Qatar Airways to acquire 25% of Virgin Australia

[RooFlyer]

Your post read as if you were calling for the entire management of VA to be contracted out to QR. Other than the outgoing CEO, VA already has a suite of managers in key roles. Why would they need to be replaced? But your latest post is only referring to the CEO so perhaps I misunderstood your point.

i’m between flights so I may not have been as eloquent as I might of been ( that said, I don’t think I was ever calling for anything, just saying what might happen ) but I think my last post explains the real world situation.

 

[justinbrett]

i’m between flights so I may not have been as eloquent as I might of been ( that said, I don’t think I was ever calling for anything, just saying what might happen ) but I think my last post explains the real world situation.

Which is QR getting a say on the CEO appointment. Not controversial.

But by no means “operational control” like you originally suggested.

 

[PERLHR]

Your post read as if you were calling for the entire management of VA to be contracted out to QR. Other than the outgoing CEO, VA already has a suite of managers in key roles. Why would they need to be replaced? But your latest post is only referring to the CEO so perhaps I misunderstood your point.

I think that is less important as they’re not going to get a Qatari CEO and I’m sure they’ll find a suitable replacement for JH with or without QR. JH has objectively been a very good CEO and I don’t think VA needs QR to find a replacement. But even if they get consulted I’m not sure they’d pick any differently - a good candidate is a good candidate.

But again this all reads like some just want VA to be QR Australia.

No. It's wanting someone or an entity to take a serious interest in VA and perhaps help them to be the best they can.

Why does it matter to you specifically who VA enter into relations with? Are all QF lovers worried that the monopolistic shelve that QF operate in has loose screws?

 

[justinbrett]

Why does it matter to you specifically who VA enter into relations with? Are all QF lovers worried that the monopolistic shelve that QF operate in has loose screws?

I’ve already said multiple times I have no problems with QR taking a 20% stake.

I’ve been seeking to understand why some want QR to take an even bigger role to the extent of taking full control. It seems to show little faith in VA as an airline and deep unhappiness with the way it’s being run. As I said before I was under the impression VA loyalists were pretty happy with VA2.

No. It's wanting someone or an entity to take a serious interest in VA and perhaps help them to be the best they can.

Again just seems to show unhappiness with current management when objectively they’ve done quite a good job. QR is good at running QR, especially with huge resources to back it up. Is it good at running an Australian predominately domestic “value carrier” airline? Well I don’t think we’ll see as they won’t be given the keys to do so. They’ll be a minor partner but I expect industry professionals with strong links to Australia, if not full citizens, will continue to run the airline.

 

[MooTime]

Again just seems to show unhappiness with current management when objectively they’ve done quite a good job.

Some of us are fine with VA doing a 'good' job, but we know full well that aiming a little higher than 'good' should be the real aim & an airline like QR can quite likely lift VA above 'good'.

'good' may be QF benchmark & even that of late would be a stretch.

 

[jrfsp]

Some of us are fine with VA doing a 'good' job, but we know full well that aiming a little higher than 'good' should be the real aim & an airline like QR can quite likely lift VA above 'good'.

'good' may be QF benchmark & even that of late would be a stretch.

Arnt they aiming for "wonderful" rather than " nice"

 

[HS-TQE]

Of course you also have to be careful what you wish for. Alliances with airlines like EY, SQ and even UA could be on the chopping block rather soon. QR would love to sell you SYD-DOH-LAX or JFK instead.

It's possible, although unlikely. A lot of airlines partner outside of their alliances, and VA should be no different.

If QR did that by extending their cuts past removing the largely unilateral EY partnership (e.g EY still codeshares on VA domestic for Etihad Guest FF but VA has replaced EY with QR in the other direction) to include the major two-way partnerships of SQ and UA would likely be a loss of FFs (and revenue) to rival programs.

Edit: Remove related but not necessary bit to the reply.

 

[justinbrett]

It's possible, although unlikely. A lot of airlines partner outside of their alliances, and VA should be no different.

If QR did that by extending their cuts past removing the largely unilateral EY partnership (e.g EY still codeshares on VA domestic for Etihad Guest FF but VA has replaced EY with QR in the other direction) to include the major two-way partnerships of SQ and UA would likely be a loss of FFs (and revenue) to rival programs.

It was alleged that both SQ and EY (perhaps even NZ before they sold out) back in the VA 1.0 had a tight lease on who VA can "partner" with, thus the frustrations with the 'so-called' then minor partnerships of AC and HA, and NH allegedly wanted to partner earlier but SQ wanted to funnel VA booked Japan pax via SIN.
The only outside partner(s) getting past the SQ/EY guard are both DL and VX (as both was a legacy Godfrey-era partnership from the VB days, and the old DL/VA JV was also set up back when Godfrey was CEO of DJ and the VA code was then only used for their long haul ops).

Hmm, your last two paragraphs seem to illustrate my point perfectly but contradict your first paragraph.

If QR gets its way, EY will be gone on day 1. It’s a main rival airline to QR just like EK. So there’s that.

SQ is a major competitor in transporting pax from Australia to Europe. It would have to be on the chopping block. Or perhaps they’ll exclude Europe from the partnership.

UA is more likely to be safe, as most Australians don’t want to fly via DOH to get there. But it’s not out of the question.

However as I said, at 19% I would think the other 81% would be keen on keeping VA profitable and not being used to prop up QR the same way NZ used AN.

 

[p--and--t]

Arnt they aiming for "wonderful" rather than " nice"

That might be their aim but my (limited) real world experience is they not close to target. Improving but a way to go yet. I preferred JQ on my recent BNE-ADL-BNE trips

 

[RooFlyer]

I’ve been seeking to understand why some want QR to take an even bigger role to the extent of taking full control. It seems to show little faith in VA as an airline and deep unhappiness with the way it’s being run. As I said before I was under the impression VA loyalists were pretty happy with VA2.

<redacted>
In a corporations sense there are about four different ways 'control' can be defined and exerted. And it’s different in a listed and in an unlisted entity.

Personally, I would like QR, if they’re going to be a significant investor, to have some say in the appointment of CEO. They know how to run a successful airline and hopefully you can transfer some of those skills, via the CEO, into Virgin.

It’s not to say there’s little faith in VA as an airline, just the real world situation that if an industry participant is going to put a major investment into an airline like Virgin, they ain’t gonna do it out of charity.

I’ve had a series of virgin flights in business and economy over the last couple of days and I’m perfectly happy with both the fares and what I found on board. However, as we all know, Virgin's reach with international is quite limited. It would be a much better airline if it had better international connectivity and more solid partnerships. And it would certainly be a better airline with a much stronger balance sheet. Having a major Industry investor is part of that and the IPO is the next step. The IPO will be much more successful if investors can see that large, successful industry player have put their money and hopefully some of their skills into the company.

 

[p--and--t]

Would be better if it stayed on topic - VA/QR partial ownership rather than the same old same old winges about other things unrelated airlines

 

[justinbrett]

<redacted> In a corporations sense there are about four different ways 'control' can be defined and exerted. And it’s different in a listed and in an unlisted entity.

I spent 20 years in the military. I could write you a thesis on the different types of control in that setting (operational control is one). So I think you know that I know there are different types of control in the corporation sense.

I am talking in a general sense. Ie, (oxford) “the power to influence or direct people's behaviour or the course of events.”

Personally, I would like QR, if they’re going to be a significant investor, to have some say in the appointment of CEO. They know how to run a successful airline and hopefully you can transfer some of those skills, via the CEO, into Virgin.

Sure, they can get a vote. But it’s gonna be from the same pool of people. QR aren’t going to magically open a new recruiting scheme because it’s QR. Unless you’re suggesting they’re gonna send some one over in a throbe, which I don’t think would fly.

QR knows how to run QR. Possibly that extends to running a value carrier in the Australian domestic market, but not necessarily. JH knows how to run such an airline. She was a good pick. Who is the next JH? I’m just saying you don’t need QR to find that person.

I just don’t think the QR investment is the silver bullet you’re making it out to be. Maybe it will be. I suspect it will be more of the same with different masters, which is not a bad thing if you like VA2.

 

[ANstar]

Qatar will never be given majority control so I’m struggling to see the difference. It seems many here just want VA turned into QR Australia and that’s just not going to happen.

Why cant QR have full control? Bain is foreign owned, Singapore owned Tiger etc.. Virgin Blue were foreign owned when they started.

 

[elanshin]

Why cant QR have full control? Bain is foreign owned, Singapore owned Tiger etc.. Virgin Blue were foreign owned when they started.

No chance government will allow it.

Too much risk involved with QR and the current relationship and history. This is specific to QR and not to foreign entities.

 

[justinbrett]

Why cant QR have full control? Bain is foreign owned, Singapore owned Tiger etc.. Virgin Blue were foreign owned when they started.

You asked me that before and I answered upthread.

Post in thread 'Qatar Airways Near to Acquiring up to 20% of Virgin Australia'
Qatar Airways Near to Acquiring up to 20% of Virgin Australia

 

[jase05]

No chance government will allow it.

Too much risk involved with QR and the current relationship and history. This is specific to QR and not to foreign entities.

Yes, nothing to do with foreign ownership just those nasty Qatari’s.

 

[PERLHR]

Yes, nothing to do with foreign ownership just those nasty Qatari’s.

Ofcourse the Chinese and where Emirates come from are much nicer aren't they?

 

[justinbrett]

Yes, nothing to do with foreign ownership just those nasty Qatari’s.

No there would be plenty of countries where a state owned investor would be carefully assessed.

However similar economies like UK, US, Canada, NZ and even Singapore are not on that list.

 

[elanshin]

Yes, nothing to do with foreign ownership just those nasty Qatari’s.

Ofcourse the Chinese and where Emirates come from are much nicer aren't they?

There's a lot more big picture things to look at when its big state owned entities and the potential impact they can have on the market should they choose to "play dirty".

The Qatari's are smart and has probably dealt with this level of pushback elsewhere globally before and thus in this case are not pushing for a nig controlling stake.

 

[PERLHR]

There's a lot more big picture things to look at when its big state owned entities and the potential impact they can have on the market should they choose to "play dirty".

The Qatari's are smart and has probably dealt with this level of pushback elsewhere globally before and thus in this case are not pushing for a nig controlling stake.

Quite possibly...not sure however that the Aussie govt or decision makers allegedly on behalf of the country is that versed on "big picture " stuff..as "Port of Darwin" come immediately to my off topic mind!