What will QF International look like in 5 years?

[juddles]

Hi all,

the thread title explains what I am contemplating at the moment. I think about this both due to curiosity about our "national flag carrier", but also for personal reasons, as I am LTG and forever toying with the idea of jumping ship.

This is solely about QFi - domestic and jetstar are not in my care-factor envelope.

The way I see it (and I am by no means an expert - not even close), I perceive that QFi is being led on a path that involves great long-term planning. The first step was to cut as many non-profitable routes as possible. That is done. The second part was to foster profitable partnerships, especially Emirates. With codeshares they have been able to keep offerring QF tickets despite reductions and changes in routes.

But where I see them heading, very specifically, is to a be a leader in the new concept of ultra-long haul point-to-point routes. I have no doubt that within but a couple of years the aircraft will be available, and I think QFi will find its niche as a full-service, ultra-long-haul specialist.

Qantas has always suffered from two big problems - we (as in Australia) are a small market in global terms, and we are so far away from everywhere. I am not a QF shareholder, but if I was, I would be very happy with what is slowly happening.

A big prediction I want to make is that QFi will again become a Boeing-dominated airline. The 787 I think will be one of the most successful long-haul aircraft in history. But I am also sure that for the new era of ultra-long-haul, new versions of the 777 will become the standard for at least the next ten or twenty years.

QFi will morph into a first-rate, premium cabin heavy, point-to-point specialist. They will ride nationalism and FF program internally, they will use their safety history everywhere, and they will avoid at all costs any route that is not profitable.

There will be interesting times ahead in the QF/Emirates relationship. Emirates is built on a "one-stop from anywhere to anywhere" concept, and with codeshares QF is riding the investment EK has made, but I see that as merely QFi "using them" in this interim period. Qantas knows that soon the aircraft will be available to delete that "one-stop".

Beyond the next ten years, I think that globally the new model will reach the apex, the ideal, that was inevitable. Point-to-point. Zero stopovers. The only unknown will be how to balance the smaller routes.

Thoughts?

 

[Himeno]

And 737?

I see Qantas ending up with a 787/777 wide body fleet and a A220/A320 narrow body fleet.

 

[JohnK]

I mainly care about travel Asia and have no interest in ultra long-haul.

I can look forward to some routes to Asia remaining serviced by 737s, A330s and 787s. That's not very exciting for someone invested over 10 years Platinum and Lifetime Gold.

 

[Melburnian1]

Australia is too big for fast train.

It works in Europe for distances up to about 400km only, but everyone would still fly London-Frankfurt for example.

Connecting Wollongong, Canberra, Sydney, Central Coast and Newcastle by VFT would work though

Untrue! It works for travel time of three to 3.5 hours point to point that now, with a top speed of 350 or 320kmh on some routes, means distances of close to 1000 kmh.

SYD - MEL is suitable, as is SYD - BNE.

 

[Forg]

Untrue! It works for travel time of three to 3.5 hours point to point that now, with a top speed of 350 or 320kmh on some routes, means distances of close to 1000 kmh.

Well ... kind-of. All examples of where it’s implemented have population centres in the middle of that run which are huge by comparison to anything in AU except for the start- and end-points. I doubt there are any routes like Syd-Cbr-Mel anywhere else, where those are the only stops. I think we lack that in-betweeny stuff here.
Plus my experience of European train-travel is that it’s more exxy than we’re currently paying for Syd-Mel by air.

 

[Melburnian1]

Well ... kind-of. All examples of where it’s implemented have population centres in the middle of that run which are huge by comparison to anything in AU except for the start- and end-points. I doubt there are any routes like Syd-Cbr-Mel anywhere else, where those are the only stops. I think we lack that in-betweeny stuff here...

i know from where you're coming, but one extra benefit of what high speed trains, if done well, achieve is population growth (and jobs!) in places like Shepparton, Albury-Wodonga and Wagga Wagga. AW is already c.95000, WW c.60000 and Shepp 45000 +, plus nearby towns...small by international standards but with land available for growth.

SYD to BNE has Newcastle (c. 400000) plus Gold Coast (600000 or so) and numerous other centres like Coffs, Grafton, Ballina, Taree, Gosford...

 

[Doctore1003]

777s are so noisy.... wouldn’t A350 be more comfortable for such long flying times?

 

[Melburnian1]

Even profitable routes may not be so on every flight or every day, but overall, apart from LHR that AJ has occasionally referred to, what other QF routes at present are marginal or distinctly unprofitable? Some AFFers may have an 'in' with QF sales reps or management and know this.

Would SYD - NOU be one likely unprofitable contender? Some USA routes? HKG, because of the three way nonstop competition with CX and VA? BKK because it's largely leisure travellers?

 

[gaz0303]

Would SYD - NOU be one likely unprofitable contender

My experience is fully booked flights and full pricing on this route. I thought it would be more a cash cow, with likely protection?

 

[moa999]

777s are so noisy.... wouldn’t A350 be more comfortabl

Which version.
ERs arena lot quieter, and no doubt the 777X quieter again and have the 6000ft cabin pressure

 

[kpc]

Connecting Wollongong, Canberra, Sydney, Central Coast and Newcastle by VFT would work though

Did you know something? Fast rail future: 300km in 1 hour

 

[Scott K]

Australia is too big for fast train.

It works in Europe for distances up to about 400km only, but everyone would still fly London-Frankfurt for example.

Connecting Wollongong, Canberra, Sydney, Central Coast and Newcastle by VFT would work though

Fast train will happen in Australia eventually, as it will allow for de-centralised populations away from capital cities. With Brisbane there's already a large population that travels from Gold Coast/Sunny coast every day for work. Extend that to Hervey Bay etc and you'll see where the benefit is. Sydney is much the same, and Melbourne could do with that to anything within 300 KM of the city.

 

[Scott K]

QF future?
Well the speculation isn't exactly difficult, considering they have been telegraphing for years what direction they wish to head. The Hub model of the 1990's and early 2000s is starting to wear a bit thin in some capacities, mainly because Qantas doesn't have access to a hub point that is central to their business interests. Emirates, Singapore, Cathay, Etihad etc. All these places are able to form businesses around hub airports, where as Qantas's business core sits at a reach point from those hubs.

When you think about it, QF is doing pretty damn well to be punching above their weight against companies that have these infrastructure advantages.

QFs recent changes with their flights from HKG to SYD at night however indicate they are looking a bit further afield, and are looking at proxy bases overseas for flights. This gives QF the advantage of using HKG as their own hub with transport to Australia from China and asia, for flight routes that don't even exist yet. The idea of having a A330 sitting on the tarmac at HKG for 17 hours seems absurd - until you think about how now that gives them 17 hours of time to perform other shorter flights in Asia. Ready your points people, QF is becoming predatory as CX stumbles. I think they are positioning themselves to grab some of the local market.

They.... sort of... are pioneering ULH flights, but I think it is a market that is in its infancy and QF are going to have to start doing things a bit more radically to keep grabbing the market. They know that these flights that don't need such access to hubs are going to be be a major part of the future, especially as it will leave their competitors with the current home-town advantage of these hubs finding that these hubs will start to become a liability.

 

[suze2000]

The issue is: would people be willing to pay fast train prices on a daily commute? Two ways?

 

[Forg]

The issue is: would people be willing to pay fast train prices on a daily commute? Two ways?

It's an interesting question; it'd depend on the cost of living overall.
Train trips in Europe (and I think Japan?) are basically the same price as 'plane trips over distances equivalent to SYD-CBR or above, setting aside tourist arrangements like travel passes … yeah discounts can be had, but then you can fly SYD-OOL for $29 pretty regularly.

So I'm looking at Orange in domain.com.au, which is a ~250km drive from Sydney. I think Orange is a pretty bustling regional hub & hence will not be super cheap to live in the middle of at the moment, but I chose it 'cos it's the sort of place they'd have a HST station (they can't put stations for a HST in every little town - all the stopping/braking/accelerating would defeat the purpose). Looking at a place a short walk from the station, a 1-bed 1-bath ground floor apartment with a nice courtyard, it's $300/wk. Say it takes an hour to get to Sydney CBD, that's Penrith-ish, and I'm looking at places for $400+/wk (more to be as new) that are in a considerably more stabby location & where amenities aren't as convenient (walking to everything you need except maybe certain types of specialty stuff which is only a 1hr train-trip away) … and that's still $65/wk in train fares to the city.

I don't think I'd necessarily be quoting our favourite Sicilian, Vizzini, on that one.

 

[drron]

Sorry, I forgot those - I have never really regarded NZ and similar local destinations as really "international"

But you have all forgotten the Crash 8's.The Tasmanians will never forgive you.
According to WW they are a different country.

 

[dajop]

they will use their safety history everywhere

Most of what you are saying makes sense and QF is pointing to this, and I agree. However, I don't agree they will use their safety history "everywhere". I think safety is an implicit advantage for QF (for example something that is promoted by customers who are also advocates), but you currently see very little explicit use of their safety record in marketing or other official company material. It is probably a dangerous marketing tool to employ, both in the fact you will always be remembered for your latest safety "problem" (regardless of significance), and there is also a double edged sword as to what effect externally promoting it could actually have on the safety culture itself.

 

[dajop]

They.... sort of... are pioneering ULH flights, but I think it is a market that is in its infancy and QF are going to have to start doing things a bit more radically to keep grabbing the market. They know that these flights that don't need such access to hubs are going to be be a major part of the future, especially as it will leave their competitors with the current home-town advantage of these hubs finding that these hubs will start to become a liability.

With ULH flights, I think they will be niche high value flights, and to a certain extent will still be dependent on hubs. I guess by their very nature the sorts of cities you would want to fly to ULH will necessarily also be hubs. Just that these hubs are close to the final destination rather than midpoint, so instead of doing 22 hours of flying comprised of 14+8 hrs, you end up doing 2+20. The ULH flights will be backed by strong demand for point to point business traffic between the cities at either end, supplemented by onward traffic. Probably still need both. So SYD/MEL-LHR will no doubt be good because you have strong demand into LHR, but also has potential to onward traffic on BA to/from western Europe (at one end) and pick up AKL/BNE/CBR/ADL traffic at the other end. The current longest flight (SIN-EWR) has both connecting and point to point traffic.

Also I can't see all of the big international hubs disappearing, instead there may be more focus on their relative strengths and weaknesses. The "lesser" hubs will struggle, but those based in international cities with strong point to point traffic will have their fortunes resting on the fortunes of the cities (or city-states) they serve. I'd say SIN, HKG, DXB all are strong and will remain strong provided their economies stay strong. Likes of AUH, KUL, BKK with less significance internationally may continue to struggle. And as long as the Emir continues to pump oil and gas money into QR, DOH will thrive like no other

 

[juddles]

With ULH flights, I think they will be niche high value flights,..........Also I can't see all of the big international hubs disappearing....

I completely agree. As Scott K pointed out - QF has no place to run a major hub mid-way through long travel. And those huge hubs like Dubai are here for the long run. So non-stop ULH flights that skip these hubs will be the Qantas forte. I am sure that there is sufficient market that can be commanded by QF to at least half a dozen cities in Europe, and another half dozen in the Americas, for this to be a big enough niche to allow Qantas to actually grow.

 

[dajop]

I am sure that there is sufficient market that can be commanded by QF to at least half a dozen cities in Europe, and another half dozen in the Americas, for this to be a big enough niche to allow Qantas to actually grow.

Would be interesting to speculate what cities would be likely to be served by ULH aircraft.

In North America, JFK is the sure bet, and then perhaps ORD, but after that? The next biggest metro areas in US not already served by QF non-stop are Houston, Washington DC, Miami, Philadelphia, Atlanta and Boston, and elsewhere in North America are Mexico City and Toronto/

And Europe? Obviously there is LHR, and then FRA and CDG would be candidates, but difficult to see compelling cases for other cities (AMS? MXP?, MAN?).

 

[Forg]

And Europe? Obviously there is LHR, and then FRA and CDG would be candidates, but difficult to see compelling cases for other cities (AMS? MXP?, MAN?).

Interesting thought; because you’d never actually go to Frankfurt, it’s a hub with nothing to do in the city itself; so if the ULH concept holds-up you’re wanting to avoid changing planes at the other wnd of the 19hr trip.

In terms of actually going somewhere, FCO is probably more likely as an end-target than FRA; surely?