So you need a new fleet Leigh?
 

Qantas says foreign ownership cap could make fleet overhaul harder

An admitted aviation light weight, Mr. Clifford claims it is the foreign ownership that 'restricts' Qantas raising capital.

In simple arithmetic Qantas bought back its own shares to the value of $1.24 billion (all on market). With another $500 million of 'capital giveback' there is almost $1.75 billion with which to find capital to buy a fleet.

Of course share buy backs have a dubious history. Forbes magazine which am sure you have a copy of did a number of pieces about the dubious nature of the practice.

https://www.forbes.com/sites/aalsin/.../#73e619476b1e

It isn't legislation stopping Qantas buying a fleet, it was executive bonuses and the option vesting dates! With share prices 23% lower, of course someone/something else is the reason why Qantas lacks a modern fleet of long range twins.

If they did raise more capital you can bet the same result would occur. Why waste valuable capital on things like long term assets?

But according to the experts on PPRUNE its OK for Virgin Australia to be 90% foreigned owned!!!

It's not the ownership that Qf staff have issues with. It's the obscene waste of resources at the expense of the long term health of the Company.

https://s14-eu5.ixquick.com/cgi-bin/...9c56af2b8d9625

Share buy backs don't reward terribly many people

I'd be more concerned if I worked for VA...

I guess there is always an option to work elsewhere too...

Pretty soon they will be asking Gov for an unsecured $3B loan.

Good to see ya back on the " I hate everything anything Virgin bandwagon again TMB 🙄

So let me see $1.6 billion on Jetstar(according to a former QF Exec) and $1.75 billion on Share Buybacks and there is your $3.0 plus billion AJ was after. Time to pull the eject handle! That money could have bought a lot of fuel efficient jets.

Here we go again...

I wonder which statement comes first.
"We need a level playing field..." or The Qantas Sale Act is redundant"... or perhaps "We may have to shed staff to save money".

Stand by...

So we have the Amazing transformation engineered by the Pikey.
How many staff are still working under the same EBA’s on the same aircraft to the same destinations with the same load factors ?
Next question is , what is Qantas’ Effective Full Time Employee to Aircraft Ratio Alan?
Or the Drone to Worker ratio for us plebs.

Whilst it is understandable that the manufactured decline of Qantas International was designed to shock and awe staff just the way Chairman Clifford likes it (as did Alan, he was handsomely rewarded), nothing has changed.

The mistake the staff made, sitting through the reeducation days, Orwellian though it must have been was to believe anything had changed.

When the 'extend and pretend' business cycle completely rolls over, EBA negotiations will follow with the familiar rhetoric: "cost neutral, times are tough, there is no more money"

They blew the time in the sun making themselves wealthy.
The first shot in this new IR campaign is the 457 visa, quietly announced when everyone is not paying attention and digesting plum pudding.

The Government needs some control over Qantas as it is the fourth arm of the military. When you need lots of troops taken to a trouble spot.

major problem Qantas can do it,

Bin there done that.

You bet it does, try enforcing national interest with a contract!

Of course the economic benefit of a Qantas controlled by Australians, results in around AUD$7 billion of direct and another AUD$4.5 billion indirect economic activity. Whilst the report by Deloittes, was commissioned by Qantas to serve some political interest in 2016 and thus open to critique as most inputs are interna(Qantas provided) lEven allowing for the input bias, if it is say $9 billion that is a substantial contribution to GDP.

As an aside I remain perplexed why foreign ownership of a now Quasi (pun intended) national carrier is even discussed when the landmass of Australia's size and the sheer distances across the continent lend itself directly to air travel.

Leigh Clifford is neither an airline man nor a patriot. Qantas cleverly ensured any mainstream media criticism of their actual performance was curtailed when 30 journalists went on the junket to Seattle. Newspaper performance being what it is, Qantas' advertising spend is important to survival. :(

But just to state the obvious it isn't the sale act Leigh.

So Leigh can you read?

Qantas 'worst major airline' for fuel efficiency on trans-Pacific flights, study suggests - ABC News (Australian Broadcasting Corporation)

Rated DE et al,
The ABC piece is a statement of the bleeding obvious.

With the QANTAS investment grade credit rating, it will have zero problem financing a modern fleet at extremely good rates.

So the question must be asked, is the present management actually managing the airline in the best interests of their shareholders, as required by the Corporations Act 2001.

The various references to the QANTAS Sales Act is a furphy, in my opinion.

Tootle pip!!

Qantas will let one Boeing 787 option lapse, undecided on others - CEO | Euronews


So new A320 NEO for JQ and the 'mythical 50 aircraft order' still hasn't happened...
More implied threats of toys going elsewhere and delays! Must be contract season!

Still need a new fleet Leigh, but guess IR need to run another scare campaign first!
In the meantime continue running a defunct fleet across the pacific burning lots more fuel than competitors and blame the staff for the cost difference..

How many $ Billion share buy back was it ?
That boosted the share price , how much ?
This occurred how long before the senior executive share scheme vested ?
How many 787’s would Those $ Billions buy ?
What sort of return on investment would that expenditure make ?
How much has been expended on the Jetstar Asia business ?
What return on Investment has been reported on those ventures ?
Come FY 2019 , FIRS16 comes into effect with off balance sheet debt having to be accounted for on the books .
Will be interesting to see how that effects debt equity ratios , share price and the potential to effect debt covenants .
99x. 320’s for the amazing business that relys on financial alchemy that is soon to change due to International Accountancy laws.
WHERE’s the money for those coming from ?
Yet we are told , more 787’s won’t be ordered for Mainline until their costings are proven.
The amazing business has been operating 787’s for how many years ?
What sort of business plan is Alan using?

Mr Joyce is a child of the financially engineered airline fraternity. Alchemy is an apt description.

As fixed cost is fixed and changes not substantially no matter what the airline model, off balance sheet leasing and driving down staff costs were two planks in the model. Load factors need to be consistently above 80% and yield is tricky to capture. The model is demand elastic relative to a more traditional structure as the revenue stream is very sensitive to price change: The traditional airline is not as susceptible. Jetstar had a role but not what Mr Joyce and Leigh Clifford hoped.

Qantas imagined not only using leverage against the staff but effectively replacing the terms of employment entirely. Perhaps 'work choices' encouraged them, who knows!

They have benefited personally very handsomely.

They need a new fleet, they are signatories to IATA's CO2 reduction plan, seeing 1.5% annual reduction to 2020 and further reduction into carbon neutral. Other than a grounding and lock out a new fleet is the only real way to achieve this given their route profile.

They spent nearly $1.75 billion on share buy backs and capital returns. Curiously their own options vested at the same time...That is a big start for a new fleet, but given the staff contract negotiations start soon it is wash, rinse and......repeat! IR first

Any sort of real regulatory oversight would at least investigate the correlation...

The real reason behind single engine taxi and giving the pax a stinking hot cabin I suppose.

^^^^^^^^^^^
Exactly my first thought too! Don't forget idle reverse, lessor flap & the new app to quantify precisely the savings in every phase of flight. I always wondered why my decent fuel was only half to a third of the flight planned burn, yet the actual FOD figure was always about what you would expect. A fudge in the system to make sure almost everyone "under-burns" compared to the flight planned figure?

It makes complete sense now. Thank you Rated De.

Perhaps someone more 'in the know' with regards to this topic could clarify, but I was of the understanding that these 787 Options were at such a good discount to List Prices the Qantas couldn't afford to NOT take them.

If that is the case, surely there were a few other options here that would have been more financially viable for the Group than letting the Option lapse, like perhaps, taking the frame and leasing it to another operator, or sending it to JQ (or haven't they proven the aircrafts 'worth' yet either?).

I'm fairly sure of one thing, if it is part of more of this childish IR rubbish, it is a waste of time. Most QF and JQ pilots are seemingly used to this kind of nonsense and no-one seems threatened by it anymore. We are all well aware of the looming Pilot shortage, and the difficulty in crewing the lower Paid subsidiaries for the birdseed they offer, and only a massive downturn is going to have any real effect on how individuals will approach the looming QF SH/LH and JQ EA negotiations this year.

All its going to achieve is increasing the risk of the next financial downturn coming around, and QF once again, stuck trying to manage through it with an inefficient, out of date fleet.

That is precisely the point.
They enjoyed a $597 million windfall in fuel price reduction.
The impaired the International fleet saving $326 million

That is pretty much the entire 'turnaround'
The fleet has how many 787 (3 or 4?) of a total of 8?

Mr Clifford may be well suited to the personality and characteristics of rocks, but airlines are completely different. At Rio Tinto if they didn't like the price of ore they left it in the ground. A substantial fuel price spike or indeed demand collapses airlines with inefficient fleets are precariously exposed.


Instead of actually structuring the business to deliver lower CASK, by re-equipping so that if fuel spiked again they would be prepared they instead vested million of options and spent nearly $1.75 billion pumping the share price..


This is from IATA itself...

Industry priorities

IATA recognizes the need to address the global challenge of climate change and adopted a set of ambitious targets to mitigate CO2 emissions from air transport:

• An average improvement in fuel efficiency of 1.5% per year from 2009 to 2020
• A cap on net aviation CO2 emissions from 2020 (carbon-neutral growth)
• A reduction in net aviation CO2 emissions of 50% by 2050, relative to 2005 levels

Short of a grounding or fleet change it will be interesting to see just how Qantas achieves the targets. Thanks CT it would appear that the office holders reap the KPI and the passengers suffer in stifling cabins because the international fleet burns almost double the fuel per ASK.


Interestingly Mr Joyce and Clifford denied Qantas domestic a twin aisle aircraft sending the 788 to JQ.

• There are now nearly three 737 required to carry the same ASK as two 767.
• Six pilots needed
• More cabin crew?
• More fuel burned
• Airspace congestion as more airframes in same 'air space' (think terminal area) leads to delays and holding

Seems like pure efficiency to me.

Must be the labour cost or the Sale Act. Have a look in the mirror Leigh it is that guy who is responsible.

So who's complaining about more pilots, F/A's and ginger beers having jobs?

As for congestion I suggest a trip to ATL TMA might give a hint to real congestion..

Nice.

However the thread and the conversation are about 'efficiency'.
More aircraft and pilots and engineers because management chose to send the twin aisle 788 to JQ denying Qantas domestic of a 'game changing' premium domestic product is not transformation now is it?

Rumours about A321s for JQ international might mean the 788 in JQ colours being bought back to mainline.

Why would you operate a small fleet of 788s beside a majority fleet of A320/321s? Sure the 788 has greater range, but does JQ actually utilise that range with any of its current 788 routes? The A321LR has comparable range to a 763 which should suffice for its needs.

Rumours may also be the next step in an IR campaign softening pilots for contractual outcomes more to the company likening. The first step was announcing 457 visas in the Christmas New Year shutdown.

QANTAS has a SMALLER 788 fleet than Jetstar (8 vs 11) IsDon...just saying ��

When did they ever ask for a $3b unsecured loan?

Qantas asked for $3 billion unsecured loan, Prime Minister Tony Abbott says - ABC News (Australian Broadcasting Corporation)

There, that wasn’t so hard, was it?

Thanks. I couldn’t find it on google.

https://blogs.crikey.com.au/planetalking/2014/03/04/hockeys-hint-qantas-wanted-7-bn-guarantee-to-smash-competitors/
No you didn’t look. Couldn’t find it. Troll.

Not for long.

Allegedly....

Wouldn't be too stressed about this for awhile. Whilst it WILL do a Bali flight from Eastcoast Aus ports, the range the thing doesn't have is a problem. Airbus quote the 321neo as having 4000nm range.......:rolleyes: Perhaps..... but not with 230 punters jetstar want, nor carrying ANY freight in the holds because they need to be filled with auxiliary fuel tanks.
Anywhere else in the JQ international network forget it.

I don’t pretend to be an expert on the 321neo, but I was reading something, somewhere, from Airbus the other week, that with a strengthened undercarriage being worked on, the 321LR supposedly will do that distance with around that number of punters. ‘Lightly configured’, whatever that means, a range closer to 5000nm was quoted :eek:(quoted by Airbus, so take it with a grain of salt).

The ABC is using a poor metric for evaluating efficiency. Breguet's range formula is appropriate to use if you are doing any comparison, but ASK is not.

The Qantas fleet mix is not optimum, but it also not bad. The A380 has a niche market that is appropriate to part of QF's program, but you definitely need the feeder system into it. The B777 and B787 are good aircraft, but if you want to you can also get lousy "marks" using the ABC's method for those aircraft as well. An aircraft is a transportation device to achieve a payload transport, and hat includes cargo etc. Comparing the A330 to the B777-200ER shows that the 330 looks great, if it is moving out to ranges of not more than 10 hours, AND if no cargo is hauled for commercial freight; add longer flight stages or high value freight, and the the picture changes. There are lousy routes to fly with particular aircraft, but the metric needs careful analysis to say which is which.

As a fraction of total weight for a given sector, very few airlines will match QF's fuel load or fuel burn for a specific airframe.

QF could use the 777 and the 787 effectively, but is also a good candidate for the A350.

A long time back I was doing an investigation on the MD11F and comparing with the B772, and it is interesting to see the similarity of the airframes performances, up to 4000nm, beyond that there is no comparison, but equally, at that sort of range, if you can tech stop without grief, then that is efficient to do usually, spot fuel price dependent.

Only 3x 787s and they are already changing the flying pattern. Melbourne - LAX was supposed to be daily now going back to 2 days a week with the A380 picking up where it left off.
Already leaving LAX at MTOW while having to lock seats out just to make it home. Game changer, absolutely.

What did they think would happen when reducing the available seats by over 50% on that route? It may be a good aircraft but I don't think it is an ultra-long haul aircraft.

PER-LHR another route with seats to be locked out and probably minimal if any cargo. Awesome.

The numbers don't add up, not on the routes they have chosen to use it on. It is not the right aircraft IMHO.

No wonder they have chosen not to take up the options at this time. Maybe there will be some announcement on Monday once all the execs have had their jolly on the A350-1000. Now that would be a game changer

A350-900 would be a good choice, 15 hr sector and no need to restrict seats

Bootstrap dunno where you get the 50% reduction from. A380 was and still is a daily service. Only change is the additional B744 (I think it was 5 days a week) now B787 4 or 5 days a week - hardly a 50% reduction. And don't forget soon Melbourne to San Francisco to add to Nth American routes.