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Government Loan to Virgin Australia

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Government Loan to Virgin Australia

Old 2nd Apr 2020, 03:17
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Government Loan to Virgin Australia

Lunch time TV news had a Channel 9 reporter, Chris Uhlmann saying that after the daily press conference with the PM that the Government is unlikely to prop up Virgin Australia with the loan that they were seeking. Shudder to think what will happen to all the staff and their families, suppliers etc if they don't reverse that. Not to mention what Qantas will do with airfare costs if Virgin collapses.
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Old 2nd Apr 2020, 03:43
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As disappointing as this may sound for some, this could just be the glimmer hope for many pilots recently made redundant.
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Old 2nd Apr 2020, 03:57
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Something has to come from Scurrah now, if only to stem the rumours that are floating around.

He needs to confirm the company is solvent and can pay its debts as and when they fall due. If so, good and well.

If not, then Administrators need to be called in to preserve the remaining cash.
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Old 2nd Apr 2020, 04:06
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Originally Posted by chance View Post
Lunch time TV news had a Channel 9 reporter, Chris Uhlmann saying that after the daily press conference with the PM that the Government is unlikely to prop up Virgin Australia with the loan that they were seeking. Shudder to think what will happen to all the staff and their families, suppliers etc if they don't reverse that. Not to mention what Qantas will do with airfare costs if Virgin collapses.
Here's a thought?
Virgin Australia will collapse only if its owners allow (or want) it to, not because the Australian Govenment ( with taxpayers money) won't lend them cash.
The owners are by majority all global players (including RB) and got in understanding the strategic risks they were taking with the existing business model that VA has operated under.
Maybe they can redefine the business for the times... and the future.
Here's a radical suggestion...let Sir Richard have his brand back, saving a few $$$$$ with that, and continue to run Tiger LCC (including a Tiger regional op) as OZ's competition to Qantas.
Unfortunately Darwin's Theory of Evolution also applies to business too.

Accreditation to - https://www.livescience.com/474-cont...ion-works.html
Quote "The theory of evolution by natural selection, first formulated in Darwin's book "On the Origin of Species" in 1859, is the process by which organisms change over time as a result of changes in heritable physical or behavioral traits.
Changes that allow an organism to better adapt to its environment will help it survive and have more offspring." Unquote


One more thought, everyone knows how this one panned out.
Back in the day, Ansett Australia, who had more than a competitive share of the Australian aviation market, but not fit enough to survive its failings and circumstances was deemed not worthy of a Government handout because of its foreign ownership.
It died an (un)natural death and the vacuum was quickly filled by a leaner and meaner operation.
So.... Go Tiger!!

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Old 2nd Apr 2020, 04:27
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VA

Just wanted to send best wishes to everyone at VA in this very difficult time.

I understand the premise of why the government canít prop-up VAH.

Itís bad enough with COVID-19, without having to navigate your future with an employer whoís becoming seemingly insolvent as a result. Please everyone, reach out to colleagues in and outside of VAH for support. It doesnít matter what carrier you work for, we all understand the strain. It could quite easily be any of us

If VA are going to wind-up, I hope it happens shortly before the cash is drained. Employees need to get their entitlements.
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Old 2nd Apr 2020, 04:31
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Employees need to get their entitlements.
They will under this scheme...

https://www.ag.gov.au/industrial-rel...s/default.aspx


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Old 2nd Apr 2020, 04:36
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If VA are going to wind-up, I hope it happens shortly before the cash is drained. Employees need to get their entitlements.
Absolutely correct!
If VA is going to go broke, call in the administrators now and give the employees their full entitlements rather than just sit around and wait until the cash is gone and there's nothing for anyone!
If VA isn't going to go broke, then tell us what the situation truly is and give us belief that the company will survive.
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Old 2nd Apr 2020, 05:26
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Originally Posted by The Bullwinkle View Post
Absolutely correct!
If VA is going to go broke, call in the administrators now and give the employees their full entitlements rather than just sit around and wait until the cash is gone and there's nothing for anyone!
If VA isn't going to go broke, then tell us what the situation truly is and give us belief that the company will survive.
Why no Government Loan? Its majority foreign owned. Etihad 21%, Singapore Airlines 20%, Nanshan 19%, HNA Holdings (Hainan) 19% , Virgin Group (Branson) 10.4% with less than 10% owned by a raft of minor shareholders from Australia. So Government will have trouble bailing it out because it a foreign owned entity given in contrast to Qantas that is a majority Australian owned company by a slim margin as the Qantas Sale Act prevents foreign ownership by majority share holding.
If they have no hope of a line of credit from somewhere then they will burn the cash and they don't have tons of assets to borrow against as Qantas was able to do by taking a loan with the Qantas owned B787 fleet as security. A horrible situation but better to shut now and call in the Administrators and then pay out the 10,000 employees their entitlements if there is no chance of a buyer.
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Old 2nd Apr 2020, 05:26
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Sow the wind , reap the whirlwind.
The government of the day deliberately allowed Ansett to fail so that Virgin Blue could lead the Australian travelling public to the sunlit uplands of low-cost deregulated airlines and the nirvana of $ 50.00 fares between Sydney and Melbourne. And nobody joined the dots. Conditions of employment trashed , zero security and an endless chase to the bottom. The a#se was always going to fall out of it eventually when exposed to a crisis. Now it has.

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Old 2nd Apr 2020, 05:53
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Originally Posted by The Bullwinkle View Post
Absolutely correct!
If VA is going to go broke, call in the administrators now and give the employees their full entitlements rather than just sit around and wait until the cash is gone and there's nothing for anyone!
If VA isn't going to go broke, then tell us what the situation truly is and give us belief that the company will survive.
Prior to the Ansett collapse, employees had to get in the (far) queue of creditors fighting for the scraps left by failed businesses.
The only good thing to come out of that whole debacle was that we were made first in line. for whatever was left in the kitty.
I absolutley, and from the bottom of my heart, wouldn't want VA employees to have to experience the trauma of that sh!tfight
Why has there not been a single word heard from VA's owners, they've made CEO Paul Scurrah the messenger and they are letting him cop all the arrows!
Regardless of how much they pay him, from a due diligence perspective they need to be more open and transparent, this is a life or death situation for Virgin Australia.

Understanding how big business operates in the background, I reckon our pollies know alot more than they are prepared to tell us.
We can't continue to accept that they have no control over businesses failing (or surviving), they are intrinsicly involved at all levels!
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Old 2nd Apr 2020, 05:59
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We can't continue to accept that they have no control over businesses failing (or surviving), they are intrinsicly involved at all levels!
Particularly when it is the Governments actions, rightly or wrongly, that is causing businesses to fail.
If you force an airline to be grounded, then you need to accept some of the responsibility for their demise.
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Old 2nd Apr 2020, 06:03
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Having gone through the Ansett demise and a period of unemployment, the government did a good job with helping ensure the payment of owed wages and benefits. The tax liability was small and I ended up with far more cash in hand than expected.

With % rates near zero, hopefully for many Australians affected by current airlines troubles, there's enough personal funds to sustain until better times.

Even as an employee of AN, at the time, I did not feel it right AN was propped up by taxpayers funds. Those funds would soon be far better spent on our War of Terror throughout the Middle East.

Last edited by Gnadenburg; 2nd Apr 2020 at 07:26.
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Old 2nd Apr 2020, 06:08
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Originally Posted by The Bullwinkle View Post
Particularly when it is the Governments actions, rightly or wrongly, that is causing businesses to fail.
If you force an airline to be grounded, then you need to accept some of the responsibility for their demise.
I hear what you're saying and sympathise but management at VAH should also accept some responsibility for the position they're in. They were forced to be grounded (like MANY airlines around the world) because of a pandemic and the risk it poses not only to the nation but the world. Not for shits and giggles.
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Old 2nd Apr 2020, 06:27
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Originally Posted by Dookie on Drums View Post
I hear what you're saying and sympathise but management at VAH should also accept some responsibility for the position they're in. They were forced to be grounded (like MANY airlines around the world) because of a pandemic and the risk it poses not only to the nation but the world. Not for shits and giggles.

​​​​​​

Virgin Australia Holdings annual losses

2009: $160million

2011: $67.8million

2013: $98.1million

2014: $353.8million

2015: $93.8million

2016: $224.7million

2017: $185.8million

2018: $653.3million

2019: $315.4million

Source: Virgin Australia Holdings annual reports showing the statutory net loss after tax for the full year
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Old 2nd Apr 2020, 06:32
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management at VAH should also accept some responsibility for the position they're in.
Yes, but unfortunately the one responsible has long since left the building with millions in his pocket and he's now comfortably swanning around the countryside in a McLaren, never to be held to account for his actions!
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Old 2nd Apr 2020, 06:52
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Originally Posted by TBM-Legend View Post
​​​​​​

Virgin Australia Holdings annual losses

2009: $160million

2011: $67.8million

2013: $98.1million

2014: $353.8million

2015: $93.8million

2016: $224.7million

2017: $185.8million

2018: $653.3million

2019: $315.4million

Source: Virgin Australia Holdings annual reports showing the statutory net loss after tax for the full year
Do their losses stem from specific areas of the business? Does the domestic SH do better than the long haul market? What about the Trans Tasman and PI flights? VA are my preferred carrier on Trans Tasman, Free baggage and meals and better seat pitch than Jetstar, and a similar price, cheaper than QF and NZ.
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Old 2nd Apr 2020, 07:05
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Originally Posted by Anti Skid On View Post
Do their losses stem from specific areas of the business? Does the domestic SH do better than the long haul market? What about the Trans Tasman and PI flights? VA are my preferred carrier on Trans Tasman, Free baggage and meals and better seat pitch than Jetstar, and a similar price, cheaper than QF and NZ.
donít bother asking him.
Heís been a VA hater forever and is loving this right now.
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Old 2nd Apr 2020, 07:07
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Do their losses stem from specific areas of the business?
Ahhh…… Where to begin!
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Old 2nd Apr 2020, 07:15
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Do their losses stem from specific areas of the business?
The part where they fly people around on aeroplanes is the problem.

The frequent flyer scheme made money so a genius manager sold it. A slighter smarter manager then bought it back in house.
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Old 2nd Apr 2020, 07:21
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Brings back some memories doesn't it.

History is so sad sometimes. The opening song "born to try"! Then it completely unravels at 08:45 into the clip.
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