The Market says Rob Fyfe has failed

So the departing CEO of Air New Zealand Ltd [AIR.NZX] is leaving his post at the end of 2012 and being lauded by some as a  "rockstar" CEO and the saviour of an airline.

According to the market though he is not.

If we look at the 7 year chart below - the length of time Mr Fyfe has been with AIR NZ -.we can see that the share price has kamakazied to half the value it was when he took over in 2005.

7 Year AIR Chart

Not only that, the share price is an all-time low (see 10 year AIR chart below) since the company was injected with a billion taxpayer dollars in 2002. Hardly the stuff of first-class lay back and champagne flutes.

10 Year AIR Chart

Over its 10 year listing Air New Zealand has had negative returns for investors and the share price was markedly better under Sir Ralph Norris who managed the current structure of the company well through its formative years in the early 2000s.

I know airlines are notoriously difficult to run and it is hard for them to make money but the plaudits and pats on the back for him now are misplaced at best and arse kissing at worst.


AIR @ Share Investor

Share Price Alert: Air New Zealand Ltd
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John Palmer Tipples on the Shareholder
Mike Pero and Air New Zealand: Capitalism vs Socialism
Rob Fyfe's "Environmental Extremism"
Reality Needs to Bite
Air New Zealand wants another taxpayer bailout

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c Share Investor 2012

Mike Pero and Air New Zealand: Capitalism vs Socialism

The fuss made by Air New Zealand [AIR.NZ] over Mike Pero's generous offer last week to provide a plane for families of victims of the 1979 Mt Erebus crash to visit the crash site has come to a head today when Air New Zealand seems to have relented because of embarrassment over a pitiful 6 individuals allowed to go to the site for the 30th anniversary of the crash last week.

The pilot of the fateful Air New Zealand DC10 that killed 257 people was blamed by Air New Zealand management at the time for the crash but evidence was clear that the fault lay first and foremost at Air NZ's feet and that management lied and covered up to rescue the company reputation.

It seems Rob Fyfe and his fellow board members have learned little over the years.

The company that he runs, which is majority owned and financially supported by Kiwi taxpayers has had a history under Fyfe's ownership of socialistic tendencies. That is, its CEO Fyfe has muttered that his company needs more taxpayer moola to run it, using fake science to attack competitors and making public comments that really shouldn't be made by a CEO in a publicly listed company.

Air New Zealand is to all intents a government department and it is run that way.

You can see that in its response to Mike Pero's offer to get a charter plane up to Erebus. Pero made the offer, Air NZ was "offended" by it, then changed its mind and now wants to do it itself, with taxpayer money - pure politics in operation and nothing else.

The failure by Fyfe at the top to be proactive and supply a plane for as many family members of victims who wanted to go is the real story.

Of course the fact that Jim Collins, the pilot of the 1979 flight, hasn't been publicly vindicated is the biggest shame of all and politics is again to blame for that.

As taxpayers, we are all Air NZ shareholders and we should all be angry about that. Those that have made a choice to buy Air NZ shares on the NZX should be seriously looking elsewhere to make money - this company aint going anywhere good in the long-term.

I salute you Mike for standing up to the mediocrity of socialism and using your fine capitalistic skills to try and make a difference for "victims" of the Erebus disaster.

Lets hope you go ahead with the flight. I know which flight I would rather be on.


AIR @ Share Investor

Queenstown Airport: Loud Voices & Loyalty
Long Term View: Air New Zealand Ltd
John Palmer Tipples on the Shareholder
Mike Pero and Air New Zealand: Capitalism vs Socialism
Rob Fyfe's "Environmental Extremism"
Reality Needs to Bite
Air New Zealand wants another taxpayer bailout

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Download AIR Company Reports

Security Analysis: Sixth Edition, Foreword by Warren Buffett (Security Analysis Prior Editions) by Benjamin Graham Buy new: $41.77 / Used from: $33.50 Usually ships in 24 hours

c Share Investor 2009

Rob Fyfe's "Environmental Extremism"

A reader of mine brought this subject up, of sorts, yesterday. That is, the folly of investing in companies that base their business on airy fairy ideas like "green technology" based on the man made global warming myth or in companies whose grip on their business is so tenuous they will sink to the depths of using this kind of bullshit on competitors in the hope they make them look bad.

In my not so humble opinion Air New Zealand [AIR.NZ] is one of those companies.

Rob Fyfe, Air New Zealand CEO has recently labeled Emirates Airline alleged running of "empty planes" across the Tasman as "Environmental Extremism"

"For this competitor, the Tasman sectors are an easy add-on to their long haul flying and an opportunity to earn revenue at only marginal cost and load factors down around 50 per cent seem to be of no consequence," Read more

Fyfe told a gab fest of Global Warming zealots at the Green Skies meeting in Hong Kong.

Now using junk science to attack a competitor is one thing but Rob and the boys and girls down at Air NZ head office have been busy over a number of years spending 10s of millions of shareholder dollars developing nonsense bio-aviation fuels and asking customers to pay extra for their "carbon credit" deficit because of the naughty way they pollute when they choose to fly with the largely Kiwi taxpayer owned airline.

So it is in Robs best interest to attack competitors who don't appear to "care" as much about how filthy flying is because he is spending shareholder money in the hope this will give our airline an edge over the competition and to justify the spending of shareholder dollars - I think the Green Party call it Greenwash.

So Mr Fyfe's stance on the evil of flying is simply a race to the bottom where the eventual winner will be the first to award themselves a gong for being green in the hope it is good for business.

Ultimately though the reckless use of Air New Zealand shareholder money to pursue the bogus notion that every time one flies it is an affront to the environment and by setting your company up as a bastion of virtue above competitors by using this to attack them is environmental extremism itself and will ultimately end in tears and lost shareholder dollars when the whole Global Warming myth unravels.

Stand by for the fallout.


Air New Zealand @ Share Investor

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c Share Investor 2009

Air New Zealand wants another taxpayer bailout

Rob Fyfe has decided that having more than NZ $1 billion of taxpayer money in the Air NZ bank isn't enough.

Proving once again that he is the evil socialist I initially pegged him as he now wants more taxpayer money to subsidise his failing airline, Air New Zealand [AIR.NZ] for "marginal routes."

Jeez Rob, I thought in the real world if something is marginal you simply either cut your costs to regain profitability or if you cant make a decent return simply stop operating.

How bad are things at the national, taxpayer owned carrier then?

Well, the pressure is coming from a number of sides.

Yet another tourist downturn, and these happen frequently for a number of reasons and is why I would rather burn my money than "invest" in an airline, means that bums on seats are down.

This doesn't look like it is going to get better anytime soon. In fact it could get allot worse.

More competition from the likes of Virgin Pacific/Blue and Jetstar mean those margins that Fyfe talks about are getting thinner than the air in a depressurised 747 before a crash landing.

The cost of jet fuel is rising quicker than you can say the Arabs have got me by the family jewels. Every buck of extra cost on aviation fuel means millions off Air New Zealand's bottomline.

To be fair, everyone is being affected by this global pandemic ("swine flu" included) of economic circumstances and every airline is getting it up the tailpipe but having said that, why, with little money left in the taxpayer pocket, should we now be stumping up more borrowed money from China to keep a failing business in the air?

If you are a Air NZ shareholder (apart from the taxpayer) you should be very worried.


Disc I own AIA shares in the Share Investor Portfolio



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