Alan Joyce Takes Over IATA

[freepyjamas]

Flag waving patriots wouldn't use an International airline, they'd stay domestic. Whats the lesson? flag waving patriotism gets you nowhere.

Dunno about that.

I think Qantas' brand - a brand built over many decades - is just about the best thing they've got going for them. Of course you can't exclusively hang your hat on it, but in an age where just about everything (including air travel) has become a commodity, Qantas still has a brand.

Now admittedly, the current management has failed to invest in the brand, preferring to divert marketing dollars to the bottom line, but as of today they're still benefitting from the days when they did a good job of selling their brand.

Let's face it: QFi is more expensive and unless you're on an A380 often on a par or worse than cheaper options. The fact that they still attract a decent customer-base suggests that their old patriotic brand messaging (coupled with inertia) still has some power.

Give it a decade though and the accountants running the joint will have successfully commoditised the brand, leaving themselves totally open to price/product comparisons. Not a wise move (longer term) for Qantas, IMO.

 

[The Rok]

Australia has an estimated population of almost 22 million people. In 1996 almost 4 million of them were not born here. My guess, and this is just a guess but I would say close on a quarter of all Australian residents, (Citizens, Permanent Residents & Temporary Visa Holders) were NOT born here.

It therefore does not take a rocket scientist to work out that they quite possibly have no loyalty to an Australia "Iconic" brand.

In addition, my guess is that the people who live here that were NOT born here are far more likely to travel overseas and need to use an airline then the folks born here…. So, if 25% of the population was not born here, and that same 25% more likely to travel overseas than the rest, and have no loyalty to Qantas, what else does that leave…. PRICE

Qantas is just too expensive… On average if I were to book a return flight from AU to LHR in Business on any random day, with no specials, just Joe Bloggs public… QF will be around the $10K mark, Emirates or Etihad $7K…

Loyal maybe, an idiot I am not……

For all those blaming Joyce & the board, take a closer at the costs they are forced to pay out to staff… Joyce's $5 Mil pales in comparison…

 

[Simo]

QF is an ICON and when you are overseas people will point at a QF plane and then try and remember what animal that is on the tail of the plane.

I love being able to walk in to a QF lounge overseas and say Gday mate and know that they understand me.

When AJ leaves QF he probably won't be looking for the nearest centrelink office.

 

[nlagalle]

I see, I thought when you mentioned Q Bag Tags / Self- Check In you were joking as these were knocked off from NZ I believe!

I do believe Air NZ had some form of electronic bag tags first. But not sure about the whole "next gen".

Also looking at the QF Group's handling of IT as a whole (specifically JQ) I would think would be a lesson in how not to manage your IT program!

Can you elaborate on where they have gone wrong? I've seen far greater issues over at VA than at QF. They do use different booking systems between JQ and QF. I am not sure the exact reasoning but cost may have been a great part.

 

[yohy?!]

I do believe Air NZ had some form of electronic bag tags first. But not sure about the whole "next gen".



Can you elaborate on where they have gone wrong? I've seen far greater issues over at VA than at QF. They do use different booking systems between JQ and QF. I am not sure the exact reasoning but cost may have been a great part.

They did. Years before QF's next-gen: DIY check-in system at airport from Monday - New Zealand Holidays - NZ Herald News

Yes I believe VA did use Navitaire like JQ (also poor judgement), the point though being that QF is by no means a market leader for IT given the (still diabolical) booking site for JQ.

 

[nlagalle]

Yes I believe VA did use Navitaire like JQ (also poor judgement), the point though being that QF is by no means a market leader for IT given the (still diabolical) booking site for JQ.

Id still contend they are up the top, remembering that it's more than just the booking system. Their website does a lot more than other carriers and easier too. It isn't perfect but hell there are a lot worse. I mentioned VA as their current systems are appalling and the only other major AU carrier so it's a good comparison.

 

[yohy?!]

Id still contend they are up the top, remembering that it's more than just the booking system. Their website does a lot more than other carriers and easier too. It isn't perfect but hell there are a lot worse. I mentioned VA as their current systems are appalling and the only other major AU carrier so it's a good comparison.

Maybe so, I'm no IT boffin but there are plenty of hits when searching for "news qantas systems crash"

 

[Pleb Status]

I think the main reason why QF is one of the few investment grade airlines has little to do with the management of AJ (and Dixon before him). It is due to the fact that QF is one of few airlines that have a large domestic market combined with limited domestic competition.

QF must have had around 90% market share after AN collapsed, with 95% of the corporate market. Even now, they have 65% total market share and a greater corporate market share. Domestically, it would not be hard to make money. Australia has avoided the worst of the GFC to date compared to other countries. I think any competent manager could have done what AJ has done for QF domestically (or better).

Internationally, where QF do face competition, they (and QF management) have performed poorly. This is the real test of AJ's ability. Domestically, QF use their market power to get what they want. Internationally they cannot. In a competive environment, good management makes a difference. In a non competitive one, bad management can still look good.

Unfortunately, IMHO, QF would have been far better without AJ at the helm. QF's market dominance domestically makes him look far better than he is. You can only measure competence against the performance of QFi.

 

[simongr]

They did. Years before QF's next-gen: DIY check-in system at airport from Monday - New Zealand Holidays - NZ Herald News

I travelled with a NZ Gold a few years ago and he had some rfid card on the back of his blackberry that he used to check in and it spat out a little boarding slip - didn't see FF card boarding passes at that time.

Maybe so, I'm no IT boffin but there are plenty of hits when searching for "news qantas systems crash"

I got 24,500,000 hits for Virgin Check in System Crash.

 

[nlagalle]

Maybe so, I'm no IT boffin but there are plenty of hits when searching for "news qantas systems crash"

I don't consider a google search an credible source to base all your facts on.

 

[Robmn]

And in addition to all of this it's also easy to forget one of the big challenges that QF (international) faced in 2009 - was much more intense competition on their most profitable route. After nearly 10 years of a cosy little duopoly on non-stop Australia-US routes, suddenly the group faced competition from DL/VA. The cream on the top disappeared overnight.

Tried them and would not fly VA/DL again.

 

[drron]

I think the main reason why QF is one of the few investment grade airlines has little to do with the management of AJ (and Dixon before him). It is due to the fact that QF is one of few airlines that have a large domestic market combined with limited domestic competition.

QF must have had around 90% market share after AN collapsed, with 95% of the corporate market. Even now, they have 65% total market share and a greater corporate market share. Domestically, it would not be hard to make money. Australia has avoided the worst of the GFC to date compared to other countries. I think any competent manager could have done what AJ has done for QF domestically (or better).

Internationally, where QF do face competition, they (and QF management) have performed poorly. This is the real test of AJ's ability. Domestically, QF use their market power to get what they want. Internationally they cannot. In a competive environment, good management makes a difference. In a non competitive one, bad management can still look good.

Unfortunately, IMHO, QF would have been far better without AJ at the helm. QF's market dominance domestically makes him look far better than he is. You can only measure competence against the performance of QFi.

As AJ got JQ up and running destroying new entrants and curbing DJs expansion I think he has a lot to do with QFs domination of the domestic market.
You probably are like me and dont like the JQ expansion but economically it paid off.

 

[vetrade]

In reality there is not a single investment-grade airline in the world today. Anyone who buys shares in airlines nowadays is either very frivolous with their money or isn't very knowledgeable about the airline industry.......or probably both.

 

[drron]

In reality there is not a single investment-grade airline in the world today. Anyone who buys shares in airlines nowadays is either very frivolous with their money or isn't very knowledgeable about the airline industry.......or probably both.

But those who study the stockmarket know that even if a company is going to go to the wall you can still make money- I have done it a few times and virtually risk free.

 

[Must...Fly!]

In reality there is not a single investment-grade airline in the world today. Anyone who buys shares in airlines nowadays is either very frivolous with their money or isn't very knowledgeable about the airline industry.......or probably both.

Maybe if you said US airlines I'd agree...plenty of value in QF at the 0.90 that was on offer IMO.

 

[vetrade]

Difference of definition here I think. Surely an airline shouldn't be rated "investment-grade" based on the fact that money can be made trading it's shares, especially if done by picking the short term vagaries of the market. Stock prices of airlines generally have been steadily falling for quite a few years because they all face the common problems of very expensive fleet replacement, fuel costs and aggressive competition cutting into margins. Qantas is typical - it traded in the $3 - $6 range during the early 2000's. You'd be hard pressed to convince investors that the recent price of about 90c (which is even lower than what it was during the peak downturn of the GFC) is indicative of an "investment-grade" company.

People who invested in QAN at $6.00 in 2006 obviously thought it was good value back then. People who are paying $1 now might well think the same thing (are they speculating on a take-over offer?). But it will be very different when European financial markets implode despite the hype, as common sense dictates they must eventually, and airlines face the resultant fall in demand. 50c might be the "good value" figure for QAN then.

 

[here2go]

I see, I thought when you mentioned Q Bag Tags / Self- Check In you were joking as these were knocked off from NZ I believe!

Also looking at the QF Group's handling of IT as a whole (specifically JQ) I would think would be a lesson in how not to manage your IT program!

RE: Q Bag Tags - World First. Self Checkin is a KLM First.

As for JQ - they are a LCC using Navitaire, and as DJ has seen, get off it if you can.

 

[simongr]

I don't consider a google search an credible source to base all your facts on.

Wikipedia's ok though

 

[eastwest101]

As AJ got JQ up and running destroying new entrants and curbing DJs expansion I think he has a lot to do with QFs domination of the domestic market.
You probably are like me and dont like the JQ expansion but economically it paid off.

Agree with some of your analysis, but some would argue that by doing this - a lot of the resources have been allocated to JQ and thus starving QFi and QFd of resources. So yes - AJ saved QF by starting JQ - the trouble is - this also helped kill off QFi, hurt QFd and hurt the brand value and competativness of of QFi and Qfd - a classic "phyrric victory" if ever I have seen one. And DJ are still there by the way so I don't think people could claim that JQ buried DJ....

 

[drron]

Agree with some of your analysis, but some would argue that by doing this - all the resources have been allocated to JQ and thus starving QFi and QFd of resources. So yes - AJ saved QF by starting JQ - the trouble is - this also helped kill off QFi, hurt QFd and hurt the brand value and competativness of of QFi and Qfd - a classic "phyrric victory" if ever I have seen one. And DJ are still there by the way so I don't think people could claim that JQ buried DJ....

Of course I didn't say he buried DJ but he sure did crimp it's growth when he was CEO of JQ.
I really dont think it was the formation of JQ that has hurt QFi-if JQ wasn't snaring some of the cheaper end of the market I am sure that the Asian based LCCs would have an even bigger share of Aussies OS air travel.
The fact is every airline in the world has suffered and will continue to suffer.QFs location puts it at a huge disadvantage to most other airlines in the world.yet under AJ's stewardship QF has outperformed most other airlines including ones that I have read on this site are considered to be well run-eg CX.So credit where credit is due.
Now I really dont like AJs changes at QF along with probably the majority of AFFers-or at least the vocal minority.However the business can only succeed in the long run if it makes a profit so there is no way any of us are going to get our wish lists.

And Vetrade-QF still has it's debt classified as investment grade by ratings agencies and is at the top of their lists for airlines.
And those that bought QF shares at $1 could have sold them at $1.10 yesterday,9% clear profit in less than a week sounds pretty good to me.