Building a stronger Qantas

[pauly7]

I'm also pretty positive about the announcements. I was expecting a lot lot worse, heaps more cuts than what is confirmed.

They needed to happen. So be it. Move on.

On the building of a new premium carrier in Asia I am really excited about seeing what their proposed routes are and can see the long term potential of funneling back more pax into the QF group international arm through this new carrier to help strengthen the Aus operated segments.

Jetstar Japan, don't care so much as less relevant to me but welcome an increased presence of a Qantas group affiliate.

If I were a betting man I'd have to say Singapore for the new premium carrier base.... KL... Not so sure but would tie up with a lot of floating rumors.

I wonder if they'll do a sleight of hand with the branding of the new premium airline... As in launch it then drag it back under the QF brand a few years later once all the union moaners calm down... Mmmm....

I'm just looking forward to hearing more on that!

 

[serfty]

...
3>, Set up an airline in China is not that difficult if you have the right source. the legislation would allow it, with a maximum of 49% investment. But whether airline industry would open up for foreign direct investment under WTO agreement is questionable since I do not have the stats. However, I would say if QF is keen on a China market oriented airline. It is possible for them to make an offer to one of the smaller local carrier provided that 99% of employees are Chinese and capital investment is below 49%. ...

It won't happen in China itself from what I have come across, as the undocumented necessary greasing would make it untenable financially, let alone morally.

 

[AnonymousCoward]

No, this is completely wrong, the travelling public is not always after the cheapest airfares.

I'm not saying that *everyone* chooses solely on price. However the rise of LCCs has shown that a large number of people are willing to trade off service and extras for cheaper pricing.

The value shopper (who are QF's target market, even if QF don't realise it) wants to fly on an airfare they consider value. Don't confuse that with cheap as they are NOT the same thing, the problem is the average accountant can not see the value shopper and often gets them confused with the budget shopper.

The problem is that there are airlines that have a cheaper cost base that can provide a better "value" service. Spending money to provide an even higher level of service is going to alienate those value buyers for whom the product is currently "good enough", and isn't willing to pay even more than today.

Whilst we might not like it as flyers of QF, I think this is the reality, and we need to look at our options.

Lastly, whilst secondary routes to LHR, like BKK-LHR or HKG-LHR might have once made sense before the rise of airlines like Thai, Cathay, Virgin etc. they probably don't make sense anymore. It may be better to concentrate on O&D traffic from Aus.

 

[medhead]

Clearly you missed the opening headline on one of Qantas many media releases that said "Qantas today announced it will invest almost $400 million in new international lounges, new inflight entertainment and aircraft refurbishment to improve the customer experience." Sounds like capital expenditure and improvements to me, although yes your right no new aircraft and 6 deferrals that were specifically mentioned with that money being used elsewhere (presumably in areas that can generate more return on that money). My point with the 787's though was Qantas (the airline) is getting a heap of them, more than enough to replace the 767's so where do you reckon the rest may well end up? Who knows some may well end up with Qantas international, in fact they would be ideal aircraft to fly from the major capitals to the hub of the new offshore airline, leaving the A380's to serve the long thin routes towards the America's. Now I know your going to say that Jetstar will do the flying top the offshore hub, but to be honest I think not, if that's what the plan was then there is no point for the new Asian airline to be a premium carrier it would just be an expansion of Jetstar asia.

A trivial amount of capital compared to the A380s clearly being put in to squeeze a bit more life out of the 747 fleet. Lounges on the most profitable routes doesn't equal expansion. I would guess that the capital saved on the A380s is going to be diverted to the 110 A320s that they are buying. As I said 787s are first going to Jetstar, then Domestic following what you're saying and I doubt international will get any. In fact I reckon the new asian airline has more chance of seeing an 787. Cynical? yes.

Who said you would be flying via Sydney and who said that a route you could already fly direct from Adelaide to is still not going to be there? I was talking about new opportunities generated by this new offshore airline by giving connection options (offshore) on the same group, as opposed to the current method which is to fly to an offshore hub with Qantas or on another airline then fly a non Qantas airline. The routes I am talking about are ones where direct flights to/from Australia are unviable do to distance and low traffic volumes, but viable when combined with other ports at the hub.

There are 3 flights a week with QF ADL-SIN and vv. 3/7 for direct flights and 4/7 via SYD or MEL. That's the point, it is more likely that I have to fly via somewhere in Oz first. So why not just fly SQ or MH direct and cut out the middle man. As for the "same group" thing, minor point but it is a separate airline according to Joyce. But more importantly as I said that is good for access to asia, but that is only good for the new airline. Qantas international become little more than a service to that Asian hub. So again not good for expansion of Qantas international.

 

[RSD]

Dont apologise. This is what annoys me the most about Qantas. Hearing stories like yours and what Qantas meant to you and what you once meant to Qantas versus what it means now is just sad.

AJ... are you listening??

It annoys me too - as a proud Aussie who travels all over the world and who promotes all that is great about Australia wherever I am in the world I was always proud to tell people that Qantas was truly one of the world's great airlines, and it was something that all Australians were very proud of. My job takes me to far-flung, off the beaten track places where I am far away from the comforts of civilisation and I am often leaving these places physically and mentally exhausted, but then I would fly from the middle of nowhere to somewhere like Joburg and the moment I stepped onto that Qantas flight back to Australia a lot of that exhaustion would just fade away as I knew that for the next fourteen hours I would be looked after by a group of Australians who really cared about my welfare, and that the guys up front were the very best pilots in the world which really helps a lot when you are a nervous flyer like I am.

These days Qantas is just a fading shadow of it's former self that vainly still tries to claim that it is the Spirit of Australia.

 

[medhead]

I'm not saying that *everyone* chooses solely on price. However the rise of LCCs has shown that a large number of people are willing to trade off service and extras for cheaper pricing.

Trouble is that LCC growth doesn't provide any valid indication for a "premium" airline, unless that airline is looking to become LCC. Of course LCCs grow simply because they are making flying more accessible for those with lower incomes. There is massive room for expansion. But work on the basis that there are lots of low income people who will fly if the price is low enough does not help an airline like QF that shouldn't be going for low cost. (hope that makes some sense)

These days Qantas is just a fading shadow of it's former self that vainly still tries to claim that it is the Spirit of Australia.

The even bigger joke is that it wasn't that long ago that a Qantas CEO was telling us that Australian's owe Qantas nothing.

 

[mattjdalton]

I spend a lot of time flying around Asia.

On the whole, I think the announcements will be good for me, Qantas I know and love on long haul, with a branch network of close partners (where I will get status bonus and stronger recognition)

The current OneWorld routes mean I transit Hong Kong a lot, and it will be good to have another hub or two so I don't spend time bouncing back to HKG all the time.

It feels like a strong plan for the future without sacrificing our the big kangaroo on the tail.

 

[AnonymousCoward]

Trouble is that LCC growth doesn't provide any valid indication for a "premium" airline, unless that airline is looking to become LCC.

My point is that these people used to fly on QANTAS, at higher fares, when LCCs didn't exist.
Now that LCCs do exist, and people are flying them, there is continual downward pressure on prices, especially at the bottom end of the market.

Is moving even further up market a possible strategy? Yes, it could be. But like BMW (mentioned earlier), you can't really do that and be as large as you would be if you were mass market.

 

[JRT]

Instead mentioned Our Most Valuable Members, which I suggest refers to WP1.

Slowly getting up to speed... Unfortunately, as a lowly bronze I too am considered amongst OMVM - but, am looking forward to achieving Silver, which shouldn't be too hard to maintain with both. Happy days.

 

[rechoboam]

It annoys me too - as a proud Aussie who travels all over the world and who promotes all that is great about Australia wherever I am in the world I was always proud to tell people that Qantas was truly one of the world's great airlines, and it was something that all Australians were very proud of. My job takes me to far-flung, off the beaten track places where I am far away from the comforts of civilisation and I am often leaving these places physically and mentally exhausted, but then I would fly from the middle of nowhere to somewhere like Joburg and the moment I stepped onto that Qantas flight back to Australia a lot of that exhaustion would just fade away as I knew that for the next fourteen hours I would be looked after by a group of Australians who really cared about my welfare, and that the guys up front were the very best pilots in the world which really helps a lot when you are a nervous flyer like I am.

These days Qantas is just a fading shadow of it's former self that vainly still tries to claim that it is the Spirit of Australia.

I agree. But Qantas is a public company and can only do what the market will bear. I think a lot of good points have been made here about responsibilities to stakeholders as opposed to just shareholders. It's very hard for any organisation to draw the boundaries as to where corporate social responsibility ends and being charitable at the shareholders' expense begins.

Things change...as an extreme example, today's iPhone data company may have been a telegraph company a hundred years ago. All the telegraph operators, machinery builders etc would all have been dumped at some time, even if the company still has "telegraph" in the name. I'm resigned to the fact that if I absolutely have to have an Australian pilot up the front of an Australian plane at a distant port, it may be my responsibility to charter one!

 

[Kendall Roy]

Bit of a pisstake!

[video=youtube;_NRKrmEjVNM]http://www.youtube.com/watch?v=_NRKrmEjVNM[/video]

 

[WWTFC]

It will be interesting to see if the original sale legislation allows all the changes proposed. Noticed Senator X from Sth Aust already talking inquiry.

Could these plans be stalled by legal challenges?

Col D

 

[awilcockson]

Bit of a pisstake!

Lolololol. Would be even funnier if if werent so true

 

[dajop]

I don't understand a lot of the negativity. As far as I can see, thus far there is only one less destination (EZE) that QF will no longer serve from Australia and that is being replaced by SCL (of course there may well be more to come, but this is all we have so far). Losing BKK-LHR and HKG-LHR but not LHR full stop. This actually makes a lot of sense as with 18-19 hrs return flying time, both are destinations where you can comfortably do a daily cycle with a single aircraft but not have excessive downtime (where as SIN, you're only looking 14-15hrs.

There is also the argument around less award availability, but on the flipside MH will be entering the program, and the new carrier when established will provide further options for people to redeem. I wouldn't be surprised if the market research indicates that Jetstar just won't have the market appeal for European services, and maybe this new carrier would (of course pure speculation).

Another thing that is ironic about this is the keep jobs in Australia aspect ...... OK argument to make if you are travelling on business, but if you are holidaying and are that concerned about keeping jobs in Australia ... perhaps consider holidaying in Australia instead?

 

[Bob]

Another thing that is ironic about this is the keep jobs in Australia aspect ...... OK argument to make if you are travelling on business, but if you are holidaying and are that concerned about keeping jobs in Australia ... perhaps consider holidaying in Australia instead?

Agreed - just guessing, but the value of the average overseas holiday would provide someone in Australia a job for a few months at least. (Of course, that may mean less income for Qantas, which may lead to more job losses...)

 

[jamesatfish]

There is also the argument around less award availability, but on the flipside MH will be entering the program, and the new carrier when established will provide further options for people to redeem.

Whilst I've redeemed quite a number of international award tickets over the past 5 years, I have never once been able to make a booking entirely from general award availability. On each occasion I've had to use the fantastic WP benefit of being able to request award seats be opened for redemption.

Unfortunately this benefit is only applicable for QF flight numbers on QF metal - there's no such process for codeshare flights as obviously QF doesn't control the load management for those flights.

With these changes, 4 daily QF flight options Aust-UK (QF9 & 29 ex MEL, QF1 & 31 ex SYD) are to be consolidated into what I assume will be just 2 flights daily (MEL-SIN-LHR and SYD-SIN-LHR). That's a substantial reduction in the total number of award seats available each day, and thus I'm assuming that the process of requesting points flights for redemption is going to become much harder with these changes, especially for travel to the UK.

 

[AnonymousCoward]

With these changes, 4 daily QF flight options Aust-UK (QF9 & 29 ex MEL, QF1 & 31 ex SYD) are to be consolidated into what I assume will be just 2 flights daily (MEL-SIN-LHR and SYD-SIN-LHR). That's a substantial reduction in the total number of award seats available each day, and thus I'm assuming that the process of requesting points flights for redemption is going to become much harder with these changes, especially for travel to the UK.

I think it will be harder to UK, but not harder to SIN, BKK or HKG - as those flighs appear to be staying. It'll only be BKK-LHR (QF1) and HKG-LHR (QF29) that are going. QF5 (plus connecting flight) would be another option I suppose.

 

[Martin J Cowling]

People said Tiger Woods would never come back, Michael Schumacher would never come back, Michael Jordan to never come back and guess what??? ......... so is there any chance of Anytime Access making a comeback?

In your dreams

 

[doctork]

Wow! 34 pages in 12 hours. I've been reading this thread since it started. For no particular reason (other than lots of us are doing it), I'm going to post how I think it will affect me.

In short, not much.

For business travel I fly J on QF, because work pays and they tell me who to fly with (even if it means 6 hours in HKG to change from QF127 to CX293 instead of CX the whole way). The whole codeshare thing doesn't bother me for business travel, because I fly alone, and an aisle J seat is an aisle J seat. As long as it's a long haul (not regional) configured aircraft on a reasonable operator, I'm just happy that I get to fly J at all.

International leisure, I mostly use Y+, and don't expect to win the upgrade lottery, even as a QFF SG. Nice if I get it, but Y+ on QF is better than the BA product in my opinion. Would I still fly QF for leisure? Yes, but only if I need the SCs to retain QFF SG (those years when I've got work travel to Asia rather than Europe/N. America).

Honestly, the most exciting thing about today's announcements has been reading everyone's reactions. One of the reasons it's taken me so long to post to this thread is that I was struggling to come up with ways I'd be affected.

Mind you, if my income drops and I start booking international discount Y in the hope of a classic award upgrade, and don't get it, that's a whole different story!

 

[Martin J Cowling]

The only reason Jetstar has grown so rapidly is that it virtually gifted the entire Qantas domestic network that was not CityFlyer routes.

I fly with Jetstar every now and again - only because I'm flying a route that used to be operated by Qantas and is now operated by Jetstar, so there's no choice.

Thats when I fly Virgin (eg Tasmania) or Emirates (eg CHC-MEL) or anyone else.