DJ Wants Higher Prices

[Andrew M]

So much for DJ/VA wanting to keep fares nice and cheap across the Pacific. When you have the Chief saying he wants a return to $2800-$3000 for an airfare to the USA you know something is up..


*Extract Below*

http://www.theage.com.au/travel/travel-news/something-is-wrong-virgin-chief-hopes-airfares-will-rise-20091119-iofr.html


"When you can get to the US for about $1200, when 15 months ago at this time of year you're were looking at $2800 to $3000, something is wrong.

"Clearly we’d like to see a return sooner rather than later (to pre-recession prices).

He said the market was not getting worse, but a detailed market update would be announced at next week's Virgin AGM.

[Michael Morrison]

.5M per departure is incorrect.

Godfrey did say in July it was loosing $4m per week and now it is $4M per month. Who knows what it is now, but .5M per departure sounds a bit incorrect, especially when loads are picking up.

[Ash W]

So let me get this right.

New carrier comes into the market, trumpeting loudly how the existing carriers are ripping off customers by charging too much and how they will be knights in shining armour by increasing competition and thus reducing prices.

Now the same company is whining that the prices are way too cheap and should go back the their pre recession (also pre their market entry prices). It looks like this little piggie wants his snout in the trough too, or am I really missing something here?

[Greg McDonald]

As pro-DJ as I am, I have to agree with you here Ash.

[Anthony T]

As far as I can recall, V Australia was not set up in order to lower fares across the Pacific.

Brett has previously stated that trans-pacific airfares should not see a major reduction as a result of the entry of V Australia into the market.

The low airfares on the trans-pacific routes are due to the GFC.

Qantas are holding their own on the route due to the passenger appeal of the A380, the 747 services aren't doing that great against VA's 777's.

[Ash W]

Anthony that is how they marketed themelves.

Indeed on arrival of the first 777 Mr Branson said ""Recession ... What recession?" Sir Richard said to a crowd of travel industry professionals gathered in LA to greet the plane.

"The way to get out of recessions is to try to expand out of recessions, create more jobs, bring airfares down and try to offer better quality of products."

Source http://www.smh.com.au/travel/travel-news/v-australias-first-boeing-777-touches-down-in-sydney-20090209-81sx.html

I will tell you one thing I really dislike about Richard Branson, and that is how he always plays the beaten battler. Now sure what BA did to him was a tad rough, but that was years and years ago but he still plays the same tune, when at the end of the day he is just out for the business and money like everyone else.

[Sarah C]

I think all airlines would agree with the general statement that prices should increase because most (if not all) are losing money.

However, I think V Aus have discounted too much to the point where they are making huge losses. But they will have to do that to attract a market - if they don't drop the fares to such a level, the likes of Delta will take those passengers. V can raise thier prices at any time to help thier yield but they know they will lose passengers. They set the bar but have realised how costly it is.

[D Chan]

I think all airlines would agree with the general statement that prices should increase because most (if not all) are losing money.

Anyone who works in the yield management area of the airline business would agree the same. Most if not all have been in the 'pulling their hair out' mode because it would not have been a pretty picture for most of this year

[Andrew P]

Andrew

sorry Andrew but disagree,

every time you hear some fly a A380 they praise it, so it is contagious to the point where others will look for A380 to try it, in preference to other types of planes

Andrew

[NickN]

Personally I would choose the Emirates A380 to Auckland over other offerings just to fly the A380, price, meh, a little more than others is worth it.

I can see people who would be attracted to the A380 service.

[Lukas M]

The exact same will happen when the 787s finally arrive for J*. For a period everyone will all of a sudden jump over give it a go. Well I will anyway.

[Georgie B]

Personally I would choose the Emirates A380 to Auckland over other offerings just to fly the A380, price, meh, a little more than others is worth it.

I can see people who would be attracted to the A380 service.

I would love to fly an A380, yet as I am not a traveller I would do just about anything...London via wherever...just to get a BA 747.

So I am not veering well off topic, my friend recently flew V Australia to the USA. She had flown before with United and Qantas [both 747s] and found the jumbo to be the most comfortable, and the Qantas service great.

[Ash W]

The exact same will happen when the 787s finally arrive for J*. For a period everyone will all of a sudden jump over give it a go. Well I will anyway.

I am willing to lay a bet that they won't, simply because the 787 as far as the every day punter is concerned is just another aircraft. The A380 on the other hand again as far as the every day punter concerned is something special due to it's size. Enthusasists on the other hand may well be tempted.

As for people making a choice between A380 and 744 on the same routes. At Easter this year I flex London to Sydney on Qantas and by all accounts the A380 flight was chockas in Y (which gained me an upgrade to Y+) but the 744 services were only about 60% on the same day. So I think that simple stat does show that given a choice people will (even for a short time due to novility) choose the A380 over the 744.

[Mike W]

I am willing to lay a bet that they won't, simply because the 787 as far as the every day punter is concerned is just another aircraft.

I don't know. I guess it will depend on how the craft is marketed by the Airlines and how well Boeing (and the Airlines) are able to talk up the pax benefits through the general media.

In actual fact, the 787 really has tangible features (and benefits) over existing Airliners, including the 380, such as lower cabin air pressure, higher humidity and more spacious layouts with larger windows, etc.

Personally, I would prefer feeling better after a long flight than being in a larger crowd (especially at check in, customs and baggage claim). But then, some might say I'm biased ;)

[Owen H]

I'd disagree very strongly Andrew. There is no doubt that passengers are choosing to take the A380 flights ahead of other alternatives, be they QF, SQ or EK. The marketing surrounding the 787 will be similar, and passengers will choose it.

[NickN]

I have family members who know nothing about aircraft types, but mention the A380 and they all start talking about how amazing it is etc etc and how they'd love to try flying on it.

Everybody wants to fly the latest and greatest, it's all a part of the modern mentality.

[lloyd fox]

I agree with Owen as well.

In my experience of 30 years in Tourism,travel and aviation i can recall alot of occasions whereby after a accident with a particular aircraft type, customers would always ask not to be booked on that plane type.For eg the DC10 after a few incidents and accidents.

In the reverse i can recall Qantas advertising the A380 on their web site so that pax would actually book to fly on it.Customers are very aware of this aircraft and i can recall the outcry when some flights went unserviceable in the first few monthes.

[Ash W]

I'd disagree very strongly Andrew. There is no doubt that passengers are choosing to take the A380 flights ahead of other alternatives, be they QF, SQ or EK. The marketing surrounding the 787 will be similar, and passengers will choose it.

The 787 may well have many benifits and features but how do you market these to the public? The A380 on the other hand has the wow factor due to it's size. So I doubt there will be the same level of interest in the 787 from the general public as opposed to the A380. Indeed maybe people will be turned off the thought of flying in a plastic plane!

[D Chan]

Let's refrain from quoting the entire previous post - thank you, mod

the 787 does have some nice features up its sleeve for the marketing gurus: 1) state of the art technology, 2) interior designs and also the electronic window shades, 3) greater cabin comfort e.g. interior environment with higher humidity

I am willing to bet that pax brochure would feature the electronic window shades in the pictures etc. to distinguish the 787 from other aircraft

[Andrew M]

But will the 787 fly ? :rolleyes:

[Bernie P]

Will the 787 fly? I believe that 22/12 we will find out... :) :D

[Ash W]

Which year Bernie?

[Bernie P]

That's why I didn't stipulate a year... :D

BUT, I have heard it will be this (fingers crossed) year though!

Now that the stringers have been 'fixed' and that all cowlings etc around the wing root etc installed. BUt I did read that there was another potential problem with it delaminating... We'll see what happens I suppose!