Third Airline Imminent (Alan Kohler)must read
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FWA/QAH/YC/QQ still to be renamed, rebadged etc, etc!
It is taking a long, long time for the dust to clear!
Am I the only one who thinks that they are frying some pretty big fish here?
Either big fish or a bucket of week old prawns!
Trouble is, there are a lot of things that smell like fish.
It is taking a long, long time for the dust to clear!
Am I the only one who thinks that they are frying some pretty big fish here?
Either big fish or a bucket of week old prawns!
Trouble is, there are a lot of things that smell like fish.
Last edited by Qduck; 5th Jun 2002 at 13:48.
Evertonian
Keg...The difference is that ANZ aren't operating domestically against QF. I take your point, but INTL & DOM are 2 different kettles of fish. SQ used to be handled by AN, but a sweetheart deal by QF, like the ANZ deal, saw them go over, to "the dark side" 
Gaunty....Point taken, but as much as Brett is touting DJ, it's still recognised as Dick's baby! Unfortunately, the pathetic state of Australian management (re; HIH, FIA, One Tel) means we may just have to accept the big boys from OS
Gaunty....Point taken, but as much as Brett is touting DJ, it's still recognised as Dick's baby! Unfortunately, the pathetic state of Australian management (re; HIH, FIA, One Tel) means we may just have to accept the big boys from OS
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I believe Singapore Airlines (SQ) have left their run too late.
Market share has fallen the way of QF (although VB has taken a slice and continues to slowly erode that away) and the icing on the cake - business contracts - have been tied up by QF for a number of years.
For any carrier to that loses customer patronage they know they have to work twice as hard to get it back.
The opportunity to start up a domestic operation or take over Ansett's carcass without the associated debt has presented itself a few times over.
Now SACL have purchased the jewel in the AN crown - the Sydney Airport terminal and QF and VB shall pay to use this facility.
The AOC would now be worthless probably in realistic terms (besides - didn't SQ have there own Australian AOC I read on this forum some time back?) and the engineering facility will shortly be sold off.
It's now almost nine months since AN collapsed and the dust has long settled.
Is it really worth a company to spend billions of dollars to attempt to capture a meagre slice of the market?
Market share has fallen the way of QF (although VB has taken a slice and continues to slowly erode that away) and the icing on the cake - business contracts - have been tied up by QF for a number of years.
For any carrier to that loses customer patronage they know they have to work twice as hard to get it back.
The opportunity to start up a domestic operation or take over Ansett's carcass without the associated debt has presented itself a few times over.
Now SACL have purchased the jewel in the AN crown - the Sydney Airport terminal and QF and VB shall pay to use this facility.
The AOC would now be worthless probably in realistic terms (besides - didn't SQ have there own Australian AOC I read on this forum some time back?) and the engineering facility will shortly be sold off.
It's now almost nine months since AN collapsed and the dust has long settled.
Is it really worth a company to spend billions of dollars to attempt to capture a meagre slice of the market?
Moderate, Modest & Mild.
The question is, "Do any of us REALLY care who starts up?"
As long as some job opportunities appear in ALL sections, ANY new start will be welcomed.
As long as some job opportunities appear in ALL sections, ANY new start will be welcomed.
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The VB UA codeshare and the Star Alliance thing has now put the cat firmly amongst the pigeons.
So anybody who hasn't been taking VB seriously so far had better do so quickly.
I don't think that they are, or ever have been very far from Mr Dixons thoughts.
SQ are learning that slowly slowly catchee monkey might work when your Govt owner makes the rules, but in the real world you learn quickly that you can not possibly control everything, that there is always a "wild card" and jokers are trumps.
So anybody who hasn't been taking VB seriously so far had better do so quickly.
I don't think that they are, or ever have been very far from Mr Dixons thoughts.
SQ are learning that slowly slowly catchee monkey might work when your Govt owner makes the rules, but in the real world you learn quickly that you can not possibly control everything, that there is always a "wild card" and jokers are trumps.
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Thursday NZ Herald
Branson deals, Air NZ waits
06.06.2002
By CHRIS DANIELS
New links between US aviation giant United Airlines and Sir Richard Branson's Virgin Blue have highlighted Air New Zealand's lack of progress across the Tasman.
United, the second-largest airline in the world, yesterday announced a code-sharing deal with Virgin Blue for flying its passengers between Sydney and Brisbane.
Virgin Blue says the deal is just the first step in a programme for it to have code-sharing arrangements on all Australian routes.
Air New Zealand, United's partner in Star Alliance, needs an Australian partner to feed traffic onto its international and transtasman services, but has yet to secure a deal despite continuing talks with Virgin Blue and Qantas.
Under code-sharing arrangements, passengers travel on different airlines as if they were one. Baggage handling and transfers become easier and the airlines are able to use seats more economically.
Air New Zealand has long been talking with Virgin Blue in an attempt achieve a similar code-sharing deal.
It has also been talking with arch rival Qantas about the Australian carrier acquiring a cornerstone shareholding in its operations.
JBWere aviation analyst Peter Sigley said the Virgin Blue-United deal was unlikely to provide any new stream of passengers for Air NZ.
"What you're seeing here is that Air New Zealand's key code-share partners really can't be satisfied by Air New Zealand in terms of the ability to feed traffic into and out of Australia, which is the real market in this part of the world."
United had looked at the market and worked out which party it needed to deal with - Virgin Blue.
"One way to read it is that it's completely independent of Air NZ and doesn't have much bearing on it, or it shows that Air New Zealand is out there in the wilderness," said Sigley.
Air New Zealand relied heavily on its code-sharing arrangements with United and Singapore Airlines and would be in big trouble without them.
The inability of Air New Zealand to come to any such arrangement with Virgin Blue for code-sharing could make the present discussions with Qantas, a member of the rival Oneworld alliance, "more meaningful".
One thing Air New Zealand could not afford to do was to end up without the code-sharing deals with United and Singapore Airlines and to be competing with Virgin Blue across the Tasman and domestically.
Air New Zealand spokesman Cameron Hill said the Virgin Blue-United deal was "of little significance to us, given that they [United] fly into only two cities in Australia and have only single frequency per day whereas we have multiple frequencies into a larger number of gateways".
Air New Zealand's requirements were therefore more complex.
"We are continuing to discuss possible arrangements for both the on-carriage of our New Zealand passengers to ports beyond those we service and the feed of Australian passengers into our transtasman network with both Qantas and Virgin Blue.
"Those discussions continue."
Air New Zealand chief executive Ralph Norris said this week that talks about selling a minority stake in the carrier to rival Qantas would probably take "two or three months".
The negotiations, which were announced last week, had no timetable and would take "weeks, not days", he said.
Qantas spokesman Michael Sharp said yesterday that talks were in a early stage and had not involved the New Zealand Government.
Qantas was talking with Air NZ management about a possible partnership, which, if agreed upon, could involve the Australian carrier taking a minority stake in the NZ airline.
After weeks of rising steadily the Air New Zealand share price closed down 8c on heavy turnover yesterday, finishing at 63c.
nzherald.co.nz/aviation
Branson deals, Air NZ waits
06.06.2002
By CHRIS DANIELS
New links between US aviation giant United Airlines and Sir Richard Branson's Virgin Blue have highlighted Air New Zealand's lack of progress across the Tasman.
United, the second-largest airline in the world, yesterday announced a code-sharing deal with Virgin Blue for flying its passengers between Sydney and Brisbane.
Virgin Blue says the deal is just the first step in a programme for it to have code-sharing arrangements on all Australian routes.
Air New Zealand, United's partner in Star Alliance, needs an Australian partner to feed traffic onto its international and transtasman services, but has yet to secure a deal despite continuing talks with Virgin Blue and Qantas.
Under code-sharing arrangements, passengers travel on different airlines as if they were one. Baggage handling and transfers become easier and the airlines are able to use seats more economically.
Air New Zealand has long been talking with Virgin Blue in an attempt achieve a similar code-sharing deal.
It has also been talking with arch rival Qantas about the Australian carrier acquiring a cornerstone shareholding in its operations.
JBWere aviation analyst Peter Sigley said the Virgin Blue-United deal was unlikely to provide any new stream of passengers for Air NZ.
"What you're seeing here is that Air New Zealand's key code-share partners really can't be satisfied by Air New Zealand in terms of the ability to feed traffic into and out of Australia, which is the real market in this part of the world."
United had looked at the market and worked out which party it needed to deal with - Virgin Blue.
"One way to read it is that it's completely independent of Air NZ and doesn't have much bearing on it, or it shows that Air New Zealand is out there in the wilderness," said Sigley.
Air New Zealand relied heavily on its code-sharing arrangements with United and Singapore Airlines and would be in big trouble without them.
The inability of Air New Zealand to come to any such arrangement with Virgin Blue for code-sharing could make the present discussions with Qantas, a member of the rival Oneworld alliance, "more meaningful".
One thing Air New Zealand could not afford to do was to end up without the code-sharing deals with United and Singapore Airlines and to be competing with Virgin Blue across the Tasman and domestically.
Air New Zealand spokesman Cameron Hill said the Virgin Blue-United deal was "of little significance to us, given that they [United] fly into only two cities in Australia and have only single frequency per day whereas we have multiple frequencies into a larger number of gateways".
Air New Zealand's requirements were therefore more complex.
"We are continuing to discuss possible arrangements for both the on-carriage of our New Zealand passengers to ports beyond those we service and the feed of Australian passengers into our transtasman network with both Qantas and Virgin Blue.
"Those discussions continue."
Air New Zealand chief executive Ralph Norris said this week that talks about selling a minority stake in the carrier to rival Qantas would probably take "two or three months".
The negotiations, which were announced last week, had no timetable and would take "weeks, not days", he said.
Qantas spokesman Michael Sharp said yesterday that talks were in a early stage and had not involved the New Zealand Government.
Qantas was talking with Air NZ management about a possible partnership, which, if agreed upon, could involve the Australian carrier taking a minority stake in the NZ airline.
After weeks of rising steadily the Air New Zealand share price closed down 8c on heavy turnover yesterday, finishing at 63c.
nzherald.co.nz/aviation
Whispering "T" Jet
Air NZ & QF
I predict that before the end of this year, Qantas will have purchased another 20% of Air New Zealand and we will see Air New Zealand's aircraft gracing our skies.
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Qduck,
I agree, things have gone very quiet on the FWA/QAH front, even my usual contacts up north aren't saying much. Like I said earlier, one of the partners in QAH is in a partnership with SIA already, maybe they could be the wild card.
SIA do, or are about to have an Australian AOC. The advanced flight training with the LR45s requires an Australian AOC. Although it is only for aerial work and charter, it could be a start.
I agree, things have gone very quiet on the FWA/QAH front, even my usual contacts up north aren't saying much. Like I said earlier, one of the partners in QAH is in a partnership with SIA already, maybe they could be the wild card.
SIA do, or are about to have an Australian AOC. The advanced flight training with the LR45s requires an Australian AOC. Although it is only for aerial work and charter, it could be a start.
Evertonian
Finally!!
It had to happen sometime. I am in agreeance with Kaptin M for a change. Jobs for all, except me, I'm outta this industry!
As for the UA/DJ codeshare, it is only a limited arrangement at the moment. Nothing to really get excited about yet, although DJ seems to think so.
Fair Dinkum, ANZ seems like the local prostitute over on that corner of the Tasman. She's run up huge debts, almost lost the kitty & is willing to "fly" with anyone.
As for the UA/DJ codeshare, it is only a limited arrangement at the moment. Nothing to really get excited about yet, although DJ seems to think so.
Fair Dinkum, ANZ seems like the local prostitute over on that corner of the Tasman. She's run up huge debts, almost lost the kitty & is willing to "fly" with anyone.
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Well, QF is with "one world" in a big way, and who else is left in Australia...unfortunately no prises for guessing that one...
Who in their wildest dream would have predicted what Air New Zealand and the New Zealand Government would do to Ansett, I also suspect that the Aussie Gov and Qantas were up to their necks in it as well.
I think SQ have missed a great opportunity...and I don't think that they are as astute as they make out to be...geographic location, government protection, and who can go past "Singapore Girl" to seduce the high yield market, that's why they are successful, they could have had Ansett for a Dollar, or was that deal only for Qantas.
I think so...Ansett out of the way was the preffered option for Air New Zealand and its moronic government, and of course it suited Qantas as well...
Who in their wildest dream would have predicted what Air New Zealand and the New Zealand Government would do to Ansett, I also suspect that the Aussie Gov and Qantas were up to their necks in it as well.
I think SQ have missed a great opportunity...and I don't think that they are as astute as they make out to be...geographic location, government protection, and who can go past "Singapore Girl" to seduce the high yield market, that's why they are successful, they could have had Ansett for a Dollar, or was that deal only for Qantas.
I think so...Ansett out of the way was the preffered option for Air New Zealand and its moronic government, and of course it suited Qantas as well...
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Wirraway, you said that it doesn't matter who starts up as long as there are jobs. You are partly correct. Jobs are one item but the correct remenueration is another.
The VB guys are already lowly paid, and if another entrant comes in, you can bet they will want to lower the salaries once again. And there will be no lack of guys that will take up the offer. These guys will be from both offshore and locally recruited. Many will have little or no jet time.
Problem is that lower salaries are not linked to higher profits or company survival. In the long run they do however provide a bumpy ride for all concenred.
Look at the past list of wannabeees and see if I am correct.
The VB guys are already lowly paid, and if another entrant comes in, you can bet they will want to lower the salaries once again. And there will be no lack of guys that will take up the offer. These guys will be from both offshore and locally recruited. Many will have little or no jet time.
Problem is that lower salaries are not linked to higher profits or company survival. In the long run they do however provide a bumpy ride for all concenred.
Look at the past list of wannabeees and see if I am correct.
Latest twist appears in AFR, with SQ reportedly wooing QF to leave Oneworld and join Star. This is in very early stages and you'd have to guess that SQ's chances of success aren't great. But Geoff Dixon has always felt that SQ should be a natural ally rather than foe and with BA thinking about selling its share in QF, anything is possible!!
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Extracts from Fri "Australian Financial Review"
Qantas becomes Star attraction
Jane Boyle
The Star Alliance airlines are considering a radical proposal to woo Qantas Airways away from the rival oneworld alliance - an alternative to the formidable option of launching a new airline to fill the gap left by Ansett's collapse.
The proposal was discussed by Star members during a gathering
in Shanghai before the recent meeting of airline chiefs for the
IATA meeting.
While Star's overtures to Qantas are at a preliminary stage, the
proposition could have major ramifications for Qantas's existing
airline relationships, including its 21.4% shareholder and fellow
Oneworld member British Airways.
One proposal raised by Star members was for a group of them
to invest in Air New Zealand to fund a launch of a domestic
operation in Australia. However, taking on Qantas and Virgin
Blue in the Australian market is a daunting prospect.
Singapore has turned down numerous opportunities and offers
of government assistance over the past eight months to build
a new carrier from Ansett's remains. It would be a bold move
to do so now that Qantas has had a headstart in adding new
capacity and establishing a strangle-hold on the loyalty market,
and Virgin Blue has won a cashed-up half owner in Patrick Corp.
Virgin Blue is more vulnerable than Qantas to a new entrant.
Unlike Qantas which invested heavily to expand its fleet and
infrastructure as soon as Ansett collapsed, Virgin Blue has taken
gradual steps to expand in order to maximise profits. A new
entrant could jeopardise Richard Branson's hopes of floating the
carrier in the short term to realise his 50% stake.
Joining with Singapore Airlines and Air New Zealand within Star
could hold appeal for Qantas, although there would be hurdles
to overcome, not least the threat to its realationships with BA
and American Airlines which are also part of Oneworld.
However, Qantas has focused increasingly on bilateral relationships, which offer more flexibility than multilateral alliances
like Oneworld and Star.
If they could reconcile their ambitions, Qantas, Singapore and
Air New Zealand would represent a powerful alliance.
Qantas is the most attractive partner for Star, but a defection
will be fiercely resisted by Qantas's Oneworld partners.
Qantas becomes Star attraction
Jane Boyle
The Star Alliance airlines are considering a radical proposal to woo Qantas Airways away from the rival oneworld alliance - an alternative to the formidable option of launching a new airline to fill the gap left by Ansett's collapse.
The proposal was discussed by Star members during a gathering
in Shanghai before the recent meeting of airline chiefs for the
IATA meeting.
While Star's overtures to Qantas are at a preliminary stage, the
proposition could have major ramifications for Qantas's existing
airline relationships, including its 21.4% shareholder and fellow
Oneworld member British Airways.
One proposal raised by Star members was for a group of them
to invest in Air New Zealand to fund a launch of a domestic
operation in Australia. However, taking on Qantas and Virgin
Blue in the Australian market is a daunting prospect.
Singapore has turned down numerous opportunities and offers
of government assistance over the past eight months to build
a new carrier from Ansett's remains. It would be a bold move
to do so now that Qantas has had a headstart in adding new
capacity and establishing a strangle-hold on the loyalty market,
and Virgin Blue has won a cashed-up half owner in Patrick Corp.
Virgin Blue is more vulnerable than Qantas to a new entrant.
Unlike Qantas which invested heavily to expand its fleet and
infrastructure as soon as Ansett collapsed, Virgin Blue has taken
gradual steps to expand in order to maximise profits. A new
entrant could jeopardise Richard Branson's hopes of floating the
carrier in the short term to realise his 50% stake.
Joining with Singapore Airlines and Air New Zealand within Star
could hold appeal for Qantas, although there would be hurdles
to overcome, not least the threat to its realationships with BA
and American Airlines which are also part of Oneworld.
However, Qantas has focused increasingly on bilateral relationships, which offer more flexibility than multilateral alliances
like Oneworld and Star.
If they could reconcile their ambitions, Qantas, Singapore and
Air New Zealand would represent a powerful alliance.
Qantas is the most attractive partner for Star, but a defection
will be fiercely resisted by Qantas's Oneworld partners.
Last edited by Wirraway; 7th Jun 2002 at 02:55.
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From Airliners Net Forum:
LadeVale wrote
This confirms it. The Star Alliance needs psychiatric treatment. They have become completely delusional. What will their next proposal be to bring the DOT into their alliance so that all their alliance agreements will be fast-tracked?
BA has a 25% ownership stake in QF and a seat on the QF board. But, somehow the megalomaniacs over at Star think this shouldn't be an obstacle.
QF currently benefits from having an alliance partner in the US (AA) who does not fly itself to Australia. Of course, it only stands to reason, he says sarcastically, that they would jettison AA for UA. Not only would they be helping a direct competitor (UA) better compete against it, but they would probably have to jettison routes and potentially slots to get regulatory approval. AA, Delta and Northwest would scream bloody murder. If you thought the DOT almost gutted BA when it wanted anti-trust immunity for AA/BA, then, you've seen nothing yet. Either UA or QF could be stripped of a significant number of their routes and slots to and from Australia. Like BA, QF benefits handsomely from its routes to the US. Yet, the Star Alliance somehow thinks that QF would forego its own interests to join them. QF is no Thai Airlines.
When one also factors into the equation the operational integration that BA and QF have achieved at the Singapore Hub, one can't help but laugh at the possibility that this was actually discussed at the Star Alliance meeting. I am beginning to think that the CEO of Singapore Airlines bought his doctorate from some diploma mill. Alas, management of the Star Alliance must be as "stupid" as the management of United Airlines. That is the only thing that explains such a ridiculous proposal.
LadeVale wrote
This confirms it. The Star Alliance needs psychiatric treatment. They have become completely delusional. What will their next proposal be to bring the DOT into their alliance so that all their alliance agreements will be fast-tracked?
BA has a 25% ownership stake in QF and a seat on the QF board. But, somehow the megalomaniacs over at Star think this shouldn't be an obstacle.
QF currently benefits from having an alliance partner in the US (AA) who does not fly itself to Australia. Of course, it only stands to reason, he says sarcastically, that they would jettison AA for UA. Not only would they be helping a direct competitor (UA) better compete against it, but they would probably have to jettison routes and potentially slots to get regulatory approval. AA, Delta and Northwest would scream bloody murder. If you thought the DOT almost gutted BA when it wanted anti-trust immunity for AA/BA, then, you've seen nothing yet. Either UA or QF could be stripped of a significant number of their routes and slots to and from Australia. Like BA, QF benefits handsomely from its routes to the US. Yet, the Star Alliance somehow thinks that QF would forego its own interests to join them. QF is no Thai Airlines.
When one also factors into the equation the operational integration that BA and QF have achieved at the Singapore Hub, one can't help but laugh at the possibility that this was actually discussed at the Star Alliance meeting. I am beginning to think that the CEO of Singapore Airlines bought his doctorate from some diploma mill. Alas, management of the Star Alliance must be as "stupid" as the management of United Airlines. That is the only thing that explains such a ridiculous proposal.
Evertonian
Way, waaaay back in the mists of time....I suggested that SQ was positioning itself to create it's own alliance. Perhaps it isn't really STAR that's making overtures to QF, but SQ preparing it's tilt at it's own alliance?
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West Australian Newspapers Limited:
Dollar gives Qantas a delayed updraft
By Geoffrey Thomas
THE recent appreciation of the Australian dollar will net Qantas Airways up to $1.3 billion in capital savings on aircraft and $14 million a year in operating costs for every cent gained but hedging will delay the impact until the 2003 financial year.
According to Katie Hudson, airline analyst with JBWere, the airline has comprehensive hedging in place for fuel and the US dollar (USD) and this means rapid currency appreciation will not affect the airline's result this year.
"It will be the second half of 2002-03 before the full effects are felt," she said. The airline's chief financial officer Peter Gregg has put the gain at $14 million for every US1¢ the Aussie dollar moves upwards against the greenback.
That appreciation, which is nearly US8¢ in the past 12 months, is more positive news for the airline which is expected to post a 40 per cent increase in net profit to $407.7 million on better than expected traffic figures and yields.
Last year, Qantas recorded a slump of 36 per cent in net profit to $290.9 million after abnormal gains, despite an 11.9 per cent lift in revenue to $10.18 billion. For the six months to December 31, it recorded a 41.6 per cent drop in net profit to $153.5 million.
As well as fuel, Qantas pays for its aircraft purchases and leases in US dollars and has an extremely ambitious fleet plan in place for A380s, 747s, A330s, 737s and 717s.
In November 2000, the airline bought 31 jets from Boeing and Airbus for $8.8 billion, which was $2 billion off the list price as the airline was a launch customer for the A380. Last year Qantas committed to 15 Boeing 737-800s worth $1.84 billion.
Both purchases were priced at an exchange rate of US50¢, which has since climbed to US57¢ giving the airline potential savings of $1.3 billion over the life of the aircraft deliveries.
Qantas chairman Margaret Jackson said the deals would be funded by a mixture of operating cash flow, debt and equity to maintain existing target gearing levels.
The 15 Boeing 737s will be delivered by July and the first of the A330s and 747s will start arriving in October, while the giant A380 is due in 2006.
The rapid appreciation of the dollar is yet another positive for Qantas, according to Singapore-based equity research group Goldman Sachs. It suggests a 12-month share price of $6.50 and the appreciation of the dollar as a catalyst.
In an another development, Virgin Blue has signed a code-share deal with United Airlines which was a co-founder of the Star Alliance link between Brisbane and Sydney.
Since the demise of Ansett, Star Alliance airlines, such as Singapore Airlines and Air New Zealand, have been booking their passengers in and out of Australia on Qantas, which belongs to rival alliance, oneworld.
According to Ms Hudson, the code-share with United will be extended to other destinations around Australia. She suggests the move lessens the chance of Star Alliance airlines starting a new domestic airline in Australia.
However, Star Alliance airlines will have to offer premium-class passengers flights on Qantas domestic business class if they are to maintain their rigorous standards.
Interline traffic, including Qantas, accounts for 15 per cent of the domestic market and JBWere suggests the long-term impact of the Virgin Blue-United deal could put at risk 5 per cent of Qantas' passenger loads. Qantas shares closed 1¢ lower yesterday at $4.50.
© 2002 West Australian Newspapers Limited
All Rights Reserved.
Dollar gives Qantas a delayed updraft
By Geoffrey Thomas
THE recent appreciation of the Australian dollar will net Qantas Airways up to $1.3 billion in capital savings on aircraft and $14 million a year in operating costs for every cent gained but hedging will delay the impact until the 2003 financial year.
According to Katie Hudson, airline analyst with JBWere, the airline has comprehensive hedging in place for fuel and the US dollar (USD) and this means rapid currency appreciation will not affect the airline's result this year.
"It will be the second half of 2002-03 before the full effects are felt," she said. The airline's chief financial officer Peter Gregg has put the gain at $14 million for every US1¢ the Aussie dollar moves upwards against the greenback.
That appreciation, which is nearly US8¢ in the past 12 months, is more positive news for the airline which is expected to post a 40 per cent increase in net profit to $407.7 million on better than expected traffic figures and yields.
Last year, Qantas recorded a slump of 36 per cent in net profit to $290.9 million after abnormal gains, despite an 11.9 per cent lift in revenue to $10.18 billion. For the six months to December 31, it recorded a 41.6 per cent drop in net profit to $153.5 million.
As well as fuel, Qantas pays for its aircraft purchases and leases in US dollars and has an extremely ambitious fleet plan in place for A380s, 747s, A330s, 737s and 717s.
In November 2000, the airline bought 31 jets from Boeing and Airbus for $8.8 billion, which was $2 billion off the list price as the airline was a launch customer for the A380. Last year Qantas committed to 15 Boeing 737-800s worth $1.84 billion.
Both purchases were priced at an exchange rate of US50¢, which has since climbed to US57¢ giving the airline potential savings of $1.3 billion over the life of the aircraft deliveries.
Qantas chairman Margaret Jackson said the deals would be funded by a mixture of operating cash flow, debt and equity to maintain existing target gearing levels.
The 15 Boeing 737s will be delivered by July and the first of the A330s and 747s will start arriving in October, while the giant A380 is due in 2006.
The rapid appreciation of the dollar is yet another positive for Qantas, according to Singapore-based equity research group Goldman Sachs. It suggests a 12-month share price of $6.50 and the appreciation of the dollar as a catalyst.
In an another development, Virgin Blue has signed a code-share deal with United Airlines which was a co-founder of the Star Alliance link between Brisbane and Sydney.
Since the demise of Ansett, Star Alliance airlines, such as Singapore Airlines and Air New Zealand, have been booking their passengers in and out of Australia on Qantas, which belongs to rival alliance, oneworld.
According to Ms Hudson, the code-share with United will be extended to other destinations around Australia. She suggests the move lessens the chance of Star Alliance airlines starting a new domestic airline in Australia.
However, Star Alliance airlines will have to offer premium-class passengers flights on Qantas domestic business class if they are to maintain their rigorous standards.
Interline traffic, including Qantas, accounts for 15 per cent of the domestic market and JBWere suggests the long-term impact of the Virgin Blue-United deal could put at risk 5 per cent of Qantas' passenger loads. Qantas shares closed 1¢ lower yesterday at $4.50.
© 2002 West Australian Newspapers Limited
All Rights Reserved.
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1A Please - to quote you "But Geoff Dixon has always felt that SQ should be a natural ally rather than foe".
Was it not Adolf Hitler that said during WWII " Great Britain is not our natural enemy".Funny about that!
Wirraway - the one thing you forgot to mention is that BA has 2 positions on the QF board AND has the right of veto with those two board members.
QF to join the Star Alliance...........................NOT!
Was it not Adolf Hitler that said during WWII " Great Britain is not our natural enemy".Funny about that!
Wirraway - the one thing you forgot to mention is that BA has 2 positions on the QF board AND has the right of veto with those two board members.
QF to join the Star Alliance...........................NOT!
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this week on Business Sunday ...9/6/02
Brett Godfrey of Virgin Blue discusses with Helen McCombie the proposed code sharing agreement with United of the US. Find out about the airline's financial performance, life with new 50 percent shareholder Patrick Corporation, the competition, and the chances of a third airline starting up in Australia.
Brett Godfrey of Virgin Blue discusses with Helen McCombie the proposed code sharing agreement with United of the US. Find out about the airline's financial performance, life with new 50 percent shareholder Patrick Corporation, the competition, and the chances of a third airline starting up in Australia.
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"Business Sunday" transcript: Brett Godfrey interview
can be found at:
http://finance.ninemsn.com.au/busine...story_1638.asp
AAP
Virgin Blue looks to beat $35 mln earnings, profits to lift
MELBOURNE, June 9 AAP|Published: Sunday June 9, 1:52 PM
Virgin Blue expects to beat its internal earnings forecast of $35 million in 2001/02, and has flagged bigger profits for its current financial year.
The upbeat outlook comes as the low-cost carrier said it was drawing closer to tackling Qantas and Air New Zealand on the lucrative trans-Tasman market by launching its own service between Australia and New Zealand.
Virgin Blue chief executive officer Brett Godfrey said good margins for the year to March 31 has put the airline in a position to pay a dividend to its shareholders Sir Richard Branson and Patrick Corp.
"They could have a dividend at anytime now because the fact is we have been profitable," Mr Godfrey told Channel Nine's Business Sunday.
Although he said dividend payments were a matter for Virgin Blue's new board to decide when it holds its first meeting next month.
When asked about the $35 million 2001/02 pre-tax profit forecast contained in Virgin Blue's private placement documents, Mr Godfrey replied: "We've done better than that."
But he declined to discuss what the profit was likely to come in at, saying the figures would be released after the airline's results were audited.
Virgin's 2001/02 earnings had been based on the carrier flying an average of eight aircraft.
Mr Godfrey said the carrier expects to boost its fleet to about 22 this year and it was targeting an average of 30 a year later.
"So we will expect a much stronger result (by) March 2003," he said.
With the Sydney-based Patrick Corp now making up half of Virgin Blue's share holdings, Mr Godfrey said airline qualified to compete on tran-Tasman routes.
"We're going through regulatory ropes at the moment to be able to be in a position to launch.
"Whether it's New Zealand or regional Pacific services, I would say that's something we will do in the not too distant future."
Under the Open Skies agreement, only airlines with a base in either Australia or New Zealand are allowed to fly passengers between across the Tasman sea.
Meanwhile, Mr Godfrey played down the threat of a third carrier entering Australia through the acquisition of Ansett's Airline Operators Certificate.
"The market's very different to two years ago where you had two carriers essentially flying wing-tip to wing-tip, the same services, the same prices.
"So someone's got to come in and just do something different and they've got to have a cost base comparable to us at least if they're going to compete against us."
"So coming in with thirty aeroplanes won't happen."
Speculation has mounted in recent weeks that the Ansett administrators have been talking to Singapore Airlines, the Emirates Group and China National Aviation about starting a new Australian operation following demise of the Tesna bid.
can be found at:
http://finance.ninemsn.com.au/busine...story_1638.asp
AAP
Virgin Blue looks to beat $35 mln earnings, profits to lift
MELBOURNE, June 9 AAP|Published: Sunday June 9, 1:52 PM
Virgin Blue expects to beat its internal earnings forecast of $35 million in 2001/02, and has flagged bigger profits for its current financial year.
The upbeat outlook comes as the low-cost carrier said it was drawing closer to tackling Qantas and Air New Zealand on the lucrative trans-Tasman market by launching its own service between Australia and New Zealand.
Virgin Blue chief executive officer Brett Godfrey said good margins for the year to March 31 has put the airline in a position to pay a dividend to its shareholders Sir Richard Branson and Patrick Corp.
"They could have a dividend at anytime now because the fact is we have been profitable," Mr Godfrey told Channel Nine's Business Sunday.
Although he said dividend payments were a matter for Virgin Blue's new board to decide when it holds its first meeting next month.
When asked about the $35 million 2001/02 pre-tax profit forecast contained in Virgin Blue's private placement documents, Mr Godfrey replied: "We've done better than that."
But he declined to discuss what the profit was likely to come in at, saying the figures would be released after the airline's results were audited.
Virgin's 2001/02 earnings had been based on the carrier flying an average of eight aircraft.
Mr Godfrey said the carrier expects to boost its fleet to about 22 this year and it was targeting an average of 30 a year later.
"So we will expect a much stronger result (by) March 2003," he said.
With the Sydney-based Patrick Corp now making up half of Virgin Blue's share holdings, Mr Godfrey said airline qualified to compete on tran-Tasman routes.
"We're going through regulatory ropes at the moment to be able to be in a position to launch.
"Whether it's New Zealand or regional Pacific services, I would say that's something we will do in the not too distant future."
Under the Open Skies agreement, only airlines with a base in either Australia or New Zealand are allowed to fly passengers between across the Tasman sea.
Meanwhile, Mr Godfrey played down the threat of a third carrier entering Australia through the acquisition of Ansett's Airline Operators Certificate.
"The market's very different to two years ago where you had two carriers essentially flying wing-tip to wing-tip, the same services, the same prices.
"So someone's got to come in and just do something different and they've got to have a cost base comparable to us at least if they're going to compete against us."
"So coming in with thirty aeroplanes won't happen."
Speculation has mounted in recent weeks that the Ansett administrators have been talking to Singapore Airlines, the Emirates Group and China National Aviation about starting a new Australian operation following demise of the Tesna bid.
Last edited by Wirraway; 9th Jun 2002 at 12:21.