correctioncx

I think QF is the black sheep here in the alliance. do
U know about the 20+ cities codeshare arrangement with AA for quite a number of years? Also codeshare with BA/JL etc.

From a customer point of view coop with CX makes much more sense than EK but commercially may not... CX already fly to all major cities in Australia and have greater frequency than QF so the incentive to codeshare within aust is not as great. Similar to this EK deal it is QF who is more desperate.

Jorgen

Personally, for ethical reasons I won't visit the UAE (or any other non-democratic country) and I won't do business with companies from those countries if I can avoid it. So if QF tells me the only way it can get me to Europe is via Dubai then that greatly diminishes my chances of going back to QF, if and when I move back to Australia.

Am I the only one who has ethical issues doing business with freaking Dubai?

eightblack

Ok, I'll bite. What is it specifically about DXB that has you all bent out of shape?

Awesom Andy

I think we need to keep in mind that there are a lot more destinations that can be reached non-stop from the middle east than from, say, HKG with just one partner airline. Also, there is also a limit to the number of slots EK can obtain in Australia, although I don't think we are that close to that number yet.

So, EK gains additional feeder traffic from QF, and better access to smaller cities. They can also consider leaving the NZ leg to QF. At the same time, QF can offer one-stop flights to about 26(?) destinations to Europe. At the moment, there are only a handful, including codeshares with various other airlines such as AF.

In summary, QF is outsourcing its European routes, while EK is happily taking on more customers.

Basically, if you have a high cost base, and it cannot be reduced, simply find ways to get rid of the base altogether.

Brettmcg

I would be very disappointed if QF5/6 were to go. Can't comment on what the yields are like for this route, but looking back at the loads from the past weeks and months they are certainly not any worse than say QF27/28 (which is apparently going to increase in frequency) or QF21/22 which hasn't been mentioned as getting the chop. Frankfurt is an important destination within QFs limited international network, not the least because of its financial significance within Europe (still one of the world's largest trading powers, despite the Euro Crisis). Even though FRA might not be a Oneworld hub, I would question how many of the average PAX using the QF5/6 service would actually care, and so long as QF get their dough from PAX travelling between AUS and EUR why should they care to which airlines transfer PAX are connecting from FRA?

Personally, I have done most of my longhaul flying over the past 7 or 8 years on QF5/6. It's a great service, especially since Y+ was introduced, and doing it reasonably often I got to know some members of the crews that rotate through it. If it is to be replaced by EK on the Europe-Asia/Europe-Middle East then I would take my business somewhere else where I don't have to change to an inferior product halfway through the journey.

QFi sounds like it is rapidly heading down the path towards becoming a virtual airline. The argument about giving Europe over to EK to concentrate more on Asia is also ludicrous. Do Qantas honestly think they'll be able to compete with the established intra-Asian networks of the likes of CX, SQ, MU and KE (regardless of their profitability)? QFs international hard product outside of the A380 is ok, but nothing special. I don't understand where they think their USPs will be?

3544quebec

And if Asia is going to be the profitable future of QFi what has changed since they went into and then pulled out of KL, Bombay, Beijing? Is Asia the future for QFi or is Jetstar to Asia the future for QFi?
Why doesn't Emirates just let QFi die as it seems to be doing and then forge an alliance with the domestic carcass that remains. Then it doesn't have to share any of the international passengers.

PotNoodle

Fully agree, other airlines drop routes to forge codeshares instead, like BA in TPE for example. If QF can't do it then let someone else carry the burden and gain some free cash through coesharing.

In terms of international networks Qantas will probably fly to major high yield destinations and drop the rest off via partners at a virtual hub. It is sad to see but they are in such a sticky situation with high labour costs compared to Asia and being based in an isolated country which is de-centralised and contains many large cities.

They will sturggle in Asia but in my opinion but losses can't get much higher on the international network than what they are currently.

I don't think Frankfurt is a must have destination for Qantas to be honest, compared to London there is subtantially less tourist, VFR and business demand. If France would have granted QF more than 3 weekly frequencies I reckon they would have dropped FRA for Paris instead. Plus FRA is outside of the Qantas ideology of now serving partner hubs.
Qantas won't toally kill off their international network, if they can't get an agreement with Emirates then they will probably try it with some else like Qatar with their DOH hub.

workingman

I recently flew AKL-HKG on CX, as WP travelling in Y. I have to say the treatment was fantastic. The CSM came back to see me, bringing newspapers, and asked if I wanted anything else and suggested wine, snacks, coffee etc. The offer of wine was taken up and I was kept supplied with J wine and snacks during the entire flight, and 1 hour out from HKG I was moved up to J to let me get off the plane easily, and I was already in the first row of Y so getting off would have been good anyway.

Globaliser

But despite all of this, we know that BA and QF both don't really get on terribly well with CX. And some industry comment explicitly refers to CX being a reluctant member of OW.

number_6

Actually, they can't

EK flies to NZ for a simple reason: it is cheaper than renting space to leave the planes on the ground in SYD and MEL. A rather unique situation, but if need be EK would fly empty to NZ (or maybe they'd make a deal with AVV to hangar the planes). Fascinating industry, this running an airline. As an aside, QF does the opposite at LAX.

correctioncx

Based on what?
From a pax standpoint CX observes the oneworld rules the best from ticketing to checkin privileges right through to lounge access. They even extend some benefits to oneworld members when it is not in the rules eg priority bags

correctioncx

But are there really that much demand ESP high yield in F and J class for all these other European destinations and also access to all the non major cities in Australia?
Of course there is a gain to EK but it does appear on the surface that QF is more desperate. But then the aust govt can impose some restriction and affect EK's operations in aust? So a tie with QF can be think of as an insurance for EK

Traveloguy

Whilst I completely agree with your previous post re CX in OW, I cannot see the Australian government doing too much to protect QF. Mr Keating ensured the Australian economy was to set on a cOourse in the 80s and 90s to be liberalised to the hilt and successive governments have continued that course. Despite various bits of rubbish spouted in the press, Australia keeps its markets fairly open. With the exception of the QF sale act which affects foreign ownership of QF, it's fairly easy to set up a carrier in Australia. Doing so however means that you are subject to Australian labour laws so many of SQ's labour practices for example would be illegal under Australian law. EK's policies would probably be fairly similar. My point is that I cannot see the government doing too much at this point in time.

The conundrum for QF is that Australia is no longer a middleing economy but has now probably transformed itself into the most prosperous economy in the world with high wages to match. In pretty much every sector Australian wages are higher than pretty much all OECD nationals globally. With that comes a price.

What annoys me is that AJ generally blames high wages and high oil prices as his major woes but in reality oil is pegged to the USD and the AUD is therefore pretty competitive in that regard. Wages are however a problem but I suspect so is his.

At the end of the day, QFs woes have been in the making for a long time. GD put the company on a course a while back that was unlikely to help it beyond getting his claws potentially into it via private equity ownership. AJ has just shown he is inept. Unable to deal with his staff, he also appears inept with dealing with his partners and most importantly his customers. If you loose the goodwill of your customers, it does not matter how good a business manager you are, none of your (past) customers will buy your product.

Forgetting all the above for the moment but I personally think the EK thing is a smokescreen. Something just does not add up. If EK really was on the cards it makes a complete mockery of what an alliance is. Thus far the business community has slaughtered the QF stock price partly because QF has not utilised it's alliance partners. A partnership with EK would show how what a scattered policy he has. A strange half hearted relationship with an alliance grouping and another with a middle east carrier which is unlikely to share the same vision as itself. Where does this all lead?

AJ needs to work out whether he wants to become a 'pimp or a wh0re'. I suspect the former makes more out of a deal than the latter.

(excuse any typos above - written on a mobile device)

grov

When I flew QF5/6 a lot a few years ago, most of the traffic came from other UK airports, on their way to Asia or Oz, avoiding Heathrow. So these a/c were often full, despite short checkin lines at Frankfurt.
I would be surprised if QF gives up this profitable route.

correctioncx

100% agree with you.

BTW what happened post Dixon. I used to remember when Strong and Dixon was around QF was much better managed and it was an excellent bluechip company to invest in? Actually I think it is not just QF, it appears post Howard years the whole country has gone downhill

- sorry going OT