Just When You Thought It Couldn't Get Any Worse For Tesco

[mikey4444]

http://www.bbc.co.uk/news/business-29488777

I bet they wished they hadn't ordered this flipping plane now, as I guess the price of planes, like cars, plummets as soon as they leave the showroom !

[mikey4444]

Forgot to add, good news for Easyjet I suppose, what with all the Tesco corporate travel to come !

[Mosaic]

Will these deliver my click n collect? I an move the car off the drive if need be.

Seriously though, the people in charge have clearly had a serious dose of the Emperor Caligula's. In fact we await their apotheosis.

[VHG]

But I see they are going to sell it, and all the other planes they have.

Seems like their previous success has gone to their head.

It is "plane" to see they are now coming "back down to earth".

[knockavacca]

as they sat in the boardroom "drinking our good health" and ordering those jets, they probably also discussed what they were going to promote at the ROYAL WELSH SHOW , the same over paid brainless crew, decided that it would be a great idea to promote "NEWZELAND LAMB", ??? I ask you, you could not make that up. sack the lot of the braindead bunch of clowns

[tonyav]

The planes aren't their only problem, mikey.
http://preview.msn.com/en-gb/money/other/ghost-store-on-road-to-nowhere-symbolises-problems-haunting-tesco/ar-BB7hxHZ

[chilli]

as a Tesco shop worker, it makes me really mad, and sick to my stomach.

[wolf63]

Why would they want or need a plane?

I like Tesco - our local Metro suits me and the online delivery service means that I don't have to lug cat litter up the stairs.

But for people like chilli it must be annoying to work hard only for the eejits at the top to waste money like this.

[237SJ]

Tesco aren`t the only UK supermarket to go in for private jets. M&S do as well - or at least they used to because I knew someone who was thinking of going for the pilot`s job that was vacant.

[237SJ]

"good news for Easyjet I suppose, what with all the Tesco corporate travel that is to come" I doubt that Easyjet give anyone corporate travel (due to their cost base). Tesco (along with most other major companies) already have corporate travel with scheduled airlines.

[mikey4444]

But the M+S share value hasn't halved in the last 12 months, and Tesco has, which is a very big issue for a company this size. They may be still making money hand over fist but they are in decline...a very serious situation for them.

[237SJ]

I haven`t looked at the details. The news says that Tesco took delivery of a £30m jet. What price was the aircraft when Tesco paid for it 20 months ago? And did they buy it or was it leased?

[Zacs-Master]

Aldi. All hail the new King.

[mikey4444]

237...they bought it. Its in the BBC link above.

[237SJ]

OK. But they bought it 20 months ago and they might have had credit. I know that sounds strange but airlines (not Tesco - I know) have credit ratings with aircraft manufactuters and can get good rates accordingly. I very much doubt that Tesco paid £30m for the aircraft. I see your point though.

[mikey4444]

The very fact that the new Tesco Boss has sold off all its unneeded aircraft, including this one, at a probable loss, speaks volumes.

Tesco is now firmly in the realms of crisis management here. They cannot allow their share price to be become any more depressed, as it puts then into take-over mode. Walmart. for instance, is awash with cash, as the worlds largest retailer, and they would dearly love to take over their biggest rival. There are plenty of private equity groups that are also swimming with hard cash.

Tesco is living in very dangerous times.

[EDDIE51]

They bought and paid for it 20 months ago and have been waiting until now for delivery. There is a shortage of 'top of the range' private / corporate jets so there is a waiting list. They may well be able to sell it at a profit.

[EDDIE51]

^^ rather like for example a Morgan sports car. There is such a long waiting list for a new one that if you order one, once it is finally delivered you can sell it immediately at over the 'list price'

[mikey4444]

Eddie..that is a very old wives tale. The current waiting time for a Morgan is only 12 months, not many years. Also the final price you pay is the price at the time of sale, not when you ordered it :::

http://www.morgan-motor.co.uk/sales/order_form2.phtml

Lets face it...Tesco is in very serious trouble.

[Hypognosis]

I always wondered whether the market for corporate jets revolves around the fact that they can write off profits on one, as a "legitimate business expense". Maybe this only applies in the USA?
Have UK equivalent rules changed? (They knobbled company cars as a perk system some years back, didn't they?)

With 5 jets, it's a wonder they didn't attempt to create a mini Tesco airline, serving corporate customers who can't afford one of their own.

Is £30 million enough to build another store from scratch? Again, I thought the Starbucks technique applies and, so long as you are building or buying new premises, to expand, you can write off profits against the costs and pay little, if any corporation tax at the end of the year. This is completely unfair on competing startups and "mom and pop" businesses, as the Yanks call them.

If you pushed me to, I'd say that the customer wins: rather than 20 chains all on different stages of the learning curve, a new store is instantly up to speed in best practice (money saved, rather than "lessons being learned", with savings passed on to customers) and the brand name tells customers what to expect in terms of service and price.

Lastly, jets fits their past intentions to expand in the USA. Changing planes to get to the smalltown/regional airport adds hours to a transatlantic trip. With 'n' executives, it is a more constructive use of their time and cheaper overall (salary costs of the delegation) to send them straight to the smalltown airport on a bizjet.

Abandoning their US expansion was announced some months ago but probably went unnoticed except for watchers of the business news segment. Selling the fleet just draws attention of a wider audience to the situation.

Much meandering there. Thanks to anyone who read this far. ;-)