tip off
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Jetstar’s single 787 cut is about the business not the jet

The news that Qantas has cut one firm 787 order from the 15 that Jetstar is due to receive starting mid year has nothing to do with the Dreamliner’s current grounding.

It is all to do with whether or not the Jetstar model for long haul flight is a success or a dud. And, in a minor way, it is also about a timely trimming of a capital expenditure item from the next financial reporting season.

While it is wall to wall angst over the Dreamliner grounding in the bigger picture, Qantas and Jetstar are locked in a destructive fare war with Virgin Australia and just about everyone else, and shareholders in Australian carriers in general are likely to get hurt badly.

It is far from certain that the 787 issues are anywhere near the top of a list of the ten most urgent things Qantas, or Virgin Australia, have to deal with at the moment.

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  • 1
    TT
    Posted January 18, 2013 at 2:49 pm | Permalink

    Ben, I read Qantas’s article from the Australian , and it sounds like Jetstar will be getting B717 and Q400 for Queensland and WA routes? Is that true? (or the Oz misquoted for Qantaslink?)

  • 2
    Ben Sandilands
    Posted January 18, 2013 at 3:04 pm | Permalink

    Not true. Although nothing is impossible in airlines in Australia. The Qantas statement specifically refers to the 717s and Q400s strengthening Qantas domestic routes, and at present both those types are the domain of Qantaslink (in its various divisions.)

    What I think is intriguing is that if you were offered a full service turbo-prop by either Q or V and the competing offer was in an 180 seat A320 for less money and also a shorter if not less bumpy ride, surely the low cost offer would win. Not that yours truly likes 180-189 seat single aisle jet cabins very much anyhow.

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