Qantas share price soars as another airline crashes

Qantas share price soars as another airline crashes

25 March, 2015. 17:01

ERROL PARKER | Editor-at-large | Contact

THE SHARE PRICE of Qantas has grown 1.5% despite news of another aviation disaster – bucking the worldwide trend.

QANTAS's share price has grown steadily since the MH370 disaster.
QANTAS’s share price has grown steadily since the MH370 disaster. SOURCE: ASX

More disturbingly, the Australian airline’s share price has continued to forge ahead since hitting an all-time low in the months leading up to the Malaysian Airlines MH370 disappearance.

Airlines around the world have all felt the squeeze brought on by the string of aviation tragedies, except for Qantas.

Economists and aviation experts have chalked up the coincidental occurrence to the waning Australian dollar, weakening local competition and rising demand for domestic air travel.

The airline's "dark days" outlined above and the resurgence post-MH370. SOURCE: ASX
The airline’s “dark days” outlined above and the resurgence post-MH370. SOURCE: ASX

Qantas International has returned to profitability for the first time since the global financial crisis (GFC); this is partly due to depreciation gains following large write-downs in FY2014 and the fact they haven’t killed anyone, but there is a fundamental redirection too.

CEO Alan Joyce says the share price reflects the flawless safety record enjoyed by the national carrier and the sweeping cancellations of Airbus orders.

“Since adopting turbofan and turbojet aircraft, Qantas has yet to have a fatal accident,”

“Though we’ve come close a few times, the time and resources we invest in training our pilots and cabin crew to deal with emergencies is reason why we have a faultless safety record,”

“As more and more airlines suffer fatal hull losses, our company becomes more valuable because when you buy a ticket with Qantas, chances are you’ll get there,”

“I mean, you get what you pay for these days. With other airlines you might get to see all the beautiful sights out of the window and enjoy the same dreadful in-flight meal – but with Qantas, we can assure you that we won’t fly you in to the side of that beautiful vista.”

From April 1 this year, Qantas will begin enforcing a dress code in all their domestic business lounges, a measure to also ensure the safety of their passengers.

Head of Domestic Product and Service Sterling Greygoose said the new rules are there to protect customers and promote a more professional work environment.

“We’ve made some changes that should please most of our customers,” he said.

“Hair must be off the ears and off the collar – for both men and women,”

“It also mustn’t be dyed, styled or have any product in it – otherwise it will be shaved off at the entrance,”

“Also, as we’re moving away from physical membership cards, our customers are encouraged to have their membership number tattooed clearly on their forearm,”

“Women are now banned from opening doors for themselves in the Qantas Lounge – each door, including cubicle doors, will now have an unpaid and overworked Bangladeshi immigrant to do it for her, ”

“Also, we’re looking at banning people from speaking languages other than English.”

Carolyne Massie-Staker
Karolyne Massie-Staker said she wouldn’t be caught dead flying on any other carrier than Qantas. PHOTO: Latte Life/Bruno Stepsen

Loyal and lifelong Qantas customer, Karolyne Massie-Staker said she’d rather walk, swim and bike to the Colorado snow fields than risk it on a budget carrier.

“My husband and I always fly Qantas,” she said.

“My husband is very important so we’re forced to travel all over the world, for business,”

“Qantas is the only airline you can fully relax on because you know that everybody on the plane has a tertiary education,”

“It can be so stressful flying these days but at least with Qantas, I know I’m more likely to die at the hands of my plastic surgeon.”

Google Trends also outlines a rising demand for Qantas bookings, with growth inflating steadily since early last year.

As the graph shows, the over inflated sense of self-worth felt by Qantas customers has led to a steady rise in demand for the airline.

The airline’s annual report for the financial year ending June 2014 also states that booking numbers increased in light of the MH370 disaster.

In the December quarter of  2014, the demand for seats on Qantas flights began to rise sharply – so much they cancelled orders for new Boeing and Airbus aircraft.

Chief Operating Officer, Mark Daniels says the Airbus cancellations were a strategic move to ensure the safety of their passengers in to the future.

“The common cause in all these recent airline disasters is that all of them were Airbuses,” he said.

“MH17 was a Boeing but we’re not going to count being shot out of the sky as the manufacturer’s fault,”

“This is another example of how Qantas puts it’s customers first.”

rainman
Rain Man (1988) first mentioned that Qantas “had never crashed” PHOTO: ColombiaTristar

Qantas’s safety record was unbeknown to many prior to the seminal 1988 blockbuster, Rain Man – which made their clean sheet a part of popular culture.

Dustin Hoffman’s character, Raymond, refused to get on a flight unless it was Qantas. Tom Cruise’s character, Charlie, found himself unable to find a “Flying Kangaroo” flight from Cincinnati to Los Angeles so the pair had to drive – where comedic gold was unearthed.

As more and more people begin demanding a spot on a Qantas plane, it seems now that life is starting to imitate art.

With additional reporting from Bloomberg 

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