AIR - Air NZ.

[Biscuit]

Plenty of short term traders have already availed themselves of a tidy profit so if you're don't believe in the long term tourism growth story, the quality of the airline or its management then maybe you should ?
.

I guess, like you Roger, I can see plenty of upside here. I'm just perhaps more cautious of the downside. I'm still holding, but like I said, I've already taken enough profit to cover the bet.

[pierre]

Flew back from Raro with AIR a couple of nights ago. Chatted with a friendly and attentive member of the cabin crew.
He was very complimentary about the management of the airline. He thought it was great the company was trading very profitably and very appreciative that all employees received a bonus recently.

Most interesting was his comment that AIR recently introduced a computerised roster system that for the first time gives crew flexibility to change their assignments to suit their personal lives, provided they can find someone else to swap with them. He said that as a result of this initiative the amount of "sick" leave taken has plummeted.

Happy crew usually means happy customers. Happy customers usually means a more profitable business.

Another good move by Mr Luxon and his team.

[winner69]

Another good move by Mr Luxon and his team.

I'm getting blinded by the brightness of Luxon's halo - a halo we have seem to have created here

Hope the halo doesn't start to fade any day soon

[winner69]

Interesting insight into the dynamics of the Air NZ senior management team

Quote: Stephen Jones, Air New Zealand's chief strategy, networks and alliances officer, says it also took some persuasion to get his fellow executives to get the flights over the line.

"The internal business case was interesting," he says. "If you don't know much about Argentina you look at it as a high risk place, a volatile government and currency -- why would we even bother with it?"

There were doubters among the airline's eight-member executive who were worried about the risk.

"We had two holdouts so we just had to understand their concerns in a lot more depth and brought them back more evidence around those. Risk management would be particularly around the financial aspects -- how do you get your money?"

http://m.nzherald.co.nz/business/new...ectid=11541576

[iceman]

Thanks for sharing that article Winner. I am looking forward to this new route starting as I will be a frequent user of it. Sadly I have to go over the week before AIR starts but will return with AIR in the new year. It will be interesting to watch the loads. Argentina is indeed a very difficult place to do business in. They currently have very stringent FX controls which makes it extremely difficult to convert pesos to foreign currencies. I trust AIR has done their homework well on this !
I am pleased to see for the first time from AIR, that they are eyeing traffic between SE Asia and South America. I have been saying since they announced this route that is where they will make or break it. The business I am in flies Chinese workers regularly between Argentina and China and it is cumbersome and expensive through Europe, which currently is the only real option. AIR will open up a new and possibly much better option but I am concerned that I think Chinese still need transit visas (not 100% sure) through NZ which needs to be sorted out for this to work. They don't need that traveling through Europe.

[skid]

Boy,its hard to put a rhyme or reason to why airline stocks rise and fall--Just been looking at the chart and this last fall and small gain you could cut out and put on the last June chart and it would fit perfectly --It then dropped to $2.40 (MA was different though)so I went back and read the posts around that time -(June-July)--There was really no apparent catalyst for the drop--about the only thing I noticed was that most airlines also dropped--everything else seemed pretty identical--management etc.--most were at a loss to say why it was happening.
Its of course bounced back now,but i can only take from this that nothing is certain with airlines and that ,as some have suggested they are cyclical in nature.
It was suggested that it was a healthy correction.
All up from here is not a given any more than get ready for the drop--Or did I miss something more,that was different back then?
One thing for sure is that the $3 resistance is a hard one to crack--If your just looking at the odds.
The only statement Im making is that it was hard to make sense of that June drop(did management expectations drop or the outlook for tourism growth?) or was it just the most fickle mistress of them all --sentiment

[Joshuatree]

There is an Argentine Working Holiday scheme arrangement with NZ which will be good for these flights.

[kizame]

Yes that will be why they are starting the route,the competition from Chile is nothing to right home about thats for sure.

[pierre]

I'm getting blinded by the brightness of Luxon's halo - a halo we have seem to have created here

Hope the halo doesn't start to fade any day soon

Luxon has created his own halo. We're just admiring its glow and contemplating the benefits that will flow to AIR's owners i.e. all New Zealanders whether they hold shares directly or not.

[Beagle]

Interesting insight into the dynamics of the Air NZ senior management team

Quote: Stephen Jones, Air New Zealand's chief strategy, networks and alliances officer, says it also took some persuasion to get his fellow executives to get the flights over the line.

"The internal business case was interesting," he says. "If you don't know much about Argentina you look at it as a high risk place, a volatile government and currency -- why would we even bother with it?"

There were doubters among the airline's eight-member executive who were worried about the risk.

"We had two holdouts so we just had to understand their concerns in a lot more depth and brought them back more evidence around those. Risk management would be particularly around the financial aspects -- how do you get your money?"

http://m.nzherald.co.nz/business/new...ectid=11541576

Fascinating insight into new route expansion. Perhaps they're putting all their management methodology on new route selection out there to calm investors nerves in regard to the pending announcement of two further new routes before Buenos Aires and Houston are even proven to be profitable ! I must admit that even I was thinking I might need a nice calming herbal tea after reading they're looking at even more route expansion next year. That said, they do seem extremly confident that the new routes commencing next month will be profitable from day 1.

Were now seeing quite a stark contrast between the approach of Qantas regarding their major drive for cost reduction with minimal expansion and AIR's approach of containing cost within the bounds of the low inflation rate but expansion, expansion and more expansion. Next couple of years will be very interesting.

While its fair to say the SP race between these two airlines looks well and truly lop sided at present the long term picture could be more interesting. When you start expanding at a great rate of knots, (fastest expansion in AIR's 75 year history according to our enterprising leader) using efficient aircraft you get economies of scale in terms of the overall business coming to the fore pretty quickly. Interesting that AIR's EPS was 29.1 cps last year and Qantas was 25 cps. Further, AIR seemed significantly more bullish in their outlook at their annual meeting than the text of Qan's annual meeting suggested they were.

Most interesting was his comment that AIR recently introduced a computerised roster system that for the first time gives crew flexibility to change their assignments to suit their personal lives, provided they can find someone else to swap with them. He said that as a result of this initiative the amount of "sick" leave taken has plummeted.

Things like that make a huge difference to people's working lives and will serve to enhance AIR's already outstanding reputation as one of N.Z's leading employers.