Himeno

This sounds like Alan Joyce has been listening to Gerard Arpey to much.

Cutting service, reducing fleet size and conceding markets to the competition isn’t going to improve anything. It will just send customers to the competition.

If this keeps up, in 5-6 years time, Qantas international will fly to

LHR
NRT
SCL
KUL
BER
HKG
LAX
DFW

Ie, oneworld hubs.

The "200 million loss" is only as large as it is because of some "creative" shifting around on the balance sheet.

Volasia

In all that, isn't the main problem of qantas a huge cost base ?
If we were to compare QF in terms of salaries, indemnities for cabin crew and so on with LH, BA, AF and othere similar airlines what would that be ?

I saw the old Swissair go burst because of unflexible cost base, bad management and arrogance. The new Swiss Intl Airlines is now much more efficient, salaries are more reasonable and more comparable with other airlines. They also try to stay in a premium segment rather than the middle market segment.

Blackcloud

Well after reading the announcement, one thing I agree with, QF cannot stay the same, there must be a change.
IMO QF appears to take a very conservative management approach of cost reduction, but of course I do not have access to all the data that they do.
The plan does not seem a stretch in fact will it address the so-called QF international issues? The closest I saw was a reference that the combined QF domestic and international groups will provide the return on capital which for all we know they do already.
Red Roo can you confirm that the new Premium Asian based airline will earn QFF not only points but also Status Credits for all fares? Will it be fully integrated with one world fares?

Traveloguy

Say that now that CHF has gone through the roof!

Up until the last 2 weeks the AUD was also following CHF. When looking at salaries across the globe, QF therefore does look expensive. Until the AUD depreciates, this is unlikely to change a great deal.

Leumas

The way I'm reading this is that QF no longer see itself as a worldwide airline, but one that focuses on the APAC region Now, they may spin that and say that's where the growth is, but if they're focusing on short/mid haul aircrafts, then they don't really think there's a future in Europe or even the US.

With regards to the new premium airline and QFF, I think I read somewhere that it'll earn something - what exactly, I don't know. It's unclear what role, if any, it will have in OW.

Red Roo can answer that for sure. He's been good today in answering questions with no spin, just facts.

Moomba

Just checked EF and it looks like QF29 ceases to fly HKG-LHR from 25/03/12.

At the same time the GDS shows no A/F booking classes for the MEL-HKG sector.

QF127 seems to show A/F availability as far out as EF will show.

number_6

Not too surprising as F is removed from most 744s in 2012 and from the last one circa March 2013 .... only A380 has F after that. Given a fleet of 12 A380s for the next decade, MEL-HKG is not going to be an A380 route.

The real failure of QF has been the inability to grow the market and bring traffic into Australia ... which would help the tourism industry not just QF. Not for lack of trying (witness cheaper fares LAX-SYD-LAX than SYD-LAX-SYD, and the various visit-Australia passes). For whatever reason they haven't been very successful, nor has QF advertising worked well for the past decade.

reubee

It will be interesting to see the timings for the effective double daily flights to LHR via SIN.

Will it be ...

SYD-SIN-LHR (388)
MEL-SIN-LHR (388)
SYD-SIN-FRA (744)

... all at the same basic 4pm departure, 6am arrival with connections in SIN from BNE/PER/ADL

If so then you get the current situation where there is no effective connections from SIN to anywhere in Asia. Making one of the A380's an earlier departure isn't feasible due to London curfew. A later departure would have to be a 10pm departure from SYD in order to beat the curfew but then you are at SIN in the middle of the morning.

ANstar

So does this mean the Qantas Cabin Crew base in the UK will be shut down?

I know the current EBA requires Aussie crew to operate one of the services - so it doesnt make sense to crew a base for just 1 daily flight does it?

BD1959

Of the new Premium Airline base, AJ is quoted: “We will be able to feed traffic into the new hub from Europe and Australia and Asian ports,” he said.

Given SIN will be the only asian port taking QF flights from Europe (LHR and FRA) does this not indicate where the base will be?

QF do seem to be in strange position, building a stronger Qantas by reducing destinations, deferring capacity and (over the last 12 months) seemingly reducing advertising to an absolute minimum. First is being reduced to blue-ribbon routes, isn't there a rumour of LAN leaving OW? 1000 jobs cut.

All very confusing signals to the travel market whilst the new entrants boast younger fleets, expanding destinations, single-carrier travel.

Meanwhile, the Engineers threaten strike action ... interesting times ahead!

BD

og

If QF is going to be stronger, its critical (IMHO) for the JetStar satellites to pay FF points and SCs - otherwise, why bother even looking at them?

Or have I missed something?

LeoFigAA

QFs decision to not fly SYD --> GRU /GIG really surprises me in this instance. GRUs traffic dwarfs SCLs, opens up a better route for cargo, enables more premiums for J product and provides the most direct hook up with BA / IB / AA at either GRU or GIG. In relation to the latter, a mid/late arvo arrival would mean total travel time to EU or east coast US would only increase by about 2-3 hrs. This strategy would be particularly attractive / profitable in a smaller aircraft (i.e. - 777-200LR/300ER...not currently in fleet but maintenance could be carried out overseas to save on overheads) and if not operated daily. Cannibalization of existing traffic on EU / US routes would be minimum.

The white elephant in the room, as far as my suggestion is concerned at least, is QFs blatant price gouging of the Australian leisure flyer. QF is currently charging roughly $3200 return for east coast US flights via LAX. This is absolutely ludicrous as I'm able to travel on the same trans Pacific flight on QF metal to LAX then connect to LHR, for instance, for about $2000 return!!! It is currently cheaper to fly QF /BA / AY to Europe THEN connect to east coast US than to fly QF via LAX. This is blatant disregard of competitions laws given capacity availability and a great example of why QF's trans pacific market share is dwindling.

willzzz88

LeofigAA,

SYD-GRU non-stop is simply impossible for QF because they don't have the single plane in the world that makes it economically feasible: 777-200LR and doing it WITH a 77L means requiring ETOPS207 certifications and flying NORTH +30 minutes/1 hour for polar route diversion so if there's an emergency diversion on ETOPS to Easter Island in the Pacific.

You can run it on a A345/6 full payload with the A345/6HGW taking more freight but the problem is that you need very high yield C/F like SQ's A345 on SIN-EWR/LAX with the 100 Executive Suites and I don't think QF has that amount to Latin America YET! The A345/6 has less passenger capacity than the 744 but more range and is still 4-engines allowing the polar ETOPS-busting crossing yet less fuel burn. Scratch that, QF doesn't have A340's in their fleet for this crossing neither do they have the 787 for extended range for ETOPS diversion (which ANZ is going to do before the 2014 Fotbol world cup in Sao Paulo, they are going to fly AKL-GRU for *A if Boeing makes their promises!).

Flying SYD-SCL is the best option because:
1. http://www.gcmap.com/mapui?P=SYD-GRU...E&MS=wls&DU=km
2. SCL is the most western-most Latin/South American geographical hub to Oceania.
3. This allows QF to take FULL PAYLOAD + freight west/east bound over the South Pacific. (Remember BOOMING Latin/South America -><- East Asia freight!)
4. Booming C/F market (SCL is just like Europe mixed with North America...). Ah the Spanish did something right...
5. SCL hub for LAN, from SCL with ONE FAST connection (the SCL hub is designed for Intl-Intl connections in UNDER ONE ROOF, you can get it done in <60 minutes). It's Euro-like, small, petite and efficient.
6. EZE is/was a dead end because they needed TAM which is in *A (and the LATAM merger, maybe NOT going through, maybe, I don't know) even though EZE is closer to GRU/GIG than SCL the difference is like <1.5 hours.
7. Avoid AKL stop. You can do AKL-GRU/GIG but then again that's not the oneWorld hub that's the *A hub.

snyderm

Any ideas on the first routes on which the refitted 747s will roll out? Sorry if the refitting announcement was made before the New Spirit one...this is the first that I read about it.

Is SYD-NRT a long shot?

Update: Sorry, just found articles that indicate that this refitting is not new as of yesterday...http://www.accessfares.com/news/airl...rvey-2098.html

number_6

The speculation has always been that it is based in SIN or KUL, but QF is still negotiating to get the best airport subsidy deal. HKG is probably being used as a bargaining chip.

QF really seems to be going into the lion's den in its future strategy. Going head to head with SQ and the new SQ-Lite, or "partnering" with Malaysian which is now 'owned' by Air Asia, and giving up trying to compete with Emirates or Etihad. What happened to QF being on of the most profitable airlines in the world, not so many years ago? What a difference an exchange rate makes, I suppose.