TAA/Ansett situation back ?

[777]

• Qantas could delay Virgin float
  October 16, 2003 - 8:05PM
  
  Qantas Airways Ltd's decision to set up a low cost airline could delay the float of Richard Branson's Virgin Blue Airlines Pty Ltd by three months, according to analysts.
  
  Australia's biggest airline revealed its directors had approved the establishment of a discount domestic airline to take on Virgin Blue, with the new operation to be launched next May.
  
  The announcement came just a few months before the partial float of Virgin Blue, loosely touted for the end of this year, and analysts said Virgin Blue could now be forced to rethink competition risks associated with the public offer.
  
  "It probably pushes out the timing of what was already going to be a very accelerated float beyond Christmas (and) puts it probably late in the first quarter of next year at best," said Peter Harbison, managing director of research firm the Centre for Asia Pacific Aviation.
  
  "The slender chance of getting it done before Christmas is probably knocked on the head by this."
  
  He added the timing of the float was not critical, given Virgin was already cashflow positive and did not urgently need to raise new capital.
  
  Shaw Stockbroking research director Scott Marshall said the news would impact the Virgin Blue's operations, and float, but not necessarily delay it.
  
  "If the current prospectus assumes 30 per cent market share, then there will possibly be not a lot of impact on the Virgin forecasts," he said.
  
  Virgin Blue's share of the domestic market is nearing 30 per cent, Mr Marshall said, a threshold Qantas does not want to see crossed.
  
  "The only reason Qantas would launch a discount airline is to offer an alternative to Virgin, so yes of course it would have an impact on Virgin," he said.
  
  "It's more a matter of how to establish the discount airline without impacting the rest of Qantas."
  
  Virgin Blue spokesman David Huttner said: "If they are trying to imitate us, we appreciate the recognition that we have the much more sustainable business model.
  
  "If Qantas believe that this would have any impact on our float plans they will be disappointed."
  
  Qantas chief executive Geoff Dixon said the new carrier had nothing to do with the float of Virgin Blue.
  
  "I can assure you that the board of Qantas and the management of Qantas don't sit down and make decisions just to try to spoil the float of another company," he said.
  
  "The Age"

  When I lived in Australia in the 70's, the most important airlines were:
  
  Qantas = international flights
  TAA = domestic flights, state(federal) owned
  Ansett = domestic flights, privately owned (Mr.Ansett)
  
  The domestic flights shedules were looking very strange to foreign people.
  
  Every time there was a TAA flight to a destination , five minutes earlier or later
  there was also an Ansett flight.
  The point was to protect a free choice market.
  But economically is was quite bizare, but petrol prices were low.
  
  Now Qantas seems to want to return to a similar situation with Virgin Blue.
  
  Andre

[Lame]

Just to update this.

Yes, you are correct about what happened from the 1960s to 1990s.

And yes it is getting back to that now, with Qantas and Virgin Blue, but with MUCH lower prices for tickets than before.

Qantas are going ahead with their low cost carrier this year, with a fleet of Airbus A320s, however the Virgin Blue float HAS happened, and it was VERY successful.

[TWA]

Hope Quantas will be succesfull in this battle.
BTW there is more than enough room for 2.

TWA

[Lame]

Although I do not really mind, some Australians get VERY upset when you spell QANTAS the way you did.

It is an acronym, for Queensland And Northern Territory Aerial Services.

There is NO "U".

Qantas will be okay, however Virgin Blue now have some 30% of the domestic market, and are going international soon too, as Pacific Blue, which will hurt Qantas and Air New Zealand.

There are all sorts of rumours about another domestic carrier, but none have started yet.