Help Me To Help Qantas!

[Kiwi Flyer]

I think it is much more complicated issue that just adding more carriers to drive down the fares. Often it is the same people who are demanding greater competition and lower fares that then complain when the airlines determine they need to send their aircraft maintencance to cheaper off-shore locations, or employ cabin crew based in countries where wages are lower, or change the in-flight service to paid meals or drinks, or reduce baggage allowances, or ...

If we want lower fares, we have ti be willing to accept that the operators need to reduce their costs. Its a complex issue and each aspect has an impact on another. And I don't think there is a simple "right" answer that will suit everyone (fare payers, passengers, staff, shareholders, politicians, me).

Right on. Having more competition though, is a good thing since pax can choose - airline A if want cheapest rate and no/less frills, or airline B with highest rate and most frills, or airline C in between. Currently some routes pax don't have that choice.

 

[d15.in.oz]

… one of the things I love about the U.S.
is that competition drives prices to new lows
and forces companies to innovate or perish

Depends what you mean by “perish”, but chapter 11 seems to have kept many flying, when they would be better off going bust! IMHO [as a consumer]. (Over here, do we see Ansett’s old fleet absorbed into JetStar or Virgin Blue, no… just sparkling “new” jets, and [mostly] friendly, happy, reasonably paid staff!)

… fly to Europe for US$299 round
trip from JFK. It's only a seven hour trip but
this shows you how much profit QANTAS make
on their LAX-SYD/MEL/BNE trips. If the Australian
government allowed other *legitimately* interested
carriers fly this route...

As for 7 hour round trips, I too have several booked this year - with JetStar, about that range (Australia to Asia) and have also paid around A$400 for them. [Looking forward to the next round of launch fares.] Competition is a great thing! As long as it’s level, fair and the barriers to market entrance & exit are not distorted. I can’t help but feel some sympathy for Qantas bleating about foreign government backed competitors, but at the end of the day, when it is all said and done, I want cheap fares! (With a reasonable level of service.)

If the political powers in other countries decide, that it is in their national interest to subsidise my travel, well great…it means Australian investment dollars/jobs/capital can be freed up to move into other areas of the economy.

But conversely, I am not interested in subsidising the pockets of Qantas investors and highly paid QF staff, if I travel to the US, but many Aussies are, so good on Qantas!

[P.S. with great posts & tips from people like serfty, I don’t think any of this forum's users ever pay more than is “reasonable” to fly anywhere.]

 

[Dave Noble]

As long as it’s level, fair and the barriers to market entrance & exit are not distorted. I can’t help but feel some sympathy for Qantas bleating about foreign government backed competitors

I can't feel sympathy for an airline that gets government backed assistance whining about other airlines that have government assistance

Dave

 

[inpd]

I think it is much more complicated issue that just adding more carriers to drive down the fares. Often it is the same people who are demanding greater competition and lower fares that then complain when the airlines determine they need to send their aircraft maintencance to cheaper off-shore locations, or employ cabin crew based in countries where wages are lower, or change the in-flight service to paid meals or drinks, or reduce baggage allowances, or ...

If we want lower fares, we have ti be willing to accept that the operators need to reduce their costs. Its a complex issue and each aspect has an impact on another. And I don't think there is a simple "right" answer that will suit everyone (fare payers, passengers, staff, shareholders, politicians, me).

But it is that simple. The US and England has been doing it for years.
I am not saying that government safety and minimum wage reqirements
are ignored. And competition is the "right" answer that will suit everyone
since if an airline provides the right product the plane will fly at near
capacity, staff with profit sharing plans benefits, stock price goes up etc.

Also, competition does not necessarily equal cheap prices, old planes,
reduced baggage allowances as you suggest. A few American carriers
forced to make a profit had a great innovation: A premier
class 757/200 service b/w SFO/JFK and LAX. Half as many seats are
installed as regular economy with decent meals, generous bag allowances
(i.e. all the things we as travellers like). It cost twice as regular
economy but I can't get a ticket on them it's that popular.

Surely your not suggesting that the US-Australia non-stop route cannot
do with at least two more carriers to help improve fares AND conditions?

Competition => Innovation

 

[inpd]

I can't feel sympathy for an airline that gets government backed assistance whining about other airlines that have government assistance

Dave

Exactly.

Anyone who thinks QANTAS is not getting government backing
is sadly mistaken. They may not get explicit dollar handouts
like other carriers, but the government's protecting of
QANTAS's most lucrative route is tantamount to
a handout (at the expence of others).
Only UA and QF fly non-stop LAX-SYD and Air Canada were
given the rights recently.

When I called Air Canada they stated they had no plans in the near
future to fly LAX-SYD non-stop. Now Singapore has been lobbying
the Australian Government for 10 years to get this route, so why
weren't they given it? Protectionism since SQ product would
compete favourably with QF's.

The Australian's government arguement that only carriers
that are based at one end of the route should be given
rights is bogus. The U.S./England gave rights to Singapore, Malaysian,
Saudia Air etc to fly from JFK to LHR and that's why you have such
cheap fairs and a nice range of carrier services. I've flown Lufthansa
JFK-LHR which is a budget (no IFE) but ruthlessly efficient carrier and
one time I wanted to be pampered so I flew Singapore.

This protectionism really is deterimental to everyone except for
QANTAS. It really hurts tourism and trade to Australia. People like
myself have to go back home to visit so I'll pay $2000 a ticket if need be.
But a tourist will not.

 

[Kiwi Flyer]

I've flown Lufthansa
JFK-LHR which is a budget (no IFE) but ruthlessly efficient carrier and
one time I wanted to be pampered so I flew Singapore.

Are you sure it was JFK-LHR and not JFK-FRA? Both LH & SQ fly JFK-FRA and not JFK-LHR. Also LH is hardly a budget airline, although currently only mainscreen IFE in economy.

 

[drron]

NM and others one of the things I love about the U.S.
is that competition drives prices to new lows
and forces companies to innovate or perish.

Every year I fly to Europe for US$299 round
trip from JFK. It's only a seven hour trip but
this shows you how much profit QANTAS make
on their LAX-SYD/MEL/BNE trips. If the Australian
government allowed other *legitimately* interested
carriers fly this route the air fare would be
closer to US$700 which would benefit everyone
(tourist industry, restaraunts etc.) except for QANTAS.
I say legitimatly interested since Air Canda (even though
they have the rights) really do not intend to fly
non-stop to Australia any time soon as per their
LAX office. Now if they let Singapore into the market
watch how the QANTAS and United product quality increases
and price decreases. Competition is a wonderful thing
for the consumer!

Regards.

Not necessarily so.I have a son living in NY and we are often comparing fares.Recently AA had a fare from here to LAX via NRT for appprox$A950 and JFK at$A1100 but he could not get that in the US through AA.Regularly you will get quotes on sites such as bestflights that are far cheaper for return fares to the US than any you can get in the US.Unfortunately for the OP they are rarely on QF.

 

[NM]

But it is that simple.

Which is just what O posted earlier. There are many factors which come into play, and its impossible to compare different geographies when the markets are so different.

Also, competition does not necessarily equal cheap prices, old planes,
reduced baggage allowances as you suggest.

I was not trying to suggest one is a result of the other. But lower fares does require changes to the operations and those changes are often challenged by the people that will be impacted by them - often the unionised labour forces and customers expecting improvements in service rather than reductions.

A few American carriers forced to make a profit had a great innovation: A premier class 757/200 service b/w SFO/JFK and LAX. Half as many seats are installed as regular economy with decent meals, generous bag allowances (i.e. all the things we as travellers like). It cost twice as regular economy but I can't get a ticket on them it's that popular.

Innovation, yes. Lower fares - no. Now, I seem to remember someone trying that approach here in Oz recently . Nice idea, but that attempt was unsuccessful (the reasons have been debated previously)

Surely your not suggesting that the US-Australia non-stop route cannot
do with at least two more carriers to help improve fares AND conditions?

Competition => Innovation

Not at all. I am just suggesting that the perception that more competition will always result in lower fares and better service is a little naive. Those are certainly some of the likely outcomes. But another outcome is that service levels and things that we have come to expect as "included" in the product are often reduced. Just look at the US domestic airline products as an example. Yes fare are low, but you are unlikely to be fed on a flight shorter than 3 hours, pay for your drinks, no lounge access based on status, buy/bring your own headphones for the poor quality IFE etc.

So I am saying that if we promote increased competition as a means to lowering air fares, then we cannot complain about the other affects that will likely result from the airline's need to reduce their costs to suit.

The likes of Ryanair, Southwest, Easyjet etc have most certainly reduced the cost of air travel. They have also reduced the service component and included extras. I am not judging whether that is good or bad. But I find it interesting when we are all seeking the lowest airfares on one hand, and complaining about the reduced services or use of low-cost labour (for maintenance, crew, call centres etc) on the other. Its a case of wanting our cake and eating it too.

Yes, we could see much lower trans-Pacific airfares if we invite Ryanair to operate 850 seat A380s on the route. Now I know that is a ridiculous extreme example, and the reality is somewhere in between.

Personally I think the best thing in terms of competition for the Trans_Pacific route is someone who will offer a variation to the same/same product we currently see. Perhaps DJ can do that if they are innovative enough and have the depth of pockets to make a real go of it. I hope they succeed. They have shown a willingness to find enough variation in their product domestically to be successful.

I would also like to see some of those airlines that are already permitted to operate the route to invest in it. CO and NW have the rights, have good products and have the aircraft types to do it, just not sure if they have the spare capacity or financial strength at this time.

But what I don't want to see if a degradation in the overall passenger experience for what is usually a 20+ hour total journey for me. I would prefer to pay the current airfares and have a comfortable trip, than to pay half the price and have a Ryanair experience on a 14 hour flight. However, I acknowledge that some people would rather other option.

 

[inpd]

Okay. Let this me the last word (!) on the matter since
I don't think we'll agree.

Extra competition does both introduce reduce prices and improve
service. The proof is simply that the the quality and price of
airlines in the U.S. (about 3 times as many carriers as
Australia) is much better than Australia. Now you may
be laughing uncontrollably right now, but bear with, its because
you are not living in the U.S. so don't get the full benefits.

From my relatively modest travels (12 times a year
business travel, one European holiday per year, one cruise
per year, back to Australia about every 1.5 years)
I get per year:

a) 1 free domestic (say LAX to JFK) flight per year
b) 1 free flight to the Caribbean or Hawaii
c) 4-5 magazine subscriptions (i.e. Golf, Money) and the Wallstreet Journal,
NY Times (I haven't bought a magazine or newspaper in a long time).
d) Lounge privelleges
e) 2-3 upgrades to business class (though rarely on international
long-hauls)
f) Free goods (typically my choice of coffee makers and other
$30-40 kitchen appliances)
g) I get to bypass the long security lines at airports which
I have registered at.
h) I get upgraded to ecnomy plus on United flights.

Yes the planes in the U.S. are older, but the interiors are typically
kept up well, nor is the food any worse or better than QANTAS.
Furthermore, competition leads to a tremendous amount of travel
options with respect to time/price/quality. Typically I can fly from
JFK to LAX in a premium service flight for $US500 with a nice meal and
reclining chair with foot-rest or I can pay US$150 and have to buy
my food. The choice is mine. Remember JFK to LAX is longer
than MEL to PER bt I doubt you'll get everyday prices or the range
of product you get in the U.S.

 

[serfty]

... The choice is mine. Remember JFK to LAX is longer
than MEL to PER bt I doubt you'll get everyday prices or the range
of product you get in the U.S.

"the range of product ... in the US" - This begats the main difference, in the US you have significant competition between several airlines, in Oz, there is virtually no competition.

True DJ have their own FF scheme, but it seems to be arranged so that it is only slightly more "rewarding" then Qantas'.

 

[drron]

Inpd you have confused airlines and frequent flyer schemes.When you are talking about FF schemes I agree with you 100%.QF have basically no competition and their scheme to me is inferior.That is why i have been a member of AAdvantage for some years.However I usually fly JAL transpacific so until now no status yet I have still been upgraded on AA and never in 20 years on QF.
However when it comes to airlines you must be joking.Comparing J on AA with QF on longhaul flights you certainly must be kidding.You also must have had a bad day sampling the food on QF(yes I still get to fly QF just usually on an AA award or ticket).There is no way AA is as good.The one disappointment when upgraded to first on AA was that the menu in first was exactly the same as J including wine selection.When it comes to wine most would agree QF again wins hands down.
When it comes to staff and service certainly QF is not as good as it once was but on their day they will still beat AA-and yes I have experienced some very good FA's on AA but unfortunately some shockers as well.
Mate to get me to defend QF has been a mighty acheivement and you surely qualify for some sort of award for that!

 

[Dave Noble]

However when it comes to airlines you must be joking.Comparing J on AA with QF on longhaul flights you certainly must be kidding.You also must have had a bad day sampling the food on QF(yes I still get to fly QF just usually on an AA award or ticket).There is no way AA is as good.The one disappointment when upgraded to first on AA was that the menu in first was exactly the same as J including wine selection.When it comes to wine most would agree QF again wins hands down.

I am not the greatest defender of AA, however the main courses I have had in J on AA have been nicer and larger portion than offered by QF

AAs old business class seats do compare favourably to QF Dreamtime seats. I have not yet tried AAs new J seats to compare against QFs skybeds

AAs flight attendants do trail way behind QF flight attendants though

Dave

 

[drron]

AAs old business class seats do compare favourably to QF Dreamtime seats. I have not yet tried AAs new J seats to compare against QFs skybeds



Dave

Is this because they are relatively new on AA.Of course JAL had their shell seat on transpacific route years before QF but they are still years in front of AA.
Another point is that if the American carriers are so good compared to QF why are they not offering more transpacific services.AA have come and gone.CO just into Cairns.Where are DL,NW etc.On top of this the USA have 15 times our population,certainly enough to ensure a loyal following for their carriers if they were to fly here.

 

[inpd]

A Clarification if You Joined the Discussion Late.

My comments were concerning competition being good for
driving down fares AND improving service. The U.S. market
is a good example of this. QANTAS may be a bit better than AA
in just about every aspect of J class, but on average I pay
far less for my AA tickets.

Also, the sheer weight of competition forces innovation
that is designed to cater to the individual. The JFK-LHR
route is a great example. Many airlines now will give you
a great meal *BEFORE* the flight in their lounges, some will
even bring it in from your favourite resteraunt. That way you can sleep
through the flight. JFK-LHR is competitve
route and each airline is trying to out-do the other.
That will never happen in the LAX-SYD route because
only UA and QF fly it and UA product is inferior.

 

[Dave Noble]

Is this because they are relatively new on AA.Of course JAL had their shell seat on transpacific route years before QF but they are still years in front of AA.
Another point is that if the American carriers are so good compared to QF why are they not offering more transpacific services.AA have come and gone.CO just into Cairns.Where are DL,NW etc.On top of this the USA have 15 times our population,certainly enough to ensure a loyal following for their carriers if they were to fly here.

How does quality determine where a carrier operates? AAs longhaul aircraft are 777s and 767s; I am not sure whether these are able to do the trip without needing to stop en-route

The beds are currently being rolled out on AA; approximately 23% of the 763 fleet is complete. Hopefully will get to see what they are like in May

AA is not as good imo as QF, however there are some aspects in business class where they are definately competitive. For daytime flights, their seats are pretty reasonable, though on night flights, QF skybeds are better ( though QF skybeds are well behind BAs horizontal beds imo )

Dave

 

[drron]

A Clarification if You Joined the Discussion Late.

My comments were concerning competition being good for
driving down fares AND improving service. The U.S. market
is a good example of this. QANTAS may be a bit better than AA
in just about every aspect of J class, but on average I pay
far less for my AA tickets.

Also, the sheer weight of competition forces innovation
that is designed to cater to the individual. The JFK-LHR
route is a great example. Many airlines now will give you
a great meal *BEFORE* the flight in their lounges, some will
even bring it in from your favourite resteraunt. That way you can sleep
through the flight. JFK-LHR is competitve
route and each airline is trying to out-do the other.
That will never happen in the LAX-SYD route because
only UA and QF fly it and UA product is inferior.

Competition certainly lowers prices,but service gets better?Not in my experience.Domestic flights in the US 25 years ago I remember as a much better product than now though maybe it is just my poor memory.
Besides there is competition on the US-AUST route.You do have to go via Asia but it is competitive.Flying BNE-JFK on JAL means only an extra 3 hours in elapsed time,J at 65% QF's price and service that I have found better than QF or AA.I fear that with them joining oneworld some of this may change and I mean price.

 

[NM]

How does quality determine where a carrier operates? AAs longhaul aircraft are 777s and 767s; I am not sure whether these are able to do the trip without needing to stop en-route

AA's 777-200s are not the extended range versions and cannot make the trans-Pacific flight non-stop with viable loads.

CO and NW certainly have aircraft capable of operating the route, but not the spare capacity as they need their long-range aircraft for existing profitable routes. They would need to make a significant capital investment in new aircraft (probably a minimum of 5 aircraft to make it work) and few USA-based airlines in a financial position to make such an investment. Now why is this so? Perhaps a result of all that competition driving down fares and profit margins such that most of the large USA-based airlines no longer have the financial capacity to make such investments in new routes?

 

[inpd]

Now why is this so? Perhaps a result of all that competition driving down fares and profit margins such that most of the large USA-based airlines no longer have the financial capacity to make such investments in new routes?

Ah! A not so subtle dig at my comments

AA would be reluctant to compete with Qantas given their
partnership in one-world. But the other U.S. carriers (in particular
the "higher-end" ones like Continental) want to desperately fly
international routes since they are quite profitable compared
to the domestic ones. The standard line the airlines use to
their share-holders is their vision to get more international routes!

 

[inpd]

Now why is this so? Perhaps a result of all that competition driving down fares and profit margins such that most of the large USA-based airlines no longer have the financial capacity to make such investments in new routes?

Ah! A not so subtle dig at my comments

AA would be reluctant to compete with Qantas given their
partnership in one-world. But the other U.S. carriers (in particular
the "higher-end" ones like Continental) want to desperately fly
international routes since they are quite profitable compared
to the domestic ones. The standard line the airlines use to
their share-holders is their vision to get more international routes!

 

[Altair]

AA's 777-200s are not the extended range versions and cannot make the trans-Pacific flight non-stop with viable loads.

Hmmm....according to the Boeing site they have delivered to AA 47 777-200ER with RR engines from 21 January to 26 May 2006. Still I am not too sure they can make a non-stop service LAX-SYD.
DL has ordered some (2?) 777-200LR but is this enough to fly to make a daily service when mx needs to be acconted for? I also think a DL exec did state that SYD was a destination that they were thinking about.
Oh for the record I am not a big fan of unrestricted 5th, 6th freedom flights as well. Air rights to me are a natural resource that should be managed by a government, for mid-point countries they benefit from geography and naturally will encourage open skies. End point countries will not benefit too much from open skies.
I am pleading ignorance as it has been some years since I studied tax law, but are foreign airlines, non-resident (?) paying company tax to a non-home country?