CAPA Live: Qantas' Alan Joyce. Not "back to 2019 levels until 2024"
Talking at the CAPA Live on 14-Apr-2021, Qantas Group CEO Alan Joyce spoke with CAPA’s chairman emeritus Peter Harbison.
Some the key quotes from the following verbatim report:
- "We're planning on being 80% (capacity) or above for the last quarter."
- “We are seeing that the demand yields hold up pretty well, but we have been out there stimulating the market."
- "International is burning around 5 million a week."
- "We've won nearly 30 corporate accounts in the last few months."
- "Jetstar should be out of COVID a lot bigger than it was going into COVID."
- "When the Qantas group plays its best game it always wins."
- "We're also seeing the corporate market, the business market, not being as impacted as other markets around the globe."
- "Internationally we don’t think we’ll get back to 2019 levels until 2024."
- "To travel (internationally), you either need to do quarantine or you need to be vaccinated."
- "I think that the 2020’s big strategic move for us is going to be (Project) Sunrise."
Alan Joyce, Qantas CEO. Verbatim from CAPA Live, Apr-2021
The market is getting stronger with each quarter and despite the start-stop, people are getting comfortable with what the situation is around borders. They’re travelling. We are seeking three protocols from the Premier, regarding advance notice to get people home, vaccines for the most vulnerable groups, and what international travel will look like.
“We've had some good dialogue with the States about the different parameters, about putting in a system that gives a bit more certainty. I will say before we get into that, what we're seeing each time is that the market's getting stronger and stronger each quarter.
"Actually now I'll go through the financial year; in the first quarter of the current financial year, we were at 20% of pre-COVID capacity levels. Second quarter, we got to 40. Third quarter, we got to 60. We're planning on being 80% or above for the last quarter. And the demand is improving all the time. But despite the stop and start, people are getting comfortable with what the situation is around borders. They're travelling. And then each time it looks like when the borders are closed, it's for a shorter period, the rebound is faster, and more rapid.
“And so we're pretty optimistic about where the domestic demand profile is.
"Now, should we be at a hundred percent plus? Absolutely. Do we want to get there faster? Absolutely. Will certainty on the borders get us there faster? Absolutely.
"So what we've said to the Premiers is let's have potentially three things in play:
- The first is a protocol, until the vaccines are rolled out to all the vulnerable groups, that you have a system in place where you can get people home to their home states. But give those 24, 48 hours to allow us to have that guarantee. And we've got a good reaction, I think, from all the states on that.
- Second thing we've said, in line with the Business Council of Australia, is that when we get to vaccinating all of Category 1b, why would we need to close the borders down again? - and can we have some certainty and guarantee that because we've covered hotel quarantine and hospital workers, there's no need to, and that we should be okay at that stage. And again, I think this is being worked through National Cabinet and the AHPPC.
- And then the third thing that we said when it comes to borders is relating to international, which is then what does the opening of international look like, and what is the framework that goes around that? - the vaccination requirements, the testing requirements, the quarantine requirements? And let's give a certainty on that, because that will allow us to open up international faster when that system is in place."
Demand yields hold up pretty well, but as we say, better to 'earn a dollar in the air then to lose a dollar on the ground', so we’ve gone out there with some amazing promotions. The freight market is bigger than it was before COVID, and then in the domestic market, the leisure market is back to where it was before COVID.
“We are seeing that the demand yields hold up pretty well, but we have been out there stimulating the market.
"What we always said is that for some time we'll be managing the business on a cash basis. That means that we just have to cover the operating costs of the operation, to get our pilots, our cabin crew, our staff back to work. And a lot of the overheads we're taking as sunk, they're there anyway, even if you don't fly the aircraft.
"It's better, as we say, to earn a dollar in the air then to lose a dollar on the ground, but that's been our philosophy and we've gone out there with some amazing promotions. We've also had the government's scheme to promote tourism. That's been very successful. It's generated huge volumes of demand; places like Cairns, a place like the Gold Coast. And we went with 'everywhere else with everywhere else' sale, to generate huge volumes of demand around those leisure markets.
“Not one size fits all in domestic at the moment. What's actually gone back to pre-COVID levels is the 'fly-in, fly-out' market. That's really, really solid, and really big. The freight market is bigger than it was before COVID, and then in the domestic market, the leisure market is back to where it was before COVID in the intakes that we're seeing coming in.
"And it's really the recovery that we're waiting for in the corporate, the SME market. We're seeing that just lag the leisure market by three or so months. And so we're seeing it coming back, as people are coming back for their offices. Now we've got most of our people back here in Mascot now.
“A lot of other companies are doing the same thing. That's the first move. And then we tell people to travel. I've travelled quite a bit in the last few weeks and I don't think it's scary to go through the airport because I think it's just back to normal – just about. If you're in our lounges, we've opened up 33 of our 35 domestic lounges, and we're finding that they're actually filling up. The reason why we've opened up the Qantas Club in Sydney and Melbourne is because the Qantas business lounge is full, and we needed to open up our other lounges. That's how good the volumes are.
“So you have to wear the masks, the masks are there at the terminal and on the aircraft, but the system is very similar as to what it was beforehand. And I think there's a lot more people at the terminals, and every day it feels more normal than it was previously.
"Domestically, cash burn actually stopped in the last quarter and is already cash positive. International is burning around AUD5 million a week, helped by the government assistance programme, but we’re more than treading water. Hopefully when international opens up we’ve got a speedboat to go towards the shore.
“Well, to be clear, what we have said, that was our last outlook is that we would, in the last quarter, start repairing the balance sheet. So that's when the cash burn essentially stopped. And the reason why in the third quarter that we would be burning cash is because of essentially the redundancies that we had in that period of time, and the restructuring costs. At the operating level, the business is generating positive cash flows, there wouldn't be many airlines in the world that are in that position.
“Now, we said domestic was already positive cash flow, and has been for some time. International is burning around 5 million a week, and that will be helped by the government assistance programme, which goes until October. But we're now in the process of repairing the balance sheet, we're more than treading water.
"The analogy I use – for some time Qantas was treading water. We weren't getting worse, we weren't getting better. And now we're starting to swim towards the shore. Hopefully when international opens up, we've got a speedboat to go with towards the shore. And that's the process that we're on at the moment."
We're not giving a forecast on profits yet because it's very hard, and a lot depends on when international opens up. If the borders do remain open, we will be repairing our balance sheets in the fourth quarter.
“Profits is a very different situation anyway. Generating positive cash flow, which is a very big, positive for Qantas, given its depreciation, it's all reds that is has, there still has an amount of assets that depreciate, which has a depression on our profitability.
“We're not giving a forecast on that period because it's very hard, and a lot depends on when international opens up. A lot depends on what the demand and robust domestic is. A lot depends on whether the borders open, stay open domestically.
"And so there's a lot of uncertainty there. And of course, we're not giving that forecast. What we're saying, if the borders do remain open, that we will be repairing our balance sheets in the fourth quarter. We'll be generating more cash than is going out, which is... We're pretty positive that that will be the case if domestic borders stay open."
We've won nearly 30 corporate accounts in the last few months from a major competitor. Our market share there has typically been over 80%, [and] we see that continuing. There’s going to be a big battle for small and medium size enterprises and there’s a lot of opportunity in the leisure end of the market.
“The market share will be the market share. What you have is your individual strategies of where your brands, where your businesses are and how they're doing. And I've got to say, if I look at the different segments of the market, which will determine at the end of the day where our share is, on the corporate market; we've won, I think, nearly 30 corporate accounts in the last few months from a major competitor. Our market share there has typically been over 80%, and we see that continuing.
“In the SME market there's going to be a big battle for that small and medium size enterprise. We've been growing market share the last decade. We have enough product and processes in play. We can grow share even further. And in the leisure end of the market, we think there's a lot of opportunity.
"Jetstar should be out of COVID a lot bigger than it was going into COVID. We don't have Tiger in this space any longer. Jetstar has a lot of capability to take share in that space. And when you put all that together, we think naturally our market share will be above 70%, but it falls to where it falls. We've got to be competitive in every segment. We've got to make sure we're profitable in every segment. And it's a very competitive market domestically, which is great for consumers. It's great for the travelling public, great for corporates, it's great for SME markets and Qantas always improves its game when it becomes more competitive. And it certainly is competitive.”
“It's clear that when you look at where Rex has positioned itself, it and Virgin are in the same territory – they're fighting in the middle of the market. They have the same aircraft, Rex aircraft are ex-Virgin aircraft, same product on board. They're operating the same type of strategy in that middle of the market.
"So, that's the battle royal there, and that will continue, I'm sure. We know the proposition of the price sensitive end of the market with Jetstar is very solid and has growth opportunities with Qantas at the premium end. And we're very solid there. So we were obviously watching, and you know what? You've known my view on this for some time, I've never seen the domestic market supporting trade carriers. Maybe it's different this time, but in the meantime, it's going to be hugely competitive between all of the carriers in order to get there.
“And as I said, any time competition has raised, Qantas raised the game with competition, that's come in. We're doing the same again here. I happened to be more efficient with going through our cost base. Making sure that we are an efficient cost base operator.
"We're going through a product and making sure our product is the best product out there, and leads the field. We're making sure that Jetstar has the lowest cost base; they offer the lowest air fares and we'll continue to do that. And we think that strategy has been successful now for nearly 15 years, it will be successful going forward. And then we'll just watch what happens with the competitive dynamic as we'll play our best game, but when the Qantas group plays its best game it always wins. And I have no doubt that will be the case on this occasion."
If you keep your customers happy and they have no reason to move, then you’re going to be a successful business. Internationally we don’t think we’ll get back to 2019 levels until 2024. Of the 11 million Aussies who travel overseas every year, if they translate even into one domestic trip every year that’s massive growth.
“I like to simplify it by – if you keep your customers happy and they have no reason to move, then you're going to be a successful business. At Qantas the number one aim at whatever – it's price sensitive customers or corporate customers, whatever on that spectrum, you are, we'll provide a product and a price on a service that meets your demands and give you no reason to have to build. And we think we can do that profitably and we can do that in a very efficient way. And that's been our strategy. It's pretty simple. Keep your customers happy at the end of the day. I think Qantas is good at doing that.
“I think you're absolutely right. I mean, if international borders continue to have restrictions on them, and even if they do open up – and it will take some time, and we've said for some time that we don't think we'll get back to 2019 levels internationally until 2024, which is similar to what IATA have been forecasting.
"And we know that 11 million Aussies travelled overseas every year. And so they are very big trips, a very long trip. So if they translate even into one domestic trip every year, it's a massive growth in the domestic market and the potential for them to be bigger than that is quite huge. So we're quite excited, quite optimistic about the domestic traffic growth. And we think that could be good going forward. I think you've got the most open market in the world.
“As you know, most domestic markets around the world can't have a 100% foreign-owned airline coming in and starting up. Australia has had that for a number of years; not the case in the United States, not the case in Japan, not the case in Europe, not the case anywhere else. And it's very easy to do that.
"But the dilemma you have is coming back to a very competitive market. You've got Virgin, Qantas, Rex now being very competitive on price, being very competitive on product. And a lot of people look at it and think this is too hard. It's already too competitive.
"Somebody could think again, we could set up an airline here, but again, I'd say Qantas, when it plays its best game always ends up winning out of this. And competition has always allowed us to raise our game and nothing has changed on that in the environment that we're in today.”
There’s a lot of talk about video conferencing taking a big hit, but we think the net result is something like a 13-15% drop for us. But – with the potential for us making up that market share with the SME market, which is less subject to be disrupted by video conferencing.
“I will say a couple of other things that might be useful; we think that the domestic market here is a little bit different from other markets around the globe.
"Corporate markets, there's a lot of talk about video conferencing taking a big hit on the business market side when we've done our maths on it and we look at the level of corporate market that's fly-in, fly-out. It’s resource based, government based, it's construction and manufacturing layered.
"And then we were like the market that could be subject to being replaced by video conferencing, like professional services and people having internal meetings this way; we think the net result is something like a 13-15% drop in the corporate market for us. But with the potential for us making that upward market share and the potential for us making that up with the SME market, which is just as big.
"And what we're finding at the moment is the SME market is less subject to [it], because these are small businesses that need to travel, [they] need to make the contact. It's less subject to be disrupted by video conferencing. And we're seeing actually good growth in that market coming back faster than the corporate market.
"The segments that we're seeing here, not only are we seeing a potential leisure boom, but we're also seeing the corporate market, the business market, not being as impacted as other markets around the globe, which is good news for Qantas and for Jetstar.”
We don’t see international coming back to pre-crisis levels until 2024. We have parked the A380s and replaced them with 787[s], which have smaller cabin overall and a bigger percentage of revenue coming from the premium cabin. If demand comes back earlier, we can reactivate the A380s within three to six months.
“After September the 11th – that was a dip, particularly on corporates. And then it took a few years, five, six years; the recovery then occurred after the global financial crisis. You saw that, and it got back to pre-crisis level.
"So we know it's a matter of time with economic activity, with economic growth, that these markets will come back. We've had this forecast for some time, and that we don't see that occurring until 2024 now. How has that directed our strategy? Well, that's directed our strategy by saying we park the A380s – they’ve the most premium seats of any of the aircraft in the fleet and are directed towards the big premium market.
"And we have luckily enough been replacing the bigger aircraft with the 787, that have a smaller premium cabin, but a smaller cabin overall and a bigger percentage of the revenue coming from the premium cabin. And the 787 is such a good aircraft. It can replace the entire A380s, 747, network, in terms of range with a smaller aircraft with unit costs that are even better than a 380. So for us it allows us – and our plan was at the end of October, if the international borders were to open up – we could start 22 of the 25 destinations we have pre-COVID with smaller aircraft, smaller number of premium seats on it.
“And we think that's sufficient to make good money and the economics work on that business. And we've been also taking a lot of costs out of our business, a billion dollars out of the Qantas in Australia and benefits coming through our transformation programme. And half of that, just about, is on international.
"So our cost base, even when a lower aircraft like the 787, is going to come down lower to cope with a weaker business market [and] a weaker demand.
"Now if demand comes back earlier, we can reactivate the A380s within three to six months. That's the level of flexibility we have. We think we will reactivate all of the A380s. We spent a lot money on them. Once demand is there, they're going to be good aircraft, get back in the air, and we can cope with this lower demand environment with some time by just parking them and using the 787 system.”
I do think there’s going to be demand and – like we’ve seen in the leisure market – a big pent-up demand for some of these business-type trips to happen; internationally as well. There’s nothing like those personal contacts. I think it's very different from the EFC that gives me optimism about the future.
“The global financial crisis was a little bit different. You had an economic recession that was massive. You had businesses overnight... We lost a billion dollars in revenue because people were not travelling in first class or business class.
"They always say the Americans are talking about a bigger growth to their economy than before they went into this crisis. And you look at our economy and other economies, though – it's very different from the global financial crisis in a number of ways. The thing we're going to have to account for is this move to video conferencing. So it's not an economic activity with a depression of demand, it's more of a technology resetting of that demand, which I think is very different.
“But I do think there's going to be the demand. We talked to our professional service clients and our customers, and they're saying the minute they can get back to the States, to Europe, to South Africa, to South America, they'll be on the aircraft. We establish those links, get those customers going, get the product out there, to talk to people. So I think there's going to be like we've seen in the leisure market: a big pent-up demand for some of these business-type trips to happen and internationally as well. And there's nothing like those personal contacts. I think it's very different from the GFC; that gives me optimism about the future.”
We haven’t walked away from October to open up international borders. This could happen bubble by bubble, market by market, dependent on what that framework looks like. We just adapt, but we are getting ready and still planning, and it's our best guess at the end of October for the market to open up.
“I think Australia has handled it admirably when it comes to managing the virus. We're in the position where we're one of the best domestic markets in the world, we'll get more aircraft, more people back to work, we're seeing more demand. Life is back to normal just about in Australia, [and] I'd rather be here than anywhere else. And I think most Australians would have the same view. And as a CEO of an airline, I'd rather be CEO of Qantas than any other airline because of that. So, I always think we should be glass half full on these things. And that is a real positive, and thankfully that the leaders in the state and the federal level have helped us get there.
“Secondly, I'd say, which I think is important, that there's a lot of things that have to be worked through before the international borders open up. And we haven't walked away from October. We're of the view that there's still a possibility with the right level of assumptions around us. So people are going to have to make a decision – will we allow vaccinated people to travel, will they be able to get back in quarantine-free, and will they have to have testing – and already countries are doing that around the world. And there's a lot of countries that are dependent on tourism and that have opened up in that way. And this could happen bubble by bubble, which is what the government is saying.
"We're now April and on the 19th of April that this will open up. It's a huge international market for us and that's ahead of our forecast, despite the delay of vaccinations. So this could open up a bubble by bubble, a market by market, dependent on what that framework looks like.
"And the national cabinet are going through that at the moment, are talking about what our framework for opening looks like, when that will be and how that will work. And the BCA and the business community and Qantas and the tourism organisations are all putting their inputs into that process and trying to get an understanding of what that looks like. And the government have also put in a support package for us and to activate aircraft to get ready for that opening.
“And that's still targeted for everything to open at the end of October. We're training people, we're activating aircraft on the basis that we need to be ready for when the borders do up.
"Now, the government have said to us, they can't give us that date with certainty today, because there's a lot of things that it depends on – how effective the vaccination is against stopping transmission, what the rollout looks like, what proportion of the population will have vaccinated, what the success[es] of the other countries are going to look like.
"Now the numbers now coming out [of] the UK, Israel and the US, with the high levels of vaccinations, are looking really good. So that's another dependency on how this could open up, but we just have to maintain flexibility. If it happens earlier, we can adapt. Or if it happens later, and it could happen later, or we just adapt and use it, but we are getting ready and still planning, and it's our best guess at the end of October for the market to open up.”
PH: Alan, in terms of getting herd immunity domestically in Australia, where you need to get to whatever it is, 75-80%, but also, I mean, you've done polling and you found out that the support for your idea of requiring vaccinations before you get on board a Qantas aircraft, is about 80% of the people polled.
I mean, how does that fit with an October deadline, if you want Australians to be able to travel? Because we're not going to have that many Australians vaccinated by that time, in the best of circumstances.
We've said for some time, we think to open up the international waters, you're going to have to have a vaccination type passport. To travel, you either need to do quarantine or you need to be vaccinated. 89% of our customers said they thought it was a really positive thing to have people vaccinated before we travel internationally.
“So AstraZeneca is still applicable for everybody over 50 and they're [a] vulnerable group, that are more likely to have serious illness or die from that COVID-19, as we know, and the government has got in extra Pfizer vaccination, which [has] come available by the last quarter to vaccinate people that are under 50, that cover our population. You can easily look at the numbers, and if the vaccinations from Pfizer are delivered on time, you can get, by the end of the calendar year, easily to the population and herd immunity. And as some of the testing going on, as you know for under 50s, as are the vaccines safe to apply to them, which potentially increases the amount of people that could get a vaccination by the end of the year.
“And with the level of the rollout in other countries. I mean, the US, it's going to have all of the adult population vaccinated by – or anybody who wants a vaccination – by April. And so they're going to have huge production capabilities that won't be needed for their own populations as well. So there's a lot [of] different ways this could go. And I don't think anybody has the certainty to know how fast the Pfizer vaccination could be delivered, how fast the population could get there. And that's why this flexibility's there. I don't think it's anywhere near the six months as a worst case that you were outlining, and maybe a few months at the other end of it, but again, there's a lot of uncertainty, and we just have to keep flexibility and being able to plan on the range of different scenarios around it.
“We've said for some time, we think to open up the international waters, you're going to have to have a vaccination-type passport. And the government's even said this, and other governments are saying it. But to travel, you either need to do quarantine or you need to be vaccinated eventually. And we know people were not going to go with the 14-day quarantine, and it just kills travel.
"So the vaccination requirements looks like it's the only way to restart the international markets again. And as we said, it looks like the Israelis may be doing a deal with Greece and Cyprus, will allow people to travel to those countries if they're vaccinated. Iceland has said – you can enter the country without quarantine if you're vaccinated; it's happening, and it's happening in the rest of the world.
“And then the second thing, we have a duty of care too. As you know, we're regarded as the safest airline in the world, but we have the duty [of] care to our people and to our passengers. And if there's a way of enhancing that in anything we do, we're always going to be at the forefront doing it.
"So having a requirement, even if it wasn't governments to do it, having a requirement to ask people to be vaccinated before they get on our aircraft, where COVID is quite rampant, you would, of course, have thought that that's the sensible thing to do. And the number is, it wasn't just 80%. It was actually 89% of our customers said they thought it was a really positive thing to have people vaccinated before we travel internationally.
"We don't see it as a requirement for domestic or trans-Tasman. But our customers are saying, it gives them confidence in travelling internationally, if they knew that was the requirement. And if it's very much going to take a number of years to build the demand back up, why wouldn't you do everything you could to generate that confidence? And if this requirement is one of the big ways of getting that confidence back, then why not take it? Because it lets more people travel faster and gets the demand back faster.”
How many Australians can travel will depend on the rollout of the vaccination. But then it's not only Australians going to travel internationally. Our largest market's the United States market, where up to 160 million vaccinations have been given now. In the UK it’s well over 20 million, and they are a couple of our largest markets.
“It depends again on the rollout of the vaccination, because if the requirement is you're vaccinated, then the gap between the first and second jab of the Pfizers is shorter. So, potentially, if there's supplies there and the large adult population is vaccinated, that's a huge proportion of people.
“But then it's also, it's not only [that] there are Australians going to travel internationally. It's people coming into the country. Our largest market's the United States market. I don't know. What would be up to 160 million vaccinations that have been given now in the United States. What [would be] in the UK, well, over 20 million.
“And they're a couple of our largest markets. So, it is on both sides, and there's a large element of people being vaccinated in the major markets that Qantas operates to. Which is a good sign that you could get an amount going back very happily.
“And I will say, international we're going to approach the same way as we did domestically. We're looking at – what do we have to do to generate positive cash flows? And that is less than what you would normally have to do with a seat factor, or a yield to make a profit.
“And we're going to be doing that to get the markets up and running again. And if that's there for a few months, so be it. That's a good thing to do to get our people back at work and to get our aircraft back operating, and stopping the cash burn that international is actually occurring at that moment."
The number one route that people were searching for on our international operation was Perth to London. We were weeks from ordering A350s when COVID hit, so we need to see a little bit more certainty before making that purchase. The advantage is – there’s not many people ordering aircraft at the moment.
“What is a good sign is before the trans-Tasman opened up, the number one route that people were searching for on our international operation was Perth to London.
"We could see that before COVID, it was the most profitable international route on our network. And we think that post-COVID, the demand for that will be extraordinarily high. And that's a good route that will perform very well. We were two weeks from ordering the aircraft. We had done the competition between the 777X and the A350. And I picked the A350. We had negotiated a deal with Airbus. We had done a deal with our pilots. We were just ready to go to the boards to confirm it all.
"And then, in March of last year COVID hit.
“So we've said, we need to see a little bit more certainty, the international borders opening up. [That's] the path out of this, because we have to do it in an environment where there's more certainty to get the market comfortable with making that purchase of the order.
“Advantage is, there's not many people ordering aircraft at the moment. The slots for aircraft when we want [them] will be there. And when we revisit a case, when we look back at the research, I think there'll be strong demand for people, as you said, not flying through hubs, [but] flying direct.
"And I think it's a great strategy for the new environment post-COVID, and something that we continue to be excited about. But we have to do it in the right environment. And I'm hoping within the next year, as we've said, that we come and revisit there and make a decision on it.
“We’ve only parked it and paused it. We think this is really strategic for us, in Qantas' history. I think I say every decade, Qantas has made a big strategic bet, and they have paid off over 100 years.
“That bet in the 2000s, it was Jetstar. Look how good that was for us. In the 2010s it was Loyalty. Look how good that has paid for us.
"But I think that the 2020’s big strategic move for us is going to be Sunrise. [Project Sunrise is Qantas' scheme to operate nonstop passenger flights (probably) using specially modified Airbus A350-1000 aircraft.]
"And that's going to put Qantas in a position that, [like] be[ing] the first airline out of the United States to get a jet aircraft in the 1950s. Being the carrier that created business class in the 1970s.
"We looked at those big moments. We're pretty proud with the fact that we led the world. And we're pretty proud of the fact of the position that put Qantas into. But I think this is another one of them.
"So I'm still very excited. Have to persuade my boards. We have to go through a process to persuade our shareholders, that capital's worthwhile investing in that. But I'm up for that, and I'm very positive about it. And I think the case is there to be made.”
The Perth-London service is unique, and when you give a customer a value proposition that's quite special, you can obviously charge a premium for it because it's more expensive to do it this way. And that's a win-win for everybody.
“Well, I think when you do something unique, that gives you a customer value proposition that's quite special, you can obviously charge a premium for it.
"Whether it's Tesla motor cars, whether it's whatever the product is, once it's in a space that hits a customer demand, a customer requirement. You're still going to have competition around you. And if people want to stop off in a hub and want to go through LA, want to go through Dubai, want to go through Singapore, that still is a choice there.
"But if you're providing a product as a unique value proposition. And for that value proposition, you need a premium – which you do because it's more expensive to do it this way. And then you can demand that and you can make a profit out of it. And that's a win-win for everybody.”