will VARA ever expand to the east-coast?

[Lucass]

Does anyone think that VARA will eventually expand into east coast routes and they might deploy E-190E2s or even 737-700s on routes which qantas & rex fly and have ridiculously high prices like Mel, Syd-mildura, albury, wagga wagga, coffs harbour etc?

 

[Simon Overall]

Does anyone think that VARA will eventually expand into east coast routes and they might deploy E-190E2s or even 737-700s on routes which qantas & rex fly and have ridiculously high prices like Mel, Syd-mildura, albury, wagga wagga, coffs harbour etc?

Wouldn't make any sense for them to do so whatsoever.

 

[Lucass]

Wouldn't make any sense for them to do so whatsoever.

Why? They flew these routes previously, people would definitely choose VA over QF and Rex if their prices were lower

 

[Simon Overall]

Why? They flew these routes previously, people would definitely choose VA over QF and Rex if their prices were lower

What financial sense would it make to go back to loss making markets yo undercut existing competition?

 

[Saab34]

The -700s are not VARA they are VA.

I would assume VARA will be merged into VA over time as it’s been reported the fleet will be down to only E190s by 2027.

It would probably be cheaper to use Air North E190s on those regional like routes, compared to the E2s which cost a bomb.

 

[Lucass]

What financial sense would it make to go back to loss making markets yo undercut existing competition?

Economies of scale. If VA flew Syd to Coffs harbour, using a 737-700 or e-190E2 they could have prices significantly lower than rex and Qantas (cheapest fare on that route is generally $169) and make a profit. Would definitely be better than QF and Rex's old turboprops

 

[Simon Overall]

Economies of scale. If VA flew Syd to Coffs harbour, using a 737-700 or e-190E2 they could have prices significantly lower than rex and Qantas (cheapest fare on that route is generally $169) and make a profit. Would definitely be better than QF and Rex's old turboprops

Hard to see them filling 737 with 100 plus people to make a profit.

Especially on an older aircraft.

 

[Lucass]

The -700s are not VARA they are VA.

I would assume VARA will be merged into VA over time as it’s been reported the fleet will be down to only E190s by 2027.

It would probably be cheaper to use Air North E190s on those regional like routes, compared to the E2s which cost a bomb.

Do you know why the E2's are so expensive?

 

[HS-TQE]

You need to settle down with the VA expansion stuff, I get you want it to be a full service airline that tries to be all things to everyone and serves almost everywhere at anytime. But the last time VA 1.0 tried to be "all things to everyone" under SQ and EY ownership under the leadership of John Borghetti and James Hogan, they lost a ton of money year in, year out and most of their divisions, including the Regional Domestic ATR flying was bleeding money across the board.

But as VA 2.0 said, they are a self described Value Carrier (a Hybrid Low Cost Carrier), not a full service carrier and are more disciplined under majority PE ownership.

As long as Bain are still majority owners, despite the ink only drying with QR formally taking up their 25% stake. Most would think that Bain and QR will continue to stay the course keeping CapEx spending disciplined until the first of the Bain IPOs are up and running in the short/medium term future.

 

[HS-TQE]

The -700s are not VARA they are VA.

I would assume VARA will be merged into VA over time as it’s been reported the fleet will be down to only E190s by 2027.

It would probably be cheaper to use Air North E190s on those regional like routes, compared to the E2s which cost a bomb.

There is also SkyTrans with their 138 seater ex-ITA A319s (they currently have 2 and will be increasing over time) available for both QF and VA for regional runs if they wish to utilise them once their ACMI/Wet-lease operations are up and running.

 

[markis10]

they lost a ton of money year in, year out and most of their divisions, including the Regional Domestic ATR flying was bleeding money across the board.

That’s because they got suckered into a deal with the ATRs that saw them paying high lease rates (more than a 737) from Skywest

 

[MarkD]

The definition of insanity is to do the same thing over and over and expecting a different result. They went broke last time they ran all these thin routes and are very disciplined now and actually making money. Sorry but all your what if posts are never going to happen, this is the real world, not make believe and even though some of their decision in relation to frequent flyers have been somewhat retarded and pissed me off, they are actually running a tight ship the way it is.

 

[Lucass]

The definition of insanity is to do the same thing over and over and expecting a different result. They went broke last time they ran all these thin routes and are very disciplined now and actually making money. Sorry but all your what if posts are never going to happen, this is the real world, not make believe and even though some of their decision in relation to frequent flyers have been somewhat retarded and pissed me off, they are actually running a tight ship the way it is.

What I suggested wasn't the same. As someone else mentioned VARA on east-coast went bankrupt because of the atr's which were extremely expensive. All I was suggesting is that eventually, they may send some E-190E2s to the east coast. Or, once the E-190's arrive and free up the 737-700s, they may be deployed onto thinner/regional routes.

 

[Lucass]

The definition of insanity is to do the same thing over and over and expecting a different result. They went broke last time they ran all these thin routes and are very disciplined now and actually making money. Sorry but all your what if posts are never going to happen, this is the real world, not make believe and even though some of their decision in relation to frequent flyers have been somewhat retarded and pissed me off, they are actually running a tight ship the way it is.

Could you explain how VA flying from Melbourne/Sydney to Coffs Harbour or Melbourne/Sydney to Mildura is "insane"

 

[markis10]

Could you explain how VA flying from Melbourne/Sydney to Coffs Harbour or Melbourne/Sydney to Mildura is "insane"

Current loads suggest it’s insane, Coffs has no routes in the Top 60 while Mel-Mildura scrapes in with an average 435 pax a day. Coffs-Syd and Mel-Mildura average 10 flights a day

 

[Lucass]

Current loads suggest it’s insane, Coffs has no routes in the Top 60 while Mel-Mildura scrapes in with an average 435 pax a day. Coffs-Syd and Mel-Mildura average 10 flights a day

And cheapest flights on those routes are $169-189. VA could have a bigger plane (737-700) and have prices under $100. I wonder who customers would choose, Rex and Qantas for an insanely high price or VA for much cheaper. This is what bonza did on the Melbourne to Mildura route, they had prices from $49 on that route. It was just a shame they didn’t have the scale to support it, but VA does have that scale

 

[dajop]

Could you explain how VA flying from Melbourne/Sydney to Coffs Harbour or Melbourne/Sydney to Mildura is "insane"

I’m not sure insane is the right word but challenging would be better. The challenge is one of frequency and yield. Larger planes = less frequency and higher yielding passengers (business and even upmarket leisure) frequency is more important, and timing plays a factor too. VA used to operate the MEL-MQL service mid-late morning. Great for leisure traffic ex-MQL, less useful for business traffic which tends to pay more.

 

[markis10]

And cheapest flights on those routes are $169-189. VA could have a bigger plane (737-700) and have prices under $100. I wonder who customers would choose, Rex and Qantas for an insanely high price or VA for much cheaper. This is what bonza did on the Melbourne to Mildura route, they had prices from $49 on that route. It was just a shame they didn’t have the scale to support it, but VA does have that scale

There are around 100 empty seats today as it is, not sure why you think adding more capacity will work, when a 737-700 will be three minutes quicker. A Q400 needs a lot lower RPK figure

 

[Lucass]

There are around 100 empty seats today as it is, not sure why you think adding more capacity will work, when a 737-700 will be three minutes quicker. A Q400 needs a lot lower RPK figure

Lower prices means customers would choose that flight rather than more expensive QF/REX flights. I understand this would primarily work on leisure based routes like Coffs Harbour. Per seat costs for a 737 compared to a dusty old SAAB is far lower if they can fill the seats. Which they can if it is leisure based/fares are significantly cheaper. This is exactly what Bonza’s CEO said about Mel to Mildura

 

[Simon Overall]

And cheapest flights on those routes are $169-189. VA could have a bigger plane (737-700) and have prices under $100. I wonder who customers would choose, Rex and Qantas for an insanely high price or VA for much cheaper. This is what bonza did on the Melbourne to Mildura route, they had prices from $49 on that route. It was just a shame they didn’t have the scale to support it, but VA does have that scale

Not sure you grasp economies of scale tbh.