Qantas - what will Coronavirus mean in the medium term?

[MEL_Traveller]

I dunno - with a vaccine who's going to care being cooped up on a plane or ship? So I'd give it maybe 18 months to see us getting back to normal.

The main reason i see QF being reluctant to re-engage a full schedule will be (a) having to pay staff and pilots and (b) they can make as much profit off a small plane like the 787 if they hike up their fares. Goodbye to $5999 business class to europe and hello to $9999.

Of course competition may have something to say about it. If SQ is offering 5 x daily to London with $5999 fares QF may have little option but to follow.

 

[woodborer]

Leisure travel I think will take much longer for two reasons:

1. Disposable income will be limited for some time for many as we deal with the fallout of CV - obviously many reasons here why

There's also going to be a bunch of cashed up folk that haven't been able to spend money.

 

[Rangalad]

I dunno - with a vaccine who's going to care being cooped up on a plane or ship? So I'd give it maybe 18 months to see us getting back to normal.

The main reason i see QF being reluctant to re-engage a full schedule will be (a) having to pay staff and pilots and (b) they can make as much profit off a small plane like the 787 if they hike up their fares. Goodbye to $5999 business class to europe and hello to $9999.

Of course competition may have something to say about it. If SQ is offering 5 x daily to London with $5999 fares QF may have little option but to follow.

Pre shutdown could fly MEL/AKL/MEL business class for less than one way MEL/PER premium economy.

 

[p--and--t]

I dunno - with a vaccine who's going to care being cooped up on a plane or ship? So I'd give it maybe 18 months to see us getting back to normal.

You might be right, but the background risk needing to be factored in by the gov, companies and travellers is that (from my lay person's reading) it appears no-one has been able to develop successfully a vaccine for any of the several preexisting coronavirus' to date.

Of course there is the alternative that drug companies love, medication that manages or reduces the effects of the illness at great expense over many years (aka HIV)

 

[RichardMEL]

Ah but whence a vaccine? And even then say one is "available" in 12-18 months (the timeframe keeps changing...) that doesn't mean EVERYONE will instantly get it (obviously).. there may well be a requirement to show proof of vaccination to enter (or leave!) certain places, or perhaps be prepared to undergo a test on arrival (or even both in some paranoid places?)..

I know certainly if/when I can get jabbed I'll be off like a rocket because I want to get back out there.

I also imagine for the types of folks that partake in forums like AFF that there will not only be cheaper premium fares/award avail but also so many promos to get us back out there it will be crazy for awhile as hotels/places/airlines try and stimulate demand. For those keen to, and feel safe enough to do so, the sky could well be the limit once things begin to open up.

 

[OATEK]

Ah but whence a vaccine? And even then say one is "available" in 12-18 months (the timeframe keeps changing...) that doesn't mean EVERYONE will instantly get it (obviously).. there may well be a requirement to show proof of vaccination to enter (or leave!) certain places, or perhaps be prepared to undergo a test on arrival (or even both in some paranoid places?)..

I know certainly if/when I can get jabbed I'll be off like a rocket because I want to get back out there.

I also imagine for the types of folks that partake in forums like AFF that there will not only be cheaper premium fares/award avail but also so many promos to get us back out there it will be crazy for awhile as hotels/places/airlines try and stimulate demand. For those keen to, and feel safe enough to do so, the sky could well be the limit once things begin to open up.

Opinion on the after-market seems to be hugely varied. One article today said air fares could soar. Other views on this forum have suggested (as above) that it will be a buyers market.

 

[dajop]

Opinion on the after-market seems to be hugely varied. One article today said air fares could soar. Other views on this forum have suggested (as above) that it will be a buyers market.

Conceivably it could be both. Anywhere competing with the Chinese carriers or Qatar (eg AU-Europe) could be a buyers market, as I just can't see QR exercising "capacity discipline" (assuming such travel is allowed), whilst domestic and near-haul international (NZ, Pacific Island) and long haul markets that QR/China carriers don't touch (Americas) could see airfares soar. SE Asia could go either way.

 

[jakeseven7]

Conceivably it could be both. Anywhere competing with the Chinese carriers or Qatar (eg AU-Europe) could be a buyers market, as I just can't see QR exercising "capacity discipline" (assuming such travel is allowed), whilst domestic and near-haul international (NZ, Pacific Island) and long haul markets that QR/China carriers don't touch (Americas) could see airfares soar. SE Asia could go either way.

People are also forgetting that airlines leverage economies of scale to deliver sharp pricing. These will be completely savaged for all major players. I will not be surprised at all if airfares are actually quite high now for a few years....

 

[drron]

You might be right, but the background risk needing to be factored in by the gov, companies and travellers is that (from my lay person's reading) it appears no-one has been able to develop successfully a vaccine for any of the several preexisting coronavirus' to date.

Of course there is the alternative that drug companies love, medication that manages or reduces the effects of the illness at great expense over many years (aka HIV)

Though the Brits tried for 40 years to develope a vaccine for the common cold without success.And the major drug companies get very little out of that market.

 

[dajop]

People are also forgetting that airlines leverage economies of scale to deliver sharp pricing. These will be completely savaged for all major players. I will not be surprised at all if airfares are actually quite high now for a few years....

You are assuming a need for airlines to be profitable. I think the wild unknown is whether QR/China will operate in a wildly unprofitable manner for a while to drive other player to reduce capacity. Not sure where EK stands, they do seem to care a bit more about profitability than QR, but their large planes will surely kill them. But Dubai Inc. depends on them to a certain extent.

Whatever the case, it's going to be a vastly different world out there now. Maybe the A321 XLR will be a much sought after type for long haul travel.

 

[juddles]

Crystal ball time: (ie am going out on a limb to make a prediction, but I TRULY understand that I, nor anyone, has any real ability to work out what is coming as this can go so many ways....)

It has come to my attention that the lockdown etc that Australia has performed has been so spectacularly succesful that there is now a glimmer of hope that we could eradicate the disease within our home shores. New Zealand is in a similar position.

If, and it is still an "IF" in its extreme infancy, we achieved that, we would then enter a period , of perhaps years, where domestic travel and travel to NZ would be freely available. We would have no international incoming tourists, as they would face a quarantine. Likewise, very few aussies would want to head elsewhere as they would face similar quarantine upon return. But there would be a gazzillion aussies and kiwis itching to travel, and we would have an economy yearning some returns to previous levels of tourism, etc.

Maybe this would be a powerful situation to create great levels of domestic and trans-tasman travel? But given that this free-for-all domestically and to NZ will not arrive for a couple of months at the very least, I doubt Virgin will still be standing. They are collapsing as we speak, just "weeks" into this.

I think most of us hate the concept of returning to a new world where QF reigns supreme with a monopoly - that would allow them to finally start making bountiful payments to shareholders. So maybe the "second carrier" could become Air New Zealand - with a complete ability to operate on all aussie domestic routes.

I can actually see that as a possible future.....

(for the record my crystal ball suffers from many failings - a basic understanding of economics, business, human behaviour, etc etc)

Edit: Additionally, I can already see a perfect slogan for Air New Zealand in that world of competition with Qantas: "Keeping the cough honest"

 

[RichardMEL]

re pricing.

I believe it's both.

As recovery begins in whichever form supply will initially be limited because airlines will not want to ramp up too many services without a good idea of demand, so at least initially the demand may well be stronger than supply and prices will go up (and it may get more complex with how, on the domestic front, a weakened VA will respond in terms of capacity, routes etc - ie we could well see monopoly routes appear until other carriers - be it QF/JQ/VA/TT - can pop back in or think there's the demand to support it) so pricing will likely go up in the short term. More medium term as demand stabalises or becomes more predictable then the airlines will provide more supply and we probably will come back to a reasonable level. "reasonable" may vary of course.. it probably will be some time before the sale fares we've seen recently may return in large scale, but they probably will on leisure routes in the medium term as consumer confidence, and ability to spend hopefully improves. Places like OOL could get interesting with the mix of convention/corporate spend being probably variable plus the leisure mix.

I could also see a case for discounted premium fares but that may be less likely. Hard to know what the carriers will do in that space. Wait and see on that one.

medium-longer term I do think fares will stabalise.

 

[p--and--t]

Though the Brits tried for 40 years to develope a vaccine for the common cold without success.And the major drug companies get very little out of that market.

Veering off topic, but - Cold and Flu "medication" - half an aisle of hocus pocus in every chemist shop in the country, $B business. Blanket advertising for "soldier on" et al every year.

 

[drron]

Veering off topic, but - Cold and Flu "medication" - half an aisle of hocus pocus in every chemist shop in the country, $B business. Blanket advertising for "soldier on" et al every year.

But they are mostly not the products of major drug companies.

 

[MEL_Traveller]

Veering off topic, but - Cold and Flu "medication" - half an aisle of hocus pocus in every chemist shop in the country, $B business. Blanket advertising for "soldier on" et al every year.

In most countries i guess, l;ike Oz and Europe. in the USA cold and flu tablets are as low as 99c for 12. Buy 'em at Kroger or Meijer

If, and it is still an "IF" in its extreme infancy, we achieved that, we would then enter a period , of perhaps years, where domestic travel and travel to NZ would be freely available. We would have no international incoming tourists, as they would face a quarantine. Likewise, very few aussies would want to head elsewhere as they would face similar quarantine upon return.

I dunno if the 'market' (us) will stand for that? 6 months, a year maybe. But if they can't produce a vaccine or other treatment I wonder if we will go for herd immunity. There are too many people in Australia with family abroad for them to never see them again. I guess we might end up taking fewer holidays/trips - maybe one trip a year and factoring in a 7 day quarantine (with rapid testing) at the end?

... there may well be a requirement to show proof of vaccination to enter (or leave!) certain places, or perhaps be prepared to undergo a test on arrival (or even both in some paranoid places?)...

the little yellow international vaccine books used to be very common, they might see a resurgence!

 

[PineappleSkip]

the little yellow international vaccine books used to be very common, they might see a resurgence!

They're still all the rage for those who answer "yes" to the question "have you been to Africa or South America in the last six days" .
They dayI arrived back for the first day of compulsory iso, they still didn't forget to ask me for my yellow book.

 

[VPS]

In most countries i guess, l;ike Oz and Europe. in the USA cold and flu tablets are as low as 99c for 12. Buy 'em at Kroger or Meijer



I dunno if the 'market' (us) will stand for that? 6 months, a year maybe. But if they can't produce a vaccine or other treatment I wonder if we will go for herd immunity. There are too many people in Australia with family abroad for them to never see them again. I guess we might end up taking fewer holidays/trips - maybe one trip a year and factoring in a 7 day quarantine (with rapid testing) at the end?




the little yellow international vaccine books used to be very common, they might see a resurgence!

I've still got my little yellow book (and it's scanned as well)

 

[JohnM]

They're still all the rage for those who answer "yes" to the question "have you been to Africa or South America in the last six days" .
They dayI arrived back for the first day of compulsory iso, they still didn't forget to ask me for my yellow book.

I've been to Africa and S America many times and answered Y to that question. I can't recall ever being asked to show my yellow book (which I keep stapled into the back of my passport).

 

[PineappleSkip]

I travel to Africa every quarter and never NOT been asked.

 

[JohnM]

I travel to Africa every quarter and never NOT been asked.

It must be because mine is permanently and obvious in my PP that they don't ask and take a look at it and I haven't been taking enough notice to be aware of it.