Qantas boss eyes Virgin's costs
Sat "Weekend Australian"
Qantas boss eyes Virgin's costs
By Steve Creedy
May 17, 2003
QANTAS chief executive Geoff Dixon has seized on Virgin Blue's $158 million pre-tax profit to attack work practices at his airline and foreshadow further upheavals for staff.
Targeting overmanning, rostering and duplication, Mr Dixon told staff in an internal memo obtained by The Weekend Australian that the airline's work practices "will and must" change.
He said Qantas needed the co-operation of workers to make the changes and avoid the massive upheavals and restructuring of the airline's international peers.
But the airline's biggest union last night rejected Mr Dixon's analysis, saying the workforce was already undergoing major restructuring.
"The Qantas he lives in on the ninth floor might not have seen too much restructuring but down where they're pushing back planes and dealing with passengers, there's plenty," said Australian Services Union assistant national secretary Linda White.
Mr Dixon said Virgin's greatest strength was its cost base, agreed to by unions, which delivered 30 per cent lower costs than Qantas in many areas.
"Qantas has been progressively lowering our overall cost base over some years, including moving our domestic costs closer to Virgin in the past 12 months, but the gap is still too large and progress is not fast enough," he said.
The Qantas chief said cost reduction would not involve downgrading the airline, and its service and product offering would remain.
"What will and must change are the way we deliver the product and our processes, work practices, overmanning, duplication and rostering," he said.
Qantas earlier this month warned its 2002-03 pre-tax profit would be 20-30 per cent below expectations because of SARS and the Iraq war and announced it would axe another 1400 jobs.
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