In Reply to: Strategic ex Pt Hedland posted by lalita on Friday, 9. July 2010 at 08:22 Bali Time:
You are right about the fares to Bali being good news in the cost area. I cant imagine anyone not welcoming another service onto the route. One of the things that worries me is the added "subject to regulatory approval". Plus what will happen if the Port Hedland - Brisbane sector does not make up the required passenger numbers which will effect profitability required before the subsidy cuts in. If the subsidy is called in how long will those companies providing the subsidy do so before calling it quits, which would obviously cause the service to become unprofitable and ultimately cancelled. It was not that long ago that Garuda used to fly the route using DC-9's on a Friday with the turn around at Port Hedland. Then on the alternate week Qantas would fly the route using a wet leased Ansett F-28 (then later a BAE-146). Garuda pulled out and handed the route to it's domestic carrier, Merpati, who ended the service when the super brainy masters in the public service in Canberra removed the fire services from regional airports and closed down the control towers. At that time, under ICAO regulations, an international service required at least a cat 3 fire service to be in attendance and an operative control tower. So it was that the Pilbara had no international connection for two years, until at last, of all the airlines that were approached and offered considerable incentives by the Airport, Skywest took up the challenge and against all odds and a several month battle between CASA and Airservices about the right to international service without a fire service, CASA declared that it was matter of interpretation and a legislative loophole within the regulations, gave Skywest the approval to commence the service. The problem was that they did not hold an international air operators certificate and thus could not operate as an RPT and were confined to operate as an open charter, which it still does today and will until their applied for IAOC is approved. An RPT operation has decided advantages within the limits of it's license, which brings the ticket cost down. Strategic are also talking to Karratha with a view to a Karratha - Denpasar service. The Port Hedland service is to be expanded to twice weekly in September (Tuesday and Saturday). Indonseia Air Asia have declared and interest in thrice weekly service (Tuedays, Thursdays and Sundays) with direct connections to Kuala Lumpar, Singapore, Phuket, Vietnam and other destinations served by them throughout Asia. Airlines have suddenly discovered the Pilbara. For Strategic it is good business sense if they can capture the Brisbane - Denpasar traffic as Garuda have not yet re-commenced the direct services from Brisbane to Denpasar. The underlying danger is the dreaded demon over-capacity, which could see the route over serviced until it became unprofitable and services cancelled due to that very reason. What is a wonderful opportunity today for cheaper fares and more services to Bali could also be the darker side limited or no service at all. One decided draw back in capturing a market from within the fly-in fly-out population is that their contracts are back to their place of embarkation. To clarify my position I must state that I have no involvement or receive any consideration from any airline but have been involved in the Tourism and aviation industry for some 49 years and a regular visitor to wonderful Bali for the past 35 years and nothing would give me greater pleasure than to see as many more people, as humanly possible, be able to enjoy all that the wonderful island of Bali has to offer at a cost that enables families young and old to make the journey on may occasions. Competition makes for better pricing to our benefit and I hope that the market is strong enough to maintain all the players. If we gain a service and lose another, the Pilbara will once again be captive to the service provider. I wish them all well and I can assure you that my good lady and myself will also avail ourselves of these great fares