Virgin Australia Financially Secure? [Now in Voluntary Administration]

[Cubiscus]

By government lets also say a combination of federal and state, it doesn't really matter who. The advice has certainly been to not travel for holidays.

If the government(s) doesn't let them operate its completely unreasonable to say they should have planned for this and offer no support.

 

[HS-TQE]

What happens to your frequent flyer points if an airline goes bust?

The good news: you probably won't magically and tragically lose all your points if an airline goes into administration.

www.executivetraveller.com

Suggests the likes of Coles (FlyBuys) may be an "ideal" buyer of the Velocity program should VAH file administration.

On the other hand, it also presents the opportunity for SIA as well. For the purposes of integrating the Velocity database into KrisFlyer.

 

[antycbr]

By government lets also say a combination of federal and state, it doesn't really matter who. The advice has certainly been to not travel for holidays.

If the government(s) doesn't let them operate its completely unreasonable to say they should have planned for this and offer no support.

Thank you for some sanity.

I’ve added this comment here after having the misfortune of reading the comments sections of SMH and The Australian.
Arguments seem to be:

1) Branson should fix it - it’s his airline (!)
2) Those bloody foreigners we should Not Bail Them Out.
3) Private sector welfare is bad. Lots of silence when I mention private health insurance, aged care, subsidies to private schools and various taxation schemes.
4) cabotage will fix the issues. Silence again when I ask when Etihad is flying A380s to Launceston or American Airlines to Tamworth.
5) they should have prepared for this - I ask why do we need Jobkeeper shouldn’t every company prepare for standing down its entire workforce with no revenue?
6) they’re debt laden - true but was being worked on with hard decisions being made
7) the the execs earn too much - have a look as Alan Joyce!
8) that another airline will pop up - it’s not that difficult to get an high capacity RPT license surely, just a few planes!
9) the white knights of NZ and SQ
10) they don’t pay tax. I point out how many years QF haven’t paid tax. Also that 10k employees pay tax and GST, plus all the people who have their income supported by the airline.
11) my personal favourite that QF will be nice and just charge us a decent fare it they’re a monopoly, or that the ACCC will regulate them effectively. I ask them to have a look at fares in regional Australia to see what monopoly non regulated fares are.

The Australian comments is in a complete torment as they don’t want to support Alan Joyce as he’s too progressive for them but they don’t want to support Virgin because of their ideology.

 

[BCons]

Interesting Michael West opinion on VA today, dunno if it will open directly or paywalled, but gist was for govt to let them slide to recvrship n buy the assests, not the Corp entity, for cents in the $$..

https://twitter.com/x/status/1249869130636771329

 

[HS-TQE]

8) that another airline will pop up - it’s not that difficult to get an high capacity RPT license surely, just a few planes!
9) the white knights of NZ and SQ

Needed a laugh at those two points. It takes a bit longer to get a AOC from scratch, unless if we face the (highly unlikely) scenario of Alliance or Skippers taking the "Impulse Airlines" route of upgrading their AOC. It would need deep pockets by investor(s) with deep pockets in either scenario.

The other laugh is the two entities seen as the "so-called messiah" by fanboys, where those two crashed and burned on their numerous previous attempts in the Australian domestic market.

 

[Cubiscus]

That would be all fine and good a year ago when VA was failing on its own merits and poor management, but that's not a moral approach when the government has shut down their business.

 

[hydrabyss]

Interesting Michael West opinion on VA today, dunno if it will open directly or paywalled, but gist was for govt to let them slide to recvrship n buy the assests, not the Corp entity, for cents in the $$..

https://twitter.com/x/status/1249869130636771329

I have noticed his name pop up a few times but tend to skip his stories.

One thing he leaves out is brand loyalty which does not come with a new airline.

Many customers when burnt will not be in a hurry to come back.

He says the planes will have no value but Virgins fleet is modern which will have value.

This is the best comment.

What is the upshot? The Government owns the business for $300 million. It flies the planes to Alice Springs, puts them in the desert so they don’t rust, drains the oil. It pays the staff so they are ready to roll when the airline flies again.

 

[Cubiscus]

Aaannnd the US are implementing their support work $25bn

US airlines to receive $25bn rescue package

 

[TheInsider]

Public are really starting to get pissy with Richard Branson, especially the British.

https://twitter.com/x/status/1250038956797943810

 

[AustraliaPoochie]

Taxpayers are already covering wages through the JobKeeper program, I assume this continues if VA goes into administration and is restructured.

Bit offtopic...
800,000 people have applied for the Jobkeeper payment, at $3000 per person per month, 6 months equals $18,000.
$18,000 x 800,000 is already $14.4m, isn't it?
Or is my maths inadequate and its only reaching $1.44m?
I wasn't too good at maths.
And VA says they need $1.4b, ...
I can only see the govt bringing in a levy to repay all these, either via us flyers, or a levy paid by all who are currently still employed.

 

[TheInsider]

Bit offtopic...
800,000 people have applied for the Jobkeeper payment, at $3000 per person per month, 6 months equals $18,000.
$18,000 x 800,000 is already $14.4m, isn't it?
Or is my maths inadequate and its only reaching $1.44m?
I wasn't too good at maths.
And VA says they need $1.4b, ...
I can only see the govt bringing in a levy to repay all these, either via us flyers, or a levy paid by all who are currently still employed.

That's a total of $14,400,000,000.00 or $14.4b - based on 800,000 at $18k.

But yes VA are saying they need 10% of that amount to survive, but for how long...

 

[antycbr]

That's a total of $14,400,000,000.00 or $14.4b - based on 800,000 at $18k.

But yes VA are saying they need 10% of that amount to survive, but for how long...

I didn’t think they knew how many people had registered as only companies can register. Unless they’ve expanded out the number of employees via the single touch payroll?

interesting side effect of jobkeeper is the genius of the ATO running it. Cash in hand work and falsified revenue numbers will come unstuck quickly here

 

[AustraliaPoochie]

How? Redundancy payments would need to be paid to employees.

Don't forget the Ansett or the gun buyback levies.
Govt could easily bring a levy to repay what they have outlaid.
Raising the GST would need bipartisan ship, or cross bench.
Levy wouldn't need these.
There is talk that a levy might be one of the main contentions for repayments.
Edit: sorry, last warble.
The Aust govt at the time of AN let it go kaput, so probably, even though they are talking about having 2 majors, in reality, don't think that the Aust govt would again buy into a private business.
They sold out of a lot of organisations they used to own.

 

[TheInsider]

I didn’t think they knew how many people had registered as only companies can register. Unless they’ve expanded out the number of employees via the single touch payroll?

interesting side effect of jobkeeper is the genius of the ATO running it. Cash in hand work and falsified revenue numbers will come unstuck quickly here

Nah they don't know the exact numbers but 800,000 business is a coughload! I think companies have to be signed up to STP to be able to qualify.

 

[Must...Fly!]

The Branson argument is as illogical as the one that VA hasn't paid any tax.

I suppose all those against it would happily pay income tax on zero income?

I bet they all claim some out there deductions too...

I didn’t think they knew how many people had registered as only companies can register. Unless they’ve expanded out the number of employees via the single touch payroll?

interesting side effect of jobkeeper is the genius of the ATO running it. Cash in hand work and falsified revenue numbers will come unstuck quickly here

I know of several people who are crying poor now as they've not filed tax returns for years due to cash in hand jobs.

Sucked in I say.

 

[odysseus]

Interesting Michael West opinion on VA today, dunno if it will open directly or paywalled, but gist was for govt to let them slide to recvrship n buy the assests, not the Corp entity, for cents in the $$..

https://twitter.com/x/status/1249869130636771329

Unfortunately he lost his way long ago and now just courts controversial causes to build his brand.

 

[odysseus]

I have noticed his name pop up a few times but tend to skip his stories.

One thing he leaves out is brand loyalty which does not come with a new airline.

Many customers when burnt will not be in a hurry to come back.

He says the planes will have no value but Virgins fleet is modern which will have value.

This is the best comment.

What is the upshot? The Government owns the business for $300 million. It flies the planes to Alice Springs, puts them in the desert so they don’t rust, drains the oil. It pays the staff so they are ready to roll when the airline flies again.

There are many things he leaves out.

Remember when the Murdochs had the same 'clever' idea to take the assets of TEN? How'd that work out for them?

 

[oz_mark]

Public are really starting to get pissy with Richard Branson, especially the British.

https://twitter.com/x/status/1250038956797943810

Good ole Katie

 

[pauly7]

Virgin holds up domestic network subsidies

Virgin Australia delayed the announcement of a scheme aimed at underwriting critical domestic air services between the capital cities to ensure taxpayers covered all losses incurred operating the flights.

The airline will not profit on the routes. Instead, the package , first reported by the media on Tuesday, is aimed at ensuring Virgin and rival Qantas break even on the services after mothballing their domestic networks due to the COVID-19 pandemic and its toll on travel demand.

It is understood the airline finalised its discussions with the Morrison government on Tuesday night, with a formal announcement and full details of the assistance imminent.

The government is committed to having two full-service airlines on the other side of the coronavirus crisis but has said this does not have to include Virgin.

It again held the line against granting Virgin a line of credit or any other assistance specific to the business on Wednesday, with Treasurer Josh Frydenberg saying any more assistance would have to be sector-wide.

"I understand that two airlines have served us well but at the same time, our approach has been sector-wide support and that’s critical to understand,'' he said.




Full article:

Virgin holds up domestic network subsidies

The airline will not profit on the routes. Instead, the package is aimed at ensuring Virgin and rival Qantas break even on the services after mothballing their domestic networks.

www.afr.com

 

[hydrabyss]

Thank you for some sanity.

I’ve added this comment here after having the misfortune of reading the comments sections of SMH and The Australian.
Arguments seem to be:

1) Branson should fix it - it’s his airline (!)

Followed by he should sell his island.

I would never ask someone to sell their island.

Virgin holds up domestic network subsidies

Virgin Australia delayed the announcement of a scheme aimed at underwriting critical domestic air services between the capital cities to ensure taxpayers covered all losses incurred operating the flights.

The airline will not profit on the routes. Instead, the package , first reported by the media on Tuesday, is aimed at ensuring Virgin and rival Qantas break even on the services after mothballing their domestic networks due to the COVID-19 pandemic and its toll on travel demand.

It is understood the airline finalised its discussions with the Morrison government on Tuesday night, with a formal announcement and full details of the assistance imminent.

The government is committed to having two full-service airlines on the other side of the coronavirus crisis but has said this does not have to include Virgin.

It again held the line against granting Virgin a line of credit or any other assistance specific to the business on Wednesday, with Treasurer Josh Frydenberg saying any more assistance would have to be sector-wide.

"I understand that two airlines have served us well but at the same time, our approach has been sector-wide support and that’s critical to understand,'' he said.

When they mentioned free childcare there was no mention of the Childcare centres not being able to make a profit. Why are the airlines different. As time goes on you start to realise there's forces at play behind the scenes.