft), but it will not have a single class of cabin (those paying higher fares are promised a 2-2 seat configuration and more legroom) and indeed Breeze says it will charge for "what’s effectively four classes of service, starting with an ultra-low-fare product, from which you can buy your way up the ladder... ". Aircraft will not feature seatback in flight entertainment; instead entertainment will be streamed through the airline's app, which will also be used to purchase flights and upgrades.=10.8333px"
>>>>
Jetblue hardly low cost in traditional sense. TAP Portugal not low cost as we think of it.
He has plenty of experience in all areas.
So all he has to do, is have a decent frequency on the golden triangle (more than JQ, which will never ever have high frequency on the triangle) & be cheaper than QF. Many are looking at cheaper everything at present as recession bites. Not hard to be better than QF & if you've got a cost advantage, you can throw things around like all sorts of freebees. TAP is also a member of star alliance.
Nothing to say new airline couldn't have small lounges at BNE, SYD, MEL.
Last edited by BNEA320; 10th May 2020 at 06:32.
Nothing left-field in that, a well worn path ... buy "cheap" aircraft, fly for a bit, and go broke ... it's a tradition in Australia.
- Compass I
- Compass II
- Jetgo
- Ozjet
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VB leased 2 x AN B734 if I remember.
The issue that will be weighing much more heavily on any prospective buyers contemplating trying to soldier on under the Virgin banner is the value of the Travel Bank liability; all those punters out there holding on to travel credit vouchers for cancelled flights. That value hasn't been included in any of the public disclosures yet for the simple reason that it's a contingent liability. While the airline continues to be an airline there's the possibility that that liability can be discharged in the course of its normal business.
So, if you're contemplating buying the carcass and building your business out of the VA customer base then you are pretty well committed to having to honour the travel credits at face value or very bloody close to it. The value of the Travel Bank hasn't been disclosed yet but it is likely to be a very big number, perhaps $1 billion. The value of Unearned Revenue (cash held for flights yet to be flown) as at 31 December 2019 was $1.2 billion and Unearned Revenue is probably a very good surrogate for the Travel Bank.
Whatever the value is, probably 80 percent of that is going to be foregone revenue in your first year of operation. It will hit your bottom line such that year one will be a very significant loss, but more importantly it will hit cash flow. The business will have to be cashed up to the eyeballs to get through its first year. I would think that it will be pretty well diabolical for any buyer who is thinking of continuing to wave the Virgin banner in any shape or form.