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Lets hope you're wrong SOPS because there'll be no government handout.
Merry Xmas then, Ho Ho f&$@ing Ho. :\ |
I'm with FPV Dude
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Spot on Variable. As a 89er, the last thing I wanted to do was create upheaval in the family, take kids out of school, leave aging parents, and try to find homes for the pets, to say nothing of selling or renting your house, and moving OS, with a family who wanted to do anything but. For some, they thrive on it, but for many its very traumatic, and trailing a pack of kids around the world, and a wife, who is homesick before you leave Sydney, is not much fun. To add to that we had a couple of close mates, top themselves, because it was a case of loss of job, wife, kids, home. I truly hope, this is not the lot of the next generation of pilots, once was enough.
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65%line in the sand furphy.
The reason domestic is now rooted is the ridiculous notion that 65% is the holy grail.
Example. DRW-SYD red eye route. Example as I've seen. Qantas 738 Jetstar A320 and Virgin 737. Qantas pax about 120 Jetstar pax about 100 Virgin pax about 150 All flights leave within 10 minutes of each other. By definition qantas group has 65% of seats available. If the disproportion of passengers carried is to Virgin, which is increasingly happening, due to their increasing yield, and probably better product, who's making money here? |
I cannot see what AJ is on about. The company is in no immediate danger of collapse, with (reportedly) $2b in the bank, these losses can be sustained for a while. The problem is in the policies, direction and structure. These need to change in order to get the company back into profitability. Simply wanting more cash or government backing is just delaying the inevitable. The path that this management team have lead the company down is wrong. They need to admit they f$&@ed up and change direction. It's simple, what they are currently doing, DOES NOT WORK!:ugh:
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I reckon there are 2 outcomes, whether Joyce stays or not, the current plan is continued and QF peters out / collapses in 5-7 years or there is a Strategy change and still another 3000 - 8000 job losses while the joint organises itself, either way brutal pain for a lot of QF Staff.
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S-Curve
post#677
It is this obsession with 65 per cent market share - as well as some flawed strategies in Asia and a focus on Jetstar - that has got Joyce and the airline in the present situation. The concern is the 65 per cent market share line in the sand is based on the ''S-curve'' phenomenon, which measures capacity share against revenue share. The theory is there is a certain profit optimisation point where if you add more capacity, you get little in the way of increased revenue, but if you lose capacity, revenue can fall off a cliff. Joyce believes the figure that needs to be protected is 65 per cent. According to a McKinsey paper published a few years ago, the S-curve is based on the premise that airlines providing a high frequency of flights attaining disproportionately high market shares. The high-margin corporate market flies with carriers that offer the most flights, lounges and loyalty programs. What it does do in reality is forces a significant reduction in frequency of each entity compared to its potential to prevent massive over capacity, and hence negates the rational for the 65% line in the sand logic. QF strong armed the punters by giving them no choice, simply pulling QF domestic out of certain ports. Punters simply aren't going to jump on the next "Qantas Group"™ aircraft available - they are likely to want either the premium or LCC, not a mix and match of both, or walk to the "Group" opposition. |
Big Balls
I cannot see what AJ is on about. The company is in no immediate danger of collapse, with (reportedly) $2b in the bank, these losses can be sustained for a while. The problem is in the policies, direction and structure. Compare the level of support that Qantas is seeking with the level of support that was afforded the big 4 banks (ANZ, CBA, NAB, WBC). Is this any different? QAN with 15.9 billion in revenue, 20.2 billion in assets and 33,000 employees is the 10th largest employer in Australia. 10. Qantas 9. Westpac 8. Telstra 7. Spotless 6. CBA 5. ANZ 4. Rio Tinto 3. BHP Billiton 2. Woolworths 1. Westfarmers I'd like to see P/L statements for each business group. I also think that Qantas are playing the man (Borghetti) rather than focussing on a sustainable future. |
If Qantas were let fail the minimum outcome would be Jetstar sold off as a profit making concern, Qlink sold off as its probably the most profitable outfit in the country at the moment, QF international bought by the taxpayer and QF domestic fed to the wolves. That's my prediction. SN |
They Know Not What They Do.............
Yeah, well, and lets allow the ABC to repeat.
Reading between the lines has never been easier. Insiders - 06/11/2011: Politicians dispute Qantas grounding timing - Insiders - ABC |
I could be wrong, but in my opinion 2 billion is not a lot of money in relative terms. Especially in the airline buisness. And if things start going wrong, I think it would be easy to burn through 2billion dollars in a relatively short period of time.
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Wasn't that $2 billion more like $3.5 billion not so very long ago? :confused:
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Rumour
Hot Tip for the week.
'heard from a very reliable source....that there will be movement afoot from ye olde Darth Dixon. Apparently he was seen with a couple of financial heavies- having a very long lunch today with very solemn faces indeed. I reckon Darth & Co. could make a tilt with the share price so low. Wednesday ...could be interesting.:eek: |
Everyone just needs to stop and take a deep breath...
QF has just announced an expectation of an operating loss. It is not like they are not trading insolvent. The fact is the they are far from it! This is mostly just a show brought in by VA's announcement of a capital raising, to garner whatever government support they can either financially or legally. The process of restructure is continuing and would have continued regardless of VA's announcement or not.
Plenty of companies trade at a loss for periods short and long and airlines are no different. SOPS is correct that that it is easy to burn through $2B quickly in a capital intensive business, but there are many levers that management will pull to avoid that. Sale of assets, decreased depreciation etc. The sky is not falling in just yet. |
SOPS
Dead right, 2B is bugger all to an airline the size of QF. If things go pear shaped they could burn that easily in two years and once that rate of loss is started its very hard to stop. Losing 1000 jobs is not gonna do it. QF needs fundamental change at all levels. Dr dre I think the taxpayer still wants a national carrier, by definition that is QF international, the original Qantas. Adding domestic into the equation would make it too expensive and the country can't afford it. SN |
Overseas news Qantas is junk,bad reputation,now no one will fly.friends now now not using qantas,many are afraid that aircraft not require maintenance becoming reality >>>>quote AJ<<<.fly Garuda now.
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New 'S curve' - Share price of $1.00
My prediction is that Dixon and Associates will make a play for QF the minute the share price dips below $1.00, which could happen this week as every time Joyce opens his mouth the price dips. One more negative announcement this week and I reckon it's all over red rover. Scrotum Face and an assortment of sharks will dive in and the feathers will fly. And this would suit everybody, except the general staff of course. Dixon would get his prize and then slice and dice it , making hundred of millions for his bank account in the process. Joyce and Co get their payouts and fly off into the sunset to a small island where all you do is drink piña coladas by the pool while being served by waiters in budgy smugglers, plus they leave with reputations in the business world intact. Joe Hockey Stick does not have to hand over a cent of taxpayer money and the spin doctors get busy blaming everything on overpaid pilots, pesky engineers, the world economy, Kim Jong Il, global warming etc etc etc. Life goes on, the rich get richer and everybody else cops it in the a#s as per usual.
Either way, once the war has finished, the dust settles and a new chapter commences one thing is for certain - the faces of Joyce, Clifford, Dixon and friends will not find a 'warm reception' around our great country should they have the balls to exit their secure ivory towers and mingle with the peasants. I can already visualize the wanted posters on the Anonymous website! |
Load factors on the 484-seat Qantas A380s, which ply routes from Melbourne and Sydney to its new base in Dubai, have been weak. Crews have pointed to a large number of empty seats on the flights over the last month.
Read more: As storm clouds close in, Qantas' distress calls go unanswered Emirates and Singapore airline now laughing,you can't buy a seat on this flight but qantas it is still available,good for staff travel. |
Load factors on the 484-seat Qantas A380s, which ply routes from Melbourne and Sydney to its new base in Dubai, have been weak. Crews have pointed to a large number of empty seats on the flights over the last month. |
My reading of the information suggests sub 90c as the trigger.
As I said, the game has been in play for some time and ( to mix metaphors) Al is the lead player. D'son and co will indeed find they can show their faces as they will ride into town as a rescue posse when all seems lost. I hope I'm reading this all wrong, I really do. |
Can they buy enough to take control?
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If an asset sale takes place ( see SMH Dec9th ) this may all be staved off for a while but ultimately Qantas has the goods to sell and that's what the Govt expects them to do.
Not sure how much the others own as I thought they sold off their shares 12 months ago. If the price goes low enough, they could make a move.Depends on whether they are currently actively courting the institutional investors with any degree of success. OR- ...? Who really knows, but beauty sleep awaits...:zzz: |
Whatever happens, the company can't be turned around with the current CEO/senior management/board in place.
No matter how good their plan of attack is (assuming they come up with one), they simply won't have the support of the staff. A fresh new leader who has the respect of staff is the only way forward I'm afraid. Until then, it's just more of the same :rolleyes: |
To me in having Jetstar doing international routes booked through Qantas and Qantas PAXs has ruined the Qantas brand world wide, Jetstar had the wrong management with the wrong attitude from the beginning, shown from the different winning style of Virgin. I would suggest the wrong aircraft, the wrong company plan, the wrong people at the top, and there is no change of rules that will support a failing business. Qantas is a great company that has been badly lead or well led for a takeover.:)
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A model of how to lose business FOR over 30 years, as a regular passenger on Qantas domestic flights, I have seen its customer service nosedive. Although a member of Qantas's frequent flyer program and the Qantas Club, I take every opportunity to fly with any other airline. Back when Qantas had genuine competition from Ansett, the attitude of frontline staff was merely insufferable arrogance: this is how we do things; if you don't like it, take your business elsewhere. They were unsackable, with salaries underwritten by the taxpayer - like public servants (but without the same accountability) or ABC journalists. With Ansett grounded, any pretence of providing customer service disappeared. Qantas achieved a virtual monopoly with business travellers on major routes, and no amount of surly behaviour or rudeness could harm their profits. To attract new customers, it spent a fortune on some of the most expensive advertisements ever produced in this country. Yet staff did everything possible to drive away existing ones, certain in the knowledge they had no alternative but to keep coming back for more. The final insult was abolishing check-in services altogether, forcing passengers to do it for themselves. One recalls, almost fondly, waiting an hour in a queue to be insulted and abused at the check-in. At least when Qantas lost your bags, they couldn't claim that you must have tagged your own bags incorrectly. This deterioration is not imagined. That customer service has declined dramatically is demonstrated by the fact that one (and only one) branch of Qantas's operations has managed to maintain traditional standards. Not in ticket sales, nor at check-in, nor on the aircraft, nor even in the club lounge, where the new policy of "the customer is always wrong" now prevails. Traditional customer service has survived only at valet parking desks. This isn't surprising. Valet parking is optional. You can take a taxi, park your own car, even catch public transport. Nobody is compelled to use valet parking. And most customers wouldn't, if treated with the contempt they receive elsewhere from Qantas. This perfectly demonstrates that, absent monopolistic dominance, the availability of genuine alternatives conduces to higher standards of customer service. Other Qantas staff fully understand that the passenger has already bought and paid for a ticket, and won't change carriers at the last moment; that, with the largest number of seats across major inter-city routes, Qantas offers a flexibility which other airlines can't match. Exemplary customer service is not required to prevent passengers seeking alternatives, now or in the future. But, with valet parking, the level of customer service makes all the difference, which explains this unique exception to the new standard. Qantas enjoys huge commercial advantages over competitors: its existing customer base, incomparable brand recognition, and an unmatched safety record; the xenophobic attraction of being the "national carrier"; and, despite Virgin Australia's best endeavours, the capacity to offer greater flexibility. So the fact Qantas is losing money, hand over fist, suggests nothing short of incompetence. When one reads that 1000 or more Qantas staff are in peril of losing their jobs, one naturally feels for the individuals concerned. But, collectively, they have brought this upon themselves. If Alan Joyce wants to do something meaningful to save his ailing airline, he should appoint a few valet parking staff to retrain the rest of the company's frontline employees. The worst possible response would be any form of government assistance, direct or indirect. That would simply guarantee Qantas can continue to provide a substandard service, without facing the inevitable financial consequences that all other businesses face when they neglect paying customers. Anthony Morris QC is a Brisbane barrister. |
^^ Very very true.^^
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QANTAS has about 2.2 billion shares on issue. At a share price of 1 buck and 2 billion in cash on the balance sheet how can a takeover NOT be in the offing?
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QANTAS has about 2.2 billion shares on issue. At a share price of 1 buck and 2 billion in cash on the balance sheet how can a takeover NOT be in the offing? |
With management this bad, after culling heads for the umpteenth time, the solution will probably be rolled out as a new livery with minuscule adjustments to the 'roo, the font, and some international b-list fashionista redesigning the uniform at vast expense.
Kardashians, anyone? |
My understanding is that a large chunk of the $2bn is guaranteed against debt. Airlines need large cash buffers to guard against short term hiccups. There is no way that is all free cash they can spend without being technically insolvent.
JB did say about two years back that Virgin were better situated to sustain a fare war than Qantas. He may well have been correct. My guess is that the $900m full year loss would result in the Company trading insolvent, hence AJ's increased sense of urgency. |
Over the last 46 years of my experience, every time QF is about to have a big loss they revamp the uniform at considerable expense.
When the latest one was announced, I commented to friends that this would be the first new uniform I'd seen that wasn't associated with some internal financial crisis. I was wrong!!:ugh: G'day ;) |
Hooking into QF, public servants and the ABC all in the one sentence.
Anthony Morris QC sure knows his audience at The Australian.:p |
Richo said it
They need to look at the board and the management because it's not terribly well run. |
So true unfortunately about Qantas service. There are always exceptions of course but the general rule was that Ansett was all over Qf in service and approachability of staff. (Of course there were always the petty tyrants at the Ansett waitlist counter!!)
But it's important to remember that there isn't always a satisfying reason or justification for things that happen. Good people have bad things happen to them, once great companies can find themselves in unrecoverable situations. It is a tragedy to all concerned when it happens, but management is just one component( a big one , but just one). In this brave new world of aviation, the airlines on the ascendant have very low cost structures due to their demographic and economic base. Work practices are less rigid, and of course wages and conditions are commensurate with that. As global citizens, we are loyal to the dollar and not so much to the carrier. We use search engines to locate the flights to and from our destination, and usually choose what we see as the best value for our money. I have to say this is rarely Qantas in my experience, but if it were remotely close I would still choose Qantas, I just haven't been able to justify that over the last few years. The product provided is not differentiated enough from others to warrant the higher cost base. As difficult as it is to accept, wages are way too high ( about 30% too high) to enable Qantas to be a significant competitor. They have given away their advantage of destination variety to a LCC that only some wish to subject themselves to over a long flight, and now it is easier and cheaper to travel with one of the many other airlines who can get you there faster and/or cheaper. Other airlines coming into the country have strangled the only other advantage they had. The Government must take some responsibility for that, but then again , they have ensured competitively low fares and more are able to travel than ever before. . Sure, sack the board, put in others who know a bit more about what this business essentially is and what it needs to do, but everyone also needs to accept that the new management would still be faced with the same problems. Whatever decisions have been made in the past and the consequences of them, however true and justified the vocal recriminations, nothing can change the past. Look at what you have to work with and come to terms with what the new reality is. Looking back constantly with regret, prevents anyone from looking forward to a solution and seeing that solution clearly. Just my thoughts based on past personal experiences.:) |
Incompetent CEO's at anything fiddle with the logo and paint. They want to put their stamp on the place, and as they are probably unlikely to manage it in a meaningful way, why not have a go at the expensive and irrelevant? In AJ's case, as an airline CEO he makes a fantastic room renovator. His largesse knew no bounds as far as buildings, lounges, offices, parties and then that horrible club foot Kangaroo. And how could any self respecting BGA leave out playing with clothes?
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Sheehan's not just talking about the pilots here. This is a reference to all union activity at Qantas. Unfortunately, the position he espouses is one shared by the majority.
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Their plan?
Let Qantas declare itself broke. Sack everybody and let Jetstar take over. Everybody gets reemployed on half salary ... Does anybody remember 1989?
Seriously there is an evil plan. Bus Drivers on $500,000 are in target range |
Just put up on SMH business pages; Food for thought??
QBE Insurance Group's chair, Belinda Hutchinson, has signalled her retirement from the insurance behemoth as the company disappointed investors with yet another major profit downgrade. Ms Hutchinson, who was appointed chairman in July 2010, led the company's board during a difficult period for QBE following years of aggressive acquisitions. QBE said on Monday that it would suffer an expected $US250 million ($274.8 million) net loss for the year to December, as profit hits from its beleaguered US division festered. The insurer is expected to post a cash net profit of around $US850 million for the year, and an insurance profit margin of around 6 per cent – nearly half the previously flagged 11 per cent. Advertisement The insurer has failed to meet its full year profit guidance every year since 2009. US-based QBE director Marty Becker, the former chief of Alterra Capital Holdings who joined the Australian insurer's board four months ago, has been named the new chair. |
This is a reference to all union activity at Qantas. I think Tony Morris has a point, but from personal experience many of those staff started out as keen, helpful people and ended up with a bad attitude due to the horrible way they were treated by Qantas management year in year out. That's not the right way to behave, but it's still understandable. |
"Virgin has to deal with unions too"
Yes of course they do, but the difference is that Virgin began from a lower $ base and the negs are all about trying to lift that to bridge the gap between them and the opposition. The problem is , Qf base has always been so much higher and now in order to be competitive they need to lower it- hence the conflict with the unions. Also VA has had the benefit of most staff experiencing the growth of the airline from nothing and the pride ensuing from that. More likely then that the staff feel more connected to the challenges. Having said that disenchantment certainly exists at VA too especially in the ground ops. They feel the pinch of not enough money every day. |
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