Virgin dumps Mt Isa route
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Virgin dumps Mt Isa route
ABC News Net:
Posted :Thu, 6 Dec 2001 17:40 AEDT
Virgin Blue to ditch Mt Isa route
Discount carrier Virgin Blue, has confirmed plans to ditch future flights to and from Mount Isa in north-west Queensland.
Chief executive Brett Godfrey, says the market is not big enough for two major carriers.
He says the airline will maintain services until the end of December.
It will also operate a limited schedule until January 14, to ensure all passengers are able to return from their holidays.
Other customers booked beyond these dates will be given a full credit or refund.
Mr Godfrey says the planes will be redirected to flights between Cairns and Brisbane.
© 2001 Australian Broadcasting Corporation
Posted :Thu, 6 Dec 2001 17:40 AEDT
Virgin Blue to ditch Mt Isa route
Discount carrier Virgin Blue, has confirmed plans to ditch future flights to and from Mount Isa in north-west Queensland.
Chief executive Brett Godfrey, says the market is not big enough for two major carriers.
He says the airline will maintain services until the end of December.
It will also operate a limited schedule until January 14, to ensure all passengers are able to return from their holidays.
Other customers booked beyond these dates will be given a full credit or refund.
Mr Godfrey says the planes will be redirected to flights between Cairns and Brisbane.
© 2001 Australian Broadcasting Corporation
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From http://www.virginblue.com.au/
6th December 2001
VIRGIN BLUE FORCED TO CANCEL SERVICES TO MT ISA
Virgin Blue has confirmed plans to withdraw flights to and from Mt Isa due to the uneconomic seat capacity in the market since the withdrawal of Ansett’s solitary daily service.
While Virgin Blue was the first to commit to the isolated regional Queensland community after the Ansett collapse, Qantas announced its intention to service the route shortly after and it is clear the market cannot support an increase from one to three jets per day.
Chief Executive Brett Godfrey said, “We are quite proud of the team who worked incredible hours to get this service going on short notice. We also want to thank the thousands of Guests who did back us on this route which was clearly a gamble and a break from our traditional strategy of servicing communities with a minimum 50,000 population due to the size of our jets.”
The airline has decided to maintain its complete schedule up until the end of December and will operate a limited schedule (Friday and Monday flights) until January 14 to ensure all passengers will be able to return from their Christmas holidays.
Other customers booked beyond these flight dates will be contacted by Virgin Blue customer care and will be given a full credit or refund or where possible, alternative travel arrangements organised.
Brett Godfrey continued, "While other airlines may feel that it is a fair business strategy to run a route at a loss, it has always been Virgin Blue's position that to offer low fares, every route flown must break even. While the traffic had clearly shifted in our favour, there is still too much going the other way to allow us to recover our costs."
The midday aircraft will be redirected towards improving the schedule on the Brisbane-Cairns service.
“Since Virgin Blue announced its intentions to enter the Mt Isa market, there was been a nearly three fold increase in the number of seats available. While we are grateful for the support of those who flew with us, as a low fare carrier, we can’t justify a loss-making route and concede there is not enough traffic to support both us and Qantas”.
6th December 2001
VIRGIN BLUE FORCED TO CANCEL SERVICES TO MT ISA
Virgin Blue has confirmed plans to withdraw flights to and from Mt Isa due to the uneconomic seat capacity in the market since the withdrawal of Ansett’s solitary daily service.
While Virgin Blue was the first to commit to the isolated regional Queensland community after the Ansett collapse, Qantas announced its intention to service the route shortly after and it is clear the market cannot support an increase from one to three jets per day.
Chief Executive Brett Godfrey said, “We are quite proud of the team who worked incredible hours to get this service going on short notice. We also want to thank the thousands of Guests who did back us on this route which was clearly a gamble and a break from our traditional strategy of servicing communities with a minimum 50,000 population due to the size of our jets.”
The airline has decided to maintain its complete schedule up until the end of December and will operate a limited schedule (Friday and Monday flights) until January 14 to ensure all passengers will be able to return from their Christmas holidays.
Other customers booked beyond these flight dates will be contacted by Virgin Blue customer care and will be given a full credit or refund or where possible, alternative travel arrangements organised.
Brett Godfrey continued, "While other airlines may feel that it is a fair business strategy to run a route at a loss, it has always been Virgin Blue's position that to offer low fares, every route flown must break even. While the traffic had clearly shifted in our favour, there is still too much going the other way to allow us to recover our costs."
The midday aircraft will be redirected towards improving the schedule on the Brisbane-Cairns service.
“Since Virgin Blue announced its intentions to enter the Mt Isa market, there was been a nearly three fold increase in the number of seats available. While we are grateful for the support of those who flew with us, as a low fare carrier, we can’t justify a loss-making route and concede there is not enough traffic to support both us and Qantas”.
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It can't be too hard to operate a budget/low cost operation on routes where demand outstrips availabilty, or should i say there are more guests than invitations.
Maybe thats why QF has too charge more because they operate on more than just the trunk routes where there are not enough guests.
Maybe thats why QF has too charge more because they operate on more than just the trunk routes where there are not enough guests.
Seems to be a very, very sensible decision by Virgin! Watch the remaining monopolistic carrier reduce frequency and increase tariffs to ensure profitability - which too makes sense!
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torres + hawk
I'have to agree, the fleecing kangaroo is laughing all the way to the bank.
Oh sorry , at the expense of ISA residents.
And in the future DWN residents and MEL residents possibly.
I have no doubt that the roo will reduce to 1 highly priced jet service per day once VB is gone.
But they're only helping the travelling public left stranded by the most unfortunate
demise of AN. And they are in no way shape or form trying to put AN MK2 or VB out of business.Apparentley!
On another note the roo is to put 747 on the BNE - MEL run shortly. Also to help the travelling public left stranded by the unfortunate demise of AN.
AS for DWN I see many more 767's traversing the route. But on to help the travelling public left strande by the unfortunate demise of AN.
As you can see the fleecing kangaroo is only doing whats best for the travelling public
I'have to agree, the fleecing kangaroo is laughing all the way to the bank.
Oh sorry , at the expense of ISA residents.
And in the future DWN residents and MEL residents possibly.
I have no doubt that the roo will reduce to 1 highly priced jet service per day once VB is gone.
But they're only helping the travelling public left stranded by the most unfortunate
demise of AN. And they are in no way shape or form trying to put AN MK2 or VB out of business.Apparentley!
On another note the roo is to put 747 on the BNE - MEL run shortly. Also to help the travelling public left stranded by the unfortunate demise of AN.
AS for DWN I see many more 767's traversing the route. But on to help the travelling public left strande by the unfortunate demise of AN.
As you can see the fleecing kangaroo is only doing whats best for the travelling public
I for one hope next time an airline folds in Australia that Qantas says screw you to the pax and doesnt carry them for free!
They cant win poor bugggers
[ 06 December 2001: Message edited by: Wonderworld ]
They cant win poor bugggers
[ 06 December 2001: Message edited by: Wonderworld ]
Nunc est bibendum
Geez, VB declare and 'operating profit' and everyone says 'oh well done'.
QF delcares a profit and people accuse them of ripping people off blind and gets stuck into them.
The 767s are chockers into and out of Darwin. There are just as many cheap seats on them as there used to be. The fact that the other seats are full of people paying a bit extra is neither here nor there.
I think it would be great if QF pulled out of some of the routes where we weren't making a profit at the moment. Geez, the US would go quiet. What about most of Europe? How are all the Aussies going to get to NZ (although that may have changed in the last few months but as of June we were losing money on it).
No, it's called providing a service to ALL of our punters and if we don't fly you there then one of our partners will.
What a croc!
QF delcares a profit and people accuse them of ripping people off blind and gets stuck into them.
The 767s are chockers into and out of Darwin. There are just as many cheap seats on them as there used to be. The fact that the other seats are full of people paying a bit extra is neither here nor there.
I think it would be great if QF pulled out of some of the routes where we weren't making a profit at the moment. Geez, the US would go quiet. What about most of Europe? How are all the Aussies going to get to NZ (although that may have changed in the last few months but as of June we were losing money on it).
No, it's called providing a service to ALL of our punters and if we don't fly you there then one of our partners will.
What a croc!
Evertonian
Sorry Keg, don't mean to be rude, but how do you know the amount of cheap fares on your flights? I'm not saying that I know better, but the only source of that kind of info is a bean counter & I wouldn't trust any of them!
As for DJ's pulling out of Isa, that's what happens when you ply unprofitable routes to provide a service Bratt! If ANZ had the opportunity to cut the unprofitable routes AN flew, well who knows what we'd be talking about now. I guess AN is unhindered by that sort of regulation & they will now fly where the money is, like DJ, and the regional cities be damned!
QF will now stitch up all the regional centres, because DJ got burnt & AN don't have to, and they will make them profitable by charging accordingly. I guess that's making the air fair is it?
As for DJ's pulling out of Isa, that's what happens when you ply unprofitable routes to provide a service Bratt! If ANZ had the opportunity to cut the unprofitable routes AN flew, well who knows what we'd be talking about now. I guess AN is unhindered by that sort of regulation & they will now fly where the money is, like DJ, and the regional cities be damned!
QF will now stitch up all the regional centres, because DJ got burnt & AN don't have to, and they will make them profitable by charging accordingly. I guess that's making the air fair is it?
Nunc est bibendum
Gday Buster, no offence taken. Sorry if I can't be more specific on that one though.
I often sail pretty close to the wind on here with some of the things I post and don't want to drop myself in it though.
But hypothetically, QF are in danger of the ACCC really getting stuck into them if they were really to start 'gouging' the travelling public. The best way to prove that you aren't gouging is by leaving EXACTLY the same number of discount seats on your flights as was previously available. The fact that your load factors sky rocket because of AN folds just means that people are picking up the more expensive seats. Remember, just a hypothetical idea and thats all I have to say about that.
Having said that, data released to the Stock exchange would indicate that QFs load factor hasn't gone up a great deal but then again, capacity has also sky rocketed.
Now where were those figures.
I often sail pretty close to the wind on here with some of the things I post and don't want to drop myself in it though.
But hypothetically, QF are in danger of the ACCC really getting stuck into them if they were really to start 'gouging' the travelling public. The best way to prove that you aren't gouging is by leaving EXACTLY the same number of discount seats on your flights as was previously available. The fact that your load factors sky rocket because of AN folds just means that people are picking up the more expensive seats. Remember, just a hypothetical idea and thats all I have to say about that.
Having said that, data released to the Stock exchange would indicate that QFs load factor hasn't gone up a great deal but then again, capacity has also sky rocketed.
Now where were those figures.
I'm the first to admit when Virgin is having a bitch about nothing but I do agree with them on this one. QF pulled out of ISA years ago and left AN to run that route by themself for at least the last 5 years, why I don't know but they weren't interested in serving it. AN dies and leaves the town with nothing and Virgin comes in and puts on a flight, THEN by some miracle of life suddenly QF throws a service on with the full knowledge there isn't the customer base to support that many services knowing that their pockets will be the deepest and win out.
Yes it's big business and yes its tough. I'm certainly no Qantas basher or lover but it's fairly obvious they are trying their best to have 100% of the market in this country by destroying all the opposition. Do you all honestly think that 100% market domination is the best case situation for us as pilots, or for the australian public?
Yes it's big business and yes its tough. I'm certainly no Qantas basher or lover but it's fairly obvious they are trying their best to have 100% of the market in this country by destroying all the opposition. Do you all honestly think that 100% market domination is the best case situation for us as pilots, or for the australian public?
Nunc est bibendum
Buster, here are the figures I alluded to earlier.
This is for September 01 I think.
DOMESTIC
Pax Carried = 1,116,000 = UP 14.1% (From Sept 00)
RPK’s = 1,511,000,000 = UP 17.1% (From Sept 00)
ASK’s = 1,785,000,000 = UP 18.3% (From Sept 00)
LOAD FACTOR = 84.7% = DOWN 0.8% (From Sept 00)
INTERNATIONAL
Pax Carried = 721,000 = UP 19.6% (From Sept 00)
RPK’s = 4,399,000,000 = UP 3.7% (From Sept 00)
ASK’s = 5,706,000,000 = DOWN 0.4% (From Sept 00)
LOAD FACTOR = 77.1% = UP 3.1% (From Sept 00)
And the following figures are a comparison with August 2001 to show a pre and post Sep 11 'trend'.
DOMESTIC
AUGUST PAX = 985,000
SEPT PAX = 1,116,000 (UP 13.3%)
AUGUST RPK’S = 1,293,000,000
SEPT RPK’S = 1,511,000,000 (UP 16.8%)
AUGUST ASK’S = 1,733,000,000
SEPT ASK’S = 1,785,000,000 (UP 3.0%)
AUGUST LOAD FACTOR = 74.6
SEPT LOAD FACTOR = 84.7 (UP 10.1 Points)
INTERNATIONAL
AUGUST PAX = 744,000
SEPT PAX = 721,000 (DOWN 3.1%)
AUGUST RPK’S = 4,663,000,000
SEPT RPK’S = 4,399,000,000 (DOWN 5.7%)
AUGUST ASK’S = 6,157,000,000
SEPT ASK’S = 5,706,000,000 (DOWN 7.3%)
AUGUST LOAD FACTOR = 75.7
SEPT LOAD FACTOR = 77.1 (UP 1.4 Points)
Thanks to Dave Breene for sticking them on Qrewroom.
Sorry to drag the discussion away from VB but I thought these figures added to where the discussion was going.
Regards,
This is for September 01 I think.
DOMESTIC
Pax Carried = 1,116,000 = UP 14.1% (From Sept 00)
RPK’s = 1,511,000,000 = UP 17.1% (From Sept 00)
ASK’s = 1,785,000,000 = UP 18.3% (From Sept 00)
LOAD FACTOR = 84.7% = DOWN 0.8% (From Sept 00)
INTERNATIONAL
Pax Carried = 721,000 = UP 19.6% (From Sept 00)
RPK’s = 4,399,000,000 = UP 3.7% (From Sept 00)
ASK’s = 5,706,000,000 = DOWN 0.4% (From Sept 00)
LOAD FACTOR = 77.1% = UP 3.1% (From Sept 00)
And the following figures are a comparison with August 2001 to show a pre and post Sep 11 'trend'.
DOMESTIC
AUGUST PAX = 985,000
SEPT PAX = 1,116,000 (UP 13.3%)
AUGUST RPK’S = 1,293,000,000
SEPT RPK’S = 1,511,000,000 (UP 16.8%)
AUGUST ASK’S = 1,733,000,000
SEPT ASK’S = 1,785,000,000 (UP 3.0%)
AUGUST LOAD FACTOR = 74.6
SEPT LOAD FACTOR = 84.7 (UP 10.1 Points)
INTERNATIONAL
AUGUST PAX = 744,000
SEPT PAX = 721,000 (DOWN 3.1%)
AUGUST RPK’S = 4,663,000,000
SEPT RPK’S = 4,399,000,000 (DOWN 5.7%)
AUGUST ASK’S = 6,157,000,000
SEPT ASK’S = 5,706,000,000 (DOWN 7.3%)
AUGUST LOAD FACTOR = 75.7
SEPT LOAD FACTOR = 77.1 (UP 1.4 Points)
Thanks to Dave Breene for sticking them on Qrewroom.
Sorry to drag the discussion away from VB but I thought these figures added to where the discussion was going.
Regards,
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If the travelling public of Isa had wanted VB to continue in preference to QF they could have voted with their bums, they didn't or not enough of them. That must say something about face painting of guests faces. Especially miners. I think they would prefer a XXXX.
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The story so far...
Pre -collapse Ansett serviced the Isa with 1x A320 each week day and 1x737 Sat and Sun. Most days loads were good say 70-85% full. Qantas chipped in with 1x Saab 340 per day thanks to ******. Their loads not suprisingly were dismal - getting most of their pax from the mines on their stop in Cloncurry.
After the "big day", DJ start up a 737 service once a day. With the numbers of pax travelling thats a 80-90% full 737 every day.
Qantas thinks..."Oh no, we can't allow that can we?" and introduces 2 (yes 2!) additional jet services every day. So it doesn't take a genius to work out that we're looking at less than 35% load factor on each of the three jet services if the numbers of pax travelling remains the same.
So... all three services are making a loss and it appears the big Q is prepared to make double the loss (or more as their costs are higher) than DJ knowing that they are in the box seat.
How anyone can argue that this is for the good of the travelling public, is not capacity dumping, is not predatory behaviour or "your just blaming the tall poppy" is beyond me.
Maybe there is a genius out there somewhere who can explain it to the rest of us?
[ 06 December 2001: Message edited by: Theo Racle ]
Pre -collapse Ansett serviced the Isa with 1x A320 each week day and 1x737 Sat and Sun. Most days loads were good say 70-85% full. Qantas chipped in with 1x Saab 340 per day thanks to ******. Their loads not suprisingly were dismal - getting most of their pax from the mines on their stop in Cloncurry.
After the "big day", DJ start up a 737 service once a day. With the numbers of pax travelling thats a 80-90% full 737 every day.
Qantas thinks..."Oh no, we can't allow that can we?" and introduces 2 (yes 2!) additional jet services every day. So it doesn't take a genius to work out that we're looking at less than 35% load factor on each of the three jet services if the numbers of pax travelling remains the same.
So... all three services are making a loss and it appears the big Q is prepared to make double the loss (or more as their costs are higher) than DJ knowing that they are in the box seat.
How anyone can argue that this is for the good of the travelling public, is not capacity dumping, is not predatory behaviour or "your just blaming the tall poppy" is beyond me.
Maybe there is a genius out there somewhere who can explain it to the rest of us?
[ 06 December 2001: Message edited by: Theo Racle ]
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I'm not completely sure, but I think that Mt Isa Mines (MIM) used to purchase a block or minimum number of seats a week to ensure a jet service to Isa.
That's why a 320 used to go there and get reasonable loads with not much interest from competitor, until contract renewal time between airline and MIM.
That's why a 320 used to go there and get reasonable loads with not much interest from competitor, until contract renewal time between airline and MIM.
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Going back a bit, Australian Airlines, later to become Qantas Shorthaul, pulled 737s out of ISA because the mining company contracted their travel to Ansett, and the remaining business did not warrant larger jets.
Now that Ansett have gone, the mining company should find someone else to favour with their business.
They chose the loser, let them sort out the answer.
As for Beattie, I thought he was Bransons bosum buddie. He should give Branson a ring.
Beattie should stick to what he knows best. Sucking up to the Union movement.
Now that Ansett have gone, the mining company should find someone else to favour with their business.
They chose the loser, let them sort out the answer.
As for Beattie, I thought he was Bransons bosum buddie. He should give Branson a ring.
Beattie should stick to what he knows best. Sucking up to the Union movement.
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QF were operating 2 x jet services = 146 at 64 seats each.
That is only slightly more if at any more than VB were operating. Hardly flooding the market.
I don't know what the habits of the Mt Isa public are but a morning and afternoon flight would have too be a good thing wouldn't it???
That is only slightly more if at any more than VB were operating. Hardly flooding the market.
I don't know what the habits of the Mt Isa public are but a morning and afternoon flight would have too be a good thing wouldn't it???