Virgin Australia Financially Secure? [Now in Voluntary Administration] | Page 4 | Australian Frequent Flyer
Australian Frequent Flyer

Welcome to Australia's leading independent Frequent Flyer and Travel Resource since 1998!
Our site contains tons of information that will improve your travel experience.

Joining AFF is fast, simple & absolutely free - register now and take immediate advantage of these great BENEFITS.

Once registered, this box will disappear. And you will see fewer advertisements :)

Login Now to remove this and all advertisements (GOLD and SILVER members)
Not a member? Register Now for free

Virgin Australia Financially Secure? [Now in Voluntary Administration]

jakeseven7

Established Member
Joined
Sep 9, 2005
Messages
1,717
HND slots are a once in a lifetime opp. Its like being gifted a Heathrow slow. They got a free peak time slot which is worth millions.

I would say they are thinking long term for that route.

I wonder if the MAX10 will make the A330 a thing of the past . 777 can replace the Tokyo and MAX10 flatbed across to Perth. Would bring costs down somewhat quite a bit.
I am sure they are thinking as long term as they can with Japan....

But awful awful timing for launching a new Asian route. News is now covering warnings about travelling to Japan and South Korea which may impact Olympic traffic - which is what VA are relying on to kick start the route. Then there is the question of general travel softness to Asia on the corona virus.

I suspect Japan isn't going to be the gravy train they think it is going to be.... it will be a question of how long they can hang on there, hoping that things get better.
 

serfty

Veteran Member
Moderator
Joined
Nov 16, 2004
Messages
41,885
Qantas
Platinum
Virgin
Platinum
Flights
My Map
I suspect Japan isn't going to be the gravy train they think it is going to be.... it will be a question of how long they can hang on there, hoping that things get better.
Except of course that (as maybe referred to upthread), a HND slot has been like "gold" and VA are unlikely to be going to relinquish it easily.
 

jakeseven7

Established Member
Joined
Sep 9, 2005
Messages
1,717
Except of course that (as maybe referred to upthread), a HND slot has been like "gold" and VA are unlikely to be going to relinquish it easily.
Yes that has already been pointed out in the post I quoted... 😂

Of course they will be unlikely to drop it and will hang on for dear life if the loads aren't there and try and develop it - but at the end of the day if it doesn't make money what are they going to do?
 

EzioAuditore

Junior Member
Joined
Sep 3, 2019
Messages
14
Flights
My Map

well, the gov just upgraded travel advice to Japan and South Korea to yellow, “exercise a high degree of caution”. If their cases continue to grow, VA might kiss goodbye to Tokyo.
 

ja1

Member
Joined
Mar 17, 2015
Messages
245
Yes that has already been pointed out in the post I quoted... 😂

Of course they will be unlikely to drop it and will hang on for dear life if the loads aren't there and try and develop it - but at the end of the day if it doesn't make money what are they going to do?
The scenario where it doesn't make money would have to be the worst case one and presumably the least likely one ?

I can't imagine that VA management would have signed off on it without a number of models for risks and finances..

Plus you have to add the dimension of time as an overlay. With Covid19 is there a short term hit on the route (which you can adjust by reducing flights etc, without giving up the slotpair?) vs a longer term view on the whole reason you bid on it is because it already is or will definitely be a part of your strategy.

I don't have a problem with the idea VA may have to run a route which isn't as profitable as they'd like - because it feeds other routes that are much more profitable..
 

cove

Enthusiast
Joined
Feb 15, 2008
Messages
12,202
Results are out today so they are a good read. Twelve planes are going or gone. The fleet had pretty reasonable occupancy of seats.
Latest fuel pricing should start helping provided $AUD doesn’t tumble. Still looking at costs.
 

eastwest101

Established Member
Joined
Oct 26, 2010
Messages
2,803
Flights
My Map
Interesting that Paul Scurrah has taken the decision to accelerate the retirement and removal of the A320s from the Tigerair fleet and removal of a lot of poorly performing/duplication TT routes (CFS in particular seems to get mayor cut backs).

I think its sort of interesting that he has chosen to try to turnaround TT by removing its stupid mixed fleet costs earlier (or at least give it a chance to redeem itself with a pure B738 fleet) rather than killing the whole thing off like many of us here have suggested. I thought he might have been a more brutal "rip the band-aid off" kind of manager but he must see some potential in TT that none of us can see! 😀

An article in other papers talks about the one-off transition costs of the purchase of the rest of Velocity and the cost of the 750 or so redundancies which would be significant. Price of fuel down, but drop in the AUD offsets the drop in jet fuel prices, at least the lower AUD might help inbound tourism from overseas.
 
Last edited:
Joined
Aug 4, 2012
Messages
191
So VA is ending the debacle of the TT fleet transition by turning it into more of a fleet retirement - replacing seven A320s with just two B737s. Is this closing TT without the bad press associated with closing TT?
 

HS-TQE

Member
Joined
Apr 5, 2018
Messages
324
So VA is ending the debacle of the TT fleet transition by turning it into more of a fleet retirement - replacing seven A320s with just two B737s. Is this closing TT without the bad press associated with closing TT?
TT is also exiting the following routes (passing some flights back to the mainline carrier)
  • Melbourne-Coffs Harbour from 27 April 2020
  • Sydney-Coffs Harbour from 27 April 2020
  • Adelaide-Sydney from 27 April 2020
  • Sydney-Cairns from 27 April 2020
  • Hobart-Gold Coast from 28 April 2020
 

jakeseven7

Established Member
Joined
Sep 9, 2005
Messages
1,717
I can't imagine that VA management would have signed off on it without a number of models for risks and finances..
So do you think they modeled a catastrophic decline in demand for travel to Japan due to an unconstrained viral outbreak at the time they went after the slots? I don't think so.
 

Bagpuss

Active Member
Joined
Feb 24, 2014
Messages
956
Interesting that Paul Scurrah has taken the decision to accelerate the retirement and removal of the A320s from the Tigerair fleet and removal of a lot of poorly performing/duplication TT routes (CFS in particular seems to get mayor cut backs).
Whilst (as always) they will foget that VARA has A320's....
 

Saab34

Established Member
Joined
Jul 22, 2008
Messages
1,384
Flights
My Map
Checkout the Hong Kong loss making number they outlined. Since Day 1. Truly eye watering.

And JB said the route was going above forecast when it was all underway.

So with a forecast loss this next half and probably the following year, I no numbers man, but I assume they are going to need to borrow some more cash?

$1B in the bank, but it appears this is largely going or pay off debt in the near term, not leaving much at all should they post another 100m this half and perhaps a similar figure next year.
 
Joined
Aug 4, 2012
Messages
191
Whilst (as always) they will foget that VARA has A320's....
TBH the fact that TT still exists is a modern miracle. What other budget airline could be the subject of a TV show that revelled in the poor treatment of its customers, be grounded by the regulator over safety concerns, be banned from operating to Bali because its dodgy workaround setup didn't fulfill its legal obligations, engage in a four year fleet changeover that massively increased costs (with no idea what to do with the aircraft being phased out, eventually just gifting some to VARA), then when that failed having its fleet reduced to just a few aircraft so it can't even dream of challenging its budget rival, and yet it carries on!
 

Bagpuss

Active Member
Joined
Feb 24, 2014
Messages
956
$1B in the bank, but it appears this is largely going or pay off debt in the near term, not leaving much at all should they post another 100m this half and perhaps a similar figure next year.
Cash and cash equivalents dropped $632.4m between 30 June 2019 and 31 December 2019. So still just over $1bn. It does seem steep as that is $100million a month burn rate.
 

Stealthflyer

Member
Joined
Jun 15, 2019
Messages
287
Virgin
Platinum
The Guardian is reporting that Olympic committee members are questioning whether the Olympics should go ahead at all. Shifting from HK to Tokyo was a good idea, but no one could have forecast this run of bad luck. With the Australian government now upgrading the travel warnings for Japan, it’s really the worst possible timing for this new route launch. I just hope Virgin is resilient enough to wear the challenges.

 

jase05

Established Member
Joined
Jan 24, 2018
Messages
2,156
Qantas
Gold
Virgin
Platinum
The Guardian is reporting that Olympic committee members are questioning whether the Olympics should go ahead at all. Shifting from HK to Tokyo was a good idea, but no one could have forecast this run of bad luck. With the Australian government now upgrading the travel warnings for Japan, it’s really the worst possible timing for this new route launch. I just hope Virgin is resilient enough to wear the challenges.

Yeah, disappointing indeed. PS mentioned bookings on the new route were very good and that they are starting to see some benefits on Dom routes thanks to the NH partnership. With the full partnership to kick in during July it could be a nice little earner for them but no one could have predicted this
 

HS-TQE

Member
Joined
Apr 5, 2018
Messages
324

Also been reported that Scurrah is looking at a medium term replacement for both the A330 and 77W fleets, with an order possibly sent to the 'successful bidder' later this year. Have read rumours (through here and other forums) that it would be the A350 in tradeoff for returning the A330s back to lessors 2-3 years earlier.
 

Saab34

Established Member
Joined
Jul 22, 2008
Messages
1,384
Flights
My Map
If they are wanting these new wide body jets "before 2024" its not going to be the 777x

A350 or A330neo (welcome both very good machines)

However A350 would too way to big for cross country if they are wanting to maintain that domestic wide body.
 
Top