VA Results/Announcement today

[PLANT]

J seats to boogie board storage areas..... Or does Tiger have better boogie board storage underneath???

 

[Deleted member 29185]

all airlines are full to cns at this time of year

I don't just fly to/from CNS.

 

[Aussie_flyer]

I don't just fly to/from CNS.

congratulations?

 

[Boris spatsky]

So they'll use VA pilots but not VA cabin crew ?

Cabin crew can be trained on a new aircraft relatively quickly at very little cost. Pilots can't. Training TT pilots to fly the 737 would be significant $$ and time, let alone the AOC issue. It makes sense to me.

 

[eastwest101]

Latest stats show JQ filling 80 to 85% of all seats to Indonesia. I think they do quite well there with the 787 and their cost structure.

You can fill a B787 with $99 airfares but it still wont make money, even if it is a brand new B787 that Qantas paid for. Once Air Asia deploy their 400 seat A330s with an Indonesian based cost structure then I can't see anyone making any money flying to/from Bali no matter what the aircraft ex-Australia. My point was that there is too much capacity around there. As predicted by others the VA B737 operation blinked/folded first, the current model A320 is not the right aircraft for some of the routes, a 180 seat weird hybrid TT B738 won't cut it, selling $99 airfares on B787s won't cut the mustard either, once additional capacity comes into the market.

The only decision to be made is how much money you are prepared to lose, and what equipment you want to tie up - everyone will be losing money in the area for a while yet.

Anyway - back on topic - the VA results are interesting in that VAd is performing ok compared to VAi division with losses still being accrued but at least heading in the right direction. Anyone else thinking the drop in the price of fuel should have helped out VA and indeed QF a bit more than what we saw? (even given the exchange rate going the other way?).

 

[Daver6]

Speaking from a consumer perspective here and living in Perth.

First time I went to Bali I chose J* as had status with QF. Figured some lounge access etc would be alright. First and last time with J*. Went again to Bali earlier this year and went VA. It certainly wasn't the cheapest option, but reputable airline with a good safety record. The price I see is the price I pay without surprised plus access to lounges in both PER and DPS.

No now more VA to DPS. I certainly won't be trying Tiger. No earn to VA plus I've only heard negative reports. Much more so than J*. I doubt I'd ever fly Air Asia. Garuda? Perhaps. Would need to investigate their safety situation. Perhaps another look at J* and pay for the premium seats. Either way, my money certainly won't be going to VA/Tiger.

I think airlines that think people will just switch to their LCC out of loyalty when they pull out of a destination are mistaken. I think they risk loyal pax trying something else and hey, perhaps finding a good alternative.

Anyway, just my 2 cents. What would I know. I'm just a paying passenger

 

[Liroquai]

I think airlines that think people will just switch to their LCC out of loyalty when they pull out of a destination are mistaken. I think they risk loyal pax trying something else and hey, perhaps finding a good alternative.

I agree but how many people actually know that TT is owned by VA? It's certainly not as obvious as J* being owned by QF.

 

[Aussie_flyer]

You can fill a B787 with $99 airfares but it still wont make money, even if it is a brand new B787 that Qantas paid for. Once Air Asia deploy their 400 seat A330s with an Indonesian based cost structure then I can't see anyone making any money flying to/from Bali no matter what the aircraft ex-Australia. My point was that there is too much capacity around there. As predicted by others the VA B737 operation blinked/folded first, the current model A320 is not the right aircraft for some of the routes, a 180 seat weird hybrid TT B738 won't cut it, selling $99 airfares on B787s won't cut the mustard either, once additional capacity comes into the market.

The only decision to be made is how much money you are prepared to lose, and what equipment you want to tie up - everyone will be losing money in the area for a while yet.

Anyway - back on topic - the VA results are interesting in that VAd is performing ok compared to VAi division with losses still being accrued but at least heading in the right direction. Anyone else thinking the drop in the price of fuel should have helped out VA and indeed QF a bit more than what we saw? (even given the exchange rate going the other way?).

Air asia already fly the a330 mel-dps, have done for a while now. How do you know JQ are filling the aircraft with $99 fares? You're lucky to even get a seat during peak times like school holidays. I think you're underestimating the demand. Jetstar often fly double daily on mel-dps... why would they unless it was worth while?

Virgin are switching to a low cost model as almost everyone else has... theyre not pulling out.

 

[Deleted member 29185]

congratulations?

Thank you. For what?

 

[pauly7]

I agree but how many people actually know that TT is owned by VA? It's certainly not as obvious as J* being owned by QF.

I'd suggest a majority and growing everyday, Tigers customer service woes, safety concerns, ultimate grounding then the sale to VA for $1 was highly publicized.

As they become more integrated - like the VFF announcement of the redemptions kicking off, VA ceding more routes to Tiger, VA pilots flying Tiger planes, phrases like Tiger operated by VA it will become as clear as the JQ/QF relationship.

 

[pauly7]

Fixed that for you.

Thanks Sam, now to kickback and watch the royalties roll in

 

[vmile]

Personally, I will miss the PER-HKT flights.
SYD-PER-HKT was a good little earner of SC in J and a good positioning flight for EY ex HKT.

I mean, why fly direct....

 

[anat0l]

I'd suggest a majority and growing everyday, Tigers customer service woes, safety concerns, ultimate grounding then the sale to VA for $1 was highly publicized.

As they become more integrated - like the VFF announcement of the redemptions kicking off, VA ceding more routes to Tiger, VA pilots flying Tiger planes, phrases like Tiger operated by VA it will become as clear as the JQ/QF relationship.

Let's not get too hasty or cynical.

VA - from upper brass to corporate underling - would be stupid not to know the lumps and bumps of the QF/JQ group 'partnership'. Let's not forget two big tenets of the new VA:

• It is owned in large part by three large international airlines, all of them with a good degree of repute
• Borghetti forged a transformation in VA in order to avoid the inability to be agile (i.e. not "bogged down") like QF

It's better to see how this whole Tiger thing goes. In fact, as far as the market is concerned, I don't think anyone is particularly apprehensive about Tiger making inroads to the VA operation, and certainly few would pine its disappearance on Bali routes. If Tiger had the ill repute it deserved, it would probably have been put to death by now.

 

[kamchatsky]

I think VA has done as well as they can under the circumstances over the last few years. It was not long ago that Qantas shares were hammered.

They have transformed from LCC to a full service airline, and let TT doing the LCC work.

I really don't know what else they can do apart from keep chewing away Qantas' market share in business travel, which is always difficult due to Qantas being incumbent, and have strong history of providing travel for businesses.

A few years ago they were even talking about launching another international flight to Asia. It hasn't eventuated probably because the sums doesn't add up. With TT taking over VA they will need to look at other avenues to increase profits.

I would like to see VA partner with NH for Japanese/Northern Asian routes but maybe the sums doesn't add up there.

 

[Mattg]

Here is a rather detailed article about Tiger going to Bali:
Tigerair Australia goes international with 737-800s as Virgin Australia's group strategy evolves | CAPA - Centre for Aviation

I've selected a few quotes that I found particularly interesting:

*On a group level Virgin Australia capacity to Bali will be relatively flat as the three Tigerair Australia-branded 737-800s will have 180 seats compared to the 176 seats currently on these aircraft. The aircraft will be partially reconfigured with the 168 existing economy seats being reupholstered in Tigerair colours. The eight business class seats will be removed and 12 economy seats will be added, resulting in the new 180-seat single class configuration. Some galley space will also be removed. The front three rows will offer extra legroom seats with about 35in of pitch, providing five rows or a total of 30 extra legroom seats when also including the two emergency rows.

*Melbourne-Bali could be viewed as a test case for Tigerair Australia as it is very unusual for a narrowbody LCC to operate a route of over five hours. If Melbourne-Bali is successful it could give the Virgin Australia Group the confidence to hand over similar medium haul routes such as Brisbane-Bali and Sydney-Bali.

*Melbourne-Bali is an unusually long route for a narrowbody LCC - with no connectivity... But ultimately it seems unlikely that Tigeair Australia will be able to generate sufficient yields to cover the relatively high cost of operating long narrowbody routes such as Melbourne-Bali. Most narrowbody LCC routes of over five hours are operated in high yielding markets with limited competition and significant business demand. Bali is almost entirely a price sensitive leisure market and is also hugely competitive.

 

[eastwest101]

This article didn't seem to get much attention (probably as a result of other more tumultuous political news over the week) but I have selected the relevant bits seeing as its hidden behind a paywall.

Qantas has called on the International Air Services Commission to ensure Virgin Australia meets ownership and control criteria in its push to use low-cost subsidiary Tigerair Australia on flights to Bali.
Virgin has requested capacity for its wholly owned subsidiary on routes to Indonesia after Tigerair announced last month it would launch flights next year to Bali from Perth, Adelaide and Melbourne using Boeing 737s sourced from its parent company.

Qantas, which uses Jetstar on the Bali routes and is restarting seasonal mainline operations to the holiday destination, responded this week by writing to the commission expressing concern on how the operations would be structured. The Qantas submission says Virgin’s application fails to provide information on the entity that will use the capacity other than to say it is a wholly owned subsidiary of Virgin Australia International.
Virgin is majority foreign-owned and has a complex structure that allows it to fly internationally while meeting rules that require Australian airlines operating internationally to be 51 per cent locally owned.

In a twist of the argument used against Jetstar Hong Kong by Cathay Pacific, Qantas argues the commission needs to be sure the unnamed subsidiary is an Australian carrier and can obtain the necessary approvals and licences to operate. “Based on the available information, questions remain about the basis upon which the VAI subsidiary can meet the various requirements necessary to utilise the capacity,’’ it says, calling for any favourable decision to include controls and monitoring.


No response from VA or TT yet.

 

[eastwest101]

And here is the response from VA: (As published in The Australian):

Virgin Australia has hit back at a Qantas attempt to muddy its plan to use low-cost subsidiary Tigerair on routes to Bali, with accusations its bigger rival does not understand the legislative framework surrounding international operations. It also criticised the International Air Services Commission for allowing Qantas to lodge a submission on its request for *capacity to Indonesia after a *published deadline and called on it to rule on its application “without further delay’’.

Virgin requested the capacity for Tigerair after announcing plans to use the low-cost carrier to launch flights next year to Bali from Perth, Adelaide and Melbourne using Boeing 737s sourced from the parent company. Qantas, which uses Jetstar on the Bali routes and is restarting seasonal main line operations to the holiday destination, responded by writing to the IASC expressing concern on how the operations would be structured. The Qantas submission said Virgin’s application failed to provide information on the entity that would use the capacity other than to say it is a wholly-owned subsidiary of Virgin Australia International Airlines and called on the commission to ensure it met the necessary conditions, including majority Australian ownership.

In a response lodged yesterday, Virgin said a lack of understanding of the legislative framework as well as the roles of the commission and the Infrastructure Department was “apparent in the Qantas submission’’. The submission said its applications complied with legislation and policies and “there was no requirement that it needed to name the wholly-owned subsidiaries or subsidiary for which capacity was sought, although in this case the capacity would be used by Tigerair”. It also noted that conditions *relating to ownership and control were mandatory for all IASC *determinations and it assumed this would apply to its application. However, the commission did not possess any powers to assess, monitor or enforce ownership requirements because this role resided with the department and it needed to review its application only in terms of public benefit.

Criticising the decision to allow Qantas to lodge a late submission, Virgin said it seemed “compliance with the commission’s published procedures is optional’’.
“The commission will appreciate the importance of all Australian carriers being subject to the same procedures and requirements in relation to its administration of the Act and minister’s policy statement,’’ it said. “Variability and lack of certainty for stakeholders in the application of this legislative framework is inconsistent with the commission’s ability to effectively perform its functions and pursue the object of the Act ‘to enhance the welfare of Australians by promoting economic efficiency through competition in the provision of international air services’.’’

Separately, government figures released yesterday showed the number of domestic commercial aviation passengers fell slightly in fiscal 2015 compared to the previous year.Almost 60 million passengers flew on passenger and charter flights, down 0.9 per cent on the previous year. Aircraft trips fell 1.5 per cent to 689,162.

 

[moa999]

When they start publishing separate financials for these separately 51% owned entities, I might start believing them.