Qantas, Loyalty and Tiger Airways

[simongr]

Or perhaps one beer too many

I still blame firefox on a mac for my poor typing

 

[SF&]

This looks like an endless argument...

For me it has to be population or traffic numbers.

I can't see Newcastle airport NSW doing the same numbers of traffic and int'l flights as a Luton airport...

But the point of the thread is who are we going to choose or are going to stay loyal to the flying roo....

Is QF offering it's regular fliers enough, I fly econ 90% of the time; where as if I was flying business class all the time wouldn't the decision be different?

 

[Johan]

The excuse that Ausstralia has low populatioin density, and thus we have to pay more is so passe. One only needs to look at the profits that QF generates vs most other airlines overseas to know that they can charge less and still make a decent buck (and pay Geoff heaps too).

I would understand the argument if QF were struggling, and had to increase fares to survive - but that is clearly not the case.

I also have friends working for QF from pilots to flight attendants to ground staff. Morale is universally poor. QF has unhappy staff and unhappy customers - the whole recent ad campaign tries to brainwash us that it cares, but if you know better, you would know that it doesn't.

I certainly don't think they deserve your loyalty. They are cutting costs, and engineers working for them say that they are definitely cutting costs in servicing and maintenance too. It doesn't mean they are not safe - but they are certainly not as safe as they used to be (if the frequency of maintenance/servicing affects safety).

 

[Evan]

(if the frequency of maintenance/servicing affects safety).

Not that i want to get OT but probably not, in the same way trucks run oil for longer, if you know what is happening to the machine you should be fine.

And to be honest if QF is making good profits but that money will go into the huge purchases they have planned A380 & B787 then i can also see the justification, wait till QF has 20 A380's & 50+ 787's in the fleet and a lot of other guys are still flying 25 year old 767's & 747's

It is still a fact from near my home town its still 4 times cheaper or more to fly to sydney than 15 years ago, and that that was 4 times the dollar not including inflation etc. I remember the old ansett fokker prop and turbo prop days.... at huge $$ and today we have A320's/B737's doing the same route at $150 each way.

E

 

[acampbel]

Qantas loyalty is 100% to the shareholders. If they could charge $1000 per domestic sector and still fill their planes then they would. As it is, they can offer a few cheapie tickets to appear to be competitive with Virgin, but screw the prices up in the last few weeks to gouge the business travellers.

My last few domestic flights have been with Virgin (BFOD policy) and they have been full as well, so it certainly seems that we have a supply problem. The trick is to introduce a 3rd airline without it going bankrupt within a year, and I think the government will have to regulate prices (as it did with Telstra) to ensure the newcomer doesn't get crushed by the incumbents.

And let's be fair .... Qantas aren't screwing us - we are doing it to ourselves. Just look at the wallys on this site who will pay and pollute to get a different coloured FF card!



Cheers,


Andrew

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[serfty]

... And let's be fair .... Qantas aren't screwing us - we are doing it to ourselves. Just look at the wallys on this site who will pay and pollute to get a different coloured FF card! .

That's waaaay too simplistic ...

With different colors cards come different benefits when flying.

Flying is part of my work - If I would not fly I world be working in a different role. I like to fly so I get to enjoy my work more than may have been the case.

If I can optimise my flying to get a card with improved benefits, I will ... and do!

I have flown DJ and JQ - In Oz I Prefer to fly Qantas.

Cheers ...

 

[littl_flier]

And let's be fair .... Qantas aren't screwing us - we are doing it to ourselves. Just look at the wallys on this site who will pay and pollute to get a different coloured FF card!

The planes are going to fly regardless of whether a couple of hundred AFFers and FTers do mileage runs on Qantas. Logic would say that if this didn't happen, flights would need to go up as there would be less revenue although it is significantly immaterial in the eyes of QF. Qantas carry millions of passengers each year.

 

[fortymilliondaggers]

The size of the market really impacts australia massively - that coupled with the distance between population points and government intervetion and you really dont have a great combination for consumerism (maybe that's a good thing?).<snip>

We don't have that many population centres though; only a few key routes between capital cities. I don't understand why there isn't more competition between the capitals because that's where most of the money is. To have a market presence in Europe or the United States requires a greater investment because more destinations need to be served. In Australia, cover the major 5 or 6 cities and you can play with the big boys.

 

[JohnK]

If I can optimise my flying to get a card with improved benefits, I will ... and do!

I don't fly anywhere near the amount you do and I have found the Platinum coloured card to be of great benefit to me already and I have only had it for one month.

I have flown DJ and JQ - In Oz I Prefer to fly Qantas.

I have not flown DJ or JQ and I still prefer to fly Qantas. Will assess the situation again if any drastic changes occur.

 

[Dave Noble]

And let's be fair .... Qantas aren't screwing us - we are doing it to ourselves. Just look at the wallys on this site who will pay and pollute to get a different coloured FF card!

A little mean, but ostensibly I can agree with that. I can understand taking a small trip / taking a slightly more ciruitous route if finding just short of Gold/Platinum status , but flying just for the sake of getting status seems just cuckoo to me; I suspect that most people who attain status are those that get it by virtue of travel that they were undertaking anyway

Dave

 

[city8flyer]

Lilflyer:The planes are going to fly regardless of whether a couple of hundred AFFers and FTers do mileage runs on Qantas. Logic would say that if this didn't happen, flights would need to go up as there would be less revenue although it is significantly immaterial in the eyes of QF. Qantas carry millions of passengers each year.

A bit confused by this post......QF has to accept that with a 3rd player in the domestic aviation scene....... their current profits from QF Group operations might not be a realistic aim anymore. And with Jetstar promising to match prices....... and Tiger allegedly turning over a loss in Asia (pretty sure I heard this from Jetstar's CEO, might be wrong- correct me if I am)...... I believe that JQ's financial result might not be as strong as before (might they even turn over a loss?).

OTHERWISE, in my opinion-For QF group to maintain profits, they will have to jack up QF prices........ driving off passengers who have little or no status....... leaving QF customers with gold and platinum status to pay hugely inflated prices (to make up for lost pax). But all the same....... from what has been said in this thread by gold and platinum status FF's....... on the whole- they seem quite loyal (to QF) and don't mind this sort of pricing for it is 'good' business practice. Believe me- flyers with little or no status, that have not been given special treatment by QF, are not as sympathetic.

So in my belief we will see either one of 3 things.
1) Tiger to bring down QF, DJ and JQ prices. In this situation , QF will be trying to keep its 65% market share, but sacrafice profits.
2) Tiger to bring down DJ and JQ prices only. QF prices to rise further. In this situation, QF will be sacrificing market share, but will try to maintain current profits.
3) Tiger to bring down DJ and JQ prices only. QF prices to stay the same. In this situation, QF will probably lose some market share (possible QF no-status customers ONLY lost to Jetstar/Tiger) and some profit- but not as much compared to situation 1.

 

[straitman]

OTHERWISE, in my opinion-For QF group to maintain profits, they will have to jack up QF prices........ driving off passengers who have little or no status....... leaving QF customers with gold and platinum status to pay hugely inflated prices (to make up for lost pax). But all the same....... from what has been said in this thread by gold and platinum status FF's....... on the whole- they seem quite loyal (to QF) and don't mind this sort of pricing for it is 'good' business practice. Believe me- flyers with little or no status, that have not been given special treatment by QF, are not as sympathetic.

So in my belief we will see either one of 3 things.
1) Tiger to bring down QF, DJ and JQ prices. In this situation , QF will be trying to keep its 65% market share, but sacrafice profits.
2) Tiger to bring down DJ and JQ prices only. QF prices to rise further. In this situation, QF will be sacrificing market share, but will try to maintain current profits.
3) Tiger to bring down DJ and JQ prices only. QF prices to stay the same. In this situation, QF will probably lose some market share (possible QF no-status customers ONLY lost to Jetstar/Tiger) and some profit- but not as much compared to situation 1.

I understand your logic with all of this though I don't agree with you. Most people are loyal until someone proves to them they should move on. Airlines are like any other company when they are advertising. Once they have their customers they should really look after them as it's a lot easier to keep a customer and it takes a huge advertising budget to move people away from where they are comfortable. Everyone I know tends to be loyal to something. Personally I'm loyal to Qantas (OW) as there is little comparison within Oz however I don't keep my status by paying inflated prices. I keep it by planning my trips carefully and properly.

There's a lot to your little rant so I'll try to address appropriately by answering points 1 - 3..
1. Possible
2. Won't happen as this (as in any business) is the quickest way out the back door.
3. Possible.

Reality says that the most likely 1 & 3. As has been mentioned previously QF like all airlines puts a lot of effort into revenue management and this will see the prices move to where the new balance works for them. This revenue management will be inclusive of where JQ is in the market as they will work for the big picture and not just JQ and/or QF specifically.

 

[littl_flier]

A bit confused by this post......QF has to accept that with a 3rd player in the domestic aviation scene....... their current profits from QF Group operations might not be a realistic aim anymore. And with Jetstar promising to match prices....... and Tiger allegedly turning over a loss in Asia (pretty sure I heard this from Jetstar's CEO, might be wrong- correct me if I am)...... I believe that JQ's financial result might not be as strong as before (might they even turn over a loss?).

OTHERWISE, in my opinion-For QF group to maintain profits, they will have to jack up QF prices........ driving off passengers who have little or no status....... leaving QF customers with gold and platinum status to pay hugely inflated prices (to make up for lost pax). But all the same....... from what has been said in this thread by gold and platinum status FF's....... on the whole- they seem quite loyal (to QF) and don't mind this sort of pricing for it is 'good' business practice. Believe me- flyers with little or no status, that have not been given special treatment by QF, are not as sympathetic.

So in my belief we will see either one of 3 things.
1) Tiger to bring down QF, DJ and JQ prices. In this situation , QF will be trying to keep its 65% market share, but sacrafice profits.
2) Tiger to bring down DJ and JQ prices only. QF prices to rise further. In this situation, QF will be sacrificing market share, but will try to maintain current profits.
3) Tiger to bring down DJ and JQ prices only. QF prices to stay the same. In this situation, QF will probably lose some market share (possible QF no-status customers ONLY lost to Jetstar/Tiger) and some profit- but not as much compared to situation 1.

I'll be the first to agree with you here city8flyer. My post above was in frustration at acampbell's comment regarding mileage runs to "attain a better FF card". I'm not guilty of a mileage run...yet.... but its a bit harsh to say that AFF'ers and FT'ers doing mileage runs have brought on increased fares and pollution. Pollution wise, the number of mileage runs that take place are negligble and the planes fly regardless of whether JohnK does a FLounge run or not. QF still need to reposition their plane between Sydney and Melbourne and reagrdless of JohnK flying or not, the pollution still occurs.

End of Rant- sorry!

 

[oz_mark]

QF still need to reposition their plane between Sydney and Melbourne and reagrdless of JohnK flying or not, the pollution still occurs.

Not forgetting Mal and kpc

 

[wallacej]

Has history not taught airlines anything... any time there is a third player, someone always goes belly up... and I dont consider J* a third party.

So atm we have QF/J* & DJ as the main players, and when a third comes in will we have another impulse etc occur.. Tiger may come and find that our local market is just not big enough..... time will tell.

I could be wrong, but just looking back at the past that is my recall....

 

[straitman]

Has history not taught airlines anything... any time there is a third player, someone always goes belly up... and I dont consider J* a third party.

So atm we have QF/J* & DJ as the main players, and when a third comes in will we have another impulse etc occur.. Tiger may come and find that our local market is just not big enough..... time will tell.

I could be wrong, but just looking back at the past that is my recall....

You are indeed correct, though I hope that history doesn't repeat on this occasion.

 

[oz_mark]

You are indeed correct, though I hope that history doesn't repeat on this occasion.

If anything, the history lesson, as I see it, is that you need deep pockets to compete on the Australian domestic routes. Compass I and II did not have deep enough pockets. Later Ansett discovered its pockets were not as deep as they used to be, and was in quite a weak financial position (and the 767 fiasco's certainly did not help its cause)

Tiger probably has more solid financial backing that some of the other challengers, Qantas is quite deeply entrenched, and I would expect that Virgin Blue is now in a position that it could go the distance.

So I would not be so sure that the same will result this time around. If anything, I expect Jetstar to be a bit bloodied by having a true LCC competitor.

 

[hgwells01]

I wonder if anyone from the airlines lurks here and reads their customers comments.....

 

[jakeseven7]

Tiger probably has more solid financial backing that some of the other challengers, Qantas is quite deeply entrenched, and I would expect that Virgin Blue is now in a position that it could go the distance.

You think? I read a report (trying to find it online now) in the AFR, analysts believe DJ is rather stretched/exposed at the moment and could be showing Tiger their soft belly when they launch... DJ are rolling out tvs, buying little jets and trying to expand internationally whilst raising their prices and perception of service in an attempt to take QF on in the business market. Internally it is suggested they are jigging around with the role (or lack thereof) that pacific blue is playing - apparantly pacific blue jets fly more domestic hours now than international!? The report suggests they are trying to be too many things to too many people and not being singleminded about what they stand for...

It really depends I guess how deep Toll's pockets are right....? If things get nasty maybe they will go crawling back to Richard Branson for help?

 

[acampbel]

I'll be the first to agree with you here city8flyer. My post above was in frustration at acampbell's comment regarding mileage runs to "attain a better FF card". I'm not guilty of a mileage run...yet.... but its a bit harsh to say that AFF'ers and FT'ers doing mileage runs have brought on increased fares and pollution. Pollution wise, the number of mileage runs that take place are negligble and the planes fly regardless of whether JohnK does a FLounge run or not. QF still need to reposition their plane between Sydney and Melbourne and reagrdless of JohnK flying or not, the pollution still occurs.

End of Rant- sorry!

No problems, littl_flier. That was a rant worthy of simoninsingapore!

I suppose you don't bother to vote because you can't possibly make any difference, or worry about turning the A/C off when you leave for work in the morning because that power station is still going to be pumping out the ergs anyway, or ..... actually I may as well stop there because no-one is listening.


Cheers,


Andrew

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