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-   -   Government Loan to Virgin Australia (https://www.pprune.org/australia-new-zealand-pacific/631164-government-loan-virgin-australia.html)

PDR1 2nd Apr 2020 10:47


Originally Posted by RampDog (Post 10736389)
"The theory of evolution by natural selection, first formulated in Darwin's book "On the Origin of Species" in 1859,

Not true. The basic theory of survival of the fittest and evolutionary development was around much earlier. For instance Lamark published a proposed theory on "Transmutation of Species" in 1809, but it is understood that he was codifying and recording ideas that had been being widely discussed in the scientific community for some time, building on the work of people like Joseph KŲlreuter and Erasmus Darwin (Charles' granfather). Robert Grant and Robert Knox started joining up the theories into a structure relating to a "single ancestor species" theory, and in 1844 Robert Chambers published work linking all of this to the fossil record.

Charles Darwin did a lot of useful work collating and assembling all of this into a coherent structure that he then published in a book, but he didn't invent the idea or even formulate it.

NALOPKT(&EFGAS),

PDR

RampDog 2nd Apr 2020 10:47

-41, all that debt, it's so very true.
But any entity who invests money in airlines is intrinsically taking a financial risk, it's been proven too many times.
But like every gamble, it's a matter of balancing your bet against how much you can make in return (I'm not a gambler btw, I work work too hard to just throw money away)
The return would be a chance to play for some of the best domestic money spinning routes in the entire world.
https://www.forbes.com/sites/ericros.../#1b3feefe1d48

longjohn 2nd Apr 2020 13:37

Ramp - why would anyone invest in a business that’s barely made a cent for the last 10 years, is saddled with debt and is dominated by its main competitor?

Now imagine its market has collapsed and is unlikely to return to previous levels for some time?

Branson took millions as did others when this business was floated. Why should taxpayers now bail it out?

AmIInsane 2nd Apr 2020 14:12


Originally Posted by PDR1 (Post 10736716)
Not true. The basic theory of survival of the fittest and evolutionary development was around much earlier. For instance Lamark published a proposed theory on "Transmutation of Species" in 1809, but it is understood that he was codifying and recording ideas that had been being widely discussed in the scientific community for some time, building on the work of people like Joseph KŲlreuter and Erasmus Darwin (Charles' granfather). Robert Grant and Robert Knox started joining up the theories into a structure relating to a "single ancestor species" theory, and in 1844 Robert Chambers published work linking all of this to the fossil record.

Charles Darwin did a lot of useful work collating and assembling all of this into a coherent structure that he then published in a book, but he didn't invent the idea or even formulate it.

NALOPKT(&EFGAS),

PDR

The Ď No idea of the context of the posts í award goes to PDR1.

PDR1 you utter flog.

Switchbait 2nd Apr 2020 15:07

Alliance or Air New Zealand for the win.....

IsDon01 2nd Apr 2020 16:01


Originally Posted by Switchbait (Post 10737006)
Alliance or Air New Zealand for the win.....

Air NZ?

Ansett, failure, who owned Ansett?
Virgin, probable failure, who was a shareholder?

Two dismal failures after two attempts.

Maybe Kiwis are slow learners but I donít think even a Kiwi would try that for the third time.

Berealgetreal 2nd Apr 2020 22:32


Originally Posted by Switchbait (Post 10737006)
Alliance or Air New Zealand for the win.....

Agree Alliance, sharp company they could take over the reigns. I think itís also possible to see an Asian carrier fill the shoes of Virgin. Air Asia etc. There are already calls to open it right up.

RampDog 2nd Apr 2020 22:39


Originally Posted by longjohn (Post 10736913)
Ramp - why would anyone invest in a business that’s barely made a cent for the last 10 years, is saddled with debt and is dominated by its main competitor?

Now imagine its market has collapsed and is unlikely to return to previous levels for some time?

Branson took millions as did others when this business was floated. Why should taxpayers now bail it out?

longjohn, excellent point and a very valid question relative to Virgin Australia's current predicament.
No person or business with any sense would throw 100s millions in, so why should the Australian Government?
The only possible way they could justify it, is that they are rescuing Aussie jobs, and from past experience that was never their credo. (Remember HIH and Ansett, Ford, Holden etc etc, goodbye jobs!)
It would be the height of financial incompetence to use today's and future taxpayer dollars to prop up this business.
No one wants airline employees above or below the wing, to lose their current jobs. Been there, and you wouldn't wish it on anyone.
The challenge for the Government will be rescuing the economy, as there will be not one industry spared by the COVID19 crisis.
Government has done its bit and now VA management, if they really believe they have a viable business, has to come up with a different strategy......

Is it not true that your current situation is, to a large extent, the result of your past actions, choices and experiences?
The positive side should be that your
future is determined by how you act in the present moment.

Window heat 2nd Apr 2020 22:45

Just watched the video, Branson had no idea, he just seemed to have been lobbed in and given a microphone.

ECAMACTIONSCOMPLETE 2nd Apr 2020 22:49


Originally Posted by IsDon01 (Post 10737055)
Air NZ?

Ansett, failure, who owned Ansett?
Virgin, probable failure, who was a shareholder?

Two dismal failures after two attempts.

Maybe Kiwis are slow learners but I donít think even a Kiwi would try that for the third time.

The difference with this though is that they wouldnít be investing in another airline to gain a foothold in the Aussie domestic market. They can use their AOC, aircraft and crew. Just set bases in MEL, SYD & BNE and itís good to go.

ive always felt it a little strange that I, as an Aussie, flying a VH registered plane can fly NZ domestic services, but thems the rules. Absolutely no reason the Kiwis canít do the same here.

kiwi grey 2nd Apr 2020 23:25


Originally Posted by ECAMACTIONSCOMPLETE (Post 10737466)
I've always felt it a little strange that I, as an Aussie, flying a VH registered plane can fly NZ domestic services, but thems the rules.
Absolutely no reason the Kiwis canít do the same here.

Last time that looked like a possibility, Keating (IIRC) changed the rules so that it couldn't happen.
That in turn led to Air NZ buying Ansett to attempt to achieve a similar result.
Which in its turn led to tragic catastrophe

Lapon 2nd Apr 2020 23:28


I donít think even a Kiwi would try that for the third time.
Adding to both Virgin and Ansett the attempts at getting hold hold of Australian Airlines before the Keating goverment blocked them, you have three attempts in the last 30 years.
If it were not for the fact Air NZ has just been bailed out again I wouldn't have put it past them.

Turnleft080 2nd Apr 2020 23:35

https://www.tvnz.co.nz/one-news/new-...down-exec-says
Speaking of ANZ this is ridiculous.

Denied Justice 2nd Apr 2020 23:43

The deputy PM, Michael McCormack is reported to have said this morning that there would be no exceptional assistance for one company. “Whatever we do for Virgin we are going to have to do for other companies as well. We can’t just pick and select individuals and winners out of this.” He said Virgin should consider raising capital from its existing shareholders, including Singapore Airlines and Etihad Airways.

DanV2 2nd Apr 2020 23:50


Originally Posted by ECAMACTIONSCOMPLETE (Post 10737466)
The difference with this though is that they wouldnít be investing in another airline to gain a foothold in the Aussie domestic market. They can use their AOC, aircraft and crew. Just set bases in MEL, SYD & BNE and itís good to go.

ive always felt it a little strange that I, as an Aussie, flying a VH registered plane can fly NZ domestic services, but thems the rules. Absolutely no reason the Kiwis canít do the same here.

NZ just got a loan from their government. Don't think NZ will be setting up in Australia anytime soon.

On another note, the same anti argument can be applied to the Singaporeans.

SIA had two previous goes at the Australian market through equity (Air NZ/Ansett Group and Tiger Airways Australia) and both equity investments ended in dismal failure. SIA also had full ownership control of the later (although separate management teams) before they "sold TT to VA" to save face on their own incompetence.

Arctaurus 2nd Apr 2020 23:50

Transfer 100% ownership to SQ for $1 which includes them taking the debt. VAH is folded and re launched as Tiger (already a familiar entity here).

Etihad and China don't have any capacity for funding, so they write the loss off.

Branson won't fund it in this environment, so he'll have to take a haircut as well.

Get rid of all the regionals and stick to core mainline operations with one aircraft type.

megan 2nd Apr 2020 23:51

Yesterdays "Australian" - behind a paywall

Expectations are mounting that Virgin Australia will receive government assistance to stave off collapse, with suggestions key decisionómakers have long memories about the windfall reaped by Qantas after Ansett Australia collapsed in 2001.

Virgin Australia has gone cap- in-hand to the federal government asking for a $1.-4bn loan, which if not repaid would see the government take an ownership stake within two or three years.

Singapore Airlines, HNA, Etihad and Chinaís Nanshan all own about 20 per cent of the airline, and Virgin Group about 10 per cent, while the rest is publicly listed.

The understanding is that Singapore Airlines would have been willing to bail out the Australian carrier. However, some believe the government would be hesitant about the foreign airline gaining a foothold in the Australian market. Singapore Airlines is essentially owned by the Singaporean government.

Preventing Singapore Airlines from owning Virgin Australia would in fact offer protection for the government-backed Qantas.

Singapore Airlines was also understood to have been keen to buy Ansett when that airline collapsed.

The dilemma for the federal government is that if it does not offer help to Virgin Australia, it faces a situation where Qantas would have a market monopoly, to the potential detriment of Australian travellers.

This is if it also disallows full foreign ownership.

Qantas made attempts to seek assistance from the federal government in the aftermath of the global financial crisis around 2014, but the treasurer at the time, Joe Hockey, declined the request.

Toruk Macto 3rd Apr 2020 00:01

Etihad and China don't have any capacity for funding, so they write the loss off.

Abu Dhabi is the richest , they could buy EK before breakfast . Australian tax payers asked to bail out a company that when profitable will pay dividends to the Chinese government ( HNA) , Abu Dhabi and Singapore government. If the Australian government put 1.4B in then they better get a seat at the table and take some profit along side of these other governments .

DanV2 3rd Apr 2020 00:06


Originally Posted by Arctaurus (Post 10737516)
Transfer 100% ownership to SQ for $1 which includes them taking the debt. VAH is folded and re launched as Tiger (already a familiar entity here).

Etihad and China don't have any capacity for funding, so they write the loss off.

Branson won't fund it in this environment, so he'll have to take a haircut as well.

Get rid of all the regionals and stick to core mainline operations with one aircraft type.

Been there done that for SQ, re Tiger Airways. SQ failed dismally and ended up selling their 50% stake to VA for $1.

SQ were also offered AN for $1 before AN filed administration and they declined. Likely will be same scenario if SQ were offered VA for $1 (5B debt and all).

Edit: Also, if SQ couldn't make their three attempts at the Australian market work (Strike 1: Air New Zealand/Ansett, Strike 2: Tiger Airways and Strike 3: Virgin Australia), especially when SQ had full management control of Tiger Australia, what makes people think SQ could make a 4th attempt work?

SQ are not much better than EY when it comes to investments. Mediocre at best, when compared to EY which are largely failures.

Anti Skid On 3rd Apr 2020 05:11


Originally Posted by Lapon (Post 10737495)
Adding to both Virgin and Ansett the attempts at getting hold hold of Australian Airlines before the Keating goverment blocked them, you have three attempts in the last 30 years.
If it were not for the fact Air NZ has just been bailed out again I wouldn't have put it past them.

Bailed out? No, offered a NZ$900 million loan facility, bit like QF have been offered by Scomo. And when they can't repay the loan the company becomes a state owned enterprise.

wheels_down 3rd Apr 2020 07:24


Originally Posted by DanV2 (Post 10737524)
Been there done that for SQ, re Tiger Airways. SQ failed dismally and ended up selling their 50% stake to VA for $1.

SQ were also offered AN for $1 before AN filed administration and they declined. Likely will be same scenario if SQ were offered VA for $1 (5B debt and all).

Edit: Also, if SQ couldn't make their three attempts at the Australian market work (Strike 1: Air New Zealand/Ansett, Strike 2: Tiger Airways and Strike 3: Virgin Australia), especially when SQ had full management control of Tiger Australia, what makes people think SQ could make a 4th attempt work?

SQ are not much better than EY when it comes to investments. Mediocre at best, when compared to EY which are largely failures.

SQ never had full control of Tiger Oz, same in Singapore. The Poms did. They gave full rein to RyanAir and co. Who remembers Tony Davis? Tim Berry....Mr Dugan. It was quite odd, a booming middle class market and the hand balled the entire concept to a group of British and had nothing to do with it.

When things continued to go backward and SQ decided to take control, well they didnít in Oz, they just Ďsoldí or told Virgin your taking it.

What is the point in kickstarting Tiger again with half a dozen 737s. Clearly the leisure market will take a year to build once this is over, just cede it and let the other guys in T4 do the job.

Dookie on Drums 3rd Apr 2020 07:37

It's wishful thinking that VA will be saved. No one with any sense will invest in a loss making venture. I feel for the guys and gals but sometimes you have to eat a sh!t sandwich and it's not their fault. People are kidding themselves if they think everything will return to normal in 12 or 18 months. Those lower down the rung...forget about it. There is going to be an abundance of VERY qualified crew out there to fill VERY limited positions.

exfocx 3rd Apr 2020 07:49


Originally Posted by Gnadenburg (Post 10736457)
Having gone through the Ansett demise and......................................................Eve n as an employee of AN, at the time, I did not feel it right AN was propped up by taxpayers funds. Those funds would soon be far better spent on our War of Terror throughout the Middle East.

What a sad comment; The War on Terror? More innocent people killed in a war that never had to happen and is still ongoing today. Evidence manufactured for a gnome of President to go to war for his ego, how can anyone be happy with the outcome of Iraq and Afghanistan.

exfocx 3rd Apr 2020 08:01


Originally Posted by TBM-Legend (Post 10736583)
Correct observation. Study the Branson business model and you will find a trail of V branded failures "after" RB has cashed out and kept minimum exposure. Remember Virgin Atlantic went ti%ts up big time once before and was bailed by SQ.

He runs like the Dali Lama with followers ogling his life style [no disrespect to His Highness]...

Yes, just like a lot of IPOs; pigs with lipstick and an endorsement from a financial house that is gunna get a nice fat commission and then 2-5 yrs down the track it goes to the abattoir.

Dragun 3rd Apr 2020 08:40

Is anyone giving any thought to the fact that under normal business conditions with a functioning economy, yes, there would probably be another carrier from any number of places that could come in to pick up where VA left off as is being discussed above....but every carrier everywhere in the world will be nursing a balance sheet too weak to do anything but pick up their own pieces, or have been bailed out by their own respective government that would severely restrict investments in markets anywhere, let alone here, prior to those debts being paid or conditions satisfied?

Why is no one understanding that this is just simply not going to happen any time in the next 2-3 years given the unique circumstances surrounding the ultimate reason that Virgin will fail if there's no bail out?

This is 100% different to a normal business failing in a free market.

All the post above just seem to ignore this one simple fact - that VA has had its operations shut down by the government (indirectly not their fault) which, regardless of its balance sheet prior to this crisis, stopped any chance it had of getting back into the black. Most importantly, this is not unique - every airline in the world is in the same boat. Qantas itself will likely need a bail out if this continues, at the very least for its international segment.

Why are people focusing so heavily on the past and ignoring the likely outcome, that no one is coming and a monopoly will exist?

You can point fingers at poor management and bad balance sheets and the fact they deserve to fail, not arguing about that, but the rife speculation of some other carrier coming to pick up the pieces shows a delusion beyond reason at what is actually happening on a broader level here. Please have a think about that fact before speculating on who, what, where and when the next carrier will come from. It's naive at best.

The country needs to prepare itself for a monopoly for a very long time, at least in the premium market, if Virgin goes to the wall. Those are the objective facts.

Time will tell.

porch monkey 3rd Apr 2020 08:58

Your wise words don't fit the general agenda here, mate, that's why......

deja vu 3rd Apr 2020 09:02

[QUOTE=Gnadenburg;10736457]Having gone through the Ansett demise and a period of unemployment, the government did a good job with helping ensure the payment of owed wages and benefits. The tax liability was small and I ended up with far more cash in hand than expected.

If I recall correctly, you guys got your "owed wages and benefits' as as an enforced levy on air tickets from a blackmailed flying public, a disgraceful sham.

ABP 3rd Apr 2020 09:22


Originally Posted by Dragun (Post 10737847)
Is anyone giving any thought to the fact that under normal business conditions with a functioning economy, yes, there would probably be another carrier from any number of places that could come in to pick up where VA left off as is being discussed above....but every carrier everywhere in the world will be nursing a balance sheet too weak to do anything but pick up their own pieces, or have been bailed out by their own respective government that would severely restrict investments in markets anywhere, let alone here, prior to those debts being paid or conditions satisfied?

Why is no one understanding that this is just simply not going to happen any time in the next 2-3 years given the unique circumstances surrounding the ultimate reason that Virgin will fail if there's no bail out?

This is 100% different to a normal business failing in a free market.

All the post above just seem to ignore this one simple fact - that VA has had its operations shut down by the government (indirectly not their fault) which, regardless of its balance sheet prior to this crisis, stopped any chance it had of getting back into the black. Most importantly, this is not unique - every airline in the world is in the same boat. Qantas itself will likely need a bail out if this continues, at the very least for its international segment.

Why are people focusing so heavily on the past and ignoring the likely outcome, that no one is coming and a monopoly will exist?

You can point fingers at poor management and bad balance sheets and the fact they deserve to fail, not arguing about that, but the rife speculation of some other carrier coming to pick up the pieces shows a delusion beyond reason at what is actually happening on a broader level here. Please have a think about that fact before speculating on who, what, where and when the next carrier will come from. It's naive at best.

The country needs to prepare itself for a monopoly for a very long time, at least in the premium market, if Virgin goes to the wall. Those are the objective facts.

Time will tell.

Agree completely. Also in their defense, analysts predicted a break even point for just after July this year, due to the cost reduction restructure (remember, there's a difference between statutory and underlying). Virgin Australia was expected to slowly make it through without COVID-19. At this stage however, I don't think a direct "bailout" from the Government will occur.

The Financial Review is owned by Channel 9 and both have reported numerous time loudly and proudly the Government will not bailout Virgin Australia. Other articles quote the Financial Review and Channel 9. Once again, I personally don't think it will happen in the form the CEO wants, but the battle is not over just yet. Once again, this evening the Financial Review has just posted another article yet again against Virgin Australia, rebuking Virgin Australia's monopoly theory. I thought they'd wait at least one day before writing another article against the airline.

https://www.afr.com/companies/transp...0200403-p54gp2

ABP 3rd Apr 2020 09:26

[QUOTE=deja vu;10737875]

Originally Posted by Gnadenburg (Post 10736457)
Having gone through the Ansett demise and a period of unemployment, the government did a good job with helping ensure the payment of owed wages and benefits. The tax liability was small and I ended up with far more cash in hand than expected.

If I recall correctly, you guys got your "owed wages and benefits' as as an enforced levy on air tickets from a blackmailed flying public, a disgraceful sham.

You remember correctly. It was the Air Passenger Ticket Levy (Imposition) Bill 2001. It was $10 a ticket, which is $16 in today's market.

Fatguyinalittlecoat 3rd Apr 2020 09:53


Originally Posted by Dragun (Post 10737847)
Is anyone giving any thought to the fact that under normal business conditions with a functioning economy, yes, there would probably be another carrier from any number of places that could come in to pick up where VA left off as is being discussed above....but every carrier everywhere in the world will be nursing a balance sheet too weak to do anything but pick up their own pieces, or have been bailed out by their own respective government that would severely restrict investments in markets anywhere, let alone here, prior to those debts being paid or conditions satisfied?

Why is no one understanding that this is just simply not going to happen any time in the next 2-3 years given the unique circumstances surrounding the ultimate reason that Virgin will fail if there's no bail out?

This is 100% different to a normal business failing in a free market.

All the post above just seem to ignore this one simple fact - that VA has had its operations shut down by the government (indirectly not their fault) which, regardless of its balance sheet prior to this crisis, stopped any chance it had of getting back into the black. Most importantly, this is not unique - every airline in the world is in the same boat. Qantas itself will likely need a bail out if this continues, at the very least for its international segment.

Why are people focusing so heavily on the past and ignoring the likely outcome, that no one is coming and a monopoly will exist?

You can point fingers at poor management and bad balance sheets and the fact they deserve to fail, not arguing about that, but the rife speculation of some other carrier coming to pick up the pieces shows a delusion beyond reason at what is actually happening on a broader level here. Please have a think about that fact before speculating on who, what, where and when the next carrier will come from. It's naive at best.

The country needs to prepare itself for a monopoly for a very long time, at least in the premium market, if Virgin goes to the wall. Those are the objective facts.

Time will tell.

Totally agree that VA have been thrown into this COVID crisis through no fault of their own. It's not their fault. But so have every other business in Australia. And i think that's the point the Government is making. They can't bail out VA without bailing out every other business that has been neutered by this. They can only supply assistance to an industry. VA are stuck. They have to make it work with what they have.

ABP 3rd Apr 2020 09:54


Originally Posted by Fatguyinalittlecoat (Post 10737939)
Totally agree that VA have been thrown into this COVID crisis through no fault of their own. It's not their fault. But so have every other business in Australia. And i think that's the point the Government is making. They can't bail out VA without bailing out every other business that has been neutered by this. They can only supply assistance to an industry. VA are stuck. They have to make it work with what they have.

So everyday Aussies should make it work with what they have too? We've all been given a 'bailout'!

Fatguyinalittlecoat 3rd Apr 2020 09:55

Yep, we have. That's it.

Funds will only flow to an industry, not a company.

Icarus2001 3rd Apr 2020 09:57


We've all been given a 'bailout'!
Don't worry you will be paying it back to the government soon enough through a higher GST and other taxes. Think of it as a loan...

chance 3rd Apr 2020 10:06


Originally Posted by Fatguyinalittlecoat (Post 10737947)
Yep, we have. That's it.

Funds will only flow to an industry, not a company.

Given the vast majority of erudite comments that reflect a knowledge of the history of VA and its various owners and iterations one could only think that:
"THE VIRGIN IS NO LONGER A VIRGIN"
Should it be rescued it should be renamed one of the following choices: "VIRGIN MARY" , "IMMACULATE CONCEPTION" or "JOSEPH AIRLINES"


Dragun 3rd Apr 2020 10:13


Originally Posted by Fatguyinalittlecoat (Post 10737939)
Totally agree that VA have been thrown into this COVID crisis through no fault of their own. It's not their fault. But so have every other business in Australia. And i think that's the point the Government is making. They can't bail out VA without bailing out every other business that has been neutered by this. They can only supply assistance to an industry. VA are stuck. They have to make it work with what they have.

Yes it's a reasonable point that has been around the media with the unfortunate difference in this case that Virgin forms part of critical infrastructure whether the government and public like it or not. In addition it contributes around $11 billion p.a. directly to the Australian economy and much more indirectly. I'm not saying other big business won't come to this either, but this is the first and it's a much bigger enterprise to let go than a collection of smaller and generic SMEs. I know that sounds harsh, and it's not meant to, but just highlighting the reality of the current predicament for government.

Dragun 3rd Apr 2020 10:18


Originally Posted by Fatguyinalittlecoat (Post 10737947)
Yep, we have. That's it.

Funds will only flow to an industry, not a company.

This does appear to be the angle even PS is going for now. He even went as far as to essentially ask for $5 billion to include Qantas suggesting a collective overdraft facility during interviews this morning. It's a smart play because although Virgin's need is immediate, Qantas would well be advised to consider their medium term position and the likely prospect of having to do the same in 12 months if international demand is still non-existent. It will be a tough ask for them to go to the government asking for money at that point if they advocated the failure of Virgin 6 months prior and got their way. For now, they are saying they can make it through, but as it has been shown already, the nature of this beast is unpredictable and very different.

Perhaps a joint approach by both airlines will be the smarter play, gain the traction they are looking for with public support and not favour any one carrier as the government has stated.

Again, time will tell.

Alfie.floor 3rd Apr 2020 10:50


Originally Posted by chance (Post 10737970)
Given the vast majority of erudite comments that reflect a knowledge of the history of VA and its various owners and iterations one could only think that:
"THE VIRGIN IS NO LONGER A VIRGIN"
Should it be rescued it should be renamed one of the following choices: "VIRGIN MARY" , "IMMACULATE CONCEPTION" or "JOSEPH AIRLINES"

whatís another name for someone who trades money for love?😉

Berealgetreal 3rd Apr 2020 11:17

fatlittleguyjnacoat, my post discussed it but not as well written as yours ;)

How is any airline supposed to survive in this environment? As stated above if it goes long enough QF will need help as well. Itís simply not possibleto have hundreds of airplanes sitting idle for months or years and just expect them to crank up as per normal on the other side. Maybe they assume itís like the government where he money is endless.

The reality is that every Tom Dick and Harry has been sitting at the airlineís table eating Xmas dinner for years and years. Dare say itís time for some of that money to be to be redistributed back.


krismiler 3rd Apr 2020 12:17

The major difference is that Qantas is well run and profitable in normal times whereas Virgin have lost an average of $215 million a year for the last ten years. Any bailout without a significant restructuring is likely to see the losses continue. When Ansett folded, Virgin Blue was in a position to step into the gap and prevent QF from having a monopoly, this time there is no potential replacement waiting in the wings and given the current financial situation, no one will be wanting to try.

A possible compromise would be a bail out of both airlines, but only to prevent a monopoly which would be unacceptable to the ACCC. The conditions on Virgin might be a cessation of wide body operations, a removal of premium class and a restructuring of the company back to its low cost roots.

A 70/30 market split in favour of QF, who would fly the long haul routes and carry the higher yielding pax, leaving the lower yielding pax to Virgin who would become a Ryanair/Easyjet low cost carrier. Whilst not a perfect solution, jobs would be retained and a monopoly avoided. Losses at Virgin could be brought down to a much more manageable level, there would be choice and some degree of competition in the market.


-41 3rd Apr 2020 12:21


Originally Posted by Dookie on Drums (Post 10737775)
It's wishful thinking that VA will be saved. No one with any sense will invest in a loss making venture. I feel for the guys and gals but sometimes you have to eat a sh!t sandwich and it's not their fault. People are kidding themselves if they think everything will return to normal in 12 or 18 months. Those lower down the rung...forget about it. There is going to be an abundance of VERY qualified crew out there to fill VERY limited positions.

great news then!

No more pilot shortage, problem solved with the China virus.


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