He’s getting out of Airlines who carry high CAPEX because they have to buy or lease planes, carry out rigorous training and refresher courses for their staff. It is a very high capex and people intensive business. Passenger safety is also another operational risk that needs to be constantly monitored, controlled and addressed. It is a very high risk and low reward industry to be in.
Very few airlines get to be profitable. They need to rely on their brand and then monetise their customer base and brand with loyalty programs.
Webjet is the polar opposite, with ultra low Capex, low operational risk, no silly unions in the online space and is mostly a software and partner relationship business.
But they simply happen to be in the same industry, so people love to tar them with the same brush. They are completely different companies - one is a capex hungry, high risk low reward industry - the other a capital light online business.
Just like comparing Uber (a platform) with Toyota (a manufacturer) - completely different companies, operating in what I guess many people would say, the same industry.
WEB Price at posting:
$2.76 Sentiment: Buy Disclosure: Held
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