VA invests in Tiger, buys Skywest, SQ investment & ACCC Concerns

[yohy?!]

re: VA invests in Tiger, buys Skywest, SQ investment & ACCC Concerns

very interesting move - AJ must be rather annoyed to be outflanked in the 'race to the bottom stakes'

VA now has the ability to leverage lower cost bases from Skywest and TT as needed to keep the pressure on QF in both the leisure and commercial sectors.

I imagine JB is beginning to enjoy this...

 

[cmon0005]

re: VA invests in Tiger, buys Skywest, SQ investment & ACCC Concerns

very interesting move - AJ must be rather annoyed to be outflanked in the 'race to the bottom stakes'

Just my opinion, I don't think this will effect QF/JQ much, if anything I think VA have purchased a lemon and lemons are sour, lemons don't get less sour as they get older they just go rotten.

 

[moa999]

re: VA invests in Tiger, buys Skywest, SQ investment & ACCC Concerns

Remember Tiger has been losing money domestically for a while... and Virgin paid money for it.
(obviously some of it casued by its recent restrictions)

 

[markis10]

re: VA invests in Tiger, buys Skywest, SQ investment & ACCC Concerns

Remember Tiger has been losing money domestically for a while... and Virgin paid money for it.
(obviously some of it casued by its recent restrictions)

Not that different to Impulse in many ways....

 

[777]

re: VA invests in Tiger, buys Skywest, SQ investment & ACCC Concerns

Remember Tiger has been losing money domestically for a while... and Virgin paid money for it.

The first part of the statement is true. The second part is questionable. You subtract the cost of Tiger from SQs equity investment and it looks like they were paid to take it off their hands!

 

[yohy?!]

re: VA invests in Tiger, buys Skywest, SQ investment & ACCC Concerns

Just my opinion, I don't think this will effect QF/JQ much, if anything I think VA have purchased a lemon and lemons are sour, lemons don't get less sour as they get older they just go rotten.

I doubt SQ are expecting TT to make money, just not lose too much.

It will serve the same purpose for VA, keep JQ honest and give them flexibility to undercut without using the main brand. They've just reversed QF's move back on them but it would seem with a lower cost base.

TT and Air Asia have successfully ensured 3K has barely ever managed to turn a profit in Asia (even accounting for help from 'big brother').

 

[moa999]

re: VA invests in Tiger, buys Skywest, SQ investment & ACCC Concerns

The first part of the statement is true. The second part is questionable. You subtract the cost of Tiger from SQs equity investment and it looks like they were paid to take it off their hands!

In which case the real losers are the other VAH shareholders - they have ended up with loss making TT, and given up 10% of their equity to SQ.

 

[777]

re: VA invests in Tiger, buys Skywest, SQ investment & ACCC Concerns

In which case the real losers are the other VAH shareholders - they have ended up with loss making TT, and given up 10% of their equity to SQ.

Depends entirely on the value they extract from it.

 

[oz_mark]

re: VA invests in Tiger, buys Skywest, SQ investment & ACCC Concerns

The first part of the statement is true. The second part is questionable. You subtract the cost of Tiger from SQs equity investment and it looks like they were paid to take it off their hands!

You do need to include the Skywest part of the deal in there as well!

 

[markis10]

re: VA invests in Tiger, buys Skywest, SQ investment & ACCC Concerns

In which case the real losers are the other VAH shareholders - they have ended up with loss making TT, and given up 10% of their equity to SQ.

Or they have just got control over an airline that can have a disruptive effect on yields where it flys, while having only a 60% exposure to the losses

 

[samh004]

Certainly wasn't expecting is, but does make a lot of sense I suppose. Now they're on equal footing against the Qantas model, so will have to see who cuts services or adds services first and what that'll mean for the other player.




 

[Ansettaddict123]

re: VA invests in Tiger, buys Skywest, SQ investment & ACCC Concerns

I wonder if we will see Godfrey back but in a tiger uniform...


Interesting times nonetheless, wise move by JB IMHO. Some work needs to be done about skywests (aging) fleet and tigers brand, but I don't doubt the ability of JB for one second given his track record of late. As others have said its interesting how we always seem to revert to a two airline system in this country.

 

[ajw373]

re: VA invests in Tiger, buys Skywest, SQ investment & ACCC Concerns

These 3 announcements are big news - but having SQ on the share registry is massive. Certainly is "game on"!

Kinda what SQ wanted 15 years ago, though with their name on the Ansett registry.

 

[Dee Thom]

re: VA invests in Tiger, buys Skywest, SQ investment & ACCC Concerns

I wonder if we will see Godfrey back but in a tiger uniform...
. Some work needs to be done about skywests (aging) fleet and tigers brand.

Skywest will probably dump their old F-50's for ATR's, but hold onto the F-100's, as they are ideal for FI/FO work in the hot and high conditions of northern W.A. plus for RPK's as well.

The Tiger brand can only improve under VA's management, and further down the track should break even.

Cheers,
Dee.

 

[ajw373]

re: VA invests in Tiger, buys Skywest, SQ investment & ACCC Concerns

Interesting news. I beleive that when Tiger was grounded they should have re-launched/re-branded as Scoot then. May cause JQ a few headaches.

That would be a bit hard. Scoot is a subsidiary of SQ, however Tiger is a completely different company that SQ just happens to be an investor in. Ie they don't actually own the brand, just a share in it.

 

[eastwest101]

re: VA invests in Tiger, buys Skywest, SQ investment & ACCC Concerns

Or they have just got control over an airline that can have a disruptive effect on yields where it flys, while having only a 60% exposure to the losses

Or maybe another way of looking at it - by introducing loss making TT onto routes already served by JQ this leaves the JQ yield managers with a problem, if the JQ yield managers have to compete/match TT fares then they have to decide if they want to preserve yields for the entire JQd network then the JQ prices have to go up on a route that does not have TT competition. Which they do - but then they have another problem - if QFd are also flying then that pushes JQd fares close to QF mainline and/or VA fares. Net result is people choose to fly QF or VA, and JQ may lose market share and see decreased load factors.

I am sure that JB knows this - that by hurting JQd he is, by definition, also hurting the whole QF group because QF management have painted themselves into a corner in the PR front with the story that JQ makes tonnes of money and QF loses money.

60% of TT losses go to the VA bottom line
100% of JQ losses go to the QF bottom line

 

[Major]

re: VA invests in Tiger, buys Skywest, SQ investment & ACCC Concerns

The Tiger brand can only improve under VA's management, and further down the track should break even.

Cheers,
Dee.

In the meantime Tiger provides good tax losses

 

[markis10]

re: VA invests in Tiger, buys Skywest, SQ investment & ACCC Concerns

Or maybe another way of looking at it

Thats actually the way I was looking at it, combat like for like!

 

[straitman]

Skywest will probably dump their old F-50's for ATR's, but hold onto the F-100's, as they are ideal for FI/FO work in the hot and high conditions of northern W.A. plus for RPK's as well.

The Tiger brand can only improve under VA's management, and further down the track should break even.

Cheers,
Dee.

Remember that Skywest/Virgin were/are introducing the ATRs as quickly as they possibly can as they are making a killing with them.

 

[eastwest101]

re: VA invests in Tiger, buys Skywest, SQ investment & ACCC Concerns

Thats actually the way I was looking at it, combat like for like!

Your version was shorter and much more elegant than mine....