Virgin Australia Financially Secure? [Now in Voluntary Administration]

[exceladdict]

In an airline the only thing that corporate should be doing is allowing the front line workforce of ground agents, air crew and maintenance and their contractors to do their jobs and get paid, monitoring the operation for cost control, doing revenue/yield management and making sure all the safety stuff is done and maintain a web site that works and allows your customers to do that they need to do. Thats it. Nothing else.

Not sure that I agree with this. I think there is a place for customer-focussed functions. Even if you outsource tier one customer service to offshore call centres, you should have local oversight, customer service quality control, marketing, community management, social media etc all wrapped up into your customer service function. The other thing to keep local is B2B sales.

 

[HS-TQE]

As predicted, Bain Capital wants to bring many LCC aspects of Virgin Blue into VA mk2.
In other words, they've indirectly confirmed Bain is leaning primarily in the LCC direction like LCC comglomerate Indigo Partners.

Cyprus Capital is the Branson backed bid, they are former co-owners of Virgin America (another former LCC/Hybrid - depending on how people looked at that carrier).

Bain Capital: Virgin Australia needs to regain "Virgin Blue fun"

Boston-based Bain Capital is pushing ahead with a "second-round proposal" to take control of Virgin Australia.

www.executivetraveller.com

 

[DavidFlynn]

Interesting: Bain, one of the four shortlisted bidders, has released a media statement (on a Sunday arvo!) spruiking its credentials and commitment for Virgin 2.0. Not only is the timing curious, but I wonder if this might this trigger similar public pledges from the other three on the shortlist?

For those wondering: not much meat in the statement, apart from this little nugget of intent: “We want to bring back the best parts of the Virgin Blue culture and make flying fun again."

 

[DavidFlynn]

As predicted, Bain Capital wants to bring many LCC aspects of Virgin Blue into VA mk2.
In other words, they've indirectly confirmed Bain is leaning primarily in the LCC direction like LCC comglomerate Indigo Partners.

Bain Capital: Virgin Australia needs to regain "Virgin Blue fun"

Boston-based Bain Capital is pushing ahead with a "second-round proposal" to take control of Virgin Australia.

www.executivetraveller.com

I wouldn't describe this as any sort of "confirmation", even an "indirect" one: Bain's statement said only “We want to bring back the best parts of the Virgin Blue culture and make flying fun again" (bold italics theirs).

So they're talking broadly about the culture and "the vibe" (you know, like Mabo and the constitution), not the business model of being a low-cost carrier.

 

[jakeseven7]

: “We want to bring back the best parts of the Virgin Blue culture and make flying fun again."

I hope that doesn’t include forcing the crew to read out stupid jokes during the PA again that was really annoying and very LCC.

Hopefully it also doesn’t involve Bransons strutting around with scantily clad women as well.

 

[DavidFlynn]

I hope that doesn’t include forcing the crew to read out stupid jokes during the PA again that was really annoying and very LCC.

As were the first-name greetings. I mean, I am not a stickler for formality but when somebody who has never met me before and will probably never meet me again says "Hi Dave!" – well, apart from the fact that NOBODY calls me "Dave", I do feel that Mr or Mrs or Ms is the correct approach for service.

 

[esseeeayeenn]

Interesting: Bain, one of the four shortlisted bidders, has released a media statement (on a Sunday arvo!) spruiking its credentials and commitment for Virgin 2.0. Not only is the timing curious, but I wonder if this might this trigger similar public pledges from the other three on the shortlist?

For those wondering: not much meat in the statement, apart from this little nugget of intent: “We want to bring back the best parts of the Virgin Blue culture and make flying fun again."

"The best parts of the Virgin Blue culture".
That is an oxymoron.
The Virgin Blue culture was grotesque.
Fun was used as an excuse for lack of service.
I certainly won't fly Virgin 2.0 if it returns to those roots.

 

[bernardblack]

So they're talking broadly about the culture and "the vibe" (you know, like Mabo and the constitution), not the business model of being a low-cost carrier.

This is a quality reference and is appropriate at every use of "the vibe".

 

[oz_mark]

As were the first-name greetings. I mean, I am not a stickler for formality but when somebody who has never met me before and will probably never meet me again says "Hi Dave!" – well, apart from the fact that NOBODY calls me "Dave", I do feel that Mr or Mrs or Ms is the correct approach for service.

I'm sorry Dave. I'm afraid I can't do that

 

[Melburnian1]

Not sure that I agree with this. I think there is a place for customer-focussed functions. Even if you outsource tier one customer service to offshore call centres, you should have local oversight, customer service quality control, marketing, community management, social media etc all wrapped up into your customer service function. The other thing to keep local is B2B sales.

You could have some oversight by basing a small number of Australian staff in these offshore locations to ensure output was in line with the contract.

Airlines have to work hard to lower their costs.

 

[Melburnian1]

As were the first-name greetings. I mean, I am not a stickler for formality but when somebody who has never met me before and will probably never meet me again says "Hi Dave!" – well, apart from the fact that NOBODY calls me "Dave", I do feel that Mr or Mrs or Ms is the correct approach for service.

Agree, and when one mentions that to call centre staff in a variety of sectors, not just airlines or hotels, they mostly comply. I don't blame them: presumably 'the script' involves them being 'chatty', 'friendly' and 'familiar' with you, but how can they know whether you prefer 'David' or 'Dave' (or even, heaven forbid, 'Dave-o') so calling you 'Mr Flynn' is the courteous approach.

Post automatically merged: May 24, 2020

I hope that doesn’t include forcing the crew to read out stupid jokes during the PA again that was really annoying and very LCC.

Hopefully it also doesn’t involve Bransons strutting around with scantily clad women as well.

It all makes for lots of media (and blog) articles but it's extremely difficult even for mere travellers like me to consider how a VA II would be profitable so I reckon it won't survive in any form.

 

[DavidFlynn]

Agree, and when one mentions that to call centre staff in a variety of sectors, not just airlines or hotels, they mostly comply. I don't blame them: presumably 'the script' involves them being 'chatty', 'friendly' and 'familiar' with you, but how can they know whether you prefer 'David' or 'Dave' (or even, heaven forbid, 'Dave-o') so calling you 'Mr Flynn' is the courteous approach.

Oh please, don't give any of the bidders any ideas about how low their low-cost airline can go.

"G'day and welcome aboard AussieBlue, your true-blue airline. I'm Captain Davo, up the front is head sheila Shazza, give 'em a wave Shaz, there's a girl! Now we're hopin' for a really quick flight today, so stay in ya seats but if you need to use the dunny there's two down the back..."

 

[DavidFlynn]

It all makes for lots of media (and blog) articles but it's extremely difficult even for mere travellers like me to consider how a VA II would be profitable so I reckon it won't survive in any form.

The theory is that Virgin Australia could be and indeed would be profitable if not weighed down by debt and if it could negotiate more favourable contracts (from pilots to leasing, WiFi, suppliers etc), and that the administration process could achieve this, pretty much wiping out debt and terminating a lot of aircraft leases for starters, as well as potentially shrinking Virgin Australia back to a smaller airline, sort of a 'clean sheet' approach, and building slowly and steadily up from there.

 

[Stealthflyer]

I wouldn't describe this as any sort of "confirmation", even an "indirect" one: Bain's statement said only “We want to bring back the best parts of the Virgin Blue culture and make flying fun again" (bold italics theirs).

So they're talking broadly about the culture and "the vibe" (you know, like Mabo and the constitution), not the business model of being a low-cost carrier.

Flying became fun for me when I attained lounge access. I suspect lounges aren’t part of any LCC model.

 

[esseeeayeenn]

If becoming an LCC was the answer why didn't Tiger do better?

 

[Melburnian1]

If becoming an LCC was the answer why didn't Tiger do better?

Was how it was run separately from VA (added overheads) part of the reason? Lack of commonality in fleet another (mix of A320s and B738s)?

 

[p--and--t]

Was how it was run separately from VA (added overheads) part of the reason? Lack of commonality in fleet another (mix of A320s and B738s)?

Some people have long memories.

For many of my friends who refuse to fly Tiger under any circumstances the memories of the fleet being grounded with safety issues and a period where on some days 50% of flights were cancelled or many hours late.

Oh and also standing in a queue at MEL for >2hours waiting to check in and then being denied boarding because you didn't make it to the head of the queue and being told it wasn't the airlines fault there were only 2 check-in staff in total for 4 flights due to leave around the same time (in the days of no online check-in)

 

[DavidFlynn]

On the subject of LCCs - I know some have suggested that Virgin Australia could down the road launch its own LCC, wouldn’t have to have the Tiger brand, could just be ‘Virgin Express’ for argument’s sake - but I fail to see how this could achieve anything but cannibalise its parent airline and indeed the parent brand. Better to be a hybrid’ with an ancillary-based economy cabin, just sell the seat sans meals or baggage.

 

[DavidFlynn]

On meals: I wouldn’t even offer any meal on most of the triangle routes. At what other time and what other occasion in your life can you not go for 2-3 hours without a meal? When airports these days have so many catering options and F&B outlets which are generally so much better than they were 10 years ago (not to mention lounge access for golds and platinums), I would honestly scrub the whole ‘snack’ service throughout economy.

Interestingly, and some here may know more of this than I, at one stage several years ago Virgin was in discussions with Sumo Salad to trial a ‘buy and bring on board’ system at Brisbane - as I understand, the plan called for Sumo carts at the departure gate, Economy passengers would buy the meal and bring it on board. There’d be no onboard f&b except for business class, and the cabin crew would just walk down the aisle and collect all of the Sumo salad bowls into a rubbish bag just before the end of the flight.

Not an ideal scenario when you consider people boarding with their hands already full with carry-on luggage and trying to stow some of that in the overhead compartments, but still, one way to reconsider the whole economy f&b proposition.

 

[oz_mark]

Some people have long memories.

For many of my friends who refuse to fly Tiger under any circumstances the memories of the fleet being grounded with safety issues and a period where on some days 50% of flights were cancelled or many hours late.

Funnily enough, folk with starry Ansett eyes seem to forget that parts of their fleet were grounded twice over safety issues....