Wow: Qantas Cutting Capacity, Grounding Most A380s

Looks like Korean Air is also grounding all their A380s. I’m scheduled to fly from LAX to ICN in two weeks and they’ve already swapped it out to the 777. They went from two daily A380 flights to just one 777 flight. A big capacity reduction. Also the same for their New York A380 flights.

I am certain Qantas is keeping a close eye on Australia to Japan flights. If the 2020 Olympics in Japan were curtailed or cancelled (not impossible!) then drastic and immediate cuts would follow. On the salary/fees cuts for Qantas execs., that plays into the PR optics Qantas is at pains to promote. Smart move nonetheless. I mean, surely Alan Joyce has squirrelled away a few millions from last year's payoff to tide himself over the next 6-12 months? $24m would seem to go a long way in most households. Likewise the Board members would not be too inconvenienced by a 30% cut. Not really a job; just a handful of meetings each year followed by drinks and a slap-up lunch. And most of them have up to a dozen other Board appointments elsewhere to pick up the slack.

Have a trip scheduled to SYD/BNE/AKL, all for business, leaving this weekend from LAX. Can't decide what to do to be honest. Trying to push aside sensationalized, fear-mongering media sites and get clear and rational information. It is an important business trip. It just truly feels unclear where the situation is headed both in the US and Australia.

I am a long-term critic of the AJ management of QF. I dislike his soap-boxing and adverserial style of management. There is no need for this. He attempts to milk maximum kudos for himself out of every decision he has ever made. Project Sunrise has been stretched into a 7-year project, from start to implementaton in 2023, if it goes ahead. He buys a handful of new aircraft and milks it for a few years. Just get on and do it, don't puff your chest out and say "look at me". I was asked to make submissions to both the 2014 and 2016 Senate Inquiries by Senators, which I did. QF have been quietly implementing things that I criticised them for in both of those Inquiries, eg, change SYD-DFW to A380's instead of B747's so as to eliminate the BNE stop, reintroduce QF flights to DPS, add more QF flights to Japan instead of Jetstar, add QF flights from regional Vic to SYD, to name but a few. I criticised the decision to give Jetstar the B788's instead of QF, who they were ordered for. Now, 3 of them are listed for sale. Who is making these decisions? They need repurposing for QF services. I am certainly not a Joycyte, as you can see. In 2012, I attempted to set up an international airline here in Australia but my investors headed for the hills once QF started hemorrhaging money. In 2016, I gave Malcolm Turnbull a plan to set up a Federally owned airline which would add about 150 aircraft over a 5 year period, and 2,000 direct and 2,000 indirect jobs pa over that period simply by opeating flights that begged to be operated, that were not operated by QF or VA, e.g., daily PER-AKL, daily ADL-SIN, and by taking back Australian jobs given away by AJ to EK,EY and QR. It ticked all of his boxes - grow the economy, grow jobs, grow tourism, grow northern Australia, grow regional Australia. I have a very different future plan for QF, from the current vision of AJ that I have been trying to get to the QF Board of Directors, but every attempt has been thwarted by QF corporate gate-keepers through the proper channels. I have a very different approach to Project Sunrise, which has some inherent problems and risks, but my alternative eliminates these. QF needs a strong plan B for European services as the Gulf region is a powder keg. As many people don't want to fly via DXB to Europe as those who don't want to fly via Asia. Putting all QF Customers onto EK flights to Europe except for LHR, exposes QF to huge commercial risk. My plan eliminates that risk. Spending $3.2 billion on buying up to only 12 aircraft to fly only 5 return services per day to LHR and JFK or EWR, for a maximum of just 425,000 pax pa, is not the best choice for the money. That is, after all, 3 year's of QF profit to be spent for a return of about $125 million pa. Will QF shareholders have to endure another 7 years without dividends? And it still does nothing to eliminate the commercial risk of putting all non-LHR European customers on EK. Will QF management continue their flawed strategy of taking $2.3 billion of shareholders' cash out of the bank to repurchase shares? Flawed strategy? You tell me. Today, the QF share price and market cap are less than in 1999. If you were a shareholder would you want your CEO to get $25 million pa for dishing you up something like this? And, QF continues to fly around an ageing fleet that gets one year older with every 12 months that passes. Seems obvious to me, but not to others apparently, who want great ROIC's instead of a modern fuel-efficient and competitive fleet, in order to get their STIP and LTIP bonuses. Maybe I am getting a little bit cynical as I get older? Yes, even I am getting one year older with every 12 months that passes too. And QF continues to be unable to fly dozens of routes because it doesn't have the aircraft to do so, current COVID-19 situation excepted of course. COVID-19 will come and go like SARS and the GFC and every other problem that has happened over the years. It needs to be dealt with swiftly and appropriately of course, and I would make some additional changes at QF to deal with it as well. With the reduced cost of fuel, the reduction in flying, and QF cheap seats disappearing because of less flights, QF will come out of it OK. QF is at a pivotal point in its future. Aircraft choices now will have an impact on the future of QF for 10 to 15 years. QF suffered badly in the past through choosing the wrong aircraft for the airline's needs. AJ still had the opportunity when he became CEO to ditch B747's and replace them with B77W's, but he didn't. Air NZ did it. SIA did it. Cathay did it for pax aircraft. All US major airline's did it. But, if I can get my plan for QF in front the QF Board at some stage, then they will see a whole new different landscape of amazing opportunities in front of them. The one-man's-vision that they have in front of them now just doesn't cut it for the future of QF though. What do you think are the chances of that, do you think?

wow?