Category Archives: Airlines

Follow your own Sheep, Airline Style

You do wonder what sort of credentials you need to run an Airline, it is very difficult, in fact it is one of the worse sort of businesses to do business, there are so many factors in the fact that can send you broke on a weekly basis, some can be the changeable climate of the traveling public, others are anything from hijackings to tsunamis, fuel shortages, volcanos, snow, pilot and ground staff strikes, computer catastrophic failures, bad press, engine explosions or the worse of all, the loss of aircraft, passengers and crew.

Airlines as a whole don’t make money, losing it is easy, making it is very difficult, so why do you want to be in this business, because it is glamorous, well maybe yes to a point, some call it the “bus service in the air”, which is a fair comment in todays highly regulated on time service environment, but there is something in that fact as flying is a still a wonderous thing to do even for people who hate it, nothing is more amazing than the fact you can circle half the globe and land within minutes of the scheduled timetable, and within the hours of a 24hour day, Sydney to London, in the time of only one day of your life, and for only $2000.00 is in anyone’s terms  a great deal.

With all these issues to face everyday you would want to minimize your losses by selecting routes that are profitable and useable, but there is a strange fact that sometimes in doing this, all reason goes out of the window, take for instance New Zealand.

Now New Zealand is a pretty country that is somewhere in the low South Pacific Ocean and at last count there was 4,315,800 people residing there, and of that  1,110, 456 of them visited Australia, and from Australia they have in the fact that 1,115,285 of them then returned the favour by going over there.

So that would seem like a pretty big market, plenty for everyone to have a slice of the travelling cake, however if you are in an airline management position this would seem to be a rainbow gold mine just waiting to be dug.

It is but a strange thing happened, for such a small country airlines have been swapping and changing around to the point that it is a lottery to seem which one will be ready for you at the airport when you get there!

Almost all have been non New Zealand Airlines and mostly come from big brother Australia, long forgotten Ansett ruled the roost for years with a massive 30% share of the cake, then Qantas in some form or the other took over the debris when the airline was grounded in 2001 and being renamed Qantas New Zealand, in 2003 Qantas created their successful LCC (low Cost Carrier) offshoot Jetstar which commenced New Zealand operations on the 1 December 2005  to Christchuch (CHC) and on the 10 June 2009 Jetstar commenced domestic New Zealand flights between Auckland, Wellington, Christchurch and Queenstown.

New Zealand has it’s own national airline called Air New Zealand which by all cases in the last decade has been a total basketcase, New Zealand as a market that is so very small for a large legacy carrier that has 6 Boeing 747-400’s always parked under the window, but under the stewardship of Rob Fyfe who was appointed in 2005 the airline has become the one to watch and now covers 27 domestic destinations and 26 international destinations, making money in a creative way which much like Singapore Airlines in Singapore, and in doing so out go the big thirsty B747’s and in come B777’s which are more suited to long thin routes, in other words good management.

Another upstart that tasted the New Zealand gold rush is Virgin Blue, based in Brisbane (BNE) , started in 2000, it had the good fortune in that Ansett dissolved right in front of them and created a market almost overnight, a LCC that was on the hunt soon dominated the Australian low-cost market and in 2003 a subsidiary of Virgin blue, Pacific Blue was heading over the Tasman Sea wanting some of the ready cash.

But in most cases you always found yourself on a Virgin Blue aircraft as the fleet was rotated around to cover the only few Pacific Blue Boeing 737’s flying, and Virgin then thought “well we are over there so why don’t we do domestic New Zealand as well”, well why not, it’s a free world.

So if you wanted a flight from Aussieland to Kiwi Land, then the choice is large, Qantas, Jetstar, Virgin Blue, Pacific Blue and not forgetting Air New Zealand, now on top of all that it is because New Zealand is where it is then most international carriers will terminate their service in either Auckland (AKL) or Christchurch (CHC), and in most case many have 5th freedoms of the air rights, which means that “they have the right to fly between two foreign countries during flights while the flight originates or ends in one’s own country”, so you can sway your way down to Sydney Airport, drop $210.00 into a Emirates passenger ticket and then rumble right along and taste the space and giantness of their double decker bus, the A380, well they are getting 90 of them so why not drop a few on the Trans Tasman route and pick a few shekels moving Australia to New Zealand or vice- versa, 460 seats is a lot to fill, Melbourne’s the same, In Brisbane you can jump on a Singapore Airlines Jet and swan over in style, and not on a cramped B737 or Airbus A320.

If there is then a saturated market it is New Zealand, with only two major ports (AKL/CHC), and as sheep following sheep its getting seriously crowded parking in Auckland with empty planes, so what happens, they lose mountains of money, and it becomes a poker game of who will hold out till the last, all of them holding their breath, fares go to bucket levels, almost coming down to stealing passengers at airports trying to board the competition, and it goes on for years, upping the frequency or adding even more ports (Gold Coast, Cairns) to get a leg over the others…..

So who gave up first…..Virgin Blue/Pacific Blue, “what the hell it’s not worth it”, so they decided that we will put our precious resources somewhere else…and that is?

Perth (PER), the resource boom of shipping the whole of Western Australia to either China or Japan is in full swing and a market just waiting to be exploited, did they learn from losing all that cash in New Zealand, “hell no”, as “thar’s gold in those W.A. Hills”

Virgin Blue decided to ship people over to W.A. wholesale, by buying a couple of large Airbus A330’s and going business class too.

Qantas not to be out done looks around and realises that Jetstar has few loose A332’s available and  so puts them on the same route, Jetstar meanwhile is a regular customer at Perth, so is Singapore  Airlines offshoot Tiger (one Dollar seats) Airlines, Strategic Airlines is also based there, Skywest too, in fact there is 12 domestic airlines based in Perth, and how many people live there?

1,659,000, less than New Zealand, in fact far less than New Zealand, oh and there are a few 5th Rights Carriers passing through there too, suicide!

And on it goes, Sheep following Sheep, Perth has not even been on the map for decades, if you wanted to fly there it cost less to fly to Hong Kong, Japan even, in fact the cheapest way was to fly to Singapore and backtrack to Perth, those were the days, going international to fly to a domestic port?

Soon it will be dollar dazzlers, free meals, face painting to fill empty seats…Suicide.

So here we go, which one will pull out first, Qantas, Nah!, Jetstar, Nah!, Virgin Blue, Nah! too much at stake, Tiger..well maybe but their numbers are low anyway.

So it’s going to be a blood bath, and coming to an airport near you.

Say, there is a good traffic going down to Antarctica, could be on a winner there, seasonal is the only problem, “could you land an Airbus A330 on the ice?”

Sheep following Sheep, Oh by the way Tiger Airlines are going to do a new route……going over the Tasman to New Zealand….

……”oh for Christ’s sake”

British Airways…Bah Humbug! to you too travellers

Its our rights, we want you to listen to us, if not then…we will strike over Christmas..so there!

As 90% of the British Airways cabin crews decide to ruin Christmas for everyone involved, you really do wonder at what they will achieve, more money..probably, better conditions..maybe, being fired, yes every chance in hell of that one…and they deserve to be.

I was brought up during the bitter Miners Strikes of the 70’s that achieved the downfall of the British Industry as we know it, so I don’t sing a Union’s praises.

But if you want to achieve your goals in bargaining the first thing you have to do is have pubic opinion and sympathy to your cause on your side, it’s the biggest chip you can bring to the table, but Unite (union) have already blew that one, pretty well everybody now not only loath’s them (that is not just like but hatred), by doing this again at Christmas to try to leverage their case, It failed, your members will be (have been) booed from every corner of the Aviation Globe including here, this sort of blackmail doesn’t get things fixed anymore but drives a wedge between you and pretty well everybody else and even giving sympathy to British Airways, which in most cases is very hard to do, and worse is the very opposite of what the union is trying to achieve.

Worse is the fact that at this time of the year, and boy what a fun year 2009 was with that Global Financial Crisis thingy, is that the very company you are working for (British Airways) is guzzling money at a rate that sends the CFO home looking like a zombie and putting a shaking drink to his mouth to calm the shakes he gets when he looks at the balance sheets, is the fact that in the season to be jolly is one of the few seasons that you can actually put up your airfares and recover some of the debris, which by some strange factor of twelve x fourteen is paying your wages that you  take home at the end of your shift to feed your families and pay your rent and if anything is left over can buy a present for your hunk of a man (same for gay stewards) to give you a hug and cry on Christmas Morn.

Worse still is the fact that come April the British Airways management will cut you up with a knife with sadly our overwhelming support.

You may have a completely valid reason to strike or ruin Christmas, need to be heard, give your side of the situation as companies can be callous bastards and treat their staff with the same regard as street people and vagrants, but this is not an effective strategy to help your cause, in 1969 yes, in 2009 it is close to murder.

You will gain nothing..and you lose everything.

If you are even close to having even a small brain, you may be able to save your job and meet me again in the cabin of a Boeing 777, if you don’t then it is to your loss next year….Merry Christmas.

Airline passengers are back, so lets get back to work….

Growth, the mantra of any airline business is coming back, the planes are full again and the losses are falling, well not by much, even Singapore Airlines took a reported a net loss of S$159 million ($114.6 million) compared to a net profit of S$324 million a year ago, but that’s good isn’t it…well maybe.

No doubt most all airlines have taken a battering and any news is good news, thank god, but what of Japan Airlines, it is still losing more than ever and is still sinking slowly into the Sea of Japan, Qantas declared a profit before tax of $181 million for the full-year ended 30 June 2009, down 87 per cent on the prior year, but most of that if not all came from its ultra successful Jetstar operations, for the International branch well they don’t want to highlight that portion of the cake.

If you wanted to travel and were one of the few mortals that still had cash or your credit card has some disposable income to dispose of then 2009 was a bumper year for deals and airfares, in fact it was downright amazing, Europe from Australia was only AUS $1600.00, USA AUS $1000.00 or even less, Asia was the same as a few years ago as going to Melbourne to Brisbane, instead it is now Melbourne – Thailand for less, and the Aussies love to travel and the emptynesters have all headed off to Europe, so all in all its been a bonza year, even city hotels have been doing games like “Name your price” for a room and have been filling the discounts with business.

But in all this the result has been good and survivable instead of the downright disaster they were predicting last year, in fact it has been a relatively good year by all accounts, the business sector is next to zero in the planes and in the rooms but the eyes glint of a new tomorrow is when it is certainly going to go back to boom and champagne times of the mid-noughtys.

So the general censorship around the Airline and Hotel boardrooms is “Lets get back to normal”…2010 prices are back to normal and “that is your cricket”…insane profit will be back and we can start those wonderful corporate functions, general freebie’s and tax dodges we missed so much this year and bring them all back again.

There is no doubt that 2009 has been a year of horror to most of the Travel Business, but I love years like this as it gets rid of the free loaders, throw out the over expanded fleets and gets the books back onto an even keel, there is nothing like a good house clear out and general stocktake to make your business feel better, out go the old inefficient planes, fire all the good people who fly or service them, in fact everything that is not useful can go to the tip, and soon the balance sheets will balance and the numbers will stabilise and you are where you are right now thinking “Well it could have been worse, but in fact it worked out for the better in the end”.

“and that brings us back to doe”

I don’t want to throw a bad light on a good moment but…

The general feeling is “well if that GFC was the 1930’s type recession then what were they all complaining about”, we have actually enjoyed our small trip into the deficit and back, in fact we have shopped and travelled like well “no tomorrow”, but the little point not to miss was that the stock exchange did the dive in 1929 but the deepest part of the depression was not until 1932, 3½ years after the sudden shock and awe…why.

The effects are really not felt until the game is played out and people start to run out of savings and cash (or have to cut up their Credit Cards), and the plus point is that all those people who have lost jobs are now lost customers, governments have thrown subsides at anyone who wants them just to keep the economies operating but that has to stop sometime and the above sheer survival of keeping your business afloat by doing he greatest deals of the new century.

So what happens when these three or more things change and you think that things are going so well “its time to put your prices back up”, the effect will be no business and the buoyant optimistic of great profits again will soon go the way of Bernard Madoff, in fact it will be suicidal, the point is Qantas still made a profit of Aus $181 million and shouldn’t get greedy in fact they should be able to hold the fares lower because if they have rationalised  their business correctly then they should be saving  enough to keep the wolf’s from the door, but they won’t…and that will be the worst decision since sub-prime loans debacle.

Worse the huge alliances of Star, OneWorld, Skyteam et all will band together to push tickets higher as noted by Tim Clark of Emirates Airlines recently, Emirates won’t play that game and that is why they are growing successfully more than anyone in the industry, so you will have higher tickets on one hand and no money to spend in the other, in fact the effect of the GFC will be after the GFC has happened and not while it has happened.

So the reality should be “all hands on the wheel”, in that in 2010 if you can get away with not losing and make a very small operating profit then adjust your fares to match and that way you won’t lose customers and keep flying, but they will put the fares through the roof for the USA/European summer, and you will crash, as like mentioned “it’s too much too soon”.

It has been an interesting year, but no doubt 2010 will be even more so, we have a chance revolutionise the Global Travel industry within the next few years, but greed must be not part of the new model, service certainly, lower costs from both sides even more and if the new model works then the profits will follow, but greed will cause disaster as it is a road to nowhere, and at the moment we are at that crossroads.

Ryanair. who is more mad, O’leary or his passengers

ryanair_O’Leary

Ryanair the Irish based LCC has grown 323.4% in the last 10 years which is brilliant stuff in any business never mind the airline business, but I want to believe I really do but something really nags me about the Irish Airline, the sheer gall of its CEO elf Michael O’Leary even makes (look at it!..) Richard Branson look amateurish in his stunts and no doubt it works in getting bums on seats.

His latest “crock o crap” is that if passenger would stand up (IATA would have a heart attack) they can fly free?..brilliant PR stuff and an amazing 66% of passengers said they would?…..for 2 hours on a bumpy plane would you stand in the aisle to get to Romania?

Mr O’Leary already has standing passengers anyway in the fact that (one) you have to pay to use his toilet, (two) he has pulled them all out for more seats and left only one to use!, so his standing passengers is really a queue to go to the loo, plus the fact that if you have a aisle seat there is a good chance that standing by your face waiting to use such facility is some older male person with a personal  bladder problem is holding his crotch to stop the dribble going down his legs…I would want to fly free for that view and in a seat please!

besides this ludicrous situation Michael O’Leary charges you for everything except smiling (including the cabin crew) and crying which you do once all the charges are laid out, another latest idea is for you to take all your hand luggage (no checked luggage, so what does he carry in the hold?) and put it in a holding area when you board or collect when you deplane, can you picture a large Indian Family with all their excess baggage carrying it up stairs and carrying it off again including sacks and trunks and “god knows what”, god help us.

Still we haven’t mentioned that you are treated like herded cattle, abused, hustled around and mostly bumped to another flight and for all of this we smile gracefully and pay up and grit our teeth, so why do we put up with it all…because it is a cheap fare……..compared to what…walking, and worse is that other carriers see this as a trendsetter and want to use this despicable model for their own uses.

So for me it just doesn’t add up, I don’t get it, and there are two reasons (one) Michael O’Leary can get away with murder, because (two) his passengers are bloody idiots for putting up with so much for so long and let him get away with murder, yes we complain and get angry at airports because our wallets have been stripped and there is nowhere to sit (except on the cold floor), we are hungry (no food now, remember that), we are late, and tired…and what do we do, “we’ll fly Ryanair again because it won’t be as bad next time”..doh!

But is the penny about to drop as Ryanair’s latest three month net income is 20 million euros lower, you could say that the economic crisis is the cause, however the airline’s strategy is to find niche airports all over Europe and fill them with a service, and to do so at such an alarming rate that passengers take up the service just because it is there and pay such a low price for doing so, the mayors of such destinations will of course welcome the tourists with open arms and give Mr O’Leary a lot of freedom in costs and infrastructure just to put his wheels on their tarmac that even their own established airlines would benefit from more, but the reason other LCC carriers don’t land here is these destinations are a bit obscure and in time a flood becomes a trickle once the gloss wears off, for Mr O’Leary he just does a better special (lower fares) and fills the planes (goats in the hold?), but you can only go down so far and has Ryanair gone to far in its quest for European domination in having too many slight routes going to too many destinations with not having too many load filling routes with good yield, or the opposite were as on any route that is popular to even take out toilets for seats means that the margins are so slight that every seat counts, even the toilet seat.. it has to be a model for problems if the load factors even drop a smidgen.

And to my unease, it feels like a very on the line, week to week survival stuff, but like an Irish magician Micheal O’Leary just creates an illusion of perfection while frantically cutting or finding another way of getting more cash from his customers, its a bit like a Madoff Ponzi scheme for airlines.

But why do people put up with this?

with the economic crisis I am hoping that some reasoning will come back and people will stop thinking that the cheapest fare is the only benchmark for travelling on an airline because it getting ridiculous to the point of stupidity, passengers should reward airlines that give good service, don’t over book them, allow a fair amount of baggage, have fair airport space and seating, are on time and have good equipment (planes), pay a little more and get a better travelling experience, good airlines will breath a sigh of relief too as their margins will be better to give you a better deal and employ a few more staff, that would be a better service, certainly better than Ryanair but until then if the option is there… then take the train, at least you can use the toilet….for free.



Dubai…Still growing in the Airline Market

Dubai-Airport-Emirates

East to West was always a backwater business for the Airlines except for Singapore Airlines, British Airways and Qantas that ruled their golden Kangaroo Route treasure trove with piratical glee for as the real money was over the pond from Europe to the Good Olde USofA, but now suddenly the world has changed mainly with our Globalisation of the planet in that we are now all one world and not the just in the Western hemisphere of doing business, in this process with the opening of up China and its Tiger States the traveller is also changing the the way they see the world and move around it in business and pleasure as it is now East and West.

The old hub of Singapore today has real competition from the cashed up Gulf states that are changing the type of route you would fly East to West or Europe to Asia or vise-versa, it was once only Via SIN (Singapore) or HKG (Hong Kong) and BKK (Bangkok (a British Airways favorite)), Now in the last few years SEO (Seoul) put a foot in the door and so does NRT (Narita Japan).

but now more and more you can jump from Asia Via DBX (Dubai), in fact it is quite a hub, as you if you desire by flying into this gulf state you can suddenly fly straight to Canada or to Brazil or pretty much anywhere which is the expanding vision of Tim Clark Emirates Airlines chief designer of conquering the world from the air.

And it changes the rules so completely and so differently that it will change the way we travel and why, and it is also a gamble of such immense proportions that if it doesn’t come off it could bankrupt a country, a small country but a country never the less, and too make the gamble even harder Dubai’s next door neighbour Abu Dhabi’s Etihad has exactly the same idea and so does Bahrain with its Airline Gulf Air.

Who will win, all of them but Emirates will still be the one with most to gain with its global domination of its order of 58 Airbus A380 mega jets, in fact the plan is for these huge machines to circle the world constantly like satellites carrying passengers to destinations with Dubai as their hub and a stopover which means any travel from East to West will mostly in 10 years time move you through one these of the Gulf states and its pleasure Kingdoms, Etihad will in time join Emirates and not compete directly as a turf war would not be in the best interest of both states but instead create a bigger hub for all to share the foils of passing trade, just like they did in the old days of the desert caravans, for the older hubs like Singapore already the effects are showing, as Hong Kong is already 12.7% down (May 09) which you would put down to the crisis but Dubai after an initial downturn is already 7% ahead of last year with five new carriers starting services and a new local LCC (Low Cost Carrier) flydubai making its debut..and Oh they want your Cargo Business as well!

Dubai (6th busiest) will also overtake Singapore (Changi) in the Airport rankings this year with Hong Kong next on the list to which you would reply that the SAR was hurt badly by H1N1 flu virus and the Asian recession but also that it is tied to the fortunes of Cathay Pacific Airlines (49% of capacity) which is 6.7% down were as Dubai has Emirates (58.4% of capacity) charging into the future as if there was no tomorrow.

The economic crisis has of course put a major knife through the overall plan, but strangely in an odd way will save it as that the building fever was going overboard with bigger and bigger plans and crazier ideas fronting the Dubai planning committees, some are quite breathtaking in their execution and many will not (should not) survive the downturn, If 58 Airbus giants is not enough then what of a Underwater Hotel, Sports City, Pleasure Cities, The World, The Palms, Dubai Pearl not to mention Burj Dubai monster that at the top you can see London, most are already done or are near completion, but a little slowdown could allow the guardians of the desert to smooth out the edges a little, as it seems now a bit like a huge building sandbox that is not really a mirage in the desert type picture that will really draw the hoards they want, plus the fact that Airbus can only build 14 to 20 planes a year means that a little time would be good and if not for a better plan than pushing everything to open in 2012.

In fact the idea is that Dubai will be a world hub, a global hub for nomads and travellers passing through and spending a shekel on the way, an attraction of pleasure like Las Vegas or Orlando to visit and play in, its a big idea, a huge gamble and its very brave but it won’t happen yet, in fact it will take 10 years before it becomes the dream destination that the Emirati are working towards as for the danger is the economic problems facing the world are more challenging and harder than anyone will expect, but there is no doubt that if you travel from Australia or Asia to Europe in five years you will be able stay underwater, ski the slopes, stand on the highest point of a man made building, shop till you drop, play on the best Golf Courses, do any type of sport you desire or see a concert of your favorite artist then Dubai will be your destination on your way to somewhere else, in fact you may not want to even go anywhere else as the those smart business people in the desert will have have everything you want…..for a shekel or two of course.


How Long Can This Go On….Low Airfares

Sale Case

The losses are huge, big, enormous and it has hit every corner of the Travel Market and still it hurts, for the airlines it is Judgement day but for how long?

When Singapore Airlines are doing European specials you know life is bad, People will pay a premium to fly the smile high club so what hope is there for anyone else, British Airways have quickly dropped their premium route fare to nothing just to survive with an AUS$1444.00 fare SYD/LON, so Qantas will have to match that and these three airlines have been the big hitters on this route for decades so for them to drop it has to be the very last resort.

For Qantas their other Premium route SYD/LAX (los Angeles), has been decimated by V Australia’s close to as possible $1000.00 return fares, with United chopping fares as well for market share its going to be banging heads on the table in the offices at Mascot and not before time.

And suddenly as a break into a new market, Delta has already dealt in a sword in the ground deal of  AUD$982.00 from Syd with Air New Zealand’s counter offer of AUD $889.00 (including taxes) from Coolangatta is near as damn soil cheap as you can get.

This is a snapshot of just one aviation market in Oceania/Asia and it is being repeated though out many other markets in every part of the globe, the good side is that it has leveled fares that were overpriced on monopolised routes, Qantas’s SYD/LAX route fare $2000.00 was quite simply Sheriff of Nottingham territory and to have it halved showed the bonuses that flowed though the doors of the Geoff Dixon era, economic crisis or not that still had to happen.

So we are in the shit, so to speak and the few cashed up travellers are having a boom time, it can’t last and it won’t but it will not be all bad news.

The cheap fares are there because most Airlines are over productive with too many planes and the staff that runs them, as the airlines shred older inefficient aircraft they will create a newer tighter business, staff will go because you are not going to go and pickup and then go back to normal when the economy picks up again, today you need to be lean and efficient, and a good old shake out of the mattress will help the restructuring of almost every aspect of the Aviation Business so you can now throw out the old model and send in with the new as for the first time in its history except with a few bumps aviation is faced without its stunning growth year after year and so like any other business it will have to adapt to the current climate changes.

The cheap fares will last this year  but for the rest it should settle back down again which means many fares will rise as they have too because.

1. Airline restructuring will be completed.

2. Airlines are not public services they have to make money, break even at least.

That is the bad news…the good news is they won’t go nowhere near the old prices or will again, this is the new new for the business so SYD/LON should level out at AUS$1600-$1800 and SYD/LAX about AUS$1200 – $1300 which is still brilliant value, most domestic traffic will not push those AUS$1 a seat deals t0o hard and put on an average of AUS$20 per ticket price per sector, really low LCC (Low Cost Carriers) will have to improve their bottom lines as the likes of Ryanair (I’ll charge you), Easyjet et all, will not find profit in expansive growth anymore and will have to fall to the realities of the a real business model, and this is all in cattle class as even more changes will come in business class, but these prices do still depend on very stable Fuel costs going into 2010, if they rise then so will the fares by another 5% to 10%.

The only growth area will be in the International LCC (Low Cost Carriers), many have already failed in this new dimension to travel, but some pioneers are paving the trail like AirAsia and Jestar International but once the model is proven many others will quickly come abroad but don’t expect really stupid low international fares here, they will be cheaper than normal route fares but these carriers will want to survive and there is a boundary limit to how far down you can go down with fares as international travel is a completely different model to domestic and short haul travel (European) as you need infrastructure and personal at the other end of the route.

Another factor if it comes to pass is that many countries like Australia are being pressured to drop or reduce their heavy outbound and inbound airport taxes to encourage more traffic, and its these expensive government add-ons that can really make a biggest difference to an airfare price,and that is even domestically and should be curtailed as why should be the airlines that always have to shoulder the costs, these little termites are in many countries a bigger cancer than anything in a good tourism market and if the governments are scared of lost revenue then that is not the case as visitors will still spend more in the country if they are not robbed at the entry point.

..At the moment fares are too cheap and unsustainable and how long they will last is not very long, my guess is the Christmas/New Year 09 period and will not be as severely discounted going into 2010 as they were in 2009 and maybe a few excellent specials will still crop up in the traditionally really low periods, say March and Oct/Nov next year, so with an economic crisis or not airlines will not survive unless they do so, there is also a chance they could even rise sooner to stop the bleeding quicker and once one large influential carrier does so the rest will quickly follow, so the real push from next year for your dollar will be in super economy class with more leg room and better service and higher profitable fares for the carrier, the deals will be there but they will expect you to pay more for them so you win and you lose at the same time.

So if your going to fly on the cheap then fly now..and book quickly because fares will rise, but not enough to break your credit card limit…….

Updated 18th Nov 2009…..
I noted in the above issue that the fare to Europe would be AUS$1600.00 – $1800.00, the recent Fares for early 2010 are AUS$1685.00, and will be basically around AUS$1750.00 late 2010, but we are having the problem of very high fares coming  (USA/European Summer) to try to pull back some profit see current issue Airline passengers are back-so lets get back to work, as this is a cash in to pull back profit it won’t work except maybe in the early (May/June 2010) period, but it will scare more away than bring passengers back into their seats….

V Australia..About time?

Let the Pacific war begin

Let the Pacific war begin

V Australia in their opening up of the Pacific Routes from a monopoly which will have the greatest impact on Australian Aviation since Virgin Blue created the lower prices that stayed around for more than a few months (Impulse, Compass) , and will give Tourism Australia finally a reason to smile, Protectionism of this immensely profitable route will be a real head holding time for Qantas at Mascot, but the reality is Qantas has been a real thorn in the side of Australian Tourism in its approach of profitability on the Pacific Routes both ways, and shows that overly protecting a national Icon can really hurt the the very thing it upholds.

I was far more expensive to fly to Los Angeles and San Francisco than to go to London or Paris, with these gateway costs so high, a return fare to New York was astronomical, it was cheaper to get a around the world ticket than have a return fare to NYC, or fly to London and go across the Atlantic then return was the same price, in other words it was ridiculous.

Qantas has held the country to ransom and knew what it was doing, and the Politicians in Canberra are to take most of the blame in letting the Airline do so. Tourism Australia should have also banged it’s drum far louder than it did and showed more in its mettle in doing what was right and not what monopoly’s can get away with, but Australia has a history of such head in the sand approach, its Two Airline agreement reigned for years until it was finally buried.. again to the benefit of Qantas but not so to Ansett which went south, but since the demise of the policy the local Australian Aviation has thrived like no other with excellent LCC carriers and good fares, And Qantas even benefited too as Jetstar has been a success they could only dream of..

So why get in such a lava over all of this, well not only did Australians pay way over barrier than what they should like in the Two Airline Policy days, but In that it also made Australia a very expensive country to visit, it is far enough away from prime travel markets as it is, but this was keeping arrivals at far lower levels than they should have been and certainly for years and years this has cost Australian Tourism millions and millions in lost revenue to give Qantas a few extra bucks in the bank, in fact Qantas should apologise for its behaviour and give the Australian Traveller a better deal to make up for all its callousness and greed.

Qantas finally only when forced has the Airline has finally dropped its prices from Aus$ 2000 + to around $1200.00 return to counter V Australia’s prices to date of average $1199.00,(both include taxes) that is in some cases a $850.00 drop (or Profit which ever way you look at it), that is a big drop by any Airline standards, but the benefits for the country will now certainly be apparent, but is it a little too late, today with the economic crisis going at full speed the Americans don’t anymore have the spare cash to pop downunder, one benefit though is the exchange rate is well balanced in the USofA’s favour making Australia an excellent value destination, and it almost always tops the most “I want to go there” lists, But for Australians its a bugger of a bad deal, offset only by the cheaper fare.

Qantas has another problem is the 777’s V Australia is using is very competitive on the routes, only the newly minted A380 Airbus’s came just in time to save the day in efficiency and high load factors, Virgin’s product is usually very good too, there are always accolades on their service and the niceys they throw around, if Qantas only had their 747.400’s still running the line, Qantas would have had a small disaster on their hands, old equipment, old service, expensive to run over the same distance, the Airline would have lost money on every takeoff from Mascot if they had matched the new prices, the only saving grace would have been lower fuel costs, but even that would have helped V Australia more than Qantas..

LA – Sydney is first on the 27th February, Followed by LA-Brisbane April 8th, LA-Melbourne Follows in September, worse for Qantas is the Sydney – Johannesburg SA routes have also been applied for, another cash cow gone, so is all of this fair to Qantas?

The answer is no, they should have rationalised the routes years ago, they have to do it now because they simply have too, if the fares had been fair there would have been no competition needed to show the discrepancy of the high fares people have been paying, Qantas will of course state this or that reason of why the fare were slated so high, but the real reason is two fold, inefficient equipment and good profit, now they will be well behind the ball mostly on the Aus-SA route, with the Boeing 787 coming in sometime in the never never.

There is no doubt it will be a tough year for the boys at Mascot, but for everyone else and mostly for the country it should give V Australia a helping hand in doing something Qantas should have done years ago, give the country and its tourism industry a fair go price wise to one of the worlds largest travel markets, so …good onya mate!


1.52