Virgin Blue announcements 26/08

[medhead]

The point being that Etihad & to a lesser extent VA will be competing with Emirates.

Etihad still hasn't made a profit in it's first 6 or whatever years of operation...

Exactly Etihad will be doing the competing and VA are filling a gap for Etihad. that's why it seems reasonable for me. It is a complimentary mix. As for Etihad, I guess when you have all that oil backing you 6 years is all relative.

I also don't get all the ranting about the route changes. They used the aircraft to try something that seemed best at the time, it didn't work. No reason to keep wasting money and not go for something better. What would you have done, put the aircraft into LAX? Given all the new capacity on that route as already mentioned.

[straitman]

The world be full of armchair experts.

Nothing wrong with negative feedback - there is often a lot to be learnt from mistakes

Absolutely Mark.

There is a difference between negative feedback and continual bagging without offering and alternate solutions.

[medhead]

I was just catching up on my newspaper reading on tonight’s flight when I noticed a story in the Financial Review from Monday (30 August) on the Virgin Etihad deal. There were a couple of points that matched why I think it sounds like a good plan. Sorry no link as the financial review requires a subscription

Virgin makes a virtue of Qantas ties

Financially the deal is no blockbuster, bringing in only $10 million in the first year. But the value comes from the longer-term benefit of an international network that will provide a lever into highly profitable domestic routes such as the $150 million-plus coast-to-coast routes.

While Borghetti featured prominently, the Etihad side of the transaction was heavily peppered with Qantas alumni as well. John Shepley, who used to work with Joyce at Jetstar, led the negotiations for the world’s richest commercial airline.

It’s a significant deal for Virgin, because one of the main reasons it failed to pry business travellers from Qantas has been its lack of an international network.
Thanks to the Etihad deal, Virgin now offers 24 flights a week to London and one-stop flights to 12 other European cities, boosting its attractiveness to companies or corporate flyers who seek a network to spend their frequent flyer points on.

Etihad gains access to Virgin’s frequent flyer program and codeshares on an extensive Australian domestic network.

Borghetti has struck a good deal because he gains a marketing advantage of being plugged into a global network at little cost.

[Ansettaddict123]

EK
PER-DXB 2x daily direct
MEL-DXB, MEL-SIN-DXB, MEL-KUL-DXB
SYD-DXB 2x daily direct*, SYD-BKK-DXB, (*1 of these will be suspended temporarily awaiting extra aircraft to come on line)
BNE-DXB, BNE-SIN-DXB

EY :
MEL-AUH, SYD-AUH (both daily), BNE-AUH (3 x weekly)

Until EY gets into the Perth market I don't think that anyone will bother with them (at least in WA). It will be interesting to see how this pans out- apparently EY have been thinking about PER for a while; if they can offer a well timed service they will be fine in my opinion.

A330's - Yep great for now, but bring on 787's in 2013/2014 for some new technology!

For now the 27% or so rise in their share price over the past week is a good start...

And what’s wrong with the A350 exactly? Boeing is not the only aerospace company who can make a next gen carbon fibre jet with all the trimmings :P

The A350 would be a perfect replacement to DJ's A330 and 77W fleet, assuming that it does what the box says
The A350-800 could replace the A332's and the A350-1000 could replace the 77Ws, with the A359 as a nice sweet spot between the two. This could potentially bring about massive cost savings in the long (and short) runs with savings in maintenance and crewing especially.

With regards to the share price; its about time (!!!!)
Not long ago I was considering cutting my losses, I think I may hold on for a while longer now and see if JB bring about more positives, which I'm sure he can!

[straitman]

And what’s wrong with the A350 exactly? Boeing is not the only aerospace company who can make a next gen carbon fibre jet with all the trimmings :P

The A350 would be a perfect replacement to DJ's A330 and 77W fleet, assuming that it does what the box says
The A350-800 could replace the A332's and the A350-1000 could replace the 77Ws, with the A359 as a nice sweet spot between the two. This could potentially bring about massive cost savings in the long (and short) runs with savings in maintenance and crewing especially.

But how long do we have to wait for the A350 is really the question IMHO

[Ansettaddict123]

But how long do we have to wait for the A350 is really the question IMHO

The A330 and 77W have plenty of life left in them, besides, itsnt it best to go with the most logical solution, rather than the aircraft that is avaliable first?
Currently the A350 is on track for its entry into service, however Its almost inevitable I think that the program will be delayed. Even if it is delayed however, there is always Boeing's outlandish 2-3 year delay with the 787 that can be used as a counter

[danielribo]

Am I one of the few who sees the logic in the HKT/NAN/JNB services?

They only happened due to the GFC/Capacity dump on the AUS-USA services and VA saw themselves with too many aeroplanes sitting around doing nothing (just like QF grounded quite a few - except it was cheaper for them to do it).

So where does one depoly additional airframes? How about HKT/NAN? Markets that are popular so will always fill planes (even though it will be lower revenue) and attract the non-frequent flyer types. The very types who may get a little upset when the service is eventually cancelled, but are of generally low value to the airline so won't hurt the bottom line too much when they cry "I'll never fly Virgin again!". Probably a good reason to go for HKT which is 100% leisure v's BKK which has a solid business market.

JNB? I think there was a football game of some sort over there that would have boosted loads for a little while? On top of that, it's an underserved market, so it wouldn't be hard at all so get bums on seats.

So what do we end up with? The USA services still intact and (other than a few schedule changes - which last I checked, QF have a hell of a lot) the higher value customers haven't been upset too much.

[lovestotravel]

the higher value customers haven't been upset too
much.

The problem is that VA doesn't have the higher value customers yet! Hence the changes to the flight times to the USA.....

They won't have higher value loyal customers until:
1. They have DECENT lounges in MEL/SYD/BNE/LAX, no showers in LAX is a big no-no!
2. They stop changing flight schedules (Qantas don't change their premium schedules much, if at all)
3. Daily flights on the MEL/SYD/BNE to LAX route

I picked random dates in Feb in Business class MEL-LAX
Qantas $ 7477 (A380)
VA $ 7204

For $200 I would be flying with Qantas for the following reasons:

1. Showers in LAX
2. Nice MEL lounge, when compared to the current VA lounge in MEL
3. All the little things that Qantas don't forget, such as amenity packs, PJ's that were missed on 2 flights that I was on MEL-LAX earlier this year.

[anat0l]

I picked random dates in Feb in Business class MEL-LAX
Qantas $ 7477 (A380)
VA $ 7204

For $200 I would be flying with Qantas for the following reasons:

1. Showers in LAX
2. Nice MEL lounge, when compared to the current VA lounge in MEL
3. All the little things that Qantas don't forget, such as amenity packs, PJ's that were missed on 2 flights that I was on MEL-LAX earlier this year.

I don't know if the VA Business price you quoted is a Saver or Flexible, but if the latter you would get a chauffer ride to the airport (can't remember whether this covers both MEL and LAX)...

[lovestotravel]

I don't know if the VA Business price you quoted is a Saver or Flexible, but if the later you would get a chauffer ride to the airport (can't remember whether this covers both MEL and LAX)...

No chauffeur ride as I have quoted the discount fares for both airlines!