Virgin Airlines Going Bust

[WilliamPowell]

I interested in people's views

Virgin is likely to officially go into Adminstration today

$5 billion in Debt before COVID19

7 years of losses

Outside of so many likely to lose their jobs which is scary it has huge ramifications in other areas

Just looking at sporting codes there is:
 - AFL - major sponsor suggestions it is worth $5-$10 million a year. They also have club deals with Carlont and GAS

- Supercar racing - again major naming right sponsor - don't knpw the value but would assume at least a few million a year

- NRL - Melbourne Storm via Tigerair which is owned by Virgin. Tigerair appear on the Storm's jersey

As I said huge impact.

Although COVID19 has given Virgin the "perfect storm" to head down the administration path, numbers show this business was in massive trouble prior.

This is Ansett mark 2. On a numbers of levels

So the question is should the Govt have bailed them out? 

My view is no.

The Howard Govt didn't bail Ansett out after it was decimated by its major shareholder Air NZ

(Though round the same time Howard did bail out another company which his brother was CEO of but I digress  )

Virgin's financial results of the last few year's show their business model before this was failing. So IMV, they got themselves into this mess, govt (taxpayers) should not be bailing them out

What do others think?

[Rampsation]

No bailout. The business was knackered beforehand anyway. There big shareholders should bail them out if they want. The ACCC just needs to make sure Qantas doesnt gouge customers if they have no rival..

[Francois Jackson]

I should be biased more than anyone but i am not. I have a personal connection to Virgin as my wife and sister in law both work there as well as some great friends.  I have also met Branson before, and have been in his room having beers with a few other blokes. He is an outstanding and humble human being, despite what some rubbish reporting may say.

Once you remove the emotion out of this, the decision was 100% the right one. The only caveat i have to do this is the ACCC stepping in to cap flight so the consumer is not impacted. I have heard this will happen.

I strongly believe Virgin will come out on top here and the Qantas share price today is proof nothing is certain in aviation. That suggests to me the fall out has been priced into the market and Qantas think Virgin aren't going anywhere. Ex macquarie boss to step in to assist as well. The Libs are going to throw the kitchen sink at keeping Virgin in Australia (without the 1.4billion bailout) Whatever happens its still the right call.

If i was the CEO i would bring back Virgin Blue, and operate only on certain international routes. (NZ, LA, Bali) Virgin was at its most profitable when the airline was a whole heap of fun. They went corporate to compete with QF, and were basically stuffed over by a narcossist in John Borgetti who was trying to make up for missing out on the qantas gig.

[Diocletian]

[WilliamPowell]

If i was the CEO i would bring back Virgin Blue, and operate only on certain international routes. (NZ, LA, Bali) Virgin was at its most profitable when the airline was a whole heap of fun. They went corporate to compete with QF, and were basically stuffed over by a narcossist in John Borgetti who was trying to make up for missing out on the qantas gig.

By all reports Frankie,  the current CEO who has been restructuring the business has been gping down this path of returning Virgin to business model of its early years. Unfortunately,  it has come a bit too late

I do think it will be sold but there is going to be a lot of pain

Also, think it is naive of the AGL and its Club's to think the sponsorship $ will continue to flow. One of the first thing the administrator should do is cut costs to stem the financial bleeding. $25 odd million is probably a good place to start

[Francois Jackson]

If i was the CEO i would bring back Virgin Blue, and operate only on certain international routes. (NZ, LA, Bali) Virgin was at its most profitable when the airline was a whole heap of fun. They went corporate to compete with QF, and were basically stuffed over by a narcossist in John Borgetti who was trying to make up for missing out on the qantas gig.

By all reports Frankie,  the current CEO who has been restructuring the business has been gping down this path of returning Virgin to business model of its early years. Unfortunately,  it has come a bit too late

I do think it will be sold but there is going to be a lot of pain

Also, think it is naive of the AGL and its Club's to think the sponsorship $ will continue to flow. One of the first thing the administrator should do is cut costs to stem the financial bleeding. $25 odd million is probably a good place to start

well you wouldn't know to be honest but he started trimming the fat off the company which resulted in halving the loss of the business over the last few years, and there was more to come before covid hit.

He is a good man the CEO, with strong values, and nothing like the narcissist before him who completely ruined the business.

I wonder how the blues will suffer on the back of this? This is why i have demanded my AFL membership fees get refunded by the afl as our hard earned money will effectively all go toward propping those dud clubs just like them.

[WilliamPowell]

I wonder how the blues will suffer on the back of this? This is why i have demanded my AFL membership fees get refunded by the afl as our hard earned money will effectively all go toward propping those dud clubs just like them.

Not just the Blues Frankie

Virgin sponsor the AFL to the tune of $5-$10 mil a year

they are major jumper sponsors of the Blues & Giants. They used to major sponsor of the Suns too but that stopped when they took on the Blues. Fox Sports suggested they had smaller deals with 2 others clubs but didn't say which

It has been suggested that all those years ago when the AFL flicked QANTAS to take up with Virgin that one of the things they asked for was that whichever airline got the AFL deal they had to sponsor the 2 newest clubs at the time (Suns & Giants)

As I said I think the business will be sold but there will be a lot of pain to go with it.

[Francois Jackson]

I know this WP, but to be honest i couldnt care less about the AFL right now and i care less about the Suns.

The blues though stuff em, no money should be given to them in any capacity by Virgin. I hope they suffer like they should have when they continually cheated the system.

There are not many winners, and i have to laugh at people who say they are foreign owned, well who isnt? Qantas completely owned by Australian tax payers.

As for Virgin i would say it could go either way.