The Distillery: Aviation appraisal

Jotters say things are finally looking up for Qantas, while one gives the Virgin-Tigerair tie-up a tentative tick.

Aviation is in focus this morning, following Virgin Australia's announcement that it has taken control of Tigerair Australia. But the commentariat has plenty to say about Qantas, too.

The Australian Financial Review's Chanticleer columnist, Michael Smith, suggests things are finally looking up for the Flying Kangaroo, despite the impact of a stronger US dollar on fuel prices and a weak revenue environment.

"It has not been a pretty couple of years for Qantas, but managing higher fuel prices is something the airline should be able to cope with. It has a good record when it comes to hedging fuel costs, although the weakening Australian dollar will not help at a time when the airline is trying to find its feet after a tough couple of years. Fixing the international business and avoiding a repeat of the crippling strike action which grounded its fleet in 2011 were far bigger challenges, which it has since resolved."

Fairfax's Matt O'Sulivan reports Qantas has also mysteriously hired high-level consultants to run the ruler over its senior executive team following the split of the airline's domestic and international flying operations.

"They are believed to be looking into matters such as the structure of the executive team, which includes Qantas Domestic chief executive Lyell Strambi and Qantas International CEO Simon Hickey. … Sources said the latest hiring of consultants was not about succession planning, despite Qantas chief executive Alan Joyce being set to notch up five years in the top job in November. '[But] everybody in the organisation is wondering what this consultancy group is going to come up with,' one said."

As for Virgin Australia and Tigerair Australia, Business Spectator's Stephen Bartholomeusz says the logic behind the tie-up is obvious. However, its success will depend on the execution. 

"The re-branding is the first step in trying to salvage a brand discredited by poor service and the lengthy grounding of the fleet in 2011 over safety concerns. The next step would be to try to stabilise a business that has lost money since its 2007 launch and is on track to lose more than $50 million this financial year. There will be some synergies from bringing Tiger into the Virgin fold but ultimately Borghetti will need more planes and more passengers to make the Tiger play work."

Meanwhile, Fairfax's Elizabeth Knight picks up the Australian Securities and Investments Commission's decision to nab companies giving out price-sensitive information to analysts and selected investors by sitting in on their briefings, following the Newcrest apparent bungling of its market update on earnings and production last month. It won't win the regulator any awards for its intelligence-gathering acumen, she argues.

"In this case the chats between the company and the analysts would have been on a one-on-one basis. And there is no way controversial or questionable snippets of information are going to change hands with an ASIC operative sitting around at the briefing. With its limited arsenal against undemocratic release of information to the market, ASIC has chosen the deterrent route."

Reserve Bank governor Glenn Stevens is also back in Fairfax's commentary pages after last week's "joke" about the length of board deliberations. Tim Colebatch laments that the content of Stevens' speech was lost in the turmoil, although the commentator disagrees with the argument that economic pain has been good for Australia. Michael Pasco, meanwhile, suggests the Reserve Bank's new theme song should be The Animals' 'Please Don't Let Me Be Misunderstood'.

At The Australian, John Durie chats with Nufarm chairman Doc McGauchie about Australia's prospects to boost farm exports, while the newspaper's Criterion columnist, Tim Boreham, calls on RHG investors to sell their shares following a buyout bid by Resimac.

Finally, The Australian FInancial Review's Jennifer Hewett examines gender inequality in Australian politics, boardrooms and executive ranks, and the paper's resources guru Matthew Stevens offers a very thorough examination of Mongolia's confirmation that Rio Tinto can start exporting copper concentrate from its giant Oyu Tolgoi mine.

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