The Blue Swan Daily brings you a roundup of the most thought-provoking and interesting comments from those industry leaders in the know.
Monarch Airlines CEO Andrew Swaffield on the carrier’s immediate cessation of operations:
“Millions of customers have flown and holidayed with Monarch over the last 50 years. I am so sorry that thousands now face a cancelled holiday or trip… And many suppliers will suffer hugely as a result of our insolvency – for which I am equally sorry”. Mr Swaffield added the “root cause” for the carrier entering administration being “the closure, due to terrorism, of Sharm El-Sheikh and Tunisia and the decimation of Turkey”, resulting in GBP160 million less revenue.
Airlines UK CEO Tim Alderslade on the announcement made by the Civil Aviation Authority that Monarch Airlines ceased trading:
“Today is a very sad day for the UK airline industry…Today’s news goes to show the ferociously competitive and challenging environment airlines currently operate in. I sincerely hope what has befallen Monarch gives politicians pause for thought about the challenges and costs facing the airline industry, and that at all times they should be champions of a sector that is a massive UK success story and which provides untold advantages to this country in terms of the jobs and connectivity it enables”.
SpaceX CEO Elon Musk on the company’s plans to deploy its BFR spaceship:
“SpaceX could deploy the BFR spaceship to transport passengers to ‘most places’ on earth in under 30 minutes and ‘anywhere in under 60’. The cost per seat should be approximately the same as full fare economy in an aircraft.” He noted: “If you build a ship that’s capable of going to Mars, what if you take that same ship and go from one place to another on Earth? So, we looked at that, and the results are quite interesting”.
Sabre Corporation president and CEO Sean Menke on airline economics:
“The continued growth of LCCs and downward pressure on airline pricing are driving factors of the new technology landscape.” Mr Menke observed that while there is a perception of airline industry consolidation steering airline financial results, “the real impact on airline economics has been the explosive growth of low cost carriers, impressively moving beyond the leisure travel market and successfully driving pricing and competition across both the business and leisure travel segments.”
Scoot CEO Lee Lik Hsin on LCCs in the ASPAC region:
“It’s quite clear that growth in the budget segments of the business are going to be at a higher rate than the full service parts of the business. Competition is par for the course and it’s always been very intense in aviation. It’s not something new, it’s not something different, we just have to respond to adequately and stay one step ahead of the rest”, he said. He added: “Each of us is going to push one other much harder. Everybody is very focused on the business. We will continue to look at ways of getting our unit costs down and really the discipline and execution of our business to be consistent”. He also said innovation and discipline with ensure the brand’s viability in the market.
AirAsia Group CEO Tony Fernandes on AirAsia launching a full service carrier:
“It is not something the company would consider. If AirAsia decided to start a full service airline, we’d be disastrous at it. It’s not in our DNA”, adding: “I think airlines should just stick to what they’re good at. You don’t get Rolls-Royce trying to start a budget car company”.
Qantas CEO Alan Joyce said the company has no plans to separate Jetstar and Qantas Loyalty into separately listed businesses:
“For both of them, we’d say absolutely no. We looked at it, but the loyalty scheme is so important to the loyalty of airline customers. For example, we don’t have expiry on points”. On Jetstar, Mr Joyce said: “There are times when I’ve made a call and said, ‘Jetstar, you’re pulling off this route even though it’s profitable, because Qantas can make more money on it. What I’m focusing on is group profitability, not maximising Jetstar’… If you start having minority shareholders in one of the entities, you have to maximise for that every day. That destroys value and it means you can’t do the co-ordination, which is the secret of how we’ve made this work”.
South Africa‘s National Treasury on the appointment of a permanent CEO for South African Airways:
“The appointment marks a critical step in ensuring that the airline’s turnaround strategy is implemented.” It said: “further appointments to fill other critical executive positions will follow shortly. As communicated before, the airline remains a strategic asset and in its role as the flag carrier, it serves as an economic enabler with direct and indirect benefits across a wide range of economic activity”.