VA half yearly results to 31 December 2018

[Bagpuss]

OT slightly, but I wonder how long it will be before we return to those rather unpalatable fares that were the norm nearly 2 decades ago. Qantas ruled the southern sky and SYD-LAX return airfares averaged $2500 per person on a good day.

Then V-Australia entered the field and the game changed.

I can't help but think that low fare wars are all very nice for the passenger, but relative to our population - truly unsustainable over a long term.

When VA upgraded the B777 business class they said they were doing it because of the premium they would/could charge.
However, you can still get the fares are circa $6k in selected sales. So it's not really worked from that angle too.

The only way I see AUS - LAX fares going up is if the AA/QF tie up gets rejected. Also when the QF A380 is out out the pasture ... so 10 years plus.

For me in Perth all my flights to the US are actually on SQ and it's make better sense (mainly timing) going via SIN. From the East Coast you have Air New Zealand options etc. etc.

 

[Melburnian1]

OT slightly, but I wonder how long it will be before we return to those rather unpalatable fares that were the norm nearly 2 decades ago. Qantas ruled the southern sky and SYD-LAX return airfares averaged $2500 per person on a good day.

Then V-Australia entered the field and the game changed.

I can't help but think that low fare wars are all very nice for the passenger, but relative to our population - truly unsustainable over a long term.

But there are numerous competitors, not just VA head-to-head with QF - nonstop or one stop - on the SYD - LAX route.

AA, CX, DL, FJ, HA, NZ, PR , SQ and UA are some. QF owns part of FJ (50 per cent if I recall).

Many are flying beyond at either end, such as ADL to SEA.

One doesn't have to go via LAX to reach JFK or another New York airport in one stop. SQ flies ex SIN nonstop, and PR flies to JFK nonstop from MNL. CX has three nonstops a day ex HKG. That's not an exhausitive list.

'Our population' at c.25 million is small, but our median income is very high and so is our purchasing power (perhaps under threat due to economic concerns). It's not just residents who use international airlines, but tourists in this case from USA, plus some from Canada, Mexico and Central America who travel via LAX (or SFO).

The propensity to travel worldwide is increasing as the middle class in nations like India expands.

So the pattern of international airfares declining in real terms is likely to continue.

 

[pauly7]

Assuming QQ are profitable VA are actually partially paying their main competitor (QF) to fly routes for them while competing on price in some markets.

I’m sure you this problem isn’t lost on the new incoming VA CEO and will have to be addressed.

A full or controlling stake takeover of Alliance by the QF group would force a major strategy rethink for the scraps of VA regional still floating around.

I’m 100% sure they are war gaming on exactly what on earth they are going to do with step one being a full defence of the aqusition in the media and regulators I’m sure.

 

[Mr Pumblechook]

There is nothing unusual about paying somebody else to do some of your regional flying. What is unusual is:

1. leasing E Jets to do your regional flying
2. buying a regional airline and paying top dollar to lease new ATRs for your new regional subsidiary
3. parking the E Jets and the ATRs
4. shrinking your regional subsidiary to smaller than it was before you bought it
5. paying a different regional airline to do all your regional flying
6. moving your oldest mainline 737s to your LCC so your LCC can move their (still under lease) 320s to what remains of your regional subsidiary to fly on behalf of mainline and replace those 737s that they lost to your LCC
   
7. all the while still paying off the leases on your E Jets and ATRs.

 

[pauly7]

There is nothing unusual about paying somebody else to do some of your regional flying. What is unusual is:

1. leasing E Jets to do your regional flying
2. buying a regional airline and paying top dollar to lease new ATRs for your new regional subsidiary
3. parking the E Jets and the ATRs
4. shrinking your regional subsidiary to smaller than it was before you bought it
5. paying a different regional airline to do all your regional flying
6. moving your oldest mainline 737s to your LCC so your LCC can move their (still under lease) 320s to what remains of your regional subsidiary to fly on behalf of mainline and replace those 737s that they lost to your LCC
   
7. all the while still paying off the leases on your E Jets and ATRs.

8. Paying your competitor to fly some regional flights on your behalf

 

[Melburnian1]

... If Tiger were working properly as an operation they would be a viable solution for trans-tasman but at the moment the incompetence in re-fleeting and staff shortages have resulted in TT becoming as much of a mess as it was when CASA shut them down and a massive burden for the VA group....

I think its will be a case of the riding instructions being:

1. Fix TT now or close it down....

January 2018 statistics out today (21 February 2019) state that overall, TT's cancellation rate in that month was a huge 8.8 per cent.

That's during school holidays. Imagine how many families would have been adversely affected. Unsustainable for almost any passenger transport operator to have that high a cancellation percentage. 228 flights cancelled in the month.

Jetstar had 239 flights cancelled but because it's much larger, the percentage came to 2.7 not 8.8. 2.7 is also unacceptable.

TT cancelled 16.8 per cent of northbound MEL - SYD flights in January 2019 (48 of 286 scheduled flights. 157 of its 238 flights that ran were more than 15 minutes late. The other three airlines were not great (VA was 'best' at 'only' 3.4 per cent but TT stood out a mile for all the wrong reasons.

 

[dajop]

Jetstar had 239 flights cancelled but because it's much larger, the percentage came to 2.7 not 8.8. 2.7 is also unacceptable.

Depends on how the cancellations were handled, which we don't know. If, for example, they were on SYD-MEL and passengers were moved onto a similarly timed QF flight, then it is probably considered more than acceptable by many passengers. . Sister in law and her family were affected by cancellation of JQ 8 SIN-MEL last year, and moved to QF 35, leaving at similar time. No complaints about that!

It would seem VA/TT are less proficient at this, and 8.8% is a much bigger number.

 

[Deleted member 29185]

January 2018 statistics out today (21 February 2019) state that overall, TT's cancellation rate in that month was a huge 8.8 per cent.

+1 suggested she could buy a cheap TT seat to get to CNS for our onward Silk flight! I advised her that even as a leisure traveler, there is no way that TT could be relied upon for a connection. Until they correct that problem, they will continue to be a nothing airline.

 

[HS-TQE]

Maybe you are a little unfair re SQ. After all it's the world's best airline, and while its level of profitability swings markedly, we ought remember it doesn't have the luxury of a domestic operation with only one other airline group against which it competes.

[..]

So irrespective of its past reticence re VA, let's give SQ - a great airline - some credit. After all apart from its flights to SIN (thank you dajop), Australia is its largest overall market (though SIN - CGK is its busiest single route).

Although SQ is considered one of the world's best airlines by service, that usually doesn't always translate to better management in certain aspects behind the scenes.

As mentioned by another poster, SQ doesn't exactly have a great track record for investing in other airlines. VS, NZ (during the Brierley/Ansett era), TR, VA.

SQ did sell their stake in VS to DL at a loss, ditto with selling their NZ stake back to the NZ government after the AN bankruptcy/liquidation and they have also been ambivalent/hands-off in VA since the capacity-war p$ssing match ended.

As I understand most posters on other forums such as a.net tend to use the likes of DL as an example of (how) to invest in other carriers, Whereas SQ and EY are used as examples of how NOT to invest in other carriers.