Qantas credit rating downgraded to junk by S&P

[Todd Hendry]

http://www.theaustralian.com.au/busi...-1226776843315

Posted without comment.

[Kazuya H]

A follow up article today on Quartz:

http://qz.com/155123/qantas-will-be-...-be-australia/

This is the worst case of journalism I've ever seen. It's basically a press release from Qantas posted almost word for word. Not a single word about the incompetence of the board and Joyce. The end game it looks like to be the selling Qantas bit by bit. It's really a sad day for the kangaroo.

[Kazuya H]

Now this is the way it should've been told:

http://blogs.crikey.com.au/planetalk...-will-kill-it/

[Greg McDonald]

Good article.

[Tim H]

Joyce inherited a legacy issue. Dixon and his policies created much of the mess Joyce inherited. Admittedly scaling down the airline internationally is not really a growth strategy but when you pick up a lousy hand of cards you have to play them the best way you can.

[Stuart Trevena]

Hi All,

Qantas has the aircraft to grow, but they tried to use the wrong type of aircraft for given routes.

Eg. B744 to San Francisco and to Rome.

Routes from Melbourne to San Francisco via Honolulu, Rome via Singapore, Johannesburg via Perth, Mumbai via Singapore, and Vancouver via Auckland are all in Range of an Airbus A330 Aircraft.

There was also a market for flights to Vancouver via HNL ex YMML.

There are more foreign tails at YMML than QF ones.
EK 3 Times Daily
SIA 3 sometimes 4 times Daily
CX 3 Times Daily
MH 3 Times Daily

No wonder QF going down the drain.

Also - I think Qantas has lost the Plot!!

There have been more Uniform Changes over the past 15 years than it needed to be, thus wasting money it doesn't need to waste. Every change in Uniform must cost many millions of dollars, including paying Top Designers thousands to do the work.

If you look at Emirates and Singapore Airlines, their uniforms haven't changed a great deal, if any, while Qantas Uniforms have had major makeovers.

As for the current ad, well that is the worst ad I seen. It doesn't make me want to fly with Qantas at all!! And that was the point of the ad, to bring customers to want to make them fly Qantas.

The whole Qantas board needs to be Sacked for the way they have allowed the Airline to run itself into the ground and also for approving this current ad. Qantas has reduced their overseas network of destinations because of poor choice in buying the wrong type of aircraft, and yet they expect customers to fly with them, when they have cut the very routes customers want to fly to.

In closing, why didn't Qantas buy the B777-200LR??
This could have been a Premium (First, Business and Prem Econ) Long Haul Service Ex YMML and SYD via Perth to LHR - Both ways and also a second LAX service for YMML.

These are my own opinions

Stuart

[James S.]

Originally Posted by Stuart Trevena

Eg. B744 to San Francisco and to Rome.

The San Francisco route was profitable wasn't it? It's just that they felt Dallas would be even more profitable and a more effective utilisation of the fleet.

Originally Posted by Stuart Trevena

Routes from Melbourne to San Francisco via Honolulu, Rome via Singapore, Johannesburg via Perth, Mumbai via Singapore, and Vancouver via Auckland are all in Range of an Airbus A330 Aircraft.

There was also a market for flights to Vancouver via HNL ex YMML.

Not a great idea at all. Passengers would definitely prefer the non-stop option and it probably saves a bit of cost. The problem with places like Rome, etc is not the fact that they didn't have the right aircraft; it's the yield on the route is absolute garbage, hence why there was rumours of those routes being operated by JQ 332's. EK can make it work through all of the feed they get from different places. Qantas establishing foreign based scissor hubs would cost more money than operating a 747 to said destinations. If it was as simple as you describe, they would have done it.

What Qantas needed was the 777-300/ER (yes, I know, it's a beaten horse) for routes to the US in particular. However, CASA's strict ETOPS rule, which I believe is limited to 180 mins verse up to 330 elsewhere means the 77W wouldn't have worked on places like JNB (see VA's attempt) and SCL. So that limits the destinations because of Australia's geographic isolation. If this was changed, perhaps the 777-9x will be a very good consideration. However, I think the 351 could be a very good fit for the QF fleet to replace the 747's and bridge the gap between the 787-9 and the A380. We shall see what happens anyway, hopefully by then CASA will relax those restrictions.

The A330 is the perfect aircraft for expansion into Asia. However, the 789 will do that even better.

Originally Posted by Stuart Trevena

There are more foreign tails at YMML than QF ones.
EK 3 Times Daily
SIA 3 sometimes 4 times Daily
CX 3 Times Daily
MH 3 Times Daily

No wonder QF going down the drain.

This is probably complemented by our ridiculous open skies policies. No idea why Emirates can fly passengers from Sydney - Auckland without a single passenger having anything to do with transiting to Dubai. Don't see many other countries doing this at all.

Anyway, the reason those airlines can do it is because they operate in one megahub base and just use massive feed from a variety of destinations to be able to support such a frequency. The problem Qantas has is simply it's geography. It's much harder to do multiple-frequency flights in that regard because we're at the end of the line for these journeys, and our population simply isn't big enough to support that much feed. Explain to me what flying 4 x SYD - SIN flights would achieve? Probably not much. However, MEL/SYD/BNE-SIN will give you the coveted "three tails" that you seem to measure an airline's success by, which is a reasonable strategy. Qantas needs to be more creative by expanding in places like Perth, Brisbane and Melbourne and even smaller centres such as Adelaide rather than being so Sydney centric. (Which is probably what you were trying to convey anyway)

Also - I think Qantas has lost the Plot!!

There have been more Uniform Changes over the past 15 years than it needed to be, thus wasting money it doesn't need to waste. Every change in Uniform must cost many millions of dollars, including paying Top Designers thousands to do the work.

If you look at Emirates and Singapore Airlines, their uniforms haven't changed a great deal, if any, while Qantas Uniforms have had major makeovers.

The new uniform is VERY good. A change for the better in my opinion; the Aboriginal theme'd uniform was very 1990's and looked kind of stale. A much needed fix in my view. The Singapore Girl image is an extremely important part of their brand, and is simply timeless that doesn't need changing. Sorry to burst your bubble about Emirates though;

Originally Posted by Emirates Official Statement

DUBAI, UAE, 16th June 2008 - Emirates Airline's 16,000-plus uniformed staff are to be given a sharper, more business-like look with the introduction of a brand new uniform.

Carrying forward the strongest components of the existing iconic outfit, the new, stylish and contemporary look will be unveiled when the airline receives its first A380s over the next months. The cabin crew assigned to Emirates’ flagship aircraft will be the first to wear the new uniform.

Originally Posted by Stuart Trevena

As for the current ad, well that is the worst ad I seen. It doesn't make me want to fly with Qantas at all!! And that was the point of the ad, to bring customers to want to make them fly Qantas.

The whole Qantas board needs to be Sacked for the way they have allowed the Airline to run itself into the ground and also for approving this current ad. Qantas has reduced their overseas network of destinations because of poor choice in buying the wrong type of aircraft, and yet they expect customers to fly with them, when they have cut the very routes customers want to fly to.

Not sure which ad you're talking about there. But I'll admit, they haven't been very strong in the last few years. However, Qantas' new "It's about Qantas" short ad is brilliant and seems to be on the right path in terms of advertisement.

Now, the fleet. Qantas wasn't helped by the whole 787 debacle, which would have made things much easier. I do raise my eyebrows at Jetstar receiving them first, though. Surely they could have coped with the A332's until Qantas got itself in order? Perhaps it's for the better though, the 787-9 will probably be much more capable anyway. I don't think the 77W is the magic solution as mentioned before because of CASA restrictions. If they were lifted, it would be economical to buy them, as a small subfleet wouldn't be worth it as 747's would still be needed for those mentioned routes.

I think what could work really well is using the 777's to Dubai and then sending them to different destinations in Europe where EK have run out of their bilateral agreement slots, such as BER with a codeshare. That way, QF can tap into Emirates' feed and get these flights profitably working. I feel as though getting into partnership with Qatar would have been a much better move. Qantas could have expanded from Australia with flights to Doha (QR only does PER/MEL I think?) as well as continuing flights using the same proposed model with EK that I mentioned above.

Originally Posted by Stuart Trevena

In closing, why didn't Qantas buy the B777-200LR??
This could have been a Premium (First, Business and Prem Econ) Long Haul Service Ex YMML and SYD via Perth to LHR - Both ways and also a second LAX service for YMML.

Yet another bad idea. The A380 does the job for MEL - LAX first of all anyway. Now the much talked about ULH Perth - Europe flights... ugh. What would that have achieved that isn't currently satisfied (or was) by SIN/BKK/DXB hubs? I never understood this infatuation with Perth-Europe flights. About the only thing I see them achieving is operating severely load restricted flights with a minor subfleet of aircraft that would be close to useless (or better served by a 77W) to any other QF destination. Those Asian destinations also have much better local traffic and freight connections to help along the way. Plus, that route would be uncomfortably long. Most passengers would prefer the stop in Asia.

These are my own opinions.

[JamesL]

Just a few things, ETOPS/EDTO is not a CASA restriction, it is an aircraft certification process that is conducted by either the FAA or EASA in Europe. CASA may set further operator requirements on ETOPS/EDTO flights but the 180 minute rule is stipulated on the aircraft manufacturing certification.

We all admit QF has made many mistakes in recent years but all could of been resolved in their recent assistance to MAS with joining OW. QF could of done to MAS, what EK is doing to QF. They could of moved hubs to KUL, gotten the feeder traffic from MAS and expanded its INTL OPS from KUL. Instead QF has completely given the *** to MAS and tunnel vissioned on EK.

As much as it is a dead horse, yes the B777 was and still is the best option for a QF revival, they need to swallow their pride and understand that the aircraft will work for them in key markets into Asian and US, even a stretch to the EU.

AJ and the board need to drop the rhetoric of this 65% line in the sand BS and maintain that by high quality service. I have flown more times on QF this year that VA (not by choice mind you) and the potential is there however the fleet and staff are not following in the same way. AJ needs to stop whining and take some ownership of HIS role within the airline, yes there may of been contributing factors by previous CEOs etc however a leader is seen as someone that provide a strategic vision and direction, not someone that crys wolf at the first sign of hardship.

IF QF really wanted to, they could go to a lower rate airline and buy slots of them for aircraft that they need TODAY.

It is a sad time currently in T1(for those in ML would get that) and it is sad to see what is really happening and why no real action is been taken board. I understand the 2011 grounding but there are companies in the world that have had worse circumstances then this and have come out better.

The QSA is not a hindrance, it's just an excuse, EK does NOT want to buy into QF, if they wanted to would of not happened already? No one wanted to buy something that looked like it's going to expire tomorrow. VA have raised more capital to increase its wide body fleet, so what if it's come from other "governments", it is helping the Australian economy.

This is the first time I have publicly written anything about what has been happening lately in the QF saga, I love the airline, I love the iconicness of it, I was in NYC last year and to see a QF B744 was just magic after being away for over a month. But in the hands of some an empire is falling without an end in sight. I just hope we don't have another AN incident and if it did I wonder if fox and leu will pull out in the 11th hour like last time...

[James S.]

Originally Posted by JamesL

Just a few things, ETOPS/EDTO is not a CASA restriction, it is an aircraft certification process that is conducted by either the FAA or EASA in Europe. CASA may set further operator requirements on ETOPS/EDTO flights but the 180 minute rule is stipulated on the aircraft manufacturing certification.

This was done before VA's attempt at Johannesburg.

Originally Posted by Boeing

On December 12, 2011, Boeing received type-design approval from the U.S. Federal Aviation Administration (FAA) for up to 330-minute extended operations for its 777 fleet. This certification applies to the 777-200LR, 777-300ER, 777F and 777-200ER equipped with GE engines.

VA never got approval for anything past 180.

[Ash W]

Originally Posted by Stuart Trevena

Hi All,

Qantas has the aircraft to grow, but they tried to use the wrong type of aircraft for given routes.

Eg. B744 to San Francisco and to Rome.

Routes from Melbourne to San Francisco via Honolulu, Rome via Singapore, Johannesburg via Perth, Mumbai via Singapore, and Vancouver via Auckland are all in Range of an Airbus A330 Aircraft.

There was also a market for flights to Vancouver via HNL ex YMML.

There are more foreign tails at YMML than QF ones.
EK 3 Times Daily
SIA 3 sometimes 4 times Daily
CX 3 Times Daily
MH 3 Times Daily

No wonder QF going down the drain.

Also - I think Qantas has lost the Plot!!

There have been more Uniform Changes over the past 15 years than it needed to be, thus wasting money it doesn't need to waste. Every change in Uniform must cost many millions of dollars, including paying Top Designers thousands to do the work.

If you look at Emirates and Singapore Airlines, their uniforms haven't changed a great deal, if any, while Qantas Uniforms have had major makeovers.

As for the current ad, well that is the worst ad I seen. It doesn't make me want to fly with Qantas at all!! And that was the point of the ad, to bring customers to want to make them fly Qantas.

The whole Qantas board needs to be Sacked for the way they have allowed the Airline to run itself into the ground and also for approving this current ad. Qantas has reduced their overseas network of destinations because of poor choice in buying the wrong type of aircraft, and yet they expect customers to fly with them, when they have cut the very routes customers want to fly to.

In closing, why didn't Qantas buy the B777-200LR??
This could have been a Premium (First, Business and Prem Econ) Long Haul Service Ex YMML and SYD via Perth to LHR - Both ways and also a second LAX service for YMML.

These are my own opinions

Stuart

Whilst an A330 might be able to do AUS-SIN-FCO and various other locations via somewhere else, history shows us that these flights are for the most part nor profitable, even if you can fill the whole aircraft. For double hop flights there is extra hidden costs. There is a good reason why very few airlines these days do them, BA and Virgin Atlantic are now the only European airlines to offer flights to Australia, all other European carries have pulled out, many before the rise of the ME airlines.

As for the 777-200LR, the main problem is it is very much a niche aircraft that Qantas would need very few of. If Qantas had a fleet of 777's, then adding 4 or 5 -LR's would be no issue, but they don't. Again history has shown that the 777 aircraft that would have been use to Qantas came too late for them, so many sit here in hindsite and ask why they never got them.