Virgin Blue reduce domestic capacity 8%

[Michael Morrison]

400 Full Time Equivalent jobs are on the line

http://www.asx.com.au/asxpdf/2009021...6bd7235l5g.pdf

5 aircraft will be parked for 2009.

[Brad Myer]

What flights/routes will be cut?

There are no details....

[Michael Morrison]

Originally Posted by Brad Myer

What flights/routes will be cut?

There are no details....

I presume these will be announced with their results next week??

[Brendan McKenna]

If I was a DJ employee, I would be rather disappointed with the company leadership in offering $1 fares one month and laying off 400 staff the next...

[Ellis Taylor]

Originally Posted by Brendan McKenna

If I was a DJ employee, I would be rather disappointed with the company leadership in offering $1 fares one month and laying off 400 staff the next...

Then it's probably a good thing you're not! The fact of the matter is that the discount airfares are out there because the market needs stimulating because the aircraft aren't filling up as quickly as they were a year ago. It's true that $1 fares are really a gimmick to get people in and there aren't a lot of them - it's usually those seats which would have gone empty anyway. Nevertheless, the person who bought a $1 airfare may then buy a meal or a drink on board, in which case it may cover some more of the cost to the airline.

[Brendan McKenna]

I understand your logic and agree that the market must be stimulated in various ways. But for every $200 seat that you give up trying to sell, you need to sell 200 of them at $1 to generate the same income. As soon as you have sold any of those seats at the discount rate, you have lost the chance to sell them at the regular rate.

I would love to see some data which illustrates how many people decided to jump on a flight purely to utilise a discount fare vs those were who were planning to fly from A to B anyway and by pure luck managed to score a cheap seat instead of the regular fare that they were expecting to pay.