Virgin Blue tries to muscle out SQ for Pacific route

[oz_mark]

oz_mark - myanmar is a fantastic country isn't it? i hope you got out of yangon, as the country is such a relaxing place.

i was actually referring to domestic myanmar flights.

Yes, I did, but I got from Yangon to Mandalay by road Went via Pagan, whihc was quite a sight.

 

[N860CR]

Of course the one important difference between DJ and AN being the ticket price. Yes perhaps DJ has just taken off where AN left off, but they certainly have made some very big changes

 

[jakeseven7]

After reading one of the SMH articles the other day, it struck me that DJ has become a relatively substantial airline in probably a shorter time than Branson may have anticipated ....

Despite some pretty tough competition from QF and the lack of fuel hedging they are still managing to turn a profit, a good feat for such a young startup that has grown so quickly. No wonder Branson wants control back.

Whilst taking nothing away from DJ - it's taken four years - but they've really just reinvented AN with a clean sheet of paper, thanks to a certain event on Sep 14 2001. Started off a classic LCC, but now have lounges, FF program, freight, customer segmentation (Suit Zone), even talk of J class. Their sister airline, VS, has entered one of AN's key international routes, and now DJ is talking of flights to US (like AN was in early 2001). I wonder whether they'll start buying up shares in Rex to truly emulate AN?

Continuing the analogy for a moment, it is probably a good thing if Branson was to get control back of DJ, after the very public spat about dividend payments. Although there were many things that lead to AN's downfall, few would dispute that one factor was its' shareholders using it as a cash cow over many years, with insufficient cash being invested back into the business.

Yep totally agree. Virgin ran into ALOT of luck which made them.

Lets not forget that there was a really good chance that Virgin Blue was going to be sold to AirNZ/AN before Branson (& rest of Australia) realised just how badly AirNZ had run both both airlines and how precarious their combined finances were...

Then days after this AN collapsed (Thanks Kiwis) and Virgin was handed 30% of the domestic market on a platter.

Things would have been very very different had Sinagpore bought Ansett... sigh can you imagine?! Good old Ansett and Qantas battling it out and Virgin probably bankrupt or a very distant 3rd LCC... We can dream :wink:

 

[Dalmien76]

WOW

Well, this section turned from being about the potential for DJ flying to the US, to bagging them about being a "Carbon Copy" of Ansett.

1st issue: I think its a good thing that SQ were stopped at flying across the Pacific from here to the US. I really believe that DJ should be given the 1st preference for slots to the US and not another international carrier. I agree with another entry on this forum that it will open up the fact that DJ can connect with VS services in the US giving a true round the world connection. Great for those who join Velocity with point earning potential.

2nd Issue: Yes, DJ were lucky to break into the market at a time where Ansett collapsed, but thems the breaks for Ansett. I worked for them and lost my job with them, but Ansett had been in major financial trouble for a very long time. Miss-management by NZ was the final nail in the Ansett coffin. They purchased the rest of the airline when clearly they financially could not support another airline. Purchasing Ansett nearly sent them broke also. Ansett became a hugh tax deduction for them and the fact that NZ were filling their own aircraft through the AN books, and using AN engines in their own aircraft, there was no way AN were going to survive. AN was litterally bled dry and the NZ management just washed their hands of the company just like throwing out a dirty rag.

Yes, DJ instantly got 30% of the domestic market, but had to work overtime to build their young airline up in a short space of time. Everyone worked hard and the hard work paid off. They are now the airline they are today because of the staff dedication, and wanting to try and give the public what they want. Yes DJ now have lounges, but DJ dont have a "Frequent Flyer Program" Its a loyalty program designed to be very different than any other airline program around. Unlike other airlines that limit their so called Frequent Flyer seats to.....oh around 3 seats a flight.....You can purchase any seat on a DJ flight, the point amount is a sliding scale depending on what the current fare is available at the time you purchase the seat. As for "J" class seating, I haven't heard that this is being talked about yet. Will it happen in the future? Who knows, but as yet I believe that this is a rumor started by a person obviously wanting to start a rumor.

There is no point in saying "Things would have been a different story if AN was still around" because in reality, they are no longer around, and secondly no-one can 100% guarantee that things would be different unless your a psychic (and if you are, I want the lotto numbers for this saturdays lotto ok).

 

[Yada Yada]

Re: WOW

Yes, DJ instantly got 30% of the domestic market, but had to work overtime to build their young airline up in a short space of time. Everyone worked hard and the hard work paid off. They are now the airline they are today because of the staff dedication, and wanting to try and give the public what they want.

I agree - while the collapse of AN was beneficial, they have been a very well run airline - they've kept costs down, have great crews, have grown rapidly but remained in control, have a good network, and have ensured that QF's pax get some of the best Y fares in history.

The possibility of J on DJ was raised either by Mr Godfrey or Mr Corrigan, I believe, in a newspaper article. Whoever it was said they were looking at business seating options, so maybe it will be more like a WT+.

 

[jakeseven7]

Re: WOW

Well, this section turned from being about the potential for DJ flying to the US, to bagging them about being a "Carbon Copy" of Ansett.

I think it is very safe to say that is not the case.

If DJ was a carbon copy of AN I would be flying them!

People are merely pointing out that the market share was served up to them on a silver platter and if SQ had chosen to jump in and buy AN, with their deep deep pockets, DJ would probably be a much smaller player today, if around at all.

Back to the topic, I think QF would much rather have DJ on the US route than SQ. Completely different product offering - unless DJ strayed from its current o/s strategy - and no where near as much as a threat as SQ.

 

[DJ CC]

First and formost AN is gone and I dont think anyone wanted them once they looked at the books.
DJ is here and is looking at going to North America but until the board decides to go we can all speculate on what they will be offering and at what price.
My theory is:
Whats to stop VB wet leasing aircraft and crew from Virgin Atlantic to operate these sectors offering a round the world experience with three cabin levels. I know the staff in OZ wouldnt be happy but it would make it very easy as VA have staff in SYD and LAX already. Im not sure what the transport minister would make of this considering the arguement to keep SQ and EK out of that route is to protect Aussie workers.
Something for you aviation people to think about.

 

[Yada Yada]

Im not sure what the transport minister would make of this considering the arguement to keep SQ and EK out of that route is to protect Aussie workers. Something for you aviation people to think about.

My guess is that the decision was probably more political than anything else. The govt probably said to QF "we'll keep SQ off your profitable AUS/USA route if you'll go easy on shedding workers because it makes our Workchoices thingy look dodgy".

To make it look more realistic they then tell the public that they are keeping out SQ in order to give another "Aussie" airline (DJ) the chance to operate on that route, knowing full well that it would take some time for them to get it going because of cost, ownership issues, US regulatory red tape, etc etc.

I've got nothing at all to back this up with. It's just my guess at what might have been happening in the corridors. :-|

 

[jakeseven7]

To make it look more realistic they then tell the public that they are keeping out SQ in order to give another "Aussie" airline (DJ) the chance to operate on that route, knowing full well that it would take some time for them to get it going because of cost, ownership issues, US regulatory red tape, etc etc.

I've got nothing at all to back this up with. It's just my guess at what might have been happening in the corridors. :-|

Interesting and probably an inkling of the truth there. I think letting DJ have a go was more of a facesaver, show that we are an open economy blah blah.... I can just imagine Geoff rubbing his hands in glee.... -> 'So Geoff would you rather have SQ all over the US routes or DJ?' QF would probably rather HELP DJ get on the route than take SQ on.