Great result for Air New Zealand

[beagle]

tvnz.co.nz/business-news/air-nz-defies-global-trend-announces-record-result-5852662

pity about QANTAS, but who cares.

[Andy Wright]

I do.

Care factor for ANZ runs a close second followed by BA.

[jonesy]

The repercussions over here will be huge. Its enough that the local manufacturing industry is winding down with huge job losses, but that the national carrier which seems to be run fairly ineptly will be shedding a whole lot more. I'm no industry expert by any means, but it seems to me that Qantas has a lot more competition over here by cut-throat operators and its really hurting them. Really feel for the hard-working employees caught in the middle...

[kiwithrottlejockey]

(click on the picture to read the news story)

[Peter Lewis]

Given the hardball take-no-prisoners game that Qantas has traditionally played in the airline world, I too have little sympathy.

[nuuumannn]

It's a cut-throat industry and you have to play hard-ball in order to get ahead. Air NZ got to where it is because of some real smart thinking and strategic decisions, and I can say that it too, has had to do the hard-ball thing. Look at the US airlines, almost all of the big ones are under Chapter 11 at the moment - it's tough out there. Alan Joyce has had to make some real difficult decisions and his vision of Qantas might not be to everyone's liking, but it is a strategic one that has a lot of merit. There is obviously more to do with why the company is doing badly financially than what we know, but the Australian market is a very different one to the NZ one; employment laws and the impact of unions is very different over there, there are more operators, much more international competition etc, a lot to consider, not to forget the rising cost of fuel, fluctuating demand based on world events, natural disasters etc. It's easy for the public to criticise companies like Qantas and Air NZ, but you gotta do what you can to survive in business.

[haughtney1]

QF are the victim of their own inept management strategy, Air NZ seem to be pretty well run, I just hope they have to face a bit more competition on certain routes….have you seen the AKL-PER fare? holy hole in the wallet batman!

[Peter Lewis]

The original problems with Qantas (and Air New Zealand, British Airways, Swissair . . .) dates back to the days when they were Government airlines.

At that time they were totally protected from competition.
It was actually illegal, in NZ, to charge less of an air fare than what the Government airline was charging. You could be had up in court and fined.
Thus management could wander around among the staff, say "How much do you want to be paid", add up the total costs, divide by the number of seats/flights, and that was the fare that the captive public was required to pay.

If all else failed, the managers could sleep well at night secure in the knowledge that, should disaster strike, the taxpayer would be bail them out.

When all of these Government airlines were privatized, there were of course many staff who had been there in the bad old days and who could not accept that times had changed.

How they have fared since privatization has depended a lot on how fast the culture within the airline has caught up with the new reality.

Qantas (as with the driver behind the NAC/ANZ merger) has used the internal Australian flights as a cash cow to fund the international flights, which faced a lot more inter-airline competition.

Now, with Virgin, they can no longer do that.

[nuuumannn]

I understand your line of thought, Peter, but I can assure you that things have come a loooong way since then - they have had to. Since privatisation, airlines have had to work harder to justify their existence - literally. The business with Virgin is designed to take bums on seats from Qantas, that's what business is about, to do better than your competition and to provide a better service to your customers.

As for using domestic/regional as a cash cow or even vice versa; show me an international airline in the same position that doesn't? Failure of airlines (like Qantas) come down to management and external influence - lots of different immediate factors; the past approach under government legistlation has nothing to do with it.

[bigal]

At that time they were totally protected from competition.
It was actually illegal, in NZ, to charge less of an air fare than what the Government airline was charging. You could be had up in court and fined.
Thus management could wander around among the staff, say "How much do you want to be paid", add up the total costs, divide by the number of seats/flights, and that was the fare that the captive public was required to pay.

If all else failed, the managers could sleep well at night secure in the knowledge that, should disaster strike, the taxpayer would be bail them out.

Nothing has changed in some parts of the civil service, the above is a good description of how caa operate except instead of the taxpayer it is aviation industry and sport aviation thats shafted time and time again.