Virgin Australia Financially Secure? [Now in Voluntary Administration]

[p--and--t]

Queensland.
If the QLD government give VA $200m and then VA nicked off to Victoria and several thousand Queenslanders lost their jobs I reckon there would be some backlash

Wouldn't that happen anyway? I thought I read somewhere (could be wrong) the QLD gov had been subsidising VA one way or another for years?

 

[jase05]

Wouldn't that happen anyway? I thought I read somewhere (could be wrong) the QLD gov had been subsidising VA one way or another for years?

I didn’t know that.

 

[jakeseven7]

I didn’t know that.

Yes they have, we have been throwing coin at VA since they started. Of course the jobs are good, but this government is very good at spending money. I'm not sure its worth it, especially if we got outbid by $300m - def not worth it

 

[p--and--t]

I didn’t know that.

As I said, could be wrong. But if I recall the reason that they set up in Brisbane was due to "incentives offered".

 

[antycbr]

As I said, could be wrong. But if I recall the reason that they set up in Brisbane was due to "incentives offered".

My understanding is that DJ received $10m to base the HQ in Queensland. I can't see any evidence of any further support after that.

 

[tomlee1986]

As I said, could be wrong. But if I recall the reason that they set up in Brisbane was due to "incentives offered".

It was.. by then QLD Premier Beattie in 2001 I think

 

[HS-TQE]

A former Labor Senator/Front Bencher via a 'News Corpse' show is flabbergasted that 'SIA' are not pulling the 'chequebook' out.

Quite an amount of 'SQ fanboys' in that opinion piece, even though SIA has every right to keep the 'chequebook' shut, and being cautious especially after the predecessor management failures in the VA and AN investments.

Singapore Airlines should ‘put its cheque book on the table’ and purchase Virgin

Former Labor minister Stephen Conroy says he can't believe "Singapore airlines is absolutely gagging" to absorb Virgin Australia as it should be "absolutely putting its cheque book on the table". Mr Conroy said purchasing Virgin would give Singapore access to the "most lucrative route in the...

www.skynews.com.au

 

[tomlee1986]

A former Labor Senator/Front Bencher via a 'News Corpse' show is flabbergasted that 'SIA' are not pulling the 'chequebook' out.

Quite an amount of 'SQ fanboys' in that opinion piece, even though SIA has every right to keep the 'chequebook' shut, and being cautious especially after the predecessor management failures in the VA and AN investments.

Singapore Airlines should ‘put its cheque book on the table’ and purchase Virgin

Former Labor minister Stephen Conroy says he can't believe "Singapore airlines is absolutely gagging" to absorb Virgin Australia as it should be "absolutely putting its cheque book on the table". Mr Conroy said purchasing Virgin would give Singapore access to the "most lucrative route in the...

www.skynews.com.au

As i recall - SIA is already supported by their own government - therefore maybe limited in what they can do with VA

 

[travel_bug]

As i recall - SIA is already supported by their own government - therefore maybe limited in what they can do with VA

Exactly, there would definitely be limitations on what SQ can do with the funds provided to them by the Singaporean government; and for any other liquidity they have, it would be a folly for them to spend anything unnecessarily given that Singapore has just entered a second wave of Covid cases that would push out their potential resumption of air travel even further.

Imagine the optics in Singapore for their taxpayers if SQ received funds to help them survive the pandemic and then they went and bought another airline unnecessarily.

 

[RAM]

Which they've progressively been amputating bits off for years ... the wings, the paws ...

RooFlyer - frankly I am shocked you should say such a thing !!!!!

Surely you meant, "Which they've progressively been 'enhancing' bits 'of' for years ... the wings, the paws ..."

 

[jakeseven7]

My understanding is that DJ received $10m to base the HQ in Queensland. I can't see any evidence of any further support after that.

Has been discussed previously, they absolutely get more than that, I'll dig up the post later

 

[RAM]

I wonder how creative the charging of oncosts would be, apportioning HR, CASA regulatory, finance etc on to these services if at all allowed by the Commonwealth. Normally each flight would contribute to these.

'Operating at cost' is a bit like the question of 'how long is a piece of string'.

In 2018/19 Q had (from a failing memory) admin costs (corporate etc) of around $500m+, so approx $10m/week.

If Q's operating say 30 flights/day then over 7 days:

$10m/210 = $47,620 per flight.

So if Q's allowed to 'break-even' after selling seats then it makes the per seat cost (approx $270 simplistically) for a Q B737-800 with 12 J and 162 Y very expensive before any aircraft maintenance/operating cost is considered.

I could be wrong but I do not expect to ever see what Q ends up charging per flight, per week, or per anything. There's a small chance we may see what VA's charging though.

 

[woodborer]

A former Labor Senator/Front Bencher via a 'News Corpse' show is flabbergasted that 'SIA' are not pulling the 'chequebook' out.

Quite an amount of 'SQ fanboys' in that opinion piece, even though SIA has every right to keep the 'chequebook' shut, and being cautious especially after the predecessor management failures in the VA and AN investments.

Singapore Airlines should ‘put its cheque book on the table’ and purchase Virgin

Former Labor minister Stephen Conroy says he can't believe "Singapore airlines is absolutely gagging" to absorb Virgin Australia as it should be "absolutely putting its cheque book on the table". Mr Conroy said purchasing Virgin would give Singapore access to the "most lucrative route in the...

www.skynews.com.au

It's much the same with most of their shareholders - they're all hurting at the moment, given they are largely in the same industries, and probably see VA as the least of their problems.

 

[woodborer]

I could be wrong but I do not expect to ever see what Q ends up charging per flight, per week, or per anything. There's a small chance we may see what VA's charging though.

We have an overall number.

Qantas group have 164 return flights a week, Virgin have 64 return flights.

So 456 flights for 8 weeks = 3648 flights

Givt gives them $165M, so a bit over $45K per flight

 

[RAM]

We have an overall number.

Qantas group have 164 return flights a week, Virgin have 64 return flights.

So 456 flights for 8 weeks = 3648 flights

Givt gives them $165M, so a bit over $45K per flight

That's a pity - Q will have to operate the flights at a loss then - not even covering overheads.....

 

[RAM]

Read through a couple of pages, if not already posted here is the official administration notice:

Virgin Australia Holdings Ltd 100 686 226 | Voluntary Administration | Meeting | Select One | Published : 21/04/2020 | ASIC Notice Details

insolvencynotices.asic.gov.au

Hope to see the awesome virgin crew & airline on the other side of this. Best of luck guys!

Just when you thought it was safe.....

I could be wrong, but those of us with flight credits, or still-to-be-cancelled flights, should qualify to participate in the virtual meeting. The travel credits are a form of debt - not sure if its unsecured but assume the worst...

 

[antycbr]

Just when you thought it was safe.....

I could be wrong, but those of us with flight credits, or still-to-be-cancelled flights, should qualify to participate in the virtual meeting. The travel credits are a form of debt - not sure if its unsecured but assume the worst...

It would be unsecured I would have thought - perhaps I should hold a catering cart as security each time I book a flight...

If I was going I'd be picking Deloitte over KordaMentha as administrators - I have more faith that an operating airline would provide me with the best recovery of my flight credit. KordaMentha's track record in the AN administration was not good.

 

[Gold60]

Turkeys - that is what i think the board and management of the shareholders are in Virgin.

Here you have, i presume, a group of highly paid and experienced business people from 4 or 5 large shareholding insitutions supposedly monitoring their investment in Virgin Australia - and we are in the situation we are in - voluntary administraion.

If this is the best they can do, i would be selling my shares in SQ, EY and the others - or at the very least, give VERY SERIOUS considerartion to selling my shares in them.

There must be turkeys owning the business - and this has been going on for years?? ....

 

[andrewpf]

could

Turkeys - that is what i think the board and management of the shareholders are in Virgin.

Here you have, i presume, a group of highly paid and experienced business people from 4 or 5 large shareholding insitutions supposedly monitoring their investment in Virgin Australia - and we are in the situation we are in - voluntary administraion.

If this is the best they can do, i would be selling my shares in SQ, EY and the others - or at the very least, give VERY SERIOUS considerartion to selling my shares in them.

There must be turkeys owning the business - and this has been going on for years?? ....

The assumption is that their primary driver is profit. But for the Government owned SQ and EY it presumably is ensuring people fly by their cities (for the broader economic benefits, rather than the benefit of the airline itself specifically); and for the Chinese carriers, who knows what the CCP wants (but maybe a combination of increased influence over the Australian economy and increased soft power through the use of China as a tourist destination?). Of course, profitability is helpful too ... but I'm not sure its the primary driver for those businesses; and so perhaps they are less business savvy than we assume?

 

[Melburnian1]

I think it would be a good thing if Melbourne becomes a hub for VA - this means Melbourne Airport could have a bigger upgrade for the future - as we all know Melbourne is growing very rapidly and needs to upgrade Tulla airport for the future

It has been, but the reduction in temporary residents due to the virus, and fewer international students could well drastically slow population growth.