NZ Newspapers are a Contrarian Indicator on Overseas Investments
I have long held the opinion that the Herald and Dom Post give great contrian signals when an international investment trend is about to reverse (I learnt this painfully after a year long rebound in Japanese stocks a bullish Herald article encouraged me to buy into a Japanese ETF). My theory being that by the time some NZ reporter finds out everyone who matters in the world already knows! Today brings us this headline:
Pressured Qantas may bite back at Air NZ-Virgin Blue alliance
http://www.stuff.co.nz/dominion-post...-Blue-alliance
Which paints a picture of Qantas at odds with the one in todays SMH:
Qantas aircraft punt comes unstuck
http://www.smh.com.au/business/qanta...124-1a2v6.html
Unlike Air NZ's excellently timed and selected aircraft purchases over the last 10 years, the article explains well what Ben at Plane Talking has been hammering away at for over a year. Qantas have had a shocker in this area of core airline competency.
With no hub constraints Air NZ not only have 777-200s but larger more effecient 777-300s entering service this year as of course do VBA. Sure Air NZ are the launch customer for the 787-9 that Qantas have also ordered but they are not dependent on it for growth or effeciency gains, taking the decision 2 years ago to add fuel saving winglets to their 767s in what at the time had to be a marginal decision but which now seems inspired. Qantas made no such risk mitgating investment and are paying heavily for it.
IMO, Qantas mainline domestically and internationally has greatly reduced ability to pressure the VBA/AIR alliance as the declining effeciency of its aircraft and thus profitability leave it a sitting duck for the next few years.
In my next post I will dig into the operating stats of both Qantas and VBA to see who is actually winning in Australia and see how they stack up to Air NZ.