Virgin Australia flights to Doha

[ben95]

I’d imagine the decline in share price is party due to the exposure, even though I don’t believe VA carries any financial risk with this transaction.

Like you’ve said VA doesn’t carry financial risk wi these flights, so any share price move is largely driven by other macro factors (oil prices).

I wonder if VA are perhaps thinking of dumping the deal?

I’d imagine that would be ultimately QR’s call whether they still need the extra capacity in the new world we enter. ME as a transit hub to Europe may or may not be dead, who even knows at this point.

 

[Saab34]

However, I think this might have killed off any hope of VA taking up a dry lease. If this situation had happened with a dry lease, VA would be losing money hand over fist. It’s probably not sensible to operate 100% of your long haul fleet to a single market relying on a single carrier.

I think that’s a good point. Parking, maintaining and leasing a small widebody sub fleet would be be a significant cash burner. Let’s face it, in our lifetimes we will see future clashes in the ME, this isn’t the first and won’t be the last.

This has probably been a good test for VA to see how they can cope with these black swan events. With a leaner cost base and simpler model, will be interesting to see the numbers at the FY.