Qantas' Asian transformation - highest Asian activity ever - Centre for Aviation CAPA

[Strategic Aviation]

Qantas' Asian transformation, relaunching Beijing & Melbourne-Tokyo; highest Asian activity ever - CAPA - Centre for Aviation

In calendar 1Q2017 Qantas will operate more flights to Asia than at any time this decade, including prior to its Emirates-necessitated restructure.

It is a sign of its growing international strength that Qantas has returned to its pre-Emirates size in Asia, even though almost all seats are now sold for Asia and there are no European connections.

Qantas' frequency to Asia has not only improved, but has surpassed pre Emirates levels. Qantas operates 12% more flights to Asia in 1Q2017 than in 1Q2016, which itself surpassed 1Q2011 for a recent record.

Compared to 1Q2011, before the post Emirates Asia restructure, Qantas is increasing seat capacity across all Asian markets except Singapore and Bangkok. The exclusion of Singapore is inevitable, since that was Qantas' major hub for Europe, and without European connections it does not need as much seat capacity into Singapore from Australia.

Many of Qantas Group's Asian competitors have been caught off guard by this expansion. Some regarded Qantas as losing further relevance in the Asia-Australia market, and had more or less written it off as a competitor.

Although Qantas has its sights on further developments and growth in Asia, its transformation of this market will partially be replicated, and expanded on, over the next two years as Qantas receives its 787 Dreamliner and changes European and North American flying.

Surprisingly CAPA didn't mention the possibility of resuming Europe one-stops via Asia, despite that being a theme in their other recent articles.

 

[eastwest101]

Re: Qantas' Asian transformation - highest Asian activity ever - Centre for Aviation

While its nice that Qantas management have actually found Asia on the map again (seems to have been distracted by long haul europe problems, Jetstar expansions and EK alliance plus IR issues forever) its still going to be tough for them with lots of competition, a potential useful partner that they have alienated (CX) and lots of competition from mainland China (some of which QF are aligning with) they haven't made it easy for themselves with a history of poor fleet selection either. The fact is that they can't deny geography and they are located on the edge of Asia with high costs as opposed to being in the middle of Asia with low costs so they aren't ever going to amount to much in Asia except as a link from Sydney to some asian cites.

 

[moa999]

Re: Qantas' Asian transformation - highest Asian activity ever - Centre for Aviation

I think CX decided it didn't need QF a long time before the recent MU tieups and Jetstar HK attempt.

I am surprised that given the growth of AirAsiaX and Scoot long-haul that some 787s haven't gone to 3K (JQ operated SIN-AKL for a while but dropped it) - would at least provide some options out of SIN.

 

[Isochronous]

Re: Qantas' Asian transformation - highest Asian activity ever - Centre for Aviation

CX is struggling financially now and with morale so you never know if they might suddenly be more accommodating to QF. Still, the resurgence of QF in Asia is a big positive and it would be nice if they can make MEL-HKG double daily!

 

[AustraliaPoochie]

Re: Qantas' Asian transformation - highest Asian activity ever - Centre for Aviation

Asian transformation my paw.
Bah humbug, QF should fly MEL/SYD/PER - KUL even if just a few days a week, seeing EK with a QF flight number does not fly MEL - KUL anymore.
And flying MH J will only earn flexY QFpoints and QF SC, double bah humbug.

 

[samh004]

Re: Qantas' Asian transformation - highest Asian activity ever - Centre for Aviation

Interesting info, but would rather see QF flying to destinations that aren't as serviced from Australia, such as perhaps South Korea (they don't fly there on their own metal, right?), Malaysia (with MH struggling) or somewhere else I can't think of.

I think CX decided it didn't need QF a long time before the recent MU tieups and Jetstar HK attempt.

Surely it wouldn't have mattered if they had been friends... despite being in the same alliance they would surely run into the same issue that QF had with AA recently in that together they already control too much capacity to be given approval to coordinate their services.

Because they don't, I know many in Australia who prefer CX fares and a few in Hong Kong who prefer QF fares. You compete where you can.

 

[Pleb Status]

Re: Qantas' Asian transformation - highest Asian activity ever - Centre for Aviation

The number of QFi Asian services (and particularly seats) ex PER and ADL are still far lower than before the QF/EK alliance began.

ADL still has no QFi service at all and the 10 weekly 737 QFi PER-SIN flights are a significant decrease in seats compared to the double daily 333 PER-SIN and the other flights to HKG, NRT etc that QFi used to operate ex PER.

The significant reduction in QF transcon widebody flights (also noted in the report) has been the thing I have felt the most over the past 18 months. My normal flights PER-BNE-PER were both operated by 332 aircraft a while ago but that then changed to a 737/332 combo and now both are 737 since December.

 

[ric_melb]

Re: Qantas' Asian transformation - highest Asian activity ever - Centre for Aviation

Three comments.

1. I believe Qantas think they cant make the route to KL profitable,either flying Qantas jets or Jetstar from Australia.
2. For the time being we have to accept that Qantas are not flying to Asia from Adelaide, and have less capacity from Perth to Asia. Again they will be looking at profitability and available planes.
3. The reduction in QF wide body flights between Perth and the East Coast surprised me, as I initially assumed this was a reduction in A330 flights for 737 flights. But I think looking at the time frames it probably reflects the phasing out of 767 flights to Perth. So now QF fly coast to coast with A330 and 737.

 

[Danger]

Re: Qantas' Asian transformation - highest Asian activity ever - Centre for Aviation

Asian transformation my paw.
Bah humbug, QF should fly MEL/SYD/PER - KUL even if just a few days a week, seeing EK with a QF flight number does not fly MEL - KUL anymore.
And flying MH J will only earn flexY QFpoints and QF SC, double bah humbug.

While I'm all for more QF flights, with respect to KUL I'd rather see QF codeshare on MH. Extend to them a helping oneworld hand as they move heaven and earth to improve and award normal SCs and points along with it. Right now QF is just kicking the bloke while he's down.

 

[RickyT84]

Re: Qantas' Asian transformation - highest Asian activity ever - Centre for Aviation

Surely it wouldn't have mattered if they had been friends... despite being in the same alliance they would surely run into the same issue that QF had with AA recently in that together they already control too much capacity to be given approval to coordinate their services.

Because they don't, I know many in Australia who prefer CX fares and a few in Hong Kong who prefer QF fares. You compete where you can.

With CX/QF having a duopoly on most AU-HK routes, it is clear a codeshare wouldn't go down too well with the regulatory authorities.

As for fares, I still find QF cheaper most of the time from AU, guess this is just a reflection of their schedule (1 daily flight from MEL/BNE vs 2/3 daily flights from BNE/MEL, and 2 daily flights from SYD vs 4 daily on CX).

 

[moa999]

Re: Qantas' Asian transformation - highest Asian activity ever - Centre for Aviation

Given MH is almost always selling deep discount fares (which often aren't available under codeshare) to compete with Air Asia, I can see why QF doesn't bother.

QF did at one point have a codeshare on the overnight EK MEL-KUL flight which was dropped in Oct2016, although it wasn't available out of SYD (only QF/3K connections via SIN)

 

[ajw373]

Re: Qantas' Asian transformation - highest Asian activity ever - Centre for Aviation

With CX/QF having a duopoly on most AU-HK routes, it is clear a codeshare wouldn't go down too well with the regulatory authorities.

As for fares, I still find QF cheaper most of the time from AU, guess this is just a reflection of their schedule (1 daily flight from MEL/BNE vs 2/3 daily flights from BNE/MEL, and 2 daily flights from SYD vs 4 daily on CX).

The benefit of any codeshare with CX would be on flights out of HKG to non Australian destinations.

Not much point code sharing on flights were you fly yourself. You want to do that then you would be looking to an alliance above a codeshare. Like what Qantas used to have with BA and planned to have with AA.

 

[ajw373]

Re: Qantas' Asian transformation - highest Asian activity ever - Centre for Aviation

Found all the references to EK alliance rather amusing. Almost like Qantas retracted from Asia due to the alliance.

Now with the exception of Singapore the EK alliance has little to do with it. The reason Qantas retracted was because they had a plan to reduce the cost of QFi, the EK alliance (to Europe and Africa) was part of that strategy as well as reducing flights in Asia due to aircraft retirements etc.

Interestingly was speaking with the CSA on a flight the other day and the Runcorn mill is more Asian flights will be coming with the reduction in A330 flights to Perth with the drop off in the mining boom. The suggestion was the reconfiguration of some of the A330-200's into an international sub fleet will lead the expansion. Where when any how guess the year will tell.

 

[Isochronous]

Re: Qantas' Asian transformation - highest Asian activity ever - Centre for Aviation

Interesting info, but would rather see QF flying to destinations that aren't as serviced from Australia, such as perhaps South Korea (they don't fly there on their own metal, right?), Malaysia (with MH struggling) or somewhere else I can't think of.



Surely it wouldn't have mattered if they had been friends... despite being in the same alliance they would surely run into the same issue that QF had with AA recently in that together they already control too much capacity to be given approval to coordinate their services.

Because they don't, I know many in Australia who prefer CX fares and a few in Hong Kong who prefer QF fares. You compete where you can.

That's why I've previously suggested that the 747 which stays forever at Tokyo could be used for a tag flight to ICN.

 

[Melburnian1]

Re: Qantas' Asian transformation - highest Asian activity ever - Centre for Aviation

That's why I've previously suggested that the 747 which stays forever at Tokyo could be used for a tag flight to ICN.

Or better still, provided there were airport slots available, the B744 on the SYD - HND run should turn around and operate during the day back to Oz, despite QF's historic view that businessmen prefer overnight flights. Currently there is very poor fleet utilisation in having a B744 sit in Tokyo all day.

And apart from QF not operating at all to KUL, it still refuses to provide MEL with the number of international flights to Asia it deserves. Our population is marginally less than Sydney's, and there are many high income residents in Melbourne. It may be a question of not having sufficient suitable A333s but why can't QF consider commencing nonstop MEL - MNL flights or longer term MEL (or SYD)- ICN? Philippines does a growing amount of business with Oz, has many migrants here and a rising tourism sector; South Korea is one of our largest trading partners, a booming economy and has many who like visiting Oz. South Korea is also an underrated holiday destination with Seoul having to be one of the more interesting cities in Asia.

Although JQ is filling the void, similarly QF lacks any own metal flights to Vietnam, another fairly fast growing Asian economy with an attractive tourism offering.

As for the suggestion QF should codeshare with MH, the disgraceful way that MH has treated 'incident' claimants from Oz should preclude anyone doing business with such a company. I have put MH on my 'no fly' list.

How can we take QF seriously in Asia when it has so many omissions from its schedules?

 

[Himeno]

Re: Qantas' Asian transformation - highest Asian activity ever - Centre for Aviation

Or better still, provided there were airport slots available, the B744 on the SYD - HND run should turn around and operate during the day back to Oz, despite QF's historic view that businessmen prefer overnight flights. Currently there is very poor fleet utilisation in having a B744 sit in Tokyo all day.

They can't operate a day flight back from HND.
The HND slots currently allowed for Australia are 14 night slots/week, with the normal 50:50 to Japanese and foreign carriers. The QF flights to HND can only arrive and depart between 10pm and 6am. In order for a day return to work with the allowed slots, QF25 would need to depart SYD 1-2 hours earlier and arrive HND around 0330 or 0400, then QF26 depart just before 0600, to arrive back in SYD around 1700, which makes it too late to connect to many domestic flights.

 

[trippin_the_rift]

Re: Qantas' Asian transformation - highest Asian activity ever - Centre for Aviation

Three comments.

1. I believe Qantas think they cant make the route to KL profitable,either flying Qantas jets or Jetstar from Australia.
2. For the time being we have to accept that Qantas are not flying to Asia from Adelaide, and have less capacity from Perth to Asia. Again they will be looking at profitability and available planes.
3. The reduction in QF wide body flights between Perth and the East Coast surprised me, as I initially assumed this was a reduction in A330 flights for 737 flights. But I think looking at the time frames it probably reflects the phasing out of 767 flights to Perth. So now QF fly coast to coast with A330 and 737.

When airlines are looking at new routes, there's an abundance of information available to them (both free and paid) to understand what the in/out traffic might look like. One source of information airlines tap into are local banks in Australia (who, by the way, sell this information to QF and other businesses).

Amex, for example, provides information on where cardholders are shopping overseas in relation to destination airports where the cardholder has flown Qantas.
Imagine you step off the plane, and get an uber to the Hilton 100km away. Amex knows your flight info (including fare class, who you travel with etc.), they know which hotel you checked into (CC is swiped) and that you took uber to the hotel. Amex then sells this info to airlines to help them make better routing choices. For example in this scenario say it was a PER-BNE and you ubered to Gold Coast - this intelligence means there might be scope for a PER-OOL as this is the final destination which pax are continuing to.

There's no room for gut feeling decisions in commercial aviation anymore. It's simply too expensive when airlines get it wrong.

 

[moa999]

Re: Qantas' Asian transformation - highest Asian activity ever - Centre for Aviation

And I'd also add that in general Asia is where QF faces its worst cost imbalance - just look how the LCCs/Chines carriers are impacting CXs margin.

QF needs a decent amount of business traffic to make the overall economics work.

 

[RickyT84]

Re: Qantas' Asian transformation - highest Asian activity ever - Centre for Aviation

The benefit of any codeshare with CX would be on flights out of HKG to non Australian destinations.

Not much point code sharing on flights were you fly yourself. You want to do that then you would be looking to an alliance above a codeshare. Like what Qantas used to have with BA and planned to have with AA.

Thats true. More so when CX/KA have plenty of flights to mainland China which would connect nicely with QF's late afternoon arrival. Other than that, I can't think of other destinations where QF can codeshare ex-HKG.

Given the often frosty relationship between the two, it maybe why QF has chosen to forge alliance with the Chinese carriers (MU and CZ in particular) instead.

 

[RickyT84]

Re: Qantas' Asian transformation - highest Asian activity ever - Centre for Aviation

And apart from QF not operating at all to KUL, it still refuses to provide MEL with the number of international flights to Asia it deserves. Our population is marginally less than Sydney's, and there are many high income residents in Melbourne. It may be a question of not having sufficient suitable A333s but why can't QF consider commencing nonstop MEL - MNL flights or longer term MEL (or SYD)- ICN? Philippines does a growing amount of business with Oz, has many migrants here and a rising tourism sector; South Korea is one of our largest trading partners, a booming economy and has many who like visiting Oz. South Korea is also an underrated holiday destination with Seoul having to be one of the more interesting cities in Asia.

Although JQ is filling the void, similarly QF lacks any own metal flights to Vietnam, another fairly fast growing Asian economy with an attractive tourism offering.

As for the suggestion QF should codeshare with MH, the disgraceful way that MH has treated 'incident' claimants from Oz should preclude anyone doing business with such a company. I have put MH on my 'no fly' list.

How can we take QF seriously in Asia when it has so many omissions from its schedules?

Melburnian1, all of the places you mentioned in your post (MNL, KUL, Vietnam) except maybe ICN are pretty low yield as they are well served by LCCs.

Having said that, it appears that the dual brand (JQ/QF) strategy works well in certain markets such as DPS, SIN and TYO.