In Reply to: Bankrupt airline posted by sirsinnik on Thursday, 12. January 2006 at 15:34 Bali Time:
but let's face reality, NO airline can survive when offering Fares which are totally unsubstainable. OK, it's great to see an aircraft running 90+% full but, if it does not make as much money as 60% at realistic fares, then why bother! API was more than generous in extending free additional baggage allowances for those who wanted to take things to Bali for Orphanages and Charitable institutions. They received much "flack" at times for "not being generous enough" but did those who complained think for a moment that for every 100kgs carried what were the fuel useage increases?
I had spoken to API Management on a number of occasions to ask "why...when loadings and tourists from Australia to Bali were inceasing, they needed to keep driving prices down, to the detriment of Garuda and Qantas/Australian (to a lesser degree) who felt they must match these prices. Take it from an Agent's perspective...regardless of the price of the package, the same amount of time is spent on a booking. Say $600.00 + Tax = $800.00 for a package of 6 Nights in a Budget Hotel, the average Agent would make less than $70.00 per person (remember that Taxes/Surcharges are not commissionable). Take into consideration the Landing Rights, Ground-Handling Fees, Staff Wages (not to mention Advertising and Promotion costs) and contemplate just how LITTLE an Airline makes from a ticket from which they realise, after Commissions to Wholesalers, less than AU$520.00 per passenger. With the Child price at AU$199.00, they would be lucky to make $110.00 per passenger.
One also has to consider that the API fleet was OLD, and not cost-effective. Their two A310 Airbus which had originally been in the Singapore Airlines fleet had been "pensioned-off" by SQ a long time before API leased them. Their Airbus A300's which operated the Eastern States routes were actually originally part of the Garuda Fleet and (while still considered commercially safe) had been "retired" by Garuda some 10 years ago. Ongoing maintenance costs on such an old fleet would be higher than with current models, plus old technology meant that they were "fuel enefficent.
I seriously believe that API was "banking" on the success of their proposed "Bali Expos" in Melbourne and Brisbane (public) and Sydney (trade) which were scheduled in November. We were part of the Adelaide 2004 Expo and, in the 15 day "window of opportunity" for people to secure "Expo Special Fares", we generated in excess of AU$375,000 in new API Bookings. You can then imagine how much cash-flor API could have expected from its Expos!
I am personally of the opinion that Kadek may have "borrowed" API Funds to support some of his other developments (like Contiki Resort)but had not anticipated another "incident" in Bali, but only the liquidators of API will be able to ascertain this fact.
Basically, what I am trying to say is that "there is no such thing as a free lunch" and sadly API Management did not appreciate this fact. Let's face facts....if you can get to Bali with 6.5 nights Accommodation + Breakfasts and still get change from AU$1000.00, then you are laughing!!
Just imagine what you would spend overall for an equivalent stay on the Gold Coast or Sunshine Coast of Queensland with a similar level of accommodation + food costs!!
There are some great fares out there in the marketplace so why not use them to show your support for Bali?
Kadek DOES operate MANY hotels, restaurants, bars and tourist attractions in Bali. While I am personally disappointed about his apparently uncaring attitude about the "loss of API" - a bit like losing a "toy", I would never want the wonderful staff he employs in his many "hospitality-oriented" operations to suffer.
PLEASE........Don't make these hard-working Balinese suffer because of a personal "grudge" against Kadek!!! They - and their families - NEED your support right now!!