THE WHITE RAT
06/03/14 10:59 Filed in: Aviation | Air Safety
Qantas Troubles Reach A Peak
On the 26th February 2014 I wrote:
What will Qantas announce, 12 years to the day that Fox & Lew killed any chance of Ansett MkII?
I predict that the International routes will be reduced to the Kangaroo (LHR), and Wallaby (LAX).
Domestic flights will be The Shark Patrol, (BNE-SYD-MEL-ADL),* and PER to the east coast (BNE, SYD, MEL), with Jetstar getting the rest.
Killed-off will be Jetstar Vietnam, (I predict a $65M loss), Japan, HKG, maybe NZ.
Jetstar Singapore? A lot of work for $2M.
Outsource all heavy maintenance, and back office, to the Philippines, and a little to India.
Sale and leaseback of the fleet ($900M for which they'll get $600M), sale and leaseback of terminals and their famous Jet Base.
Pain all 'round. Shocking for thousands of loyal Qantas staff who are going to be retrenched.
Alan Joyce? Not all his fault, Jetstar overseas expansion excepted. Instead, blame Geoff Dixon for handing him a poisoned chalice with absolutely no Plan B.
The B747 replacements were the A380s, and the B767 replacements the NightMare (Dreamliner).
The second that both these aircraft were late, as all new aircraft are, his fate was sealed. The job came with No Plan B, which Joyce was silly to accept.
* With ADL dropping-off the day G.M.H. closes its doors.
___________________
Today, 6th March 2014:
My prediction before the announcement still stands. This is what will eventually be left.
I have read the briefing to the stock exchange and I think Alan Joyce has a chance of stemming the flow. Last year they were bleeding $1.5M a day. Now it's down to $M1.28. Some old B767s and B747s have gone. The last old B737 did its last flight two weeks ago. PER-SIN is finished. The CNS base will close, and the crews are being redeployed.
The problem is that the Labor Government privatised 100% of this company 19 years ago yet people think that is still a Government carrier.
In fact, after being funded by the QLD Government during its startup phase, Virgin Australia has more government-money in it than Qantas.
The Federal Government has to allow Qantas to operate unrestrained with respect to ownership. Today that amendment has passed the House Of Representatives, but has yet to pass the Senate.
I doubt any international carriers would be silly enough to buy a share of Qantas. KLM went to bed with Air France, and British Airways went to bed with Iberian, so there are precedents.
Qantas is a business, not a charity. The staff and customers must get this.
I used to fly MEL-SYD for $237 return in 1980. You can get this same fare, or cheaper, today. 34 years later it should cost $931, according the Reserve Bank of Australia’s website with inflation averaging 4.2%.
Joyce should contact every Mayor of every charity destination, CNS, TSV, MKY, ROK, ISA, ASP, DRW etc —he has about 60 calls to make— and say:
" If you want the White Rat to continue your daily service, it's going to cost your city $XX,000 per week. We will do it for you, better and cheaper than anyone ... and if you think you can start your own airline for less, call the Mayors of Mackay and RockVegas, (who went and started their own Fokker 100 airline after Ansett), and ask them.”
Everything else besides the cash-cow routes needs to move to Jetstar, which is going to grow and grow.
In the longer term I'd move Jetstar from a low-cost / low-service offering into a low-cost / full-service offering based on Barbara Cassani's 'go' —British Airways’ low-cost carrier killed-off by Rod Eddington.
I believe it was Eddington’s worst decision in his time with British. Correctly, he recognised that go was cannibalising his premium B.A. mainline customers. He sold it to a private equity firm for GBP 100M who, a year later sold it to Stelios Haji-Ioannou for a GBP 220M profit, who instantly added 27 aircraft to Easyjet’s low-cost / low-service fleet.
No longer could British Airways control the movement of their premium customers to the low-cost sector.
Alan Joyce, on the other hand, learnt from this and turned it into an art form for Qantas. High value customers who accrued their Frequent Flyer points on the cash-cow routes for business travel, suddenly found that when they tried to redeem them during holidays, the only flights servicing their favoured destinations of Noosa and the Gold Coast were with the low-cost Jetstar.
Worse, every flight seemed to have at least one family defeated by the strict check-in rules who now had to rebook, for real cash.
Moving loss-leader flights to Jetstar solves the problem, but loses passenger appeal. Barbara Cassani, Emirates, Etihad, Qatar have shown that low-cost / full-service airlines can work.
Low cost? An Emirates A380 Captain gets exactly half of an equivalent Qantas Captain, and does nearly twice the work.
The longer Qantas keeps operating loss-making routes, the faster it bleeds. Joyce must get the staff levels, per aeroplane, from the high of 385 (approx.) pre Ansett’s demise, to about 120. The sooner he does it, the sooner he crawls out of the grave. If he doesn't, the White Rat will die.
That may take 5,000 jobs, maybe even 6,000.
The day the flight crews started using iPads instead of paper inflight manuals, the people updating them every day became obsolete —the cost of modernisation. Remember? It’s why we all got computers.
When Flight Engineers went the way of the Do-do, replaced by inflight computer screens, no-one in Head Office cared. That’s about to change.
The politicians and unions hate Joyce. Grounding the airline, as he did in 2011, sealed his fate.
A senior Australian businessman told me on Monday, over a nice crumbed Whiting, that the only way to complete the recovery is with a new broom of management — “for whom the old way is history, not standard business practice.”
All the pollies and union bosses know that this is a fight between two men: the CEOs of Qantas and Virgin. They are set against each other, and with Virgin losing $450,000 a day, the stakes are high.
Sadly, they are using honest, hard-working, loyal staff members as chips.
Originally Published March 6th., 2014.
___________________________________
On the 26th February 2014 I wrote:
What will Qantas announce, 12 years to the day that Fox & Lew killed any chance of Ansett MkII?
I predict that the International routes will be reduced to the Kangaroo (LHR), and Wallaby (LAX).
Domestic flights will be The Shark Patrol, (BNE-SYD-MEL-ADL),* and PER to the east coast (BNE, SYD, MEL), with Jetstar getting the rest.
Killed-off will be Jetstar Vietnam, (I predict a $65M loss), Japan, HKG, maybe NZ.
Jetstar Singapore? A lot of work for $2M.
Outsource all heavy maintenance, and back office, to the Philippines, and a little to India.
Sale and leaseback of the fleet ($900M for which they'll get $600M), sale and leaseback of terminals and their famous Jet Base.
Pain all 'round. Shocking for thousands of loyal Qantas staff who are going to be retrenched.
Alan Joyce? Not all his fault, Jetstar overseas expansion excepted. Instead, blame Geoff Dixon for handing him a poisoned chalice with absolutely no Plan B.
The B747 replacements were the A380s, and the B767 replacements the NightMare (Dreamliner).
The second that both these aircraft were late, as all new aircraft are, his fate was sealed. The job came with No Plan B, which Joyce was silly to accept.
* With ADL dropping-off the day G.M.H. closes its doors.
___________________
Today, 6th March 2014:
My prediction before the announcement still stands. This is what will eventually be left.
I have read the briefing to the stock exchange and I think Alan Joyce has a chance of stemming the flow. Last year they were bleeding $1.5M a day. Now it's down to $M1.28. Some old B767s and B747s have gone. The last old B737 did its last flight two weeks ago. PER-SIN is finished. The CNS base will close, and the crews are being redeployed.
The problem is that the Labor Government privatised 100% of this company 19 years ago yet people think that is still a Government carrier.
In fact, after being funded by the QLD Government during its startup phase, Virgin Australia has more government-money in it than Qantas.
The Federal Government has to allow Qantas to operate unrestrained with respect to ownership. Today that amendment has passed the House Of Representatives, but has yet to pass the Senate.
I doubt any international carriers would be silly enough to buy a share of Qantas. KLM went to bed with Air France, and British Airways went to bed with Iberian, so there are precedents.
Qantas is a business, not a charity. The staff and customers must get this.
I used to fly MEL-SYD for $237 return in 1980. You can get this same fare, or cheaper, today. 34 years later it should cost $931, according the Reserve Bank of Australia’s website with inflation averaging 4.2%.
Joyce should contact every Mayor of every charity destination, CNS, TSV, MKY, ROK, ISA, ASP, DRW etc —he has about 60 calls to make— and say:
" If you want the White Rat to continue your daily service, it's going to cost your city $XX,000 per week. We will do it for you, better and cheaper than anyone ... and if you think you can start your own airline for less, call the Mayors of Mackay and RockVegas, (who went and started their own Fokker 100 airline after Ansett), and ask them.”
Everything else besides the cash-cow routes needs to move to Jetstar, which is going to grow and grow.
In the longer term I'd move Jetstar from a low-cost / low-service offering into a low-cost / full-service offering based on Barbara Cassani's 'go' —British Airways’ low-cost carrier killed-off by Rod Eddington.
I believe it was Eddington’s worst decision in his time with British. Correctly, he recognised that go was cannibalising his premium B.A. mainline customers. He sold it to a private equity firm for GBP 100M who, a year later sold it to Stelios Haji-Ioannou for a GBP 220M profit, who instantly added 27 aircraft to Easyjet’s low-cost / low-service fleet.
No longer could British Airways control the movement of their premium customers to the low-cost sector.
Alan Joyce, on the other hand, learnt from this and turned it into an art form for Qantas. High value customers who accrued their Frequent Flyer points on the cash-cow routes for business travel, suddenly found that when they tried to redeem them during holidays, the only flights servicing their favoured destinations of Noosa and the Gold Coast were with the low-cost Jetstar.
Worse, every flight seemed to have at least one family defeated by the strict check-in rules who now had to rebook, for real cash.
Moving loss-leader flights to Jetstar solves the problem, but loses passenger appeal. Barbara Cassani, Emirates, Etihad, Qatar have shown that low-cost / full-service airlines can work.
Low cost? An Emirates A380 Captain gets exactly half of an equivalent Qantas Captain, and does nearly twice the work.
The longer Qantas keeps operating loss-making routes, the faster it bleeds. Joyce must get the staff levels, per aeroplane, from the high of 385 (approx.) pre Ansett’s demise, to about 120. The sooner he does it, the sooner he crawls out of the grave. If he doesn't, the White Rat will die.
That may take 5,000 jobs, maybe even 6,000.
The day the flight crews started using iPads instead of paper inflight manuals, the people updating them every day became obsolete —the cost of modernisation. Remember? It’s why we all got computers.
When Flight Engineers went the way of the Do-do, replaced by inflight computer screens, no-one in Head Office cared. That’s about to change.
The politicians and unions hate Joyce. Grounding the airline, as he did in 2011, sealed his fate.
A senior Australian businessman told me on Monday, over a nice crumbed Whiting, that the only way to complete the recovery is with a new broom of management — “for whom the old way is history, not standard business practice.”
All the pollies and union bosses know that this is a fight between two men: the CEOs of Qantas and Virgin. They are set against each other, and with Virgin losing $450,000 a day, the stakes are high.
Sadly, they are using honest, hard-working, loyal staff members as chips.
Originally Published March 6th., 2014.
___________________________________
Air Safety (34)
Airbus (6)
ATSB (2)
Australia (20)
Aviation (31)
Boeing (8)
Current Affairs (2)
CV19 (2)
Emirates (1)
F1 (1)
Greece (2)
Melbourne (3)
My adventures (1)
My Ideas (24)
News (2)
Once upon a time (1)
Personal (5)
Politics (1)
Racism (1)
USA (3)
Victoria (2)
Airbus (6)
ATSB (2)
Australia (20)
Aviation (31)
Boeing (8)
Current Affairs (2)
CV19 (2)
Emirates (1)
F1 (1)
Greece (2)
Melbourne (3)
My adventures (1)
My Ideas (24)
News (2)
Once upon a time (1)
Personal (5)
Politics (1)
Racism (1)
USA (3)
Victoria (2)
April 2021
October 2018
April 2018
March 2017
February 2011
November 2010
October 2010
September 2010
November 2009
October 2009
April 2006
March 2006
June 2002
February 2002
March 2021
February 2021
January 2021December 2020
November 2020October 2020
September 2020
August 2020July 2020
June 2020
May 2020
April 2020March 2020
February 2020
January 2020
December 2019
November 2019
October 2019
September 2019
August 2019
July 2019
June 2019
May 2019
April 2019
March 2019February 2019
January 2019December 2018
November 2018October 2018
September 2018
August 2018
July 2018June 2018
May 2018April 2018
March 2018
February 2018
January 2018
December 2017November 2017
October 2017September 2017
August 2017
July 2017
June 2017
May 2017
April 2017March 2017
February 2017
January 2017
December 2016
November 2016October 2016
September 2016
August 2016July 2016
June 2016
May 2016
April 2016
March 2016
February 2016
January 2016
December 2015
November 2015
October 2015
September 2015
August 2015July 2015
June 2015
May 2015
April 2015
March 2015
February 2015
January 2015
December 2014
November 2014October 2014
September 2014
August 2014
July 2014June 2014
May 2014
April 2014
March 2014February 2014
January 2014
December 2013
November 2013
October 2013
September 2013
August 2013
July 2013
June 2013
May 2013
April 2013March 2013
February 2013
January 2013
December 2012November 2012
October 2012
September 2012
August 2012
July 2012
June 2012
May 2012
April 2012
March 2012
February 2012
January 2012
December 2011
November 2011
October 2011
September 2011
August 2011July 2011
June 2011
May 2011
April 2011
March 2011February 2011
January 2011
December 2010November 2010
October 2010
September 2010
August 2010
July 2010
June 2010
May 2010
April 2010
March 2010February 2010
January 2010
December 2009November 2009
October 2009
September 2009
August 2009
July 2009
June 2009May 2009
April 2009
March 2009
February 2009
January 2009
December 2008
November 2008
October 2008September 2008
August 2008
July 2008
June 2008
May 2008
April 2008
March 2008
February 2008
January 2008
December 2007
November 2007
October 2007
September 2007
August 2007
July 2007
June 2007
May 2007
April 2007
March 2007
February 2007
January 2007
December 2006
November 2006
October 2006
September 2006
August 2006
July 2006
June 2006
May 2006April 2006
March 2006
February 2006
January 2006
December 2005
November 2005
October 2005
September 2005
August 2005
July 2005
June 2005
May 2005
April 2005
March 2005February 2005
January 2005December 2004
November 2004
October 2004
September 2004
August 2004
July 2004
June 2004
May 2004
April 2004
March 2004
February 2004
January 2004
December 2003
November 2003
October 2003
September 2003
August 2003
July 2003
June 2003
May 2003
April 2003
March 2003
February 2003
January 2003
December 2002
November 2002
October 2002
September 2002
August 2002
July 2002June 2002
May 2002
April 2002
March 2002February 2002
January 2002
December 2001
November 2001
October 2001
September 2001August 2001
July 2001- 2GB
- 3AW
- 737MAX
- 777
- 787
- A350
- A380
- ABC Helicopter
- ABC Radio
- ABC TV
- AF447
- Afghanistan
- Air Astana
- AirSafetyAwards
- AM Radio
- Ansett
- Astronauts
- AsylumSeekers
- Athens
- Australia's Population
- B747
- Bahrain
- Ben Sandilands
- Boating
- BoatPeople
- Business
- Canberra
- Channel 9
- Charlie Whiting
- ChelseaBrown
- Cleanest Third World Country
- Contaminated Air
- CRM
- Current Affairs
- Dam
- Dreamliner
- Economy
- EK407
- Emergency
- Energy
- ET302
- Ethiopoan
- Expats
- Film Industry
- First Officers
- Fishing
- Fog
- Friends
- Fuel
- Gander
- Helicopter
- History
- Innovative Products
- Jetlag
- JT610
- Kangaroo Valley rescue
- Kapton Wiring
- Lightning
- Lion Air
- Lithium Batteries
- LiveableCity
- Masks
- MH370
- Moon
- Murdoch
- Newfoundland
- NewZealand
- Nuclear
- PacificAirlines
- Paid Passengers
- Peter Issacson
- Piano
- Pilot Salaries
- Process-ize Medical Service
- Qantas
- QF32
- Riots
- Road Safety
- RollS Royce
- Sleeping
- Smoke Fire Fumes
- Smoking
- Solar
- Speed record
- Terrorism
- Third World Countries
- Thunderstorms
- TOGA call
- TripleM
- Trump
- U.S. Election
- Ultra Long Haul
- United
- UPS 6
- Video Conferencing
- Vietnam
- Walkerville
- Windfarms