Break even at 98%
 

There is something very disturbing that JQ require such a high load factor to break even.

I wonder what other LCC require?

And legacy carriers such as QF mainline / SQ / TG etc

98% load factor to break even, even with Mama Mainline paying the bills? :eek:

I'd love to see how the Orange Cancer would make money as a standalone company.

98% load factor to break even? As well as an impossible load factor to maintain for any airline,there is serious management shortfalls if that is a correct figure....oh wait we are talking about Jetstar.... Disregard...

Bankrunner you may see that sooner than you think :(

96% load factors to be profitable?

Nah, this is PPRUNE, if they don't get 103% load then they're stuffed and mainline will have to pay off the total debt of the USA.

Romulus.

The figure of 98% load factor (excluding ancillaries) to break even was quoted at a JQ staff briefing earlier this year by DH.

When I see high load factors published for JQ, it doesn't equate to profit.

V-Jet. My bad. That should have read muffins.

I've been through proud to be a associated with QF, honoured to get a job, knowing it 'will all be OK' to frustrated, apathetic, shocked, angry and now I just have to laugh and throw stupid comments back at 'them' (which should be 'we') about muffins/donuts. And you know, there is probably a very flashy ppt presentation in an office somewhere that shows exactly why muffins are better than donuts.

This is probably Australia's only true internationally recognised iconic brand we are openly mocking. And we actually care about the place!

You could not make this stuff up!

Wolf of Wall Street was surely not meant to be an airline owners handbook!!

Your right V Jet.

You couldn't make this stuff up.

The QF 767 dedicated freighter goes in for Maintanence and the mainliners cover the flying.

It may have been more palatable if QF Freight weren't gearing up for some more promotional training early in the new year.

It typically costs a couple of million dollars per year to maintain a high cap AOC, these costs include the Head of Flight Ops, the head of Training and Checking, the administrative staff, compliance costs etc.

I can't see the value in having QF freight, an operation which flies aircraft operated by its owner, operate on a separate AOC.

Ah - The pilot costs are lower in QF freight I hear you say!

Possibly if you look at the costs on a per unit basis BUT the reality is that adding the night freight flying to the QF 737 and 767 pax flying results in a minuscule increase in overall flying and allows guys operating on min guaranteed hours or less each month to gain some flying. If someone needs leave, there are plenty of others to fill the seat. If you need sim, then you do sim anyway so it's covered, if someone goes sick there is a much bigger pool of available pilots to pick up the lost trip.

It is an incremental cost only

On the other hand you could do what they have done, employ people on lower terms and conditions but they only fly on night freight, so the work has to be spread across a dedicated group - this by itself makes it inherently inefficient.

Add to that the cost of sim, leave, reserve coverage, training if someone leaves to get a better paying job, the cost of paying for a separate management structure, and the lower salaries for the pilots becomes a much bigger overall cost to the mothership.

Economies of scale will almost always win out and having "boutique" operations just to screw wages down is short sighted and dumb.

After all, you canna change the laws of physics cap'n as a Scottish engineer would say and regardless of whether it is a mainline pilot or EFA pilot, the fuel burn will be roughly the same (the overall level of pissedoffness if that is a word I can use will impact this slightly), the air Nav charges are the same, the lease costs on each airframe are the same, the engineering support is basically the same (same discussion re engineering) , so your basic input costs - fuel, lease, maintenance, air Nav are all the same regardless of who crews the machines, so the motivation for separating out the pilot group must be to screw down wages.

So if Alan and the board want to save a million bucks a year off the cuff how about looking at the structure of the business and seeing where economies of scale can be made.

This seems opposite to what they are up to with the separation of AOC's etc, but breaking the operation up into smaller chunks can only increase your costs not decrease them, without achieving the ultimate aim which is supposedly accountability.

PS the same discussion could be had with regards that amaaazing business called Jetstar? QF operate A330's and did before JQ came on the scene. QF could have still bought A320's if they wanted, still painted them with the Jetstar branding, and still operated them on the QF mainline AOC. They could have CCQ'd the 330 crews and had them doing domestic and international work -efficient flying with lots of variety -economies of scale at work.

Would it have been cheaper? Dunno, but it is worth doing the maths and worth having a discussion from an industrial perspective to see what could have been done to better facilitate the flying being done by mainline.

V Australia and Virgin Blue tried the same thing when V was established. It didn't work and ultimately V was rolled into VB or VAA as it was by then.

#1310
Mstr Caution, nothing like giving a heads up to your major Australian competitor as well, imagine Air NZ making a quick call to Virgin and saying a few things like:
all systems go,
you can expand in Perth,
you are correct John, they haven't got a clue,
you are correct John, they are only focused on the FIFO segment,

A quick look at the Virgin Australia careers site shows a few jobs in Perth,
Safety and Quality Specialist,
Quality Assessor,
Ground Operations Outsourced Ports Trainer,
Reliability Team Support Advisor,
Flight Safety Manager,
Line Planning Engineer,
Regional Cabin Crew - Perth,

John's transformation continues........

Snakecharma the old V Australia AOC is the VAI AOC in the Virgin Group. It didn't get rolled at all.

Borghetti to throw in free catering for domestic SLF
 

Virgin Australia keeps upping the ante in domestic. They've signalled they're going to start offering meals. What next - baggage included?

They're systematically eroding all QF's differentiation and doing it smartly. They're roasting Alan slowly.

When did you last see a marketing innovation from Qantas? Long before the dividends disappeared... Sack the CEO and the board now!

I wish "last unread post" worked...:(

JB & his team must be getting pretty nervous about now. (Sarcasm applied)

AJ's got his weapon of choice, JQ.

VA's value for money service with a great product to holiday destinations like Bali, Fiji & Phuket versus AJ's JQ.

QF strategic mistakes were made years ago, replacing QF services with that of JQ. Forcing the JQ product on punters and marketing it as "now you have a choice"

Well. Now AJ's customers certainly do have a choice. VA.

73 to 91.

AirNZ only wanted 2 engineers to cover their Perth 777 flying.

Rather than look at the contract as a revenue source, QF declined the revenue source.

Much like the Sydney international baggage handling. Five years ago QF baggage handlers turned around the majority of international services at Sydney. Progressively QF failed to pursue renewing handling contracts.

QF International baggage handlers would turn around other airlines in between QF services. QF didn't renew contracts, so handlers sat idle in between QF services shaking there heads at the loss of productivity.

Happy Xmas fella's and girls. For all you "Orphans" over the next couple of days working,( we have all been there,) God speed home to your families, and to the Ginger Beers who miss out on the kids tomorrow, thanks for keeping the whole box and dice going. Have a good one all.

Thanks Teresa green :)

Would've loved to have been your FO, I believe I might have learnt a thing or three.

Merry Christmas to you and yours!

You would have certainly learnt how to enjoy a cleansing ale, Goblin! Many a F/O went to bed, slightly pie eyed and confused, after a evening of aviation talk, up the track, about the ancestry and breeding habits of the many CEO's and CP's I worked under. The nerdy ones I always took to the Air Force Officers Mess in DRW. They were never the same after that, a whole new world opened up to them. Not always good, but a good start for the wonderful world of flying, if they wanted to survive! I still get a lot of Xmas Cards from my former F/O's, I am never sure if age has diminished their memories, or they were just forgiving! Have a great Xmas mate, and to you and yours.

Why give your competitor a leg up? Provision of 2 engineers will hardly make a scratch to your revenue line but if you force your competitor to employ 2 people along with all the overhead then they are in a more costly position.

Of course, how they retaliate in NZ is another story.

er, arent there already 777s flying to per?

whoever does those, could turn around airnz? qf may as well have taken the revenue if its gonna happen anyway?