RedQ firms as name for Qantas's new premium airline in Asia

[Mike P 0]

KL best for Qantas hub: Tony

 

0 comments

 

 

SYDNEY: Australian airline Qantas should base its Asian operations in Malaysia rather than Singapore if it is serious about expanding in the region, AirAsia chief Tony Fernandes said Wednesday.

 

Qantas CEO and managing director, Alan Joyce, addresses the Australian Tourism Export Council (ATEC) conference in Sydney on December 7, 2011. Joyce apologised for grounding the carrier's entire fleet in October ahead of a planned staff lockout, saying he knows it hurt the tourism industry. AFP photo.

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Fernandes, who is in talks with Qantas and Malaysia Airlines on a three-way alliance, told The Australian Financial Review that a Qantas operation based in Kuala Lumpur would be the stronger option.

“Singapore is the better business hub for sure, but the majority of Singapore traffic is transit traffic — just like Dubai,” he said.

“Whether you connect in KL or Singapore, the key is connectivity.” Qantas in August announced plans to establish a joint-venture premium airline in Asia as it repositions itself within the industry’s fastest-growing region and seeks to turn around its loss-making international arm.

Talks were reported to be on the backburner given uncertainty over global economic conditions and volatile fuel prices, but Qantas said Monday that they were ongoing, with Kuala Lumpur and Singapore the most likely potential bases.

Fernandes, who over the past decade has revived Malaysia-based AirAsia to turn it into Asia’s biggest budget carrier, said Qantas would have lower costs if it chose Kuala Lumpur.

“The main thing is cost saving, avoiding wasteful competition,” he said.

Qantas chief Alan Joyce wants the Australian carrier to have, within five years, a hub in Asia feeding traffic into Qantas and budget offshoot Jetstar’s networks.

“Our aim is to position ourselves within the Southeast Asian marketplace in advance of planned aviation liberalisation,” Joyce said Monday.

“This is how we will end the disadvantage of being an end-of-the-line carrier.” Fernandes refused to comment on the status of talks with Qantas.

The announcement in August of Qantas plans to establish a premium Asian airline sparked a fierce backlash from unions concerned at the outsourcing of jobs, which culminated in the carrier grounding its entire fleet in October.

The government’s industrial relations umpire was forced to step in and, with unions representing pilots, engineers and ground staff unable to resolve their disagreements with the airline, the dispute is now headed to arbitration.

 

 

Read more: KL best for Qantas hub: Tony - Latest - New Straits Times http://www.nst.com.my/latest/kl-best-for-qantas-hub-tony-1.19206#ixzz1gTlWeq9j

[BC Tam 2]

“The main thing is cost saving, avoiding wasteful competition,” he said.

There, you've heard it from dah-man

Now prepare to pay more

[flee 5]

Really don't know why we are nit picking on "wasteful competition"? I think that in other industries, we seldom see head on competition. Even aircraft manufacturers like Boeing and Airbus do not compete head on - their products tend to be complementary. There is not much point in reinventing the wheel.

 

Healthy competition allows customers to have a choice of a wide variety of different products, not same old products made by different competing manufacturers.

[BC Tam 2]

I think that in other industries, we seldom see head on competition. Even aircraft manufacturers like Boeing and Airbus do not compete head on .....

Manufacturers A & B not competing head on ?!

Perhaps Mr Leahy has had a cushier job than he has led us to believe all this while

What other industries do you have in mind ? Successful ones that is

[V Wong 0]

TF's mantra for AK was it thrives on competition , when MH was blocking its new routes....

[flee 5]

Manufacturers A & B not competing head on ?!

Perhaps Mr Leahy has had a cushier job than he has led us to believe all this while

What other industries do you have in mind ? Successful ones that is

E.g.

Airbus A380 does not compete with B747-8

Airbus A330 does not compete with B777 or B787 - all three aircraft have unique capabilities

A320 family and B737 family comes closest to head on competition. But even then pax and cargo capacities as well as range are slightly different.

 

TF's mantra for AK was it thrives on competition , when MH was blocking its new routes....

Yes, they are still competing, not against MAS but with Jetstar, Scoot, and other non-Malaysian airlines.

 

I think that not competing with MAS is their idea of serving "national interest"!

[Waiping 12]

E.g.

Airbus A380 does not compete with B747-8

Airbus A330 does not compete with B777 or B787 - all three aircraft have unique capabilities

A320 family and B737 family comes closest to head on competition. But even then pax and cargo capacities as well as range are slightly different.

 

Interesting thought, Flee. Just my take on the case but do correct me if I am wrong.

 

I think A380 was somewhat inspired by the B747 instead of competing with B787. Airbus was selling the idea that the future should be long distance direct whereas Boeing was selling the idea differently, that hub and spoke was the way to go. Hence the different product that came out. The B777 should be in competition with A330 because prior to that don't think there is any airframe that can "compete" with Airbus in that segment i.e. pax, load, distance etc. No doubt in terms of product they may not be directly competing since they offer different specs than each other, but there is no way they would not consider each other not a threat.

 

Like cars Honda City vs Toyota Vios, Honda Accord vs Toyota Camry etc.

 

Just like Nikon and Canon...

Edited December 15, 2011 by Waiping

[flee 5]

OT:

Waiping,

It is interesting that you should bring up Canon and Nikon. Their products seldom compete head on - that is why there are customers for both of them.

 

As for car manufacturers, Honda is targetting younger customers who want more sporty handling and performance. Toyota targets the customers who are more mature and have comfort and economy more in mind. As such the products reflect these philosophies.

 

Airbus and Boeing do have products that are in general competition. However, there are very few that are in direct or head-on competition. That is why they each have their own set of customers. And obviously, customers do find that each airframer has a product line that is suitable for their needs. That is why they buy from both.

 

Back on topic:

Qantas obviously feels that there is room for another premium airline in Asia. I think that if they partner MH/AK, the product will be quite unique. On the one hand MH has one of the best in flight services an airline can offer. On the other AK can offer cost control expertise. QF can bring with it the premium branding and clout that neither MH nor AK can do. As such it would be a pretty good match should QF forge the partnership with the Malaysian carriers.

Edited December 15, 2011 by flee

[alberttky 0]

“Singapore is the better business hub for sure, but the majority of Singapore traffic is transit traffic — just like Dubai,” he said. “Whether you connect in KL or Singapore, the key is connectivity.”

 

So doesn't SIN offer better connectivity???

[BC Tam 2]

So doesn't SIN offer better connectivity???

Ssshhhh .....

perhaps and let's hope Mr Joyce has missed out on that

[alberttky 0]

Ssshhhh .....

perhaps and let's hope Mr Joyce has missed out on that

 

sorry buddy... Don't think AJ is that stupid. otherwise he wouldn't have started 3K in SIN.

 

they've also sunk more than $10m renovating the QF/BA lounge at T1, so obviously business out of SIN is good.

[Mike P 0]

sorry buddy... Don't think AJ is that stupid. otherwise he wouldn't have started 3K in SIN.

 

they've also sunk more than $10m renovating the QF/BA lounge at T1, so obviously business out of SIN is good.

 

I think what Tony was trying to convey is SIN is virtually a good hub with good connectivity but many passengers do not drop in SIN where KUL can be proven to be offering good connectivity too with lower cost incurred.

[flee 5]

KUL was lousy for connectivity when AK started. You just got to build it yourself!

 

I think that is what TF is trying to impress on AJ. Now, if you built the connectivity yourself, doesn't it mean that you will partake in all of the profits associated with all those connected destinations?

[Mike P 0]

KUL was lousy for connectivity when AK started. You just got to build it yourself!

 

I think that is what TF is trying to impress on AJ. Now, if you built the connectivity yourself, doesn't it mean that you will partake in all of the profits associated with all those connected destinations?

 

Good to know that AJ is approaching MH and AK so as to make collaboration with QF...

[KC Sim 2]

Looks like Qantas wants its feet in both SIN and KUL. 2012 is going to be an interesting year indeed. Now I wait to see how Qantas defines "premium" ... is it "business" or "first class" premium or is it "premium economy" or economy masquerading as premium?

 

KC Sim

[BC Tam 2]

Anyone else noticed that it should be the two AJ's of QF and MH doing the courtship ritual but instead it's a third party chirping in the mating call ?!

[V Wong 0]

Anyone else noticed that it should be the two AJ's of QF and MH doing the courtship ritual but instead it's a third party chirping in the mating call ?!

 

Broker with heavily vested interest that AK should not be snuffed out of the equation.

[alberttky 0]

PETALING JAYA: Malaysia Airlines (MAS) and Australian carrier Qantas are mulling over a joint venture to set up a premium airline based in Kuala Lumpur, a move that could give a competitive boost to both airlines, industry sources said.

 

The sources said that both parties had been working towards signing a memorandum of understanding (MoU) on Tuesday, but the date had been pushed back indefinitely.

 

The aim of the MoU is for both parties to explore areas of co-operation and/or joint venture before they enter into a definitive agreement.

 

“They have been talking but there are many things that need to be addressed before they can come to the table to ink any sort of agreement. In any case, it is an MoU (that will be signed), so it’s still preliminary and exploratory,’’ the source said.

 

Some industry sources alluded to the possibility that both MAS and Qantas would have equity in the joint venture, with MAS likely to have a controlling 51% stake.

 

Some say it could involve the long-haul operations but this is unclear, although Qantas has said it is exploring entry into the growing Asian market.

 

If Qantas does set up an airline with MAS, it would be operating from a low-cost place and that would bode well for the airline which has suffered losses from its long-haul operations.

 

“How this would pan out is unclear for now, but if the JV does come true, it would create a major airline that can compete with the regional peers, and it would certainly lift MAS up a few notches,’’ said a source.

 

Qantas made it clear last year that it was eager to enter the Asian market and wanted to set up a premium airline to be based either in Singapore or Kuala Lumpur. But those in the know claim that plan has since been abandoned by the airline due to, among others, pressure from its unions.

 

This is not the first time the two carriers had wanted to collaborate. They tried in 2008 when Datuk Seri Idris Jala was managing director of MAS and Geoff Dixon helmed Qantas. But things did not work out the way they had wanted, because both could not agree on the shareholding structure.

 

Qantas is also the MAS sponsor to the Oneworld airline alliance, of which MAS should be a full member by the third quarter this year.

 

MAS is also due to launch its premium regional airline mid this year to capture a larger Asian market share.

 

MAS, in its Business Plan 2011, said: “Beyond alliance membership, we are exploring the possibility of JVs with select partners in order to serve multiple markets together, while reducing the financial risks of participating individually. We look forward to sharing details of these initiatives in the months ahead.’’

 

http://biz.thestar.c...60&sec=business

Edited January 27, 2012 by alberttky

[CH Tan 0]

So, it is confirmed to be in KUL. Interesting

 

But frankly, I'd rather see another LCC than another premium carrier in KUL. Our market is more suitable for an LCC.

Edited January 27, 2012 by CH Tan

[KK Lee 5]

PETALING JAYA: Malaysia Airlines (MAS) and Australian carrier Qantas are mulling over a joint venture to set up a premium airline based in Kuala Lumpur, a move that could give a competitive boost to both airlines, industry sources said.

 

 

The end of MH as we know it?

[kandiah k 0]

Nice article about the whole QF/MH deal and RedQ for your reading pleasure

 

http://www.aspireaviation.com/2012/02/23/qantas-sets-sights-on-asian-growth-despite-challenges/

Edited February 24, 2012 by kandiah k

[Izanee 0]

interesting indeed ... if it works out, i will be a happy man!

[jani 0]

Do you guys think MH might be involved in just too many airlines?

 

You have MH, FY, MAS, RedQ and don't forget Tony's private jet biz that he said will involve MH. That is FIVE airlines.

[Sharil Abdul Rahman 0]

Do you guys think MH might be involved in just too many airlines?

 

You have MH, FY, MAS, RedQ and don't forget Tony's private jet biz that he said will involve MH. That is FIVE airlines.

 

We all have our speculations here.

 

So will one day we see MH stoop to BI level? or MH turned into just MAS? and AK taking everything else?

 

we can only speculate here.

[Mushrif A 3]

Do you guys think MH might be involved in just too many airlines?

 

You have MH, FY, MAS, RedQ and don't forget Tony's private jet biz that he said will involve MH. That is FIVE airlines.

 

IF you put 2+2 together, MAS = RedQ. At this moment, they are all paper airlines.