The great Qantas con

[maxkerr]

It is now obvious that Qantas has pulled one of the great con acts in recent years with the frequent flyer program.

Conning probably millions of points into their frequent flyer program, and now just a couple of weeks after the deadline to transfer points, shut down some flights, sack staff therebye reducing the number of reward seats available overall.

Qantas executives would have known the likelyhood of reduced flights and staff sackiings several months ago while they were still sending flyers and advertising the fact that points holders had to transfer them before 31st March.

How much money is there in points? Obviously quite a lot as Qantas fought desperately to accumulate as many as possible into their coffers before 31st March.

 

[Lucky_man]

What do you suggest they advertise -

"Due to the financial crisis please sit at home and wait for the lights to go out."

The truth is it is pretty easy to use points at the momment even with the reduced flights. Using them to upgrade to Business and First is particularly easy at the momment.

I wonder if Qantas had a button at booking time "Pay 25% more and help save some jobs" how many people would click it.

 

[moa999]

The only reason they are cutting flights is passenger numbers and yields are way way down (like every global airline).

Less yield typically means more FF seats.

 

[Mr Ed]

Newbies first post...........

A profitable airline is safer than a broke one.

Not always but it is a good indicator.

I never buy the cheapest flight, hoping and I stress only hoping the extra few dollars I spend will hopefully keep me up in the air and not spiral me down to the earth at a 1000k's an hour with a thud.

How they make that profit is up to them.

 

[anat0l]

The dilemma of the modern company:

• Shareholders want increasing returns = must remain profitable
• Profits with increasing costs = jobs and services probably go first
• Jobs have to be cut = unions accuse airline of being a tyrant
• Services have to be cut = public accuses airline of being flippant and irresponsible
• Maintain services and decrease profits = increased risk of going broke, but more responsible from a corporate point of view
• Cut executive salaries and feed back into company = public definitely wants it, shareholders either don't or don't give a damn
• Global financial crisis puts adverse pressure on company = nobody cares, just run with the status quo else the company will be crucified

You can't win. Glad I'm not running a large company.

 

[stryker]

Newbies first post...........

A profitable airline is safer than a broke one.

Not always but it is a good indicator.

I never buy the cheapest flight, hoping and I stress only hoping the extra few dollars I spend will hopefully keep me up in the air and not spiral me down to the earth at a 1000k's an hour with a thud.

How they make that profit is up to them.

Wow, Qantas would obviously love people like you!

 

[albatross710]

The dilemma of the modern company:

• Services have to be cut = public accuses airline of being flippant and irresponsible
• Maintain services and decrease profits = increased risk of going broke, but more responsible from a corporate point of view
  .

• 
  
  Cutting services that customers don't want - Good, as they aren't seeing the value of them or putting a value into the price they are willing to pay.
  
  Cutting services that customers want and willing to pay for - Bad
  
  Now is the time for airlines (and all companies) to have open dialogue with clients, question exactly what services they want, what new services can be offered that aren't offered now. Particularly good if a service can be implemented well before others.
  
  What have I got in mind?
  
  CBD check-in? - An airline could offer a CBD checkin, lounge then airport transfers.
  More customisation of booking preferences - sleeping/non-sleeping, golfer, talker, introvert etc etc
  
  I'm enjoying the management challenges in my own organisation. I see this year as a 1-in-10 year to make some major changes and set us up for the next few years.
  
  Alby

 

[MelUser]

I think this post is unfair - I have never seen so many award seats being available. There are plenty of award seats on the pacific routes in economy and premium economy - even on saturdays and fridays. This was unheard of even last year.

 

[banger2]

There seems to be very good availability of award seats atm.

I don't know what effect seasons etc have on availability prior to this global "meltdown"...I booked close to 365 days out to get a return award PE ticket to Hong Kong, even missing my first date choices due to my tardiness to book (3days after checking capacity!)...this was booked in early January 2008 for flight in late November 2008. I just booked the same flight for October this year, and it seems there was plenty of choice to the dates available.

Lets all hope that Qantas can continue to adapt to the current market conditions so that all those with QFF points, retain their value in those hard earned points (not to mention keeping countless people employed etc)...the alternative is another gut wrenching "Ansett" type event. No-one wins then, maybe even the competition doesnt win....

Thanks to the actions of Qantas, I will be flying more in the coming year than I have in my entire life, with a mix of great offers and excellent award availibility! Its a great time to be travelling by flying

 

[geoffl]

What Con??
Good for QF, they must continue to do what is necesary to remain viable, profitable and safe.
I have 6 flights with QF coming up, and half of these, (for my wife) are Reward seats, there was no problem.
Because Points are actually a liability on a balance sheet, I imagine QF will do what they can to get people to use them if possible, a case in point is their current promtioon to get people to use their FF Points for Show Tickets.

 

[samh004]

What have I got in mind?

CBD check-in? - An airline could offer a CBD checkin, lounge then airport transfers.

Not to go off topic, but they have that in Hong Kong and it works great! I think it's all airlines too, or at least most of the big ones.

 

[DTM1]

Not to go off topic, but they have that in Hong Kong and it works great! I think it's all airlines too, or at least most of the big ones.

yes, but the HKG in city check in is on the airport express train line, so they have no problem getting the baggage out to the airport v quickly. Can you imagine the grief trying to get baggage out to the airport in MEL or SYD by road ? If you wanted to leave around peak hour, you'd have to check in 3 hours early, and even then there would be no g'tees...

 

[albatross710]

yes, but the HKG in city check in is on the airport express train line, so they have no problem getting the baggage out to the airport v quickly. Can you imagine the grief trying to get baggage out to the airport in MEL or SYD by road ? If you wanted to leave around peak hour, you'd have to check in 3 hours early, and even then there would be no g'tees...

I was thinking that the check-in would be at/near an inner city train line. Check in at a dedicated section of the station, lounge, then dedicated small train express to the airport for 'checked-in' passengers.

For instance, instead of each individual traveller having to battle taxis etc to the airport in the afternoon, they would walk from their office to 'central' station, check-in, board the rail carriage (some fitted as a QP). Airline takes responsibility/risk to get passengers to airport on time. Departure arrival times quoted to/from 'central' rather than 'flights'

I'm thinking that perhaps airlines offer a 'door-to-door' service. My travel might be from "Sydney office - Brisbane house". Australia Post takes mail door to door, what about an airline that takes me from office to home, some by Sydney train, some by plane, some by Bris taxi. They use their bulk buying to improve the taxi /train services into out of airports.

These days in revenue terms, it costs me more to get to/from Brisbane airport than it does for my airfare.

Given that we all pay for transport to the airports "Airline doubles revenue by rebilling taxis", it worked early on for

Optus (rebilling Telstra services),
Origin, (rebilling Energex services)
Bolton (?) rebilling Au domain charges?

Random Friday night thoughts.


Alby

 

[medhead]

I'm thinking that perhaps airlines offer a 'door-to-door' service. My travel might be from "Sydney office - Brisbane house". Australia Post takes mail door to door, what about an airline that takes me from office to home, some by Sydney train, some by plane, some by Bris taxi. They use their bulk buying to improve the taxi /train services into out of airports.

These days in revenue terms, it costs me more to get to/from Brisbane airport than it does for my airfare.

Given that we all pay for transport to the airports "Airline doubles revenue by rebilling taxis", it worked early on for

Alby

Nice idea, I'm not sure it really takes into account how the taxi industry works, there is no margin in taxis for QF to cut into by bulk buying. Passenger would basically end up paying extra to QF for them to organise a taxi. (ignore for a minute that this would be illegal) This service is already available it is called Qantas drive. Which is quite expensive compared to a taxi, sure the price might drop if there was a fixed regular service, i.e. full utilisation of the car, such as for a taxi. But a taxi will always be cheaper.

As for paying qantas more for a taxi. Taxi fares are regulated, it is illegal to charge higher then the set fare rate. THe taxi industry is already full of players trying to take a cut of the fixed pie. The fare on the meter has to pay the taxi licence owner, the car owner, vehicle operating costs, fleet manager, and finally the driver. Who will take the cut to give qantas a slice of the pie? Does qantas become the taxi plate owner? That is a big capital outlay. Maybe they can lease the taxi plates but that costs and they gotta have the car running full time - there isn't many flights at 4 am on Tuesday morning. So what they take on other business, then the CL pax on Monday morning is still getting into a cab that has been vomitted in 3 hours before hand.

It is a good idea, but I just don't think there is money in the taxi side of the business

 

[Dougo]

It is now obvious that Qantas has pulled one of the great con acts in recent years with the frequent flyer program.

Conning probably millions of points into their frequent flyer program, and now just a couple of weeks after the deadline to transfer points, shut down some flights, sack staff therebye reducing the number of reward seats available overall.

Qantas executives would have known the likelyhood of reduced flights and staff sackiings several months ago while they were still sending flyers and advertising the fact that points holders had to transfer them before 31st March.

How much money is there in points? Obviously quite a lot as Qantas fought desperately to accumulate as many as possible into their coffers before 31st March.

Sorry Max, but I don't see your reasoning here.

Why would Qantas want FF to pour all their points into their FF coffers just so that Qantas can provide them with free flights (+ taxes etc). That's a huge liability that Qantas is acountable for regardless of whether all of the FF members actually use their FF points for flights or not.

The reduction of flights and personnel is due to the downturn in the economy - heeelllllooooo - where have you been lately??? - and NOT simply timed for full effect to "con" people as you say, after people elected to transfer their FF points to Qantas.

I agree with the other posters - reduction of staff and changing routes is inevitable in this day and age. You can still use your FF points for a Qantas flight or with an airline partner, or cars, hotels etc.

 

[albatross710]

Nice idea, I'm not sure it really takes into account how the taxi industry works, there is no margin in taxis for QF to cut into by bulk buying.

I wouldn't intend that anything would be illegal. Perhaps regulatory changes would be required in the same way government opened up competiton to Aust Post. Perhaps instead of a single person in a 'taxi' as such, it might be another form of transport, share riding, car pooling, special trains, helicopter from CBD - Airport.

 

[oz_mark]

Conning probably millions of points into their frequent flyer program, and now just a couple of weeks after the deadline to transfer points, shut down some flights, sack staff therebye reducing the number of reward seats available overall.

Qantas executives would have known the likelyhood of reduced flights and staff sackiings several months ago while they were still sending flyers and advertising the fact that points holders had to transfer them before 31st March.

The decision on the direct sweep occured way before they would have known about the downturn, and was one part of a set of changes made to the program over the last year or so (Anyseat and the FF shop expansion). A downturn in the market does not seem to be a reason to not press ahead with the change.

As for paying qantas more for a taxi. Taxi fares are regulated, it is illegal to charge higher then the set fare rate. THe taxi industry is already full of players trying to take a cut of the fixed pie.

While that is true, taxi's can already add a selection of fees on top of a taxi fare:

1) $2.00+ for catching a taxi at an airport
2) +++ for going down a toll road
3) +10% + 1% for paying by credit card

 

[medhead]

While that is true, taxi's can already add a selection of fees on top of a taxi fare:

1) $2.00+ for catching a taxi at an airport
2) +++ for going down a toll road
3) +10% + 1% for paying by credit card

All these select fees are allowed to be added by legislation.

I wouldn't intend that anything would be illegal. Perhaps regulatory changes would be required in the same way government opened up competiton to Aust Post. Perhaps instead of a single person in a 'taxi' as such, it might be another form of transport, share riding, car pooling, special trains, helicopter from CBD - Airport.

Interesting idea. I wasn't sure that Oz Post was opened up to competition, domestically, for buying stamps or getting a letter to someone's letterbox, say. These are the type of functions that don't work with competition. They talk about taxi deregulation a lot to get cars on the road at the peak demand times. But I don't think the economies can add up, all those extra cars can't earn enough money to stay on the road.

However, it is a great vision for a "full service" airline and for the cream that they seem to add into the premium classes they could throw in a free Qantas drive trip.

 

[jpk]

CBD check-in? - An airline could offer a CBD checkin, lounge then airport transfers.

Interesting idea. Might be viable in BNE and SYD (they are the only cities to have a train to the airport). The SYD airport link is commonly known to be loss-making, and the tickets are not that cheap, so on the face of it perhaps possibilities for QF to partner there.

On the downside though, both lines terminate some distance from the terminals, unlike the HKG train, so significant investment in manpower required to move the luggage from platform to checkin.

Also in HKG, most people take the train as its the best way of getting to the airport - fast, cheap, clean, regular, and most importantly reliable. Taxi/car is expensive and take longer, the bus is cheap but takes ages. In SYD/BNE most people still drive or taxi it, as its not that expensive, especially given time frames. So there would need to be an regular express train - unlikely to happen.

Finally - this was tried by BA at London Paddington station, where the Heathrow Express originates. They canned it because it was too expensive to run, it didn't win enough business to make it viable. If it didn't work there, then I am not sure it will in Australia. In Australia labour is expensive, whereas its cheap in HKG.

 

[dajop]

I don't understand how a CBD checkin assists (unless like HKG train is the quickest most efficient way of getting to airport). Instead of going A->Airport it would be A->B->Airport. Seems inefficient for passenger and airline. Too late for SYD, if it had been a dedicated line ala HKG, KUL, Heathrow Express maybe. But the fact is the airport lines are integrated into the suburban network so not practical to do anything else with that. A better solution would be refining the Air NZ technology approach to make the airport process smooth.

Now back to OP, load of absolute codswallop. Maybe if the economy had been booming your accusation would have had a grain of truth, if availability as bad as early part of last year. But now? A dream run for most QFF's who've been struggling for availabity ever since AN went belly up. Plenty of availability now on QF and its many partners. A few cut services here and there does not define a con. A con is when the airline goes belly up because it goes broke.