......agree there percy
There was a piece in the paper on Luxon the other day ....covered a lot of things but one thing missing was his vision for NZ ....didn’t have a vision for AIR either
Printable View
Cabin service in AIRplanes should be improving ... a young Luxon apparently is now one of them.
Wonder whether he would work with Winston.?...........................lol.
I agree. I think he heavily incentivised his executive and management and then looked the other way.
He certainly inherited an airline with a very strong profit base and culture set up by Fyfe then milked it.
Both have deteriorated.
An indication of his Regard for Air NZ was the way he walked away to immediately pursue his own interests. No gradual handover like he enjoyed when appointed and it left the company in limbo for months.
A window on how he will be as a politician. No different from the rest, but having a hard, right wing, conservative agenda, heavily influenced by his Christian ‘faith’ and personal aspirations.
A man to be wary of.
All only in my opinion of course.
Shareholders rejoice at the rumour AIR call centre going to Phillipines to save money
Customers probably lament the move fearing worse service
I agree with you.
Luxon added so very little to Air NZ - and he never hid his self proclaimed 'socially conservative' views from the comapny and he did in fact allow them to blur his decision making. He was solely responsible for the cessation of the popular PINK Flight to Sydney. It's not my cup of tea but it MADE MONEY and garnered a truckload of free press every year.
Luxon just proves that a well spoken white man in suit will suck every schmuk in.
Fyfe did the hard yards and created a real drive forward engaged workforce - all Luxon did was dismantle it and run the business down to deliver maximum shareholder return in the short term all the while delivering progressively lower and lower profits.
Dont overlook that at the same time the board upped the short term incentive plan - largely based on share price numbers the business was having some $50 gutted from it. It was not overly bloated and all that seemed to happen was the same old story. The 10 workers in a department were told they were now 6 and to just deal with it.
Don't forget that under this caring Christians' watch full time low paying jobs like aircraft loaders and airport check in people suddenly became part time full time jobs - still low paid only just now the day was split into 2 with an idle 3 -4 hours in between shifts. It goes on and on.
Luxon was a smooth talking well presented man of little substance in my view (I have met him many times and know his reasonably well), he bolted when Key assured him now was the time to jump into the NATS.
If you are a hard right religious type then this guy is your man. Pity the rest of us.
I have way better feeling for Foran as a leader - early indications bode well for his people skills, time will tell.
Most people I know who work for AIR rated Chris Luxon very well and are sad he's gone. Greg Foran with his background is going to be ruthless in cutting costs and will need to be. I am sick and tired of other companies pandering and encouraging all things LGTBQ so good on him for cancelling the pink flights.
Couple of reports out overnight I have seen suggest air travel within the Asia Pacific region previously forecast to grow at 4.5% in 2020 could contract by as much as 8% this year and that's just based on known information about the virus at this time.
If this becomes a worldwide pandemic, look out, demand for air travel will fall off the face of a cliff like nothing anyone has ever seen before. You will see what cost cutting really feels like then...for example Cathay Pacific have asked many of their workers to take unpaid leave until June, (which could easily be restated to a later month). Good luck to those that don't have a decent nest egg for a rainy day.
Foran will do whatever needs to be done to ensure the survival of the airline and you'll probably look back and think Chris Luxon was a kind caring person after all...that's my prediction. AIR is a clear SELL in my view with known risks. Fair value is where the shares are now, (before there was any virus risk at all) and nothing whatsoever has come off to account for known virus risks...I leave it to others to judge whether that's logical or not.
Sydney Customs hall quiet as
Pretty revealing image for those who know what Sydney is like.
https://twitter.com/chaudave/status/...704451072?s=21
It's called "positive discrimination", biscuit. Use with discretion!
:mellow:
Good luck mate. This news out yesterday (one of the first bits of news out of the aviation industry that endeavours to quantify the impact of this virus), gives an interesting insight into how difficult this storm might be to navigate. https://ph.news.yahoo.com/vietnam-ai...054307063.html
I am sure AIR will update shareholders how their forward bookings are looking with their half year result due later this month and I expect that they will clearly articulate a serious decline in people's forward intentions arounds bookings. I expect a downgrade to 2020 guidance later this month with the half year result and at least one more, probably two more downgrades before June 2020. Shareholders might also like to brace for a dividend cut as it would appear to be prudent to conserve cash at this time.
I wouldn't presently even pay $2.50 per share. I don't want to be a prophet of doom because I like the company but the fact is AIR is directly in the path of this approaching storm and there's nowhere to hide. Depending on the severity of its effects it could get extremely ugly.
Yes, a sobering bit of news from Vietnam Air. Note, however, that China accounts for a third of Vietnam's tourists.
Very sobering at this very early stage and it isn't just Chinese by any means that can't or don't want to be travelling. Discretionary long haul travel is on indefinite hold for everyone I personally know. There are those that have to travel long haul regularly for work though, like Iceman and I hope he's okay.
Been there seen it all before... You tend to when you have been in this industry as long as alot of us have!
We were within a few hours of closing the door for good with the Ansett disaster.. Not knowing if we should take our personal equipment home with us each night in case the gates were locked the next day..you tend to grow to be quite resilient in this industry.
Would I buy AIR... Nope... Carona Virus, the787's drama and the like is enough to convince me to look elsewhere..can't quite fathom why the share price is still where it is. Good for holders though and I wish you all the best..
As for Luxon everyone has their own opinions and always will...
I'll keep mine to myself...
And Beagle I can assure you that there has been plenty of pandering to certain groups of the employee community.
They're always going to need highly skilled people like you that fix things Benny so you'll be okay.
Best wishes.
Just a little snippet. My wife yesterday had to change dates on a flight with AIR to London via LA at the beginning of March. The call centre person told us the cehapest option would be to go through HK as "we have had hundreds of cancellations on that route".
Needless to say my wife will go through LA !
Just before it all kicked off, we bought tickets for a holiday to the UK. To via LA and back via HK. Will be watching this one with interest.
Interesting information, though probably predictable.
From personal experience - it is quite easy to catch a flu or bad cold on these long distance flights ... probably every second time I go to Europe I end up with one of these - caught in flight on one of these legs. So far however I survived them all :);
But anyway - I would think that in these hyped up days the risk to catch a bug on the plane might be lower than normal ... everybody will be alert and highly unlikely that they allow particularly in SE Asia anybody with symptoms (no matter which flu or cold) close to the airport ...
Personally - I would have taken the HK connection - it is nicer (and less risk to catch whatever bug) if you
fly in less filled planes and go through well organised airports with friendly staff. North American airports are inefficient, always full with arrogant security staff, bull dogs and a bunch of bureaucrats who clearly enjoy to exercise the nearly unlimited power they have over incoming passengers. Not sure whether queuing up in front of US immigration with lots of other people (some of them might be sick) for often one to two hours really reduces the bug spread.
Anyway - all the best and safe travels to your wife ...
We plan to go August / September and I am sure I won't take the route through the US ..
With the coronavirus around flying on airplanes is a huge no no...
Just a few days ago 21 studies confirmed that this virus can survive for 9 days on surfaces... you touch it and dont wash your hands before you rub your face and eyes and you have it...
Planes are never cleaned efficiently.. maybe this might change with coronavirus i doubt it... the aircon is the worst... the ducts never get cleaned ever id think... which is a breeding ground for moulds and fungus...those little knobs you turn to direct air ive heard are bad bad bad.... but i cant find much info on it and cant remember how i heard about it....
You dont even have to be within 3 feet to catch the virus... from how contageous the virus is id say that if one person on the entire flight has it then by the end every person has it...
I would not be flying anywhere and at least seeing how the weeks unfold... I am to believe the numbers infected are significantly higher than reported... and some studies have predicted that even as early as late this month that hundreds of millions of people could become infected...
:cool:
.^sc
The resilience of some of the corona linked companies like AIR I find surprising. This would have to be $2.00 come March.
You're probably dead right. Passenger revenue last year was $4,960m. Very quick look would suggest an 8% reduction in load factor would suck about $400m off the top line. Then there's the retrenchment of various routes, Hong Kong and Singapore next ?. The effect on revenue would also be serious in regard to route suspensions.
Then there's the effect on yield, super special offers to keep people flying ? and effect on cargo volumes and pricing.
One would hope that Greg Foran would be quick and nimble enough to manage his way through this but a complete newbie to the airline industry at a time when there could be unprecedented disruption is not a good coincidence.
I think the potential for this to be a VERY VERY serious matter for AIR to cope with is crystal clear.
And wine merchants will be suffering as well .....AIR proudly touted they poured 963,202 bottles of wine last year.
Wowsers ...wine and flying don’t mix ...should stop it.
It will for a few months. What could be quite interesting when AIR report later this month is if there's any caution in the commentary regarding forward bookings ? This is arguably the best business in N.Z. to get a feel for whether people's intentions are changing as $1,372m in forward bookings as at 30 June 2019 indicates more than 3 months forward travel.
We probably won't see any change in prepaid travel as at 31 December 2019 with the numbers coming out shortly but it will be interesting to see where this number stands as at 30 June 2020 ! I am sure they will have an inkling of how this number might be changing when they report their half year results later this month...and if people's intention to defer discretionary travel snowballs then look out !
Hope SUM have their annual meeting in Auckland this April. Its a long drive to Wellington and back.
Just noticed - flightcentre ads popping up in my browser - they started to discount flights.
Just a couple of hundred dollars so far, but I suppose this is just the beginning :):
Yes that will be interesting. I had a couple of good chats with him after annual meetings and thought he communicated very well. During the annual meetings he articulated his strategy very well. Forward booking info is going to be very interesting. Perhaps more to the point, of those that have booked already, what percentage will actually fly ?
Yeah because they were probably working for him, but he's working for shareholders. In the time he was there, share price more than doubles and they continue to get dividends. I would say that investors would have been happy with that.
The thing is in airlines, a good CEO is either good for shareholders or employees, I don't think they can be both.
AIR made money throughout the GFC which shows it is very resilient...but people were seriously concerned about their finances then...being seriously concerned about the prospect of death is something entirely different and I would say potentially far more serious. If they start flying with 8% lower load factors at an average of 2-3% lower yields that $400-500m less revenue effect as you quite rightly suggest, comes straight off their bottom line. They're smarter than that though and will reduce frequency of service to try and keep load factors profitable but there's only so much you can do when demand falls significantly before a company becomes like a sick cat chasing its own tail down in a descending tailspin.
On the weekend I heard Hello travel advertising return fares to Australia for $299 inclusive of taxes, (of which they are very steep to exit Australia) I would think close to half that fare is taxes and $299 is not something I can recall for a very long time which gives an interesting insight into where airfares might be headed. i.e. Its not just load factors that could come under enormous pressure, yields could too.
Disc: No position but wish I could find an easy way to short this.
Pretty interesting chart here too. Had to break it down to the 4 hour to get a good fit but it looks like a decline to 2.70 is happening right now and this will be the area to watch. A close below 2.70 has 2.6 and then 2.5 in sight. Pretty solid support at 2.50 so don't think its a straight shot, but 2.40 could be on.
Attachment 11028
About to book very expensive flights to Nelson through air NZ, not put off by Coronavirus at all. Wouldn’t fly to Asia though.
I'm currently sitting on an AirNZ flight from S Korea to Auckland. It looks about 75% full. I wouldn't know wether that is normal or not.
Also I've been watching the very long movie "Time to destination".
it is very uninteresting ........I do not recommend it.
Lightened the load a little bit. Can't help but think that this will affect AIR. SA reducing services ... https://www.singaporeair.com/saar5/p...htcapacity.pdf
Had plans for a personal trip to Asia mid this year, have shelved it for now ... expect many to be doing the same. Even at work, most reducing trans-tasman travel if they can avoid it.
Just the beginning of widespread flight cancellations worldwide by almost all airlines, in my opinion.
Of course AIR's unionised workers will still be expecting their usual last year + 2-3% annual increase.
Just out - AIR cuts Hong Kong services https://www.nzherald.co.nz/business/...ectid=12309619
Beagle - you really do enjoy kicking unions and unionised workers yet I am pretty sure you would have no objection to Employer Unions -also known more commonly as the likes of Federated Farmers, Chambers of Commerce, Employers and Manufacturers Association etc etc etc.
I am not anti these groups at all - but to call a spade a spade they are essentially or in part lobby groups - employer or industry unions if you like.
They act as a union would - lobby for the best outcomes of their members. Yet there is no outcry when in the past they have lobbied for tariffs on imports to protect their profits - oops I meant industry - all the while happy for Joe public to pay the inflated prices they charged.
So why is it that workers union bad employer union good?
Anyway for what it is worth Beagle in tough times in years and decades gone by Air NZ worker unions have FORGONE wages rises for the sake of all in the company -on more than one occasion. How about laying off the workers who keep Air NZ going eh? Maybe your wrath can be turned on the HQ fat cats starting with the abruptly departed smooth talking Low Wage Luxon.
corporate travel announcement provides a good guidance on impact of virus to date. feb bookings down 50% :scared:
https://www.asx.com.au/asxpdf/202002...qp8m38mldy.pdf
Thanks. I am expecting AIR to downgrade (the first of several downgrades) FY20 guidance when they report on 27 February.
I assume anyone still on board this one has a very strong stomach and their seat belt firmly tightened because they are in for some extreme turbulence directly ahead.
air nz asia travel bookings i imagine will be down already. probably significantly. so work out the % of this part to there profits and theres the immediate hit to the bottom line. So agree with beagle downgrade coming.
Hopefully lifting travel ban by China not too far away.
Appears there is a break through with China reporting declining new cases of NOVID-19 on 17th Feb down from 2048 on Feb 16th and recoveries picking up as well with 1708 reported on 17th Feb up from previous day of 1425 recoveries. Interesting to note 46,524 cases as reported as 'MILD CONDITION' remembering 80% of deaths to date are over 60's in poor health so if one is to worry constantly scaremongering and down-ramping should reconsider Retirement stock which would also be very high risk as everyone there are over 60yrs with RYM having a nose bleed today down 48 cents.
Healthy friends returned from China their 14 day curfew lifts in 4 days.
Next few days could be interesting. $2.50 is the base of the pattern here
Attachment 11040
Corporate travel seems quite affected wondering if SKO will downgrade guidance like WEB
Could AIR handle 16,000 - 100,000 Chinese Uni students traveling immediately after Travel Ban lifted maybe to NZ
Appears no shortage of willing Chinese travelers.
"The Australian this morning reports on a survey of more than
16,000 Chinese students stranded in China by the travel ban
which found nearly a third of them (32 per cent) would enrol in
another country if they were prevented from studying in Australia
in the first semester of this year. The paper notes that if all of the
roughly 100,000 Chinese students who are expected to study in
Australian universities this year have to postpone their study in
the first semester, universities face losing up to $2bn."
qantas says virus will impact earnings 100 - 150 million and will be updated in april
https://www.asx.com.au/asxpdf/202002...5l4gl2y21j.pdf
Doesn't AIR pretty much run international flights at break even and they make all their profits from their domestic operation anyway? I am pretty sure AIR will be in good stead to survive this coronavirus thing. The impact and disruption will be offset by lower fuel costs.
qantas impact was taking account of lower fuel costs in there impact calculation. air will be impacted no doubt. qantas also said demand reduction was spreading to the whole of asia. obviously the outlook and impact when affect accounts going forward the longer the virus stays the bigger the impact will get over time.
Question is how much the domestic operations are impacted. Less international flights mean as well less connecting domestic flights, it means less tourists who might otherwise move domestically up and down the country - and I suspect even beagle (who referred to the Holden) is not alone in avoiding any flights.
We choose to stop 10% of our international tourists at the border - and the Chinese did a lot of flying ....
Very well put. Yes I forgot about the tourists that may fly locally. I purchased a return trip to Auckland from Wellington for next Thursday. Cost me $568 so I am sure AIR are still doing very well. Yes less flights will mean more disruptions. But when valuing companies and using a 10 year DCF model, an aberration of half a year is not really that material. So AIR may decline in the short term but I suspect that the market has already priced in some future disturbance.
Its just beginning. QAN's outlook was on the assumption of just a 3.8% capacity reduction.
18th Feb - CHINA URGES NZ TO LIFT TRAVEL BAN Chinese student bags packed ready to go.............
According to Wu, the number of confirmed cases has been dropping for a consecutive 13 days outside Hubei province and the number of recovered patients has increased rapidly. More than 10,000 patients have been cured and discharged from hospital, she said.
New Zealand, however, followed countries such as the US, Australia and Japan in restricting entry by foreign nationals arriving from mainland China for 14 days. Over the weekend, Health Minister David Clark extended the ban for a further eight days and said that would be reviewed every 48 hours.
Wu said the bans have already had an impact on bilateral cooperation, with 40 per cent of Chinese students who study in New Zealand now stuck in China.
https://www.nzherald.co.nz/business/...ectid=12309559
Ive read it here that CMC markets have been suggested for "shorting". I wouldn't go near them with a barge pole, if it's not standard offering of theirs or with any meaningful amount of moola.
A few weeks ago I refired up my account with them (dormant from yonks ago when I dabbled in a bit of currency "gambling" - which is what it is.)with the view of leveraging to buy OCA .
Well ... long story short, they don't offer OCA but told me they would ,on 2 occasions and confirmed with an email, as long as it was over the phone. So I pop in 2k to trial the procedure.
They buy me OCA at $1.23 as agreed(that was the right price at the time), I find out the next day they bought me OCA in Aussy @ $1.23, not NZ at $1.23 , So I'm down 5%.
I phone them and they said they would reverse the trade, which they promptly did to their credit.
But this is where it got wierd, they then called me to say they don't , and won't, do OCA (after saying twice they would).
I then get an email saying they will close my account fully, as I am unsuitable? Say what???. In quite a harsh email I have been unceremoniously termited despite ALL of our conversations , to their poor English speaking call Center's, being very pleasant.
These guys clearly demonstrated through numerous conflicting story's they don't know what the heck they are up to, outside of standard procedure.
There is no way I would trust them with any substantial money, even for there standard offerings.
I have no doubt they willl refund the 2k in full but will be more than pleased to have my account shutdown by them.
maybe they are still pi**ed with me because I walked away with a currency profit.
qantas rising stronly in aus even after there outlook
it would appear CMC have poor customer service but I've never had any problems, and I wouldn't keep large amounts in their account, is not really necessary with leverage.
And yeh instant execution is actually better than DB or Craigs, you pull the trigger yourself. But hey they're a bucket shop effectively so I take care.
Interesting post Mav. You have struck me as a perfectly reasonable, level headed, polite and intelligent guy both times we have met so for it to come to this with CMC markets is quite concerning. For what its worth I went to a lot of trouble to complete their online application last week and at the end of quite an exhausting and thorough process, I pressed send and got a message there is an error in your application. It did not highlight where in the many pages the error was. WTF ? They have all my contact details for 4 working days now but have not contacted me to finalize the process. I've decided I am not going to chase them.
Interesting. I used CMC for some 4x trading. Lost two small parcels mostly from not having enough to cover sudden spikes and they cash you out when your reseves hit flat line. So I decided that Maverick's gambling wasn't for me either (even though it was fun while it lasted).
Didn't try trading stocks with them because their offering was pretty limited.
Here’s a good report on how green airlines are
https://www.oag.com/how-green-is-you...7-c94cd3379600
Air NZ have slashed CHC-BNE on Grabaseat offering $99 flights CHC to BNE. Tax etc alone on the route is $70.75
Not much left for AIR
Yes a few good discounts today including a number of deals via email, major discounts if you commit to non refundable flights and if you commit to a number of flights for the year from my usual carriers. Their emails reflect my previous flying profile so looking at their regular flyers. Think they are alarmed that people like me have held off on all travel. Still nothing special yet from holden:)
The grabaseat deals probably shows a bunch of seats that AIR would rather just breakeven on than go empty. Its quite unsettling to have empty seats on your most popular routes such as domestically or Australia in March. I know a few people been apprehensive of travelling to anywhere in Asia right now.
This is a good time for AIR to hedge long on the jetfuel prices. I still really like the long term prospects of the company still, and would accumulate more at sub $2.50 prices.
Very good chance this goes under $2 sometime in my opinion, potentially even much lower even than that but I won't try and bottom pick because the bottom will be impossible to predict with any degree of accuracy and will be determined by the severity of the fallout from this virus. My approach if anyone is interested is as follows.
1. Completely forget about fundamental analysis with AIR at present. Reason. Its impossible to predict what earnings will be going forward as this is totally reliant on the virus not scaring people enough so that en-masse they won't choose to defer or cancel discretionary or business travel.
2. Sticking with technical analysis its clear that AIR broke down through the 100 day moving average recently at $2.85. This is my usual preferred signal to get out of a cyclical company but as I was very sure the 100 day MA breech was coming I got out much earlier at $2.98.
3. To de-risk this, (potentially extremely serious virus risk), thoroughly, I will wait until it breaks back up through the 100 day moving average line, no matter how long it takes to do this. It is possible this may not happen for quite a protracted period of time and I am fine with that.
Well... finally AIR admitted that there will be an impact with this corona virus....good luck to those that bought in last couple weeks...
impact of corona virus not to bad 55 mil approx and could be of a short term nature. mitigated by lower fuel bill and capacity cuts to routes. Of course its still a moving situation. dividend shouldnt change
https://www.nzx.com/announcements/348842
So virus impact $75m and counting ...and that’s assuming a significantly lower fuel cost (just as well for that)
Operating earnings now guessed at $275m ....and going down fast
http://nzx-prod-s7fsd7f98s.s3-websit...842/317306.pdf
Flight Centre says its sales to Asia are down 5 per cent following the coronavirus outbreak, with its travel suppliers offering special sale airfares to other parts of the world.
The travel agent said its airfares to China were down 75 per cent, as it had expected following the advent of Covid-19,but the outbreak had had only minimal effect on bookings to the region
https://www.nzherald.co.nz/business/...ectid=12310065
So if you look at air and what flight centre are saying. air nz impact to date is really all about china travel mostly in there downgrade. so the strategy is to buy air for the rebound in china travel ? if you think its a short term issue
Too early bull....that would be a suicide