Why is Alan Joyce still Qantas' CEO?

[markis10]

JB hasn't made a profit yet at Virgin - it is very easy to spend money but he hasn't made money yet.

Yes he has, VA has a net 23M for 2012.

 

[DaveB]

I can't think of another CEO able to undertake a second comprehensive review of the business five years down the track .

 

[maninblack]

Joyce and the current board deserve plenty of criticism but think back 5 years to what Joyce actually inherited and some of the later actions of the previous board and CEO. Dixon, Jackson et al get a free pass when they actually ultimately created most of the problems, including hiring Joyce.

 

[eastwest101]

Joyce and the current board deserve plenty of criticism but think back 5 years to what Joyce actually inherited and some of the later actions of the previous board and CEO. Dixon, Jackson et al get a free pass when they actually ultimately created most of the problems, including hiring Joyce.

I was just going through the 2008 QF annual report, highlights for me were, and interesting to compare where QF are now:

GFC uncertainty begining (some people were calling it the end of civilization as we know it, others were dismissing it as the North Atlantic banking crisis)

End of Geoff Dixon's tenure as CEO and start of Alan Joyce tenure
Revenue up 7.5% to $16.2Bn in 2008
Virgin Blue the only competitor to QF domestic
Price of fuel rising from $70 barrel to $140 barrel but QF hedging absorbs most of the pain
Exchange rates varying from AUD/US 79 to 85c approx
Two brand strategy but no mention of a 65% Market Share yet
Current QF Network spans 146 destinations in in 38 countries
A380 'hub buster' aircraft starting to be delivered
B787 praised as a game changing aircraft and supposed to be delivered in 2009 (increase in orders from 20 to 65 aircraft)
B777 no orders at all
A332s from QF to JQ
Narrowbody orders of 68 A320/321 family and 31 B738s
In 2008 QF party to 33 awards with 16 unions and 44 other union and non-union EBAs in place
Retirement of B743s
Rollout of Premium Economy product for QFi
QFi flying to mainland China and India
QFi reduction in services to Japan
JQ launched in Vietnam

 

[Fruitcake]

A380 'hub buster' aircraft starting to be delivered

Interesting - I thought the only way an A380 busts hubs is by temporarily overloading terminals? After all QF now flies their A380s via EK's hub in DXB to pick up extra transit traffic from the hub. If anything ever busts hubs it will be medium capacity long range aircraft with low CASM, not A380s.

 

[maninblack]

I was just going through the 2008 QF annual report, highlights for me were, and interesting to compare where QF are now:

End of Leigh Clifford's tenure and start of Alan Joyce tenure

I think you mean Geoff Dixon not Leigh Clifford. In the Dixon years Qantas made huge profits but had a dividend payout ratio typically of around 80%. So like many Australian businesses they racked up big profits but did not plan well for the bad times.

 

[dajop]

I
Current QF Network spans 146 destinations in in 38 countries

Wonder what the number is today? Obviously this includes codeshares. I think today QF metal actually goes to 15 countries (including QF link, Jetconnect, but not including Jetstar). Surprisingly, as far as I can recall this is the same number of countries as in 2008 (removed Germany, India, Argentina, added UAE, Chile & PNG).

One thing it is easy to forget is that around 2007/8 the trans-pacific gravy train also ended when DL and VA joined the fray. I'm sure this has significantly impacted QFi -as undoubtedly the LAX routes were the most profitable international routes.

 

[moa999]

Wonder what the number is today? Obviously this includes codeshares. I think today QF metal actually goes to 15 countries (including QF link, Jetconnect, but not including Jetstar). Surprisingly, as far as I can recall this is the same number of countries as in 2008 (removed Germany, India, Argentina, added UAE, Chile & PNG).

One thing it is easy to forget is that around 2007/8 the trans-pacific gravy train also ended when DL and VA joined the fray. I'm sure this has significantly impacted QFi -as undoubtedly the LAX routes were the most profitable international routes.

Agree dajop.
I think biggest changes over the tenure which all are pretty negative on QFi
TransPac - DL/ VA joining the fray
TransTas - EK starting to onfly to NZ
Kangaroo - Substantial growth of EK, EY, QR only mitigated by some Euros pulling out eg AF. More recent impact of CZ, MU etc
All of which have undoubtedly impacted loads and fares.
Combined with the substantial increase in fuel price

 

[dajop]

Agree dajop.
I think biggest changes over the tenure which all are pretty negative on QFi

You could also add DJ's transformation into VA. Can't help but think QF created that rod for it's own back (or at the very least accelerated the move upmarket) by squeezing DJ through JQ - we'll never know but I wonder if DJ had been happy creaming the low end (with TT but without JQ) it wouldn't have gone after the top end of the market - QF's core business - as much.

 

[eastwest101]

I think you mean Geoff Dixon not Leigh Clifford. In the Dixon years Qantas made huge profits but had a dividend payout ratio typically of around 80%. So like many Australian businesses they racked up big profits but did not plan well for the bad times.

Agree - my mistake re Dixon and Clifford and the profits whilst great for shareholders at the time meant underinvestment and problems for the future that we are seeing now.

Interesting - I thought the only way an A380 busts hubs is by temporarily overloading terminals? After all QF now flies their A380s via EK's hub in DXB to pick up extra transit traffic from the hub. If anything ever busts hubs it will be medium capacity long range aircraft with low CASM, not A380s.

Sorry - should have clarified A380 as more of a "slot constrained very large aircraft" - a perfect aircraft for a few middle eastern carriers but maybe not so perfect for QF. My point was more about the poor fleet planning rather than just generalized A380 bashing.

 

[woodborer]

Agree - my mistake re Dixon and Clifford and the profits whilst great for shareholders at the time meant underinvestment and problems for the future that we are seeing now.

Last year saw the share buyback program. Seems to have been a foolish exercise, aimed at trying to keep the share price up....Qantas should have kept the money in the bank.

 

[whatmeworry]

After the future enhancements are passed, one would suspect he will not be CEO for long.

 

[Himeno]

After the future enhancements are passed, one would suspect he will not be CEO for long.

They'll be enhancing Alan Joyce?

 

[auskiwiflyer]

See thread title.

 

[whatmeworry]

So AJ has taken a pay freeze.

Joyce has earned $22.2 million as chief executive and in the 2012-13 financial year his $5.1 million package matches the combined salaries of the Cathay, Singapore and Air New Zealand chiefs. Shareholder value seems inversely proportional to Joyce's pay packet. Qantas shares today are worth 40 per cent less than when Joyce took over.

Read more: Qantas chief Alan Joyce has many questions to answer
​

 

[bertair]

I have just seen AJ interviewed on ABC 7.30. I heard him say that more people than ever are flying Qantas, or words to that effect.

What I would like to ask Mr. Joyce is why I as a regular Qantas flier, a member of the FF Club, as well as getting points from other supporters of Qantas by using their cards. (e.g.. Amex, Woolworths EDR) that I have been frustrated so many times by the fact that when I decide to fly, and not have to make plans 12 months out,why can I not use my points to pay for a seat in Business Class or above.
I am continually looking at various international routes for a trip with about 2 to 3 month time lag before flying, and can find none.
Using Qantas Phone reservations has produced no seats either.
I have paid full fare on numerous occasions to fly Business, thus gaining many more points to add to my pool, but I cannot seem to be able to use them for flights of my choosing. I have tried various route permutations.
If you don't believe me, I challenge you to go on line and see if you can find a Business Class seat on any of the major International QF routes for travel within the next two to three months
I am sure that with 10 million members of the QF FF Programme, I am not alone at being angry with Mr. Joyce and his stance.
With Qantas losing so much money as we have seen today, I now am deeply concerned that my loyalty and support of Qantas has been for naught.
Will the ever decreasing value of my QF FF points be even usable in the future?
That is if I can find a seat.
I guess there will be those who have sympathy for AJ, but I would like him to go on ABC's Q & A alone or even make a Qantas Web Cast to speak to customers and answer questions from us.
Could our Australian FF community commence an online petition here to put the challenge to him ?

 

[jgm]

So AJ has taken a pay freeze.Joyce has earned $22.2 million as chief executive and in the 2012-13 financial year his $5.1 million package matches the combined salaries of the Cathay, Singapore and Air New Zealand chiefs. Shareholder value seems inversely proportional to Joyce's pay packet. Qantas shares today are worth 40 per cent less than when Joyce took over.

Read more: Qantas chief Alan Joyce has many questions to answer

And 7 times the salary of the CEO of the world's largest airline - AA.

 

[jetlagger]

Great Quality Airline... mostly fantastic staff.. however .. truly a cough CEO & the crony board members are an even bigger joke.

 

[JohnK]

So AJ has taken a pay freeze.

Not good enough. A pay cut was in order for him and senior executives to bring them in line with the real world and not make believe.

 

[serfty]

...
If you don't believe me, I challenge you to go on line and see if you can find a Business Class seat on any of the major International QF routes for travel within the next two to three months
...

Try finding a Business Class award seat on Air New Zealand long haul. ... That mob are making a profit ...