COVID-19 impacts on Australian airlines

Really , if they or anyone here was thinking about pumping money into Virgin , they probably should just start another Airline that is actually Australian.
And why would Australia pump money into Virgin anyway why wouldn't the countries that do actually own it find the money.

ps , mind you though , l'm happy for Virgin Jetstar Tiger anyone to stay in our market to stop bloody Quantas ripping everyone off. Think Quantas owns Jetstar too actually , but technically probably foreign money in the fine print l'd bet ya.

 

Welder is a tuff gig and respect for the good ones, I've seen some artwork from HKS.

 

I don't know how true this is but I have read that the Federal Government could be up for $800M in FEG (Fair Entitlements Guarantee) payments if they let Virgin collapse.

Government faces $800M bill if they sit back and watch Virgin die

If we take that $800M plus Queensland Government $200M, we are now only looking for a miserly $400M to save Virgin.

Maybe, we should pass the hat around the PC community and seek donations.

@Sackie, you happy to contribute ?

 

Legend, I've been trying to work this out for some time, I hope it's correct.

I'm happy to contribute

 

So this means the government either steps in and gives a loan of 1.4 billion, or pay more than that in entitlements owed by the government to staff paying out leave/long service leave/redundancy and then add on job seeker payouts.

Wonder how the general public will feel about that.

 

Not sure how to value velocity, but prior it was valued at 2 billion. Not sure if you factored that in.

Just prior to covid virgin spent 700million buying up the remaining velocity so it's owned outright as velocity was producing good cashflow.

If they hadn't bought it out and projections continued without covid then it would have made its first profit in many years. Paul scurrah really did turn the airline around but hasn't had enough time to really execute the plan.

 

Unfortunately, I have lost a lot of faith in the Australian public in recent years, weeks, days, ...

Fancy boguns having a birthday party for an 8 year old (with lots of people attending) in Melbourne yesterday.

Idiots!!!!

 

No I didn’t. I assume Velocity will be worth nothing if Virgin folds.

In hindsight, probably a bad use of $700M.

Probably not the worst wastage of $’s by Virgin management.

 

Me too, 80% of the general public suck. The other 20% are awesome

 

Hopefully, I am one of the 20% .

 

Yep I get infuriated hearing of these incidences happening too. But then I look over at the US at the people protesting and wanting the country to open up again...

I also heard that there were potential Chinese buyers for Virgin? I actually didn't know Virgin was foreign owned anyway (until I read Simon's post) so will it make a difference if a Chinese buyer came in (like with everything else)?

 

I wonder if in two years' time air travel will be about the same cost as it was last year, or significantly cheaper or significantly more expensive.
I can see drivers for both.
More expensive: There's a decrease in competition, travel is still subdued and airline overheads still need to be paid for.
Cheaper: A number of airlines go bankrupt and others (new or established) airlines swoop in and buy their planes for cents in the dollar. The amount of capital that those airlines will have to recover from flights will be substantially less than what is currently the case.

 

The problem becomes, who gets a "loan" (bailout) and who doesn't?
Airlines are not the only industry being shut down.
You tell Scomo to stop choosing favourites but why does Virgin get a bailout over the countless other companies that are trying to raise capital?

As mentioned previously, if the owners of the airline aren't prepared to put their hands in their pockets for a "loan" why should the Australian tax payer? I understand the 1 airline thing and I stated the same above. But IMO it cannot be in the form of a loan, unless of course the loan has a very attractive yield.

 

It’s just dumb. These same people and also Pauline Hanson are apposing no Chinese Or foreigners should buy into virgin, no loan or ownership should be given to virgin by the government. She said unfortunately staff will have to loose their jobs.

It’s already foreign owned.

These people are just racist, or have an agenda to profit somehow.

 

I hadn't seen that and can't find a credible report.

Virgin is already majority foreign owned, who cares if the current shareholder's equity gets diluted...??

 

I’m all in for helping all companies that have been effected due to the government’s decision to disrupt the whole country. Scomo made the decision to lock up the country and cause the greatest depression we might ever see.

I’m Not saying it’s right or wrong but you have to help these businesses. Scomo is 100% responsible for this country and his decisions.

Now back to the virgin, did you read the article? 800 million must be paid out in entitlements. Let alone another 500 million plus will go to job seeker payments etc.
From a financial position you give a loan that must be paid out or Australia gets part ownership of the airline, or you pay the similar amount out in tax payers dollars and then have one airline causing additional pain for every single person traveling.

It’s easy to say the company’s owners should pay up, but they are also in the exact same position overseas with their own airlines. How can they help virgin when they also need help.

It’s a tuff call, But form a financial point of view I choose helping with loan, not a handout.

Government faces $800M bill if they sit back and watch Virgin die

 

https://www.facebook.com/video.php?v=2900471743393374

 

Australia has already survived:
Pilots strike of 1987 (?) when essential flights were run by the RAAF on Air Force planes
The collapse of Ansett
The collapse of Compass.

If Virgin folds, another airline will buy the planes etc and start up. Virgin has massive losses accumulated over the last 7 years - a $1.4b bailout will most probably disappear into the black hole of debt.

Virgin UK is also looking for a government bailout.

 

https://www.smh.com.au/business/com...voluntary-administration-20200420-p54lcd.html

Sounds like it's all too late...