eastwest101
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- Oct 26, 2010
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I think post administration that metric is definitely skewed because:
1. VA don't have many seats to fill i.e. loss of their entire widebody fleet?
2. Because of the change in the business, they don't fly many kilometers anymore, and a lot of their flying is short haul and a lot of unproductive time on the ground so lots of costs and poor aircraft utilization? i..e. most of their fleet goes to sleep overnight, unlike Qantas who have an international division with some very long flights and better aircraft utilization and Jetstar who have more back of the clock flying and a few long haul flights.
Its even more appalling result/metric if you consider that international division of Qantas also has a reasonably premium heavy mix of seats with its long haul fleet having F J and PE seating in their larger international fleet, so if this metric is the cost to operate one available seat, (and yes you have to count every seat in the fleet as one seat) for one kilometer as a key efficiency metric for airlines to manage and compare their cost structures then it would seem that Bain have stripped out all the costs that the customer sees (Lounges, lower wages for cabin crew, and making all the previous VA shareholders/bondholders take a major haircut) but aren't that efficient at running an airline as they think they are.......
I suspect the only saving grace for VA at the moment is the sky-high domestic travel demand, Rex and Bonza conveniently disappearing and all airlines, and especially domestic airlines, not having any fleet expansion opportunities because of the lack of new aircraft and delays in deliveries from Airbus and Boeing, so even if the Qantas Group wanted to expand its difficult to get new/second hand aircraft. I think that Qantas in particular would also run into other bottlenecks such as available domestic gates at SYD and MEL that make it tough to expand capacity.
