VA Running low on Cash?

[markis10]

Re: QANTAS's domestic sale(s)

People who blame Air NZ for Ansett's demise seem to forget that from 1979 until February 2000, managerial control of Ansett was held by News Corporation. Say what you will about Rupert Murdoch's ability to run a media business, but he sure couldn't run an airline.

Murdoch was not running the airline per se for much of that time, it was left to TNT who held the MD chair until 92, and TNT of course sold their 50% in 1996.
theage.com.au - The Age -

Similarities between Ansett and VA are few and far between when it comes to important issues such as fleet diversity, age and share of the business end of the market.

 

[AdMEL]

Re: QANTAS's domestic sale(s)

People who blame Air NZ for Ansett's demise seem to forget that from 1979 until February 2000, managerial control of Ansett was held by News Corporation. Say what you will about Rupert Murdoch's ability to run a media business, but he sure couldn't run an airline. It had a expensive mix of planes of almost every type and size and capital expenditure to upgrade the fleet was almost non-existent. Some say Air NZ should have known better what they were getting into as they had owned 50% since 1995, but News Corp still had managerial control and as anyone who has only a 50% interest in a business will know, it restricts how much information you get. Ansett was already a steaming heap before Air NZ bought the remaining 50%, some argue that News hid the extent of it from Air NZ so that Murdoch had a sucker to pay them cash to exit the Ansett investment before it fell over.

Air NZ should never have bought into Ansett and let it go under under Murdoch's watch like anything else he touches that isn't a newspaper or TV station (hello, Myspace).

Whilst I can't/don't disagree with anything you've stated, that does not excuse what Air NZ did with Ansett in the end. Yes, what they did was legal, but not ethical, in my opinion.

 

[Supersonic Swinger]

Re: QANTAS's domestic sale(s)

Whilst I can't/don't disagree with anything you've stated, that does not excuse what Air NZ did with Ansett in the end. Yes, what they did was legal, but not ethical, in my opinion.

What should have Air NZ done? Because that may be what is expected of Air NZ/SQ/Etihad if VA runs out of cash...

 

[pauly7]

Re: QANTAS's domestic sale(s)

What should have Air NZ done? Because that may be what is expected of Air NZ/SQ/Etihad if VA runs out of cash...

SQ or Air NZ would potentially get VA for an absolute steal though should conditions go south for them...

 

[AdMEL]

Re: QANTAS's domestic sale(s)

What should have Air NZ done? Because that may be what is expected of Air NZ/SQ/Etihad if VA runs out of cash...

In my opinion, a parent company should not be able to cut a subsidiary loose to fend for itself, without any liability for the subsidiary's debts and other obligations such as statutory payments to employees. As owner, Air NZ should have been made to honour debts and employee obligations.

 

[pauly7]

Re: QANTAS's domestic sale(s)

In my opinion, a parent company should not be able to cut a subsidiary loose to fend for itself, without any liability for the subsidiary's debts and other obligations such as statutory payments to employees. As owner, Air NZ should not have been made to honour debts and employee obligations.

Do you mean *should* have had to honour debts etc?

Lets not forget, essentially Air NZ went to the wall as well and only avoided the same fate as Ansett because the NZ government propped them up at enormous expense to the tax payer.

Anyway this is a little OT! Supposed to be about VA....

I suspect some of the major shareholders won't be that *unhappy* to see VA struggle a little as it creates an environment ripe for acquisition/merger/equity structure maneuvers.

 

[anat0l]

Re: QANTAS's domestic sale(s)

Lets not forget, essentially Air NZ went to the wall as well and only avoided the same fate as Ansett because the NZ government propped them up at enormous expense to the tax payer.

Let's not forget that a lot of the payout for the Ansett collapse in Australia was funded by the Australian government through aviation levies (a move which was thought equitable to avoid exposure to the tax payer base directly), and many of those who believed Ansett deserved to keep flying harboured considerable contempt for the government (and by some extension, the general public) not saving the airline let alone assisting in the payout of outstanding benefits. I'll give that the government was extremely gutless to let Air NZ off but at that point they were probably thinking the ASIC inquiry may have been fruitless in the longer term of having to address the immediate needs of the employees at the shorter term.


In any case, to get back to the topic, I don't think this is really a cause for alarm as such. Just seems... odd to report. If VA were truly on a trajectory towards insolvency then that could only point to JB being seriously irresponsible. I won't say that JB is an aviation corporate God, but it would seem out of character to be that reckless. Given the nature of the new market, JB knows that he's in a position with VA which can't really go back unless through gross incompetence. A blip in the market demand is not going to have considerable detriment.

 

[Deleted member 29185]

Re: QANTAS's domestic sale(s)

If VA were truly on a trajectory towards insolvency then that could only point to JB being seriously irresponsible. I won't say that JB is an aviation corporate God, but it would seem out of character to be that reckless.

I personally think JB is an astute man. His vision seemed well structured and planning and roll-out was going well. I think his biggest failure was to allow the implementation to falter and collapse from a "steady as she goes" ascent to a "jeeze, is there anything left we can stuff up" freefall (and I'm guessing that's a result of perhaps too many LCC experienced people and too few full service experienced people) and perhaps failing to accept advice from companies like Sabre. Given the Sabre move was recent, I'm guessing the failure of much of it's implementation was most likely due to penny-pinching and this seems to be supported by this recent financial gossiping. The long term may well be bright, but that's no comfort in the short term and I guess we'll see how well they navigate the short term cash flow problems, whilst repairing the damage done to the brand and whether they can reach those long term lofty goals.

FTR, I hope they succeed.

 

[lovestotravel]

Re: QANTAS's domestic sale(s)

SQ or Air NZ would potentially get VA for an absolute steal though should conditions go south for them...

Yep and that would be a very interesting propsition

One which I actually hope comes to fruition

 

[AdMEL]

Re: QANTAS's domestic sale(s)

Do you mean *should* have had to honour debts etc?

Oops! That's exactly what I meant!

Lets not forget, essentially Air NZ went to the wall as well and only avoided the same fate as Ansett because the NZ government propped them up at enormous expense to the tax payer.

As I posted earlier in this thread in response to a comment about Air NZ being well run:

Not to mention if I remember correctly, the very same airline which owned Ansett had to be bailed out by their country's government!

Let's not forget that a lot of the payout for the Ansett collapse in Australia was funded by the Australian government through aviation levies (a move which was thought equitable to avoid exposure to the tax payer base directly), and many of those who believed Ansett deserved to keep flying harboured considerable contempt for the government (and by some extension, the general public) not saving the airline let alone assisting in the payout of outstanding benefits. I'll give that the government was extremely gutless to let Air NZ off but at that point they were probably thinking the ASIC inquiry may have been fruitless in the longer term of having to address the immediate needs of the employees at the shorter term.

I would argue that is the ASIC's role! But they seem to be a toothless tiger these days, run like a cut throat business, so they only go after people/companies they know they will win against. Any small element of doubt and they see it as being too hard. In my opinion, they may as well not exist, as they don't protect the people (you and I) that they are supposed to.

I personally think JB is an astute man. His vision seemed well structured and planning and roll-out was going well. I think his biggest failure was to allow the implementation to falter and collapse from a "steady as she goes" ascent to a "jeeze, is there anything left we can stuff up" freefall (and I'm guessing that's a result of perhaps too many LCC experienced people and too few full service experienced people) and perhaps failing to accept advice from companies like Sabre. Given the Sabre move was recent, I'm guessing the failure of much of it's implementation was most likely due to penny-pinching and this seems to be supported by this recent financial gossiping. The long term may well be bright, but that's no comfort in the short term and I guess we'll see how well they navigate the short term cash flow problems, whilst repairing the damage done to the brand and whether they can reach those long term lofty goals.

FTR, I hope they succeed.

Agreed.

Yep and that would be a very interesting propsition

One which I actually hope comes to fruition

What makes you say that?

 

[lovestotravel]

Re: QANTAS's domestic sale(s)

What makes you say that?

VA have been on a downward trajectory for the last 12-18 months, and I don't see it getting any better

Qantas has the cash to survive, VA don't

If SQ get their hands on VA, then you would be able to fly SQ to/from the USA and most parts of the world, closing the gap that SQ has.

Plus *Alliance benefits

 

[eastwest101]

Re: QANTAS's domestic sale(s)

What makes you say that?

I suspect that lovestotravel would like a competitor to QF that is in Star Alliance not skirting around the issue with unsatisfactory virtual/partial alliances.

 

[toowongman]

Re: QANTAS's domestic sale(s)

I suspect that lovestotravel would like a competitor to QF that is in Star Alliance not skirting around the issue with unsatisfactory virtual/partial alliances.

Integration with a proper alliance would be preferred. Even Skyteam would be OK.

 

[eastwest101]

Re: QANTAS's domestic sale(s)

Integration with a proper alliance would be preferred. Even Skyteam would be OK.

Yes I was thinking the same - if someone came out to Australia and launched a Sky Team alliance/affiliate there would be nano-seconds before the response from SQ/NZ would be getting VA signed on to * alliance.

Actually Sky Team may not be so silly as it sounds either because you would have China Southern and China Eastern, Delta Airlines, Korean Air, Aeroflot, KLM Aeromexico and Garuda as your partners...

 

[BAM1748]

Re: QANTAS's domestic sale(s)

Yes I was thinking the same - if someone came out to Australia and launched a Sky Team alliance/affiliate there would be nano-seconds before the response from SQ/NZ would be getting VA signed on to * alliance.

Actually Sky Team may not be so silly as it sounds either because you would have China Southern, Delta, Korean Airlines, KLM and Garuda as your partners...

Delta, Korean, KLM ok, as for the others.........

 

[jetlagger]

Re: QANTAS's domestic sale(s)

Yes I was thinking the same - if someone came out to Australia and launched a Sky Team alliance/affiliate there would be nano-seconds before the response from SQ/NZ would be getting VA signed on to * alliance.

Actually Sky Team may not be so silly as it sounds either because you would have China Southern and China Eastern, Delta Airlines, Korean Air, Aeroflot, KLM Aeromexico and Garuda as your partners...

All very second rate airlines IMO.. to say the least..

 

[jetlagger]

Re: QANTAS's domestic sale(s)

VA have been on a downward trajectory for the last 12-18 months, and I don't see it getting any better
Qantas has the cash to survive, VA don't

Are you sure? From what realistic evidence?

 

[AdMEL]

Re: QANTAS's domestic sale(s)

Yes I was thinking the same - if someone came out to Australia and launched a Sky Team alliance/affiliate there would be nano-seconds before the response from SQ/NZ would be getting VA signed on to * alliance.

Actually Sky Team may not be so silly as it sounds either because you would have China Southern and China Eastern, Delta Airlines, Korean Air, Aeroflot, KLM Aeromexico and Garuda as your partners...

That would make sense, given Delta is one of their key partners already. Having said that, by the same token, so would joining Star Alliance, given Singapore is one of their key partners too!

 

[AdMEL]

Re: QANTAS's domestic sale(s)

All very second rate airlines IMO.. to say the least..

Even Delta and KLM??

 

[pauly7]

Re: QANTAS's domestic sale(s)

That would make sense, given Delta is one of their key partners already. Having said that, by the same token, so would joining Star Alliance, given Singapore is one of their key partners too!

Yes..... and VA is pretty much all foreign owned these days... And which alliance do two of the owners operate in...