Qantas fleet Choices:A Perspective
 

Summary
Cutting out premium seating undermines an already precarious business case for the A380 – did Qantas prematurely write off the 777-300ER as well as 747-8 Intercontinental?

Analysis
Former CEO Geoff Dixon was one of the first to lambaste the 747-8 Intercontinental. As part of the original “Working Together” advisory group, Qantas is the only member not to have purchased a single 777.

Dixon confessed that not buying the 777-300ER had hampered Qantas’ ability to effectively compete with new entrants - and not just on the lucrative Australia-US segment.

With Airbus dilly-dallying on A380 production rates it cannot hope to achieve within even a decade, Qantas faces a mounting prospect of behind left behind its rivals.

The carrier deferred its A380’s, it has delayed, swapped and chopped its 787 orders and yet works towards phasing out its ageing 747-400 fleet with nothing to step in to replace that capacity.

That the airline is considering cutting business class seating from its A380 fleet is a startling indictment at the sheer gravity of the mistake of overbuying a big bird whose “flexibility” in a downturn is as commensurate to using gasoline to extinguish a forest fire.

That’s before we consider that Qantas has a hefty batch of 767-300s that need divesting hurriedly too.

Alan Joyce hasn’t had the dream start to his role he may have wished for. Domestic traffic erosion, Tiger Airways, Virgin Blue and new competition on US routes means Qantas has a rockier future ahead of it – perhaps that’s why Joyce alluded to a decade or more to elapse before Qantas could consider merger overtures.

The common theme in this entire quandary is the over-ambitious pep talks on how the A380 would be all things to all long haul airlines.

Reality has shown it to be everything its not.

Shrinking market, half of the 16 customers have deferred orders, a terminated freighter variant and a volatile production regime that shows no sign of stability.

Qantas has already made moves to drop First Class from a slew of key routes – to consider business class immune is at best a hollow fantasy.

If, as expected, Qantas takes the cull to its business class sections, the very ethos of John Leahy’s “you can break-even at 65% load factor on the A380” mantra evaporates as quickly as the Airbus E-Squared concept response to Boeing’s former Sonic Cruiser.

With Qantas increasing freight operations to the USA and having nothing efficient to fly it on when a rebound occurs means their planning will become unstuck.

Dixon was way too quick to condemn the 747-8 Intercontinental – such incremental growth could slot right into its fleet and global network with no problems. Equally, the 777-300ER could play a fundamental role on European routes that Jetstar hoped to ply 787s with.

For the interim, 777s could play a productive role – even the newest 777-300ER customer in Turkish Airlines is poised to deploy the airplane on routes to Australia.

It takes a big man to make big decisions.

Dixon is no longer at the helm of Qantas, although he was indeed man enough to admit the 777 should have been in the fleet.

The question is whether the Alan Joyce is man enough to bite the bullet and order the 777 and/or 747-8 Intercontinental to make up for the failings of the A380.

This author consults with leading institutions through GLG
Analyses are solely the work of the authors and have not been edited or endorsed by GLG.
Contributed by a Member of the GLG Energy & Industrials Councils
So, guys how interesting is that?

A Special Industry Insider Report by John Alwyn-Jones – e-TravelBlackbaord’s Special Correspondent.

clearly an interesting perspecitive.. passenger reaction is really good on the A380 but can the airline really compete with it....

hard to know i guess only time will tell..

personally i would feel a bit better if Qantas had a real replacement for the older 747 in the wings... rather than a pipe dream of the 787 variants still on the drawing boards

Wrong Choice
 

Aviation is cyclical.An understatement obviously.So why would you purchase an aircraft that is only suitable for the top of the cycle?
The 777 offers flexibilities that the A380 does not.At least Scrotum Face admitted he made a mistake.Will Joyce buy 777s now?If he doesnt he is a bigger fool than Dixon

Any long haul carrier today that is NOT using 777's should get out of the game

Wrong Mindset,Wrong Skillset
 

When James Strong and his cobbers from TAA took over Qantas they removed all the red tail men that had experience at running an international airline.
When Strong couldnt make the changes he wanted he spat the dummy and left.Enter Geoff Dixon an ex journo with a few politico mates.His experience at running a large international airline...zilch.
They couldnt run an airline but they discovered they could make a lot of money...for themselves.
Hence poor decisions...
No 777s
Purchase of A330s in the wrong configuration and wrong fuel tank capacity.
Commitment to the A380.
Freight price fixing..mea culpa
Gutting E and M spares inventory
Disengaging staff through fear management.
The EQ platform
The second rate introduction of the Blackberry..now an excellent doorstop
Cutting back on maintenance when having the oldest fleet in the western world.
Threatening and bluffing LAMES.
All adding up to trashing an iconic Australian Brand.
But as the author of the original piece discusses buying the A380 was the biggest blunder.
Thieving incompetent bunglers

c guard
 

yes yes yes you hit the nail on the head ....but we have an up to date IT intranet.....oops.....no we dont add that to the list and we are still waiting for AJ and his mates to walk the talk he gave us some months ago....the only difference between qf and circus is that we have more clowns at qf:(

How long has it taken for you guys to realise what a nasty little a'hole the bow tie was.
Time and time again we have heard he was wonderful, he had the most talent of any recent CEO, he engaged the staff (cc at least).

At last someone has woken up.

The worst of it is that he taught scrotum face how to be an a'hole, and then GD perfected it.

That feels better.:ok: tata

Maui

777
 

Top post Crossing Guard.

Dicko use to bang on about LEGACY CARRIERS ........well guess what we have THE DIXON LEGACY now.

Your list of QF failures is on the money.

Any chump can work out the 777 was/is the aircraft for QF.......for Christ sake even the poms ( BA) bought them !!!!!:eek:

The honey moon is over for AJ.......its time to deliver matey.

Otherwise this period will be known as the Leprochaun wearing a bow tie below a scrotum face ........LEGACY :hmm:

Nice of Scrotum face to admit he made a mistake as he was walking out the door, that was so big and strong of him.

The man is an egotistical fool who plays games with peoples lives, he made a costly mistake,and he doesnt need to face up to the consequences.

Any new fleet choice requires spending A LOT of precious CASH.

Even the big boys in the middle east have reigned that in, so who here sees QF being a bit contrary and opening the wallet?

What? Huh? is that silence I hear? I thought so....

No 777's coming for QF any time soon, that horse has bolted...

Convert dream[ing]liner slots to 777 ????

Business 101

You've got to spend money to make money!

I reckon they screwed up when they cancelled 15 787's they should have converted it to 10 or so 777's with an immediate delivery schedule in place and they may have got them at cheap rates considering Boeing has only got a handful of orders this year.

No Experience and No Idea
 

If you told most of QF senior management that you had some DC3s in pristine condition for sale they would jump at them.
How can you run an airline with management that are clueless.?
No one at QF has any noteworthy experience running an international airline.
No wonder the fleet composition is a mess.The A380 will prove to be a millstone around the Qantas coporate neck

Thought of an interesting parallel.Qantas from memory took it's first 747 in 1971 and the oil crisis hit in 1972 or 1973.Now they have just received the latest wide body aircraft just in time for this GFC.
GD has admitted he got it wrong with the 777 but even if AJ wanted to spend the money on the 777 how long would it take to take delivery?

They have the money
 

SH
As i recall they raised bucket loads of money a year or two ago to finance the new fleet. What happened to all those billions of dollars? ? ?

Billions of Dollars?
 

That would be for bonuses to management if things get really really tight

Rumour has it that Peter Gregg and his family were "sponsored" a fully paid up and rather lavish European holiday around the time of the Airbus order.

Ohhh Ditch..

I think it would be completely reprehensible to even infer that there would have been any incentives or favourable treatment given to airline execs so as to influence their decision on aircraft purchases....:E

I mean to say this is not like the Olympics....:E:E:E:E

If QF aren't careful, they will find themselves in a very similar fleet (age and maintenance) position as Ansett. Whilst the dollar is good and demand is down, QF should be making some real decisions for the future. Stop focusing on the doom and gloom and see this as an opportunity to get ahead of your competition.

Correct me if I'm wrong but did QF also not long ago cancel orders for new 73's. How they can keep operating 73-400s locally and across the ditch I have no idea. Many of the 3rd world African countries have a more modern fleet than QF.