QF in the poo.....or is it really

[cowpatz]

Not quite NZ aviation but close enough.
Interesting to see Joyce crying foul and that QF need to shed 5000 staff to remain profitable. Really?
Some things to ponder......
Joyce hates the restraint of the "Sale of Qantas act". This act maintains the airline as an Australian asset and limits the amount of foreign investment.
How to get around it?...start up a no frills airline that the parent company subsidises. Give it all your profitable routes to fly and allow it to bleed the parent company dry.
Accelerate the downfall by redirecting any fuel efficient new aircraft that QF were to get to Jetstar (787).
What will all this achieve?
Well first up Joyce is now openly stating that QF needs foreign investment or it will fail. He has cunningly set up 'stand alone' Jetstar operations in Asia and NZ. Jetstar Asia has required huge capital injections. He will get his scrapping of the act unless the few senators that are on to him can convince the others that this is a bad move.
Secondly he gets to shed 5000 jobs and restructure. New contracts on significantly reduced salaries and conditions. Get rid of those pesky unions. What good are they anyway? Who needs time at home with the family and an adequate income to support them?
Thirdly once the fear is entrenched within Qantas start inferring that same thing needs to happen to Jetstar to 'maintain it's competitive edge no frills edge'. Remember in Jetstar NZ you don't need downtime to eat a meal or take a break as it spoils the yield for a low cost airline model. Yep you heard that right. In a day you could pound up and down the country through a front, shoot 6 approaches to minima in shitty conditions and still not be entitled to a break. Thankfully a judge saw through that one. Recall the Feudal system anyone?
This is where the low cost no frills model is taking aviation. The only way to increase yield is by market share (which is saturated and means an increase in yield in one airline will be at the expense of others). This will result in cuts to the cost base. Salaries, conditions and increased risk taking (read safety) being the traditional ones. A never ending race to the bottom of the barrel.

QF are to ground all their Q300 operations. How seriously mismanaged must an airline be to not make money out of a Q300?

Will there be opposition and a backlash to these cuts. Yes. Have will Qantas management cope with that and the resultant losses. Easy.......... a AU$3.4 Billion dollar cash reserve war chest.
That's right this airline which lost $300m in 6 months has $3.4 billon in cash reserve.
Now if we do the maths and add the profit that Jetsar makes and subtract the losses that QF is making you end up with basically the profit that QF used to make prior Jetstar's existance.

Ah isn't neo liberalism a wonderful thing...................

[ardypilot]

Where has it been announced that the Q300's are to be grounded? Can't see the Feb 27th release on the QF News Room page yet?

[Charl]

I Googled Alan Joyce:
The Wikipedia entry was brief and to the point:

"Alan Joseph Joyce''' (born 30 June 1966) is completely incompetent. He is the Chief Executive Officer (CEO) of the Australian airline Qantas."

30 seconds later I went back to copy the quote and it said:

"Alan Joseph Joyce (born 30 June 1966) is an Irish-born Australian[2] businessman. He is the Chief Executive Officer (CEO) of the Australian airline Qantas Airways Limited."

Mmm there is a war on the go, over on the West Island.

Joyce represents what is known as the Ugly Face of Capitalism (Tough Irish Version).
When Unions go ballistic and paralyse a country, it is often in response to people like Mr. Joyce.
I bet he will get a $10million end-of-contract performance bonus.

[ardypilot]

[Ian Warren]

Nice one Andy looks about right from what I saw on the news last night .

[cowpatz]

QUOTE (Trolly @ Feb 27 2014,11:25 AM) <{POST_SNAPBACK}>

Where has it been announced that the Q300's are to be grounded? Can't see the Feb 27th release on the QF News Room page yet?

It is not announced yet.

[cowpatz]

From the Australian today 28th Feb
Says it all really except for that the fact that barring the odd balls up this was all deliberately orchestrated over a 5 year industrial odessy. A means to an end.
Senator Xenophon (Don't you just love that name?) is on to it.

THE one thing I can say that is in any way complimentary about Alan Joyce is that he possesses a hide so thick it is beyond belief. As I listened to his words in yesterday’s press conference, I felt profoundly sad. Here was the chief executive of a great Australian company calmly announcing a dreadful set of numbers. The true story of how and why Qantas has descended to the very bottom of the aviation pit was not even mentioned in passing. Joyce takes no responsibility. There was no apology for a failure of leadership on a grand scale. The massive losses made by a series of hopeless mistakes in Asia are not part of the public discourse. If this was an exercise in demonstrating to the government that Qantas was getting its house in order so some form of largesse could be distributed, I sincerely hope that it meets the most ignominious of ends.
Whatever happened to the concept of honour and dignity as it is applied in business? Very few chief executives can boast they have succeeded in driving down profits to historic lows and driving down the share price to levels no investor could have ever contemplated. This bloke has presided over a corporate disaster, but acts like he is a man of courage.
If Joyce had any real courage, he would have announced his resignation. If Leigh Clifford and his fellow board members had been prepared to admit that they had backed every dud idea their CEO had put forward, they, too, would have fallen on their swords.
When Joyce closed down the airline a year or two ago, he was lauded by the HR Nichols set as an industrial hero. Here was a man prepared to take on the Transport Workers Union. No matter that he trashed the airline’s reputation on a world scale! If you were a passenger who had boarded your flight to Australia in Los Angeles, and had been left stranded on the tarmac for hours before being told to get off and make other arrangements, I wonder if you would throw rose petals or something of a different odour at Alan Joyce. Qantas is fast becoming a basket-case, and I was sickened to watch a press conference that was merely a pathetic exercise in obfuscation and arse-covering.
Why would there need to be more than a hundred corporate entities for Jetstar’s various names and operations throughout Asia? Clearly, the Jetstar invasion of our northern neighbours has gone horribly wrong. Hundreds of millions of dollars have been lost with barely an acknowledgment anything is amiss. Joyce came from Jetstar five years ago and is a relentless promoter of its expansion. A weak board had meekly acquiesced to this Asian mess.
Independent South Australian senator Nick Xenophon has taken a particular interest in Qantas in recent years. He has made some serious allegations about the way the airline does business. No attempt was made by the Qantas CEO or the chairman to publicly debunk them.
If it is true Jetstar wanted to base an operation in Hong Kong and then bought aircraft to fly passengers for that operation without first getting the OK from the Chinese authorities, a huge and expensive error has been made. If it is true 11 planes are sitting on the tarmac in Toulouse at a cost of $400,000 a plane a month, then Qantas will bleed more than $50m a year for no result. Why wasn’t this allegation covered at the press conference?
Xenophon also alleges that he has been told by Qantas engineers planes are frequently transferred from Jetstar to Qantas domestic operations just before very costly servicing is due. Again, this is a very serious allegation and if it is untrue you would expect that Joyce, not known as a shrinking violet when it comes to talking to the media, would have taken the opportunities at a press conference guaranteed to get saturation coverage. In addition to what Xenophon has said, it is blatantly obvious Qantas remains profitable domestically. Two out of every three journeys in Australia are on Qantas aircraft. They make a squillion here and manage to blow all that and hundreds of millions more every year on their international business. And we still don’t know why.
Apparently, there is no price to pay for incompetence at the highest levels of this once great airline. The price here is paid by the innocent, not the guilty. Five thousand employees will lose their jobs. Five thousand families will face an uncertain future through no fault of their own. I cannot fathom how sacking this many staff will restore the financial health of the company. It is simply not possible to carry out a scorched-earth policy like this without affecting service standards, and when you provide a lesser service you get a lesser number of punters prepared to stick with you.
Qantas has already stretched customer loyalty to breaking point and there must be a good chance that this announcement may push that loyalty over the edge. I sincerely hope that as Tony Abbott and Joe Hockey ponder the wisdom of extending a bank guarantee of some sort to Qantas they are not found guilty of providing an atavistic, conservative response. If all they can do is give this exercise a tick because thousands of workers’ jobs will hit the fence then they will completely abrogate their responsibilities. Having knocked back SPC Ardmona, the eyes of the world will be upon them as they announce their decision on extending assistance to Qantas.
Australians actually care about Qantas. They do not believe it should be sold off to foreign interests. They want so see this most iconic of Australian brands restored to its former glory and they will not thank the government for supporting the airline without some basic conditions.
At the very minimum, there will need to be a demand for the chief executive to do the decent, honourable thing and resign. The government must also insist on a revamped board committed to questioning management recommendations rather than just accepting them.
We should all be greatly saddened that our favourite airline is headed for the rocks. The hard decision still to be made is to ensure that the 5001st job to go is brought forward. Alan Joyce and the board must be forced to resign because they lack the courage to face their own failures.
Stop blaming the troops and turn your eyes to the generals.

[jastheace]

Qantas has been on a downward slope for some time, it is sad to see it happen, i for the life of me, cannot see sound reasoning in delaying or cancelling aircraft, as they did with the 787's, Qantas cancelled a lot of aircraft but kept options, to me the purchase or lease of fuel efficient aircraft would be a priority given that Joyce keeps going on about the cost of fuel. second he did a lot of damage to the brand with he whole union/employee relations in the last few years. Qantas has been going on about how it is an uneven playing field with virgin and that virgin has an unfair advantage, that maybe true for financing, but the costs to virgin, i would expect, would be the same, fuel, airport charges etc would be the same. staff is cheaper, but then virgin has seemed to be better at dealing with their staff and getting the staff on side, rather than the Joyce take it or i will shut down the airline until you all bend to my will attitude. mean whilst it has been said that Qantas may sell of Jetstar and the Frequent Flyer program, why would you want to sell the most profitable part of your business? doesn't make sense to me

fixing the mess Qantas is in is going to take a lot of time and hard work, and personally i don't think Joyce is the man for the job.

getting off my soapbox now

[SA227]

Brings back memories of Brierleys and Air NZ. Raped and pillaged the place then disappeared.
Use to erk me writing out FOC tickets for certain board members friends under the guise of "consultants"

[Ian Warren]

Arr Governments, Bean Counters and the CEOs and the extra special political BUTT kissers and... how they really muck the world up these days ...

[cowpatz]

QUOTE (Trolly @ Feb 27 2014,11:25 AM) <{POST_SNAPBACK}>

Where has it been announced that the Q300's are to be grounded? Can't see the Feb 27th release on the QF News Room page yet?

It appears that the initial strategy was to ground all of the -220 and -300's but it is now to be a severe route pruning. This makes more sense as why would you want to cancel out your domestic feeder aircraft?
It really would not surprise me at all to read the NZ Herald one morning to find that the QF CEO has been found dead with a bullet hole in the back of his head. Feelings there are running very high and with 5000 specialised jobs down the road there is bound to be one worker there with a "US postal worker" gripe. I hope his AU$5.1 million salary gives him piece of mind.

Did anyone watch the doco "mind the gap" on TV2 the other night. It was a repeat but it is very good and really hits the nail on the head as to what is wrong with current economic thinking and practice. This QF saga fits in with this very well.