Virgin Blue announcements 26/08

[medhead]

The point being that Etihad & to a lesser extent VA will be competing with Emirates.

Etihad still hasn't made a profit in it's first 6 or whatever years of operation...

Exactly Etihad will be doing the competing and VA are filling a gap for Etihad. that's why it seems reasonable for me. It is a complimentary mix. As for Etihad, I guess when you have all that oil backing you 6 years is all relative.

I also don't get all the ranting about the route changes. They used the aircraft to try something that seemed best at the time, it didn't work. No reason to keep wasting money and not go for something better. What would you have done, put the aircraft into LAX? Given all the new capacity on that route as already mentioned.

 

[straitman]

The world be full of armchair experts.

Nothing wrong with negative feedback - there is often a lot to be learnt from mistakes

Absolutely Mark.

There is a difference between negative feedback and continual bagging without offering and alternate solutions.

 

[medhead]

I was just catching up on my newspaper reading on tonight’s flight when I noticed a story in the Financial Review from Monday (30 August) on the Virgin Etihad deal. There were a couple of points that matched why I think it sounds like a good plan. Sorry no link as the financial review requires a subscription

Virgin makes a virtue of Qantas ties

Financially the deal is no blockbuster, bringing in only $10 million in the first year. But the value comes from the longer-term benefit of an international network that will provide a lever into highly profitable domestic routes such as the $150 million-plus coast-to-coast routes.

While Borghetti featured prominently, the Etihad side of the transaction was heavily peppered with Qantas alumni as well. John Shepley, who used to work with Joyce at Jetstar, led the negotiations for the world’s richest commercial airline.

It’s a significant deal for Virgin, because one of the main reasons it failed to pry business travellers from Qantas has been its lack of an international network.
Thanks to the Etihad deal, Virgin now offers 24 flights a week to London and one-stop flights to 12 other European cities, boosting its attractiveness to companies or corporate flyers who seek a network to spend their frequent flyer points on.

Etihad gains access to Virgin’s frequent flyer program and codeshares on an extensive Australian domestic network.

Borghetti has struck a good deal because he gains a marketing advantage of being plugged into a global network at little cost.

 

[Ansettaddict123]

EK
PER-DXB 2x daily direct
MEL-DXB, MEL-SIN-DXB, MEL-KUL-DXB
SYD-DXB 2x daily direct*, SYD-BKK-DXB, (*1 of these will be suspended temporarily awaiting extra aircraft to come on line)
BNE-DXB, BNE-SIN-DXB

EY :
MEL-AUH, SYD-AUH (both daily), BNE-AUH (3 x weekly)

Until EY gets into the Perth market I don't think that anyone will bother with them (at least in WA). It will be interesting to see how this pans out- apparently EY have been thinking about PER for a while; if they can offer a well timed service they will be fine in my opinion.

A330's - Yep great for now, but bring on 787's in 2013/2014 for some new technology!

For now the 27% or so rise in their share price over the past week is a good start...

And what’s wrong with the A350 exactly? Boeing is not the only aerospace company who can make a next gen carbon fibre jet with all the trimmings

The A350 would be a perfect replacement to DJ's A330 and 77W fleet, assuming that it does what the box says
The A350-800 could replace the A332's and the A350-1000 could replace the 77Ws, with the A359 as a nice sweet spot between the two. This could potentially bring about massive cost savings in the long (and short) runs with savings in maintenance and crewing especially.

With regards to the share price; its about time (!!!!)
Not long ago I was considering cutting my losses, I think I may hold on for a while longer now and see if JB bring about more positives, which I'm sure he can!

 

[straitman]

And what’s wrong with the A350 exactly? Boeing is not the only aerospace company who can make a next gen carbon fibre jet with all the trimmings

The A350 would be a perfect replacement to DJ's A330 and 77W fleet, assuming that it does what the box says
The A350-800 could replace the A332's and the A350-1000 could replace the 77Ws, with the A359 as a nice sweet spot between the two. This could potentially bring about massive cost savings in the long (and short) runs with savings in maintenance and crewing especially.

But how long do we have to wait for the A350 is really the question IMHO :?:

 

[Ansettaddict123]

But how long do we have to wait for the A350 is really the question IMHO :?:

The A330 and 77W have plenty of life left in them, besides, itsnt it best to go with the most logical solution, rather than the aircraft that is avaliable first?
Currently the A350 is on track for its entry into service, however Its almost inevitable I think that the program will be delayed. Even if it is delayed however, there is always Boeing's outlandish 2-3 year delay with the 787 that can be used as a counter

 

[N860CR]

Am I one of the few who sees the logic in the HKT/NAN/JNB services?

They only happened due to the GFC/Capacity dump on the AUS-USA services and VA saw themselves with too many aeroplanes sitting around doing nothing (just like QF grounded quite a few - except it was cheaper for them to do it).

So where does one depoly additional airframes? How about HKT/NAN? Markets that are popular so will always fill planes (even though it will be lower revenue) and attract the non-frequent flyer types. The very types who may get a little upset when the service is eventually cancelled, but are of generally low value to the airline so won't hurt the bottom line too much when they cry "I'll never fly Virgin again!". Probably a good reason to go for HKT which is 100% leisure v's BKK which has a solid business market.

JNB? I think there was a football game of some sort over there that would have boosted loads for a little while? On top of that, it's an underserved market, so it wouldn't be hard at all so get bums on seats.

So what do we end up with? The USA services still intact and (other than a few schedule changes - which last I checked, QF have a hell of a lot) the higher value customers haven't been upset too much.

 

[lovestotravel]

the higher value customers haven't been upset too
much.

The problem is that VA doesn't have the higher value customers yet! Hence the changes to the flight times to the USA.....

They won't have higher value loyal customers until:
1. They have DECENT lounges in MEL/SYD/BNE/LAX, no showers in LAX is a big no-no!
2. They stop changing flight schedules (Qantas don't change their premium schedules much, if at all)
3. Daily flights on the MEL/SYD/BNE to LAX route

I picked random dates in Feb in Business class MEL-LAX
Qantas $ 7477 (A380)
VA $ 7204

For $200 I would be flying with Qantas for the following reasons:

1. Showers in LAX
2. Nice MEL lounge, when compared to the current VA lounge in MEL
3. All the little things that Qantas don't forget, such as amenity packs, PJ's that were missed on 2 flights that I was on MEL-LAX earlier this year.

 

[anat0l]

I picked random dates in Feb in Business class MEL-LAX
Qantas $ 7477 (A380)
VA $ 7204

For $200 I would be flying with Qantas for the following reasons:

1. Showers in LAX
2. Nice MEL lounge, when compared to the current VA lounge in MEL
3. All the little things that Qantas don't forget, such as amenity packs, PJ's that were missed on 2 flights that I was on MEL-LAX earlier this year.

I don't know if the VA Business price you quoted is a Saver or Flexible, but if the latter you would get a chauffer ride to the airport (can't remember whether this covers both MEL and LAX)...

 

[lovestotravel]

I don't know if the VA Business price you quoted is a Saver or Flexible, but if the later you would get a chauffer ride to the airport (can't remember whether this covers both MEL and LAX)...

No chauffeur ride as I have quoted the discount fares for both airlines!

 

[Keith009]

Jumping in late - but as I mentioned on FB and Twitter, although I'm at present a QF loyalist, I'm tremendously excited at the direction the Virgin Blue Group is heading in consolidating itself as a full service carrier with global reach. An alternative to QF can only be good for choice and competition. As someone who prefers to support Australian-based carriers, the changes at Virgin are certainly to be commended.

Now the only gap seems to be Asia. I'd love the Asian partner to be Malaysia Airlines as they're by far my fave carrier in Asia, but at the same time KUL isn't exactly a major financial or transportation hub. I'm hoping for a hub in SE Asia, as this works very well for connections to both SE Asia, NE Asia and the subcontinent, as opposed to a hub in NE Asia which causes a fair bit of backtracking for destinations like SIN. From the comments made by JB I've read in the media, I reckon an Asian hub is what they're moving towards - hopefully an announcement will be made as soon as they have appropriate equipment levels.

As for a Virgin lounge in Australian international ports Virgin Atlantic Clubhouse stylie - YES PLEASE!!!!!

I for one wouldn't mind moving some business away from QF and trying something new if the schedules work.

 

[777]

Sounds like they're ahead of us at the LA end:

Further demonstrating the brand's linkages, a swanky new Virgin terminal for its carriers is in the planning stages at Los Angeles International Airport. It will feature the kind of innovative and luxe clubhouse lounges Virgin is known for, with separate tiers for upper class, celebrities, economy class — and even one for children.

From: Virgin's Richard Branson Circles His Wagons - TIME

It's already been hinted that there'll be an international Lounge in SYD in this thread. I think the company's thinking is probably similar to what a lot of suggestions have been.

Not sure how this will tie in the with Delta Joint venture though. I don't really know LAX either - any idea where/ how they might accommodate this?

 

[Keith009]

From what I understand, V Australia and Virgin America both operate out of T3 at LAX, whilst Virgin Atlantic uses T2. Delta is over at T5 and 6. Not sure how it all links up as I've only ever used T4 and TBIT.

 

[kamchatsky]

Jumping in late - but as I mentioned on FB and Twitter, although I'm at present a QF loyalist, I'm tremendously excited at the direction the Virgin Blue Group is heading in consolidating itself as a full service carrier with global reach. An alternative to QF can only be good for choice and competition. As someone who prefers to support Australian-based carriers, the changes at Virgin are certainly to be commended.

Now the only gap seems to be Asia. I'd love the Asian partner to be Malaysia Airlines as they're by far my fave carrier in Asia, but at the same time KUL isn't exactly a major financial or transportation hub. I'm hoping for a hub in SE Asia, as this works very well for connections to both SE Asia, NE Asia and the subcontinent, as opposed to a hub in NE Asia which causes a fair bit of backtracking for destinations like SIN. From the comments made by JB I've read in the media, I reckon an Asian hub is what they're moving towards - hopefully an announcement will be made as soon as they have appropriate equipment levels.

As for a Virgin lounge in Australian international ports Virgin Atlantic Clubhouse stylie - YES PLEASE!!!!!

I for one wouldn't mind moving some business away from QF and trying something new if the schedules work.

It would be a long shot, but it could be partnering SQ given that VS is already 49% owned, and will give SQ codeshare to US from Australia. But yes, it is still a long shot.

 

[Ansettaddict123]

It would be a long shot, but it could be partnering SQ given that VS is already 49% owned, and will give SQ codeshare to US from Australia. But yes, it is still a long shot.

It could work- however only when (and if) DJ becomes full service

 

[straitman]

It could work- however only when (and if) DJ becomes full service

They are currently heading down that road at quite a rate.

 

[lovestotravel]

It could work- however only when (and if) DJ becomes full service

Ummm, there is no IF about this!!!!

 

[Ansettaddict123]

They are currently heading down that road at quite a rate.

Ummm, there is no IF about this!!!!

Nothing is set in stone. However as has been pointed out previously, JB seems to be intent on making DJ Ansett Mk#2
To me thats a great thing, finally a decent alternative to QF!!!! Leave Tiger and Jetstar fighting it out at the bottom of the market I say!

 

[dajop]

It could work- however only when (and if) DJ becomes full service

Why? I guess it depends on definition of "full" service. But there are effective partnerships by full service airlines with a range of US carriers and they are anything but full service domestically. I think having a J cabin would be more important than becoming full service in the sense of free meals.

 

[Ansettaddict123]

Why? I guess it depends on definition of "full" service. But there are effective partnerships by full service airlines with a range of US carriers and they are anything but full service domestically. I think having a J cabin would be more important than becoming full service in the sense of free meals.

By full service I'm meaning free meals, AVOD, proper J class etc.
Coming off an SIA flight, would you like a free meal and AVOD? Or a buy on board service and Live2Air on 5" screen?

For me its about consistency, and currently I do not think that these partnerships with some of the worlds best airlines (were talking EY and SQ here) will work with what is a very different onboard product- people like consistency!!!