One thing does strike me is being obvious with this increased competition around Asia & that is consolidation - Cathay Pacific cross owns China Air and came out with a big warning of how competition is really hurting its ability to produce a profit in 2017 and is going to conduct a review and seems to be wanting to go down the Air New Zealand path - ie narrow and update the fleet...
If all the competition is around these new Chinese players & some of the Middle east doesn't it seem obvious that consolidation must be on the cards for at least some of these players? - Cathay Pacific sp has dived making it easy pickings - there must be internal talk going on between players to thin the market through consolidation as the weaker get run over like with Cathay Pacific & even Virgin here in Australia?
Just look at this graph from CAPA on Air New Zealand - the turn around happened 2 years before the start of the oil price coming down & we already know they are forecasting $400-600m with jet fuel at $55 for FY17 so even if they come in low at say $400m then that still leaves them above 2015 results but with a more modern fleet and less crap on the books like Virgin..
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