reliability? residual value? passenger capacity? supplier rebates? maintenance costs? pilot & engineer preferences? technology? - could be many other factors to take into consideration......
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Yes all these things are no doubt considered, reliability being extremely important. Boeing with Dreamliner (engine) problems and 737 MAX software issues are unlikely to have a high reliability score at the moment.
Quite worrying if true what Benny1 says above that compensation from RR will come in the form of discounts of new engines !! The damage/loss has been done already and RR should be compensating now, not sometime in the future and only IF AIR buys more engines of them.
So if true about RR, if they do not pick RR engines for whichever aircraft they decide on, the $40M odd (think it was around that much) will never be recovered??
Not so fast - just calling a spade a spade.
Which other airline producer supplied recently new planes with build in crash mechanism - other than Boeing? AIR was just lucky they had no need for the 737 Max 8 - who knows which other bugs Boeing did oversee in their planes?
Why would the software for the other new Boeing planes be any better?
Boeing's processes are clearly not up to scratch - and they didn't even admit their haphazard engineering approach after the first crash but happily allowed another plane to go down and kill its passengers.
Ah yes - and buying Boeings with RR engines was an amazing idea, wasn't it?
Not sure why AIR would pick them, but it clearly can't be with safety, reliability, range or economy in mind.
Didn’t an AIR Airbus crash about 10 years killing all aboard.
Yes it did but was operated by XL airways and about to be handed over the AIR. Caused by human error https://nzhistory.govt.nz/page/air-n...crashes-france
Wikipedia are saying that the A350 Airbus is powered exclusively by the RR Trent 1000 engine,so if they are getting a credit from RR they would have to be looking at the A350?
The A350 engine is actually a RR Trent XWB which was developed from the RR Trent 1000 according to Wikipedia.
Nobody expected them to foresee the recent issues. However - given that they seem to be happy to ignore them in their decision to buy future planes, any further issue with Boeing planes will fall back on them.
The problem with serious design flaws is, that they are like cockroaches. If there is one which slipped through their quality system, there are likely to be more which did the same. Hard to see why AIR wants to take this risk if the alternative is anyway better ...
My guess is they will run with the 787-9 and hope it finally becomes a Dreamliner with the much more reliable GE engines.
Surely the directors and senior management team are well aware that with all the substantial disruption caused by the faulty RR engines AIR has suffered some brand damage and the prudent thing to do is irrespective of whatever favorable deal RR come up with, is to take the substantially lower risk option and run with GE engines.
Worth noting that GE engines can be retrofitted on existing aircraft.
The Troughers are getting a pay freeze my heart bleeds for them. Lol
Basically just saying fuel costs have risen by $200m per year and top end of management will accept a 12 months pay freeze and be focused on cost cutting. I suppose this includes Luxon having to suffer on his measly $4.6m (last year's remuneration) for another 12 months !!
https://www.nzherald.co.nz/business/...ectid=12230900
So the plan is to squeeze up what's left of traditional economy as tight as they dare think they can get away with down in the back far corner of the aircraft then install some new seats in the pitch they just had.. And then charge extra for what they offer at the moment ?
She's pretty squeezed up down the back already.
Virgin reducing capacity across the Tasman https://www.stuff.co.nz/business/ind...d-chirstchurch
Airlines doing it tough this part of the world ...at least Virgin
Wonder if AIR will reduce guidance further?
https://www.businessnewsaus.com.au/a...ebd3bf4ce1f3a6
Yeah, NAH.
"Over the last few years Virgin has struggled to turn a profit, recording a $653.3 million loss after tax in 2018, a $185.8 million loss in 2017, and a $224.7 million loss in 2016".
Chris Luxon was so right to ditch this dog. Talk about a perennial under-performer and some of those years with very low fuel prices and other airlines making record profits. The previous CEO was completely inept and grossly overpaid and needed to go many years ago. Only one person on the board had the gonads to stand up and say what needed to be said and the other board members were wimps. He departed a little while back, finally but now there are all the failed legacy issues to deal with that'll be years in the clean-up. Snow Leopard is very welcome to this mongrel of a mutt.
This bird (pup) will never fly but we can't call it a Kiwi can we lol
So it’s going to be the Boing planes
https://www.reuters.com/article/us-a...-idUSKCN1SQ03U
http://nzx-prod-s7fsd7f98s.s3-websit...012/300456.pdf
Latest stat's and fuel hedge look okay to me.
Forecast fuel consumption for FY20 is 9.6m U.S. barrels which at 42 gallons each is 403.2m U.S. gallons of fuel forecast to be burned and at 3.78 litres per US gallon is $1.524 Billion liters of jet fuel.
Crikey, No wonder fuel cost is important !
Always a worry when a company publicly says they’ve got external consultants in to sort out their business ....esp when they mention words like “business realignment”. Implication is that they don’t know what they’re doing.
But then when you are seeing profits sinking to 5 year lows suppose you need to do something drastic
https://www.nzherald.co.nz/business/...ectid=12224620
https://www.nzherald.co.nz/business/...ectid=12234014
Well at least it is now been confirmed publicly that the new aircraft order will be announced on Monday.
Eight new 787-10s with GE engines
Wonder how they calculate 150,000 tons of carbon savings ......what a ****....can’t fool me
http://nzx-prod-s7fsd7f98s.s3-websit...068/300527.pdf
I am very relived they have gone with GE engines. I would have sold my shares if they choose to stay with RR as I believe a decision that way would amount to gross recklessness no matter how cheaply RR would supply them. I hope they can wiggle their way out of the RR engine leases on the existing planes at some stage.
Goode pragmatic decision making by AIR.
Don't think there will be a downgrade at this afternoon's investor day because I haven't noticed any exec's selling many shares lately.
LOL Barked so loudly SUM company had to change theirs and Tony Carter probably has the Beagle's barking still ringing in his ears after I barked up a storm after last time AIR's exec's sold one day before the investor presentation. Beagle's thinking is that if one is going to bark you might as well bark nice and loud :D
Sharechat essentially says it’s a downgrade ...or at a profit warning
Don’t downgrades come in fours
the market seems quite happy as AIR head to what could be their worst profit in five years.
http://www.sharechat.co.nz/article/f...ouncementshtml
Market was well aware that the fuel price was trading above previous estimate so is not surprised. Anyone surprised would have to have been living under a rock for the past couple of months.
Very smart move going with GE engines https://www.msn.com/en-nz/travel/new...cid=spartandhp
Media hype painting it as a $60m downgrade when in fact they were previously guiding $340m - $400m, mid point $370m, and now guiding $340m+
Only in the imagination of some creative journalists minds is this a $60m downgrade.
Investor day materiuals here http://nzx-prod-s7fsd7f98s.s3-websit...101/300568.pdf
The range was initially at $340-400m, and down $25m but in excess of $340m. So anywhere between $340m to $375m. The movement in fuel prices is always going to be there and for that reason its a cyclical stock more than anything.
I bought at the lowest point of the market so I'm okay with holding at close to $2 average. I would only buy more if it went down that low again which I only suspect would happen in two circumstances. First being oil prices heading back up to $100 USD a barrel or global conditions worsening considerably to the point it affects disposable income on a mass level.
A lot can happen between now and 2022 and both events are on the cards, not sure at what state either will be at in 2022, if oil goes up I think the budget players and poor brand operators get weeded out quickly with the brand champions sticking around. A quick response to slowing demand and oil prices rising will give you an indication of what type of company this is.
And backwards we go...
https://www.stuff.co.nz/business/ind...-reviews-fares
AIR share price drifting a bit today after yesterday’s profit downgrade.
Is it time to start saving up for when it’s back in the 220s
Luxon’s days at AIR maybe numbered
Rumour is he is being ‘parachuted’ into Botany by the Nats in next year’s election
LinkQuote:
Air New Zealand is reducing flights on domestic routes and reviewing airfares as tourism slows and operating costs rise.
When the execs are freezing their pay packets you know things are bad!
Could be a bit embarrassing for AIR if John boy forced out of ANZ for bad governance / oversight
But many directors are only it to feed from the bottomless trough ...is that the term
https://www.stuff.co.nz/business/113...esign-from-anz
Talking of politics wonder if any substance to that rumour Luxon being parachuted in as a National MP
Talking of politics wonder if any substance to that rumour Luxon being parachuted in as a National MP[/QUOTE]
Luxon says he's not interested at present. However, some in National party must be desperately searching for another J.K.
https://www.msn.com/en-nz/news/natio...cid=spartandhp
Shocking.
Big fall in oil prices in May. I reckon AIR about fair value at present and continue to hold a modest position.
22 cps fully imputed dividend (which I think they can maintain in the years ahead) gives a 12% gross return at $2.55 (rounded, actually 2.5463). I think those looking for this to go down to $2 or close to that are going to be disappointed again but predicting the future is like predicting the weather so as usual time will tell.
A lot depends upon how much more damage the loose cannon Trumpet does to international markets...he just never shuts up...so almost anything is possible I suppose.
Well done AIR ....recognised for its diversity and inclusivity in the global airline industry
Pretty telling photo of IATA members head honchos
https://www.nzherald.co.nz/business/...ectid=12236892
Share price inching ever closer to $2.20 for this cyclical stock heading to its worse earnings for five years
Dave topping up the housekeeping kitty
http://nzx-prod-s7fsd7f98s.s3-websit...526/301151.pdf
Swedes not flying as much as they did because of flygskam (flight shame)
Just as well NZ is a long and isolated country .....can’t imagine beagle driving all way to Queenstown for his annual ski trip and it’s a long row to Australia and beyond.
But inevitably this thinking probably will impact the likes of AIR sometime
https://www.weforum.org/agenda/2019/...-it-s-working/
Air NZ getting all inclusive and PC about tattoos now, give me a break. PS-Quite pleased not to hold any of these.
Air New Zealand Dreamliner crashes and burns (the replica one)
https://www.stuff.co.nz/travel/news/...hit-on-youtube
must be a very expensive crash...
There is a series of videos on Youtube showing the guy building it. Must be devastated after all the painstaking work he put into it.
On another subject, if they lower road speed limits in NZ more people will fly domestically.
Luxon gone ..,,
Pity we no longer have his biggest fan on the forum...
Oh well Rodger you may as well sell those shares... All down hill from here without your trusty can do no wrong Christopher at the control stick!
This is excellent timing, I will be contractually unrestrained from mid-August.
So not only could I takeover CEO-ing the airline during it's next difficult phase straight away but I could turn up early and make sure he does not steal too many lollies as he goes out the door.
Will send my CV in within the hour.
imagine the shares will have a tank on this news. another leader who did a great job
ADMIN: AIR: Air New Zealand CEO Christopher Luxon to resign
Air New Zealand Chief Executive Officer Christopher Luxon has resigned this
evening and will step down from day to day leadership of the airline on
September 25.
@franosullivan
Air NZ's Christopher Luxon holding forth over breakfast this am on the bold and provocative agenda the PM's Business Advisory Council (which he chairs) has been developing. Should we read anything into that former National PM Sir John Key was in the front row?
Luxon leaving is a bit of a loss. I'm not sure that I was particularly a fan of his but he was a good reliable safe pair of hands. I was hoping for more information about replacement and handover but I guess the process of finding a replacement starts now (if it hadn't already started).
I do feel that he let things slide to some degree. Constantly cutting until something gives, and that was Air NZ's reputation, culminating in the Luxon apology tour in Sept 2018: https://www.flyertalk.com/forum/air-...w-zealand.html. Some of those things were out of his control (fuel pipeline, RR engine) but some should've been foreseen and rectified sooner (growth in lounge demand, contact centre delays). Airlines are a fickle business and it's much harder to gain customers than it is to not lose them in the first place.
He did produce solid reliable financial results, grow the airline, and made some good growth decisions along the way (Buenos Aires, Houston, Chicago) as well as some less good (Vietnam and Phillipines). I see him as consolidating after the transformative Fyfe era rather than bringing much new. Useful work but not exciting.
People are touting him as a new John Key, but re-reading my description above I'd see him as more Bill English than John Key. Safe. Reliable. Cost-cutting. I may be totally off the mark here though as I haven't followed him that closely (despite feeling the need to write several paragraphs here about his AIR career).
Also, did someone mention about that Roger has gone? That is also a bit of a loss too. I'll probably miss him more than I will miss CL.
Moving back to AIR, interesting to see where yields head with all these discounted airfares in the past few months. Some of the lowest prices I have ever seen on AIR. Instead of being a premium over the competition for once they have been the cheapest by some margin.
The best thing Wing Commander Luxon did was pull the rip cord on Virgin(Under Arm Bowlers Division) and push them out of the plane.
His biggest missed opportunity was failing to flog Cullen Airlines off to Etihad when they were paying silly money for airlines. Now that Etihad is in a financial stall the taxpayers could have brought it back at a large discount. Think of the transaction as a reverse Cullen.
Boop boop de do
Marilyn
If I was the Emir of Etihad I would be offering Wing Commander Luxon gold frankincense and myr to entice him to take on the job of sorting out Etihad.
He could even offer Michael Cullen a supporting role where he would hide in a cupboard and when the Wing Commander wanted advice he opens the door asks for advice and then does the opposite.
Boop boop de do
Marilyn
Interesting news out of the Paris Air Show, the new A321 XLR has been announced, a slighter longer range aircraft with better economy on this mid distance trips. Qantas and Air Asia converting their A321 orders into the XLR variant. I wonder if AIR would do the same, especially given the competition with Jetstar. It would give them huge coverage in the Asia market.
https://www.youtube.com/watch?v=zLfyOd3Vedk
Asia is not "mid distance"
JIT with a know weak line in supply...
https://www.stuff.co.nz/business/113...ipeline-damage
https://www.stuff.co.nz/the-press/ne...church-airport
Second incident recently I understand.
Co-incidence hopefully.