Virgin Australia Financially Secure? [Now in Voluntary Administration]

[antycbr]

With respect, whatever it is you're talking about, is of no relevence to me.

Let me walk you though it as you pay income tax.

Now that VA is in administration, if it doesnt make it out the other side there will be obligations on the government to pay for liabilities to the VA employees. These are backed by the government through the Fair Entitlements Guarantee Scheme. (link) After this time the VA employees will be on Jobseeker (the dole) until such time as they find another job, which might be a long time. The FEGS liability has been estimated at $800 million.

In this context government assistance becomes more likely in some form (and probably to QF now that the administration of VA has dealt with the foreign shareholders). It's probably cheaper than paying for the entitlments and unemployment benefits. Thats before we consider the downstream impacts on the tourism industry etc.

You stated you were a taxpayer, so now it's the governments role to minimise their costs in dealing with this mess and providing assistance may be cheaper than letting VA go into liquidation. It also provides political cover to provide assistance to QF as such assistance will be on a sector basis.

 

[travel_bug]

What is in point 6 for Branson to allow his brand to be used royalty free if his equity is wiped out?

Well the stay on payment of royalties seems to be the only help he's provided in this period outside of "thoughts and prayers" and passive aggressive notes about lack of government loans and how he knows he lives in a tax haven but he promises that he's not there just to avoid tax

quick edit: I know he's said that he's pumped millions into saving jobs through Virgin Group, but I don't know how much of that actually went to VA given Virgin Group's minority stake, unlike its stake in Virgin Atlantic.

 

[33kft]

Well the stay on payment of royalties seems to be the only help he's provided in this period outside of "thoughts and prayers" and passive aggressive notes about lack of government loans and how he knows he lives in a tax haven but he promises that he's not there just to avoid tax

You can tell who the favourite child is. He's offered an island for the bailout of VS

Coronavirus: Branson offers Caribbean island to secure Virgin bailout

Sir Richard Branson pledges Necker Island as collateral to help get a UK government bailout for Virgin Atlantic.

www.bbc.com

 

[jakeseven7]

Well the stay on payment of royalties seems to be the only help he's provided in this period outside of "thoughts and prayers" and passive aggressive notes about lack of government loans and how he knows he lives in a tax haven but he promises that he's not there just to avoid tax

HE SAYS HE HAS NO CASH!!!! He says he can't help VS or VA ok!!! He can write letters though!!

 

[antycbr]

Well the stay on payment of royalties seems to be the only help he's provided in this period outside of "thoughts and prayers" and passive aggressive notes about lack of government loans and how he knows he lives in a tax haven but he promises that he's not there just to avoid tax

I actually think Branson should stay silent. The more he speaks the more that VA is linked to a "paper" billionaire. The strongest message VA has is that it's an Australian company, paying Australian staff employed under Australian conditions, and paying a wide variety of Australian suppliers of services.

(note the NZers have been made redundant and the less said about the Velocity MNL call centre the better).

 

[jakeseven7]

I actually think Branson should stay silent. The more he speaks the more that VA is linked to a "paper" billionaire. The strongest message VA has is that it's an Australian company, paying Australian staff employed under Australian conditions, and paying a wide variety of Australian suppliers of services.

I totally agree and posted as such earlier today. Unfortunately he is so self obsessed this will not happen.

And VA's cover has been well and truly blown open by the media, government as well calling out repeatedly all their foreign owners (not just Branson).

 

[travel_bug]

HE SAYS HE HAS NO CASH!!!! He says he can't help VS or VA ok!!! He can write letters though!!

I can never help but laugh every time I realise I pay more tax than some billionaires - it stops the tears

 

[Franky]

You can tell who the favourite child is. He's offered an island for the bailout of VS

Coronavirus: Branson offers Caribbean island to secure Virgin bailout

Sir Richard Branson pledges Necker Island as collateral to help get a UK government bailout for Virgin Atlantic.

www.bbc.com

At first I thought you were referring to the pic with his kids, wondering how you had picked the chosen one. Then the penny dropped!

 

[antycbr]

I totally agree and posted as such earlier today. Unfortunately he is so self obsessed this will not happen.

And VA's cover has been well and truly blown open by the media, government as well calling out repeatedly all their foreign owners (not just Branson).

Time for VA to wrap itself in the flag. QF do it with the kangaroo, perhaps we can have an Emu, Koala or Echidna on the tail?

 

[Rembrandt]

I think they will continue to use the Virgin Australia branding. However, they will have to negotiate the right fee to Branson if his company is no longer a share holder. Marketing a new name for VA, new livery on planes, uniforms etc will be expensive and wasteful, so if they can come to an affordable deal with Branson that would be the ideal route to take.

A much as Branson love to market his brand he isn't going to do it for free.

 

[antycbr]

I think they will continue to use the Virgin Australia branding. However, they will have to negotiate the right fee to Branson if his company is no longer a share holder. Marketing a new name for VA, new livery on planes, uniforms etc will be expensive and wasteful, so if they can come to an affordable deal with Branson that would be the ideal route to take.

A much as Branson love to market his brand he isn't going to do it for free.

My recommendation - negotiate a token base plus a percentage of profit.

 

[Rembrandt]

Time for VA to wrap itself in the flag. QF do it with the kangaroo, perhaps we can have an Emu, Koala or Echidna on the tail?

You may remember 'V Australia' has the southern cross on it's tail. However, I think changing the livery on the planes is wasteful unless the brand changes. The planes look great as they are.

 

[travel_bug]

Time for VA to wrap itself in the flag. QF do it with the kangaroo, perhaps we can have an Emu, Koala or Echidna on the tail?

How about a black swan? Named after the event from whence it came, and a nod to the nation's capital.

 

[Mattg]

Time for VA to wrap itself in the flag. QF do it with the kangaroo, perhaps we can have an Emu, Koala or Echidna on the tail?

I think they will continue to use the Virgin Australia branding. However, they will have to negotiate the right fee to Branson if his company is no longer a share holder. Marketing a new name for VA, new livery on planes, uniforms etc will be expensive and wasteful, so if they can come to an affordable deal with Branson that would be the ideal route to take.

A much as Branson love to market his brand he isn't going to do it for free.

I have wondered if Virgin Australia wouldn't be better off re-branding as "Koala Airlines" or something to save on royalties paid to Richard Branson's company.

A couple of years ago I put this exact question to somebody at Virgin, who said they wouldn't dream of it. They thought that VA got much more value out of using the Virgin brand than the cost of the royalties. (But who knows, things could change now...)

 

[antycbr]

How about a black swan? Named after the event from whence it came, and a nod to the nation's capital.

And will help with VARA as well... The Western Australians will love it.

 

[Franky]

Time for VA to wrap itself in the flag. QF do it with the kangaroo, perhaps we can have an Emu, Koala or Echidna on the tail?

To lose all of the past baggage, I was thinking they should change their name, and thought that if they do survive they could call themselves Phoenix Airways, but when I looked up 'phoenix' in the dictionary, I thought better of it, though the 500 years of existence would be good!

 

[Must...Fly!]

Seriously we are talking less than $15m a year for a recognisable name and brand that has 20 years of good will behind it for a business that does billions in revenue each year.

How much do you reckon a total rebranding and repainting of the fleet will cost?

The name and paying a royalty to Branson to use the Virgin name is so far down the list of problems it isn't funny

 

[antycbr]

Seriously we are talking less than $15m a year for a recognisable name and brand that has 20 years of good will behind it for a business that does billions in revenue each year.

How much do you reckon a total rebranding and repainting of the fleet will cost?

The name and paying a royalty to Branson to use the Virgin name is so far down the list of problems it isn't funny

Agree, the VA stuff looks good and is ready to go already. The last rebrand is probably in the $5bn debt pile!

Branson will come to the party in some shape or form. My thinking is more about stopping Branson from talking for a bit. The lower profile the better and the media is also getting his efforts to save VS mixed up with our story in Australia.

My emphaisis is that Virgin needs to remind people just how Australian it acutally is right now. That makes assistance from all quarters so much easier.

 

[moa999]

that it is also not crushed by any anti-competitive actions that may be put in place by another player in the market.

Well unless the govt somehow assists Qantas in disposing of some of its aircraft, I'm not sure how they can prevent Qantas minimising their losses by utilising all their aircraft.

 

[SeatBackForward]

How about a black swan? Named after the event from whence it came, and a nod to the nation's capital.

Black Swans were in WA wern't they?