Air New Zealand Engineering

[WITCH]

Air New Zealand Proposes Outsourcing Some Engineering Services

Air New Zealand has today announced a proposal to outsource heavy maintenance on its long haul aircraft and engines.

Under the proposal Air New Zealand Engineering Services (ANZES) would outsource heavy maintenance of the airline’s long haul fleet of Boeing 747s and 767s as well as the new Boeing 777s, which start arriving at the end of this month. It would also outsource maintenance of the engines that power these aircraft. This work would be outsourced to a specialist, large scale maintenance centre in Asia or Europe.

Under the proposal around 600 jobs could be disestablished, mostly in Auckland. ANZES currently employs a total of 2,100 staff in Auckland and Christchurch.

Air New Zealand Group General Manager Ventures Craig Sinclair said the global aviation market has undergone rapid change in the past three years.

“Maintenance, repair and overhaul (MRO) for long-haul aircraft is now dominated by large scale international maintenance providers, who through their size can achieve more competitive cost structures. Add to this their proximity to key customers and, for some, the benefits of operating in low-cost Asian economies, and our current small scale, remote operation simply cannot compete,” Mr Sinclair said.



“An exhaustive review has established that this situation will not improve as ANZES is facing declining volumes of work from Air New Zealand and has been unable to secure any committed, long-term external customers for either wide body heavy maintenance or wide body engine maintenance,” he said.

“The proposal to outsource wide body heavy maintenance and engine maintenance would save $100 million over five years, compared to ANZES continuing with the status quo.”

Mr Sinclair said increasing cost pressure on ANZES was masked in 2002 and 2003 by some temporary contracts with QANTAS and the relatively low New Zealand dollar. QANTAS is no longer a wide body aircraft maintenance customer and the New Zealand dollar has risen sharply.

“Compounding this, our internal requirement is declining and new generations of long-haul aircraft coming into service require substantially less maintenance over the aircraft lifetime. As a result ANZES cannot operate a viable heavy maintenance programme solely based on Air New Zealand’s future fleet. In fact, it would have to attract a substantial amount of work from offshore in order to be viable - which would put us head-to-head with the large-scale operators that can match ANZES’ quality and surpass it in terms of cost and turnaround time,” he said.

A defined consultation process involving unions and staff will take place over the next two months with the final decision to be announced on 19 December 2005.

Mr Sinclair said an open and transparent approach is being taken by the company.

“Unions and staff will have the opportunity to examine all the pertinent information and we welcome alternative proposals that may result in fewer job losses or the retention of more work in New Zealand.

“ANZES has consistently provided excellent service to the airline and enjoys the confidence of the public and airline management for its quality of workmanship and commitment to safe practice.”

Mr Sinclair said the company recognised the announcement would be unsettling for ANZES staff and their families and would provide support should the proposal go ahead.

Mr Sinclair and ANZES General Manager Chris Nassenstein are meeting with ANZES staff in Auckland and Christchurch over the next few days to discuss the proposal.

Air New Zealand and ANZES each have a number of other significant investments in their engineering portfolios, which are not affected by the proposal. These include

the narrow body aircraft maintenance business in Christchurch
the military and marine and industrial engine maintenance capability in Auckland
the Christchurch Engine Centre (a joint venture with Pratt & Whitney)
Safe Air, based in Blenheim
Australian-based Tasman Aviation Enterprises.

[pakeha-boy]

....and then you wonder why there is no work ethic or loyalty :confused:

[AN LAME]

Under the proposal around 600 jobs could be disestablished

...the new politically correct vernacular :hmm:

[hangar 9]

Don't get sucked in, this is typical of the new generation of Management, leak these sort of information and scare the sh!t out of everyone and then ask them to be party to a review of jobs and work quota's. They have no intention of taking away your jobs, but you'll be that Sh!t scared that you're going to loose it that you will agree to cut your remuneration just to kep your jobs.

You have to watch carefully any card player, and see what he is shufling to the bottom of the pack.

Oh and if by chance this is true, you would have thought they would have learnt something from the way they mismanaged Ansett.

[sys 4]

qantas hm syd were told today of 70 lames to go by dec 1,this is the begining of our end today,looks like john howards australia is on it's way

[skol]

I'm sure if the worst comes to the worst these guys will have no trouble finding jobs particularly if they dont mind moving offshore.
It may not be in the aviation industry if they want stay in NZ.
What are the qualifications these guys have, are they LAMES?

[skol]

Disestablished-haven't heard that one before.
I guess I'm just not engaged.

[aintsaying]

Not so long ago a certain well respected person inside ANZES brought in all the 3rd part work to Aucklands hangars.
Then the person in charge (the same person who wrote the internal announcement above) fired that person who brought in all the 3rd party work.
The reasons why were strange at the time as it seemed to be opposite to Ralph's view. Back then they said" we don't need third party work coz we got enough of our own work to do."
So now ANZES management has finally realized that they needed those contacts to survive.
So 600 hundred employees get shafted while the ones who F****d it all up get to stay on the pay roll.
I bet you guys wish you kept Mr *o**** around now.
Just goes to show why the employees don't trust their management, I guess the employees are right all along and here's the evidence.
Good luck to all those displaced, look overseas if you can, not much rosier overseas either but least its not a one horse town.

[HotDog]

qantas hm syd were told today of 70 lames to go by dec 1,this is the begining of our end today,looks like john howards australia is on it's way

What on earth has this got to do with John Howard.:confused:

[pullock]

HotDog my friend if you don't understant that then perhaps you should consider not voting in the next election!!

[sys 4]

sorry wrong thread,thats right you guys over there in NZ have a labour gov,you should be right

[alangirvan]

If part of the problem is that Air NZ will not have a large enough fleet in its own right to justify keeping the skills base in NZ this might be a time for a KSSU alliance in this part of the world. ( KSSU= KLM, SAS, Swissair and UTA, where the different airlines in the group specialised in manitenance of one model.)


If Qantas does choose 777s and 787s. AirNZ could specialise in maintaining these types for QF+NZ, and result in a reasonable number of planes going through the Auckland workshops. If AirNZ chose A380s, QF would look after those aircraft.

This is a time when staff at QF and Air NZ would do well to work together.

[reynoldsno1]

the final decision to be announced on 19 December 2005
Why do they always seem to do this just before Christmas?
Craig Sinclair is a lawyer - former CEO of the Airways Corporation - disestablishment is legal speak for sacked - at least the NZ media recognised that.
There is, apparently, a worldwide shortage of engineers - but once they've gone, they've gone....

[aintsaying]

Air New Zealand does have enough work to keep the current level of employment going.
The problem is the current management staff don't know how to do their jobs. Marketing can't market good enough. Why did Mr Sinclair sack Mr *o**** in the first place? If he did not sack him ANZES would not be in this position now would they?
The boys and girls in ANZES can do just a good a job as anyone else.
Have you ever wondered why Boeing approached AirNZ and asked them to be an Boeing approved MRO for the 787? That was back in very early 2004.
So its not the poor quality of work, its the Bonuses for management that are at stake now.
The reasons prices go up is not because the purchase price has risen, its because managements profit margen is not the same as last year.

[hoggsnortrupert]

Just browsing and thought I may add my thrupnece worth.

A day or so after this news broke, I heard Helen #%&^*& Clarke saying she had no "formal" talks with regard to the ANZ proposed layoff, prior to the election?????.

From my perspective the industry has changed alot, together with the so called NEW GENERATION MANAGER, and ACCOUNTANT, any glamour has long gone, with me blaming deregulation in the main.

I reached the stage that I got sick of whoring myself to the industry for the right to sit in the left seat.

Over the last ten years salaries and conditons have both reduced, and will reduce further.

I have a mate ( I have the odd one) with a PHD, he now has a couple of rural delivery runs, and makes some real good coin.

With all this I have wittnessed and worked with a declining level of engineering standards, as the engineering budgets were tightened.( Not to be confused with the professionalisim of our engineer's).

Sometimes when say a prop seal, or FCU, Bleed Valve, Steering actuator, Flight director,( actual examples from my note book, there are others) could not be repaired due to the lack of spares, the engineer would ask with a faint expression of guilt at having to ask, or tell of the above, and ask if the machine could carry it until the parts arrived.

I only mention the above as an example, I know the 777 will require less maintainance as it is new and the level of technology incorporated in this machine, and others of a similair elk is indeed less, but lets get real here it is a machine that relies on making revenue with bum's in seats, and a "good few bums" at that, and as with all machines , new or old, things do break.

The statement that because it is new and requires less "heavy" maintainance, maybe true for a few years, but just does not stack up in total.

If our ANZ aircraft are going to farmed out to the "cheapest" maintainance organisation ( Probably Asian) I would no longer travel on ANZ.

I say this with memories of sights on ramps in Asia.

I wonder if it could be somehow possible, for ALL ENGINEER'S and PILOTS, across the globe to for once unite in solidarity.

Keep all the Aluminum on the ground for a period of time.

Maybe, just maybe, it may get some attention.

I remember when a Labour Government was for the people.

Also I remember the Govt selling ANZ for $600 mil. and then six years later, buying it back for $800 mil????.

I know you are aware of this, but just thought I may throw it in there.

Forget about being ripped off by the "Bombay" or "Fijian" Indians.

The above have alot to learn from the NEW GENERATION WHITE LAND BASED NEW ZEALAND SHARKS.



:confused: :yuk: :{ :E :sad: :suspect:

[pakeha-boy]

hoggsnort.....great post mate,and as for the grounding of all aluminium...forget it,too many SCABS in the ranks.These types of sentiments have been advocated many times and to no avail ,who says the dog doesnt bite the hand that feeds it

WITCH mate....just read that AIRNZ is only trying to outsource the "Heavy" D checks on the 777 and that for the next 8 years AIRNZ Mtx staff would do all the rest of the work...blowing smoke up their a@se,s sound more like it. With only 7-8 777,s,the angle is that they cant justify setting up the MTX facilties....why not deadhead the Mtx crews to where-ever and let them earn big $$$$ in an overseas Mtx base,a little holiday perhaps,no tax....talk about loyalty.........hang on ,let me put out this "joint" and return to the real world..... kapa O Panga:=

[skol]

The job vacancies are beginning to appear in the NZ Herald.
Take the money and run, if history is anything to go by in a couple of years time you'll get your jobs back.

[nike]

Airline says yes to plan to save jobs
31.01.06 12.05pm UPDATE
Air New Zealand has accepted a union plan aimed at preventing hundreds of redundancies among engineering staff.
More than 500 workers have been awaiting their fate as their unions and airline management tried to find a way to avoid or reduce job losses at Air NZ Engineering Services.
The airline originally planned to send both aero engine and wide-body heavy maintenance to overseas companies, axing 617 jobs, mostly in Auckland.
Last month Air NZ confirmed the aero engine work would definitely go overseas this year, cutting 110 jobs and saving the airline $52 million over five years.
Yesterday's counter-proposal could see the wide-body heavy maintenance work remain in-house, through a combination of job losses and labour reform.
The breakthrough follows three weeks of intense talks between management and union representatives.
Green Party industrial relations spokesperson said: "I believe the unions and workers have compromised hugely to come up with this deal and I only hope Air New Zealand management, in its acceptance of this proposal, does not see it as an opportunity to force workers into unreasonable cuts in wages and conditions."
Last month the Engineering, Printing and Manufacturing Union (EPMU) and the Aviation and Marine Engineers Association indicated it might be able to save about 300 jobs.
But in a statement yesterday, the airline said the unions' initial proposal did not deliver the required remaining savings of $48 million over five years.
Over the weekend, the unions came back with an offer that would deliver the savings, to save the wide-body maintenance work.
The proposal hinges on whether the Christchurch workforce, which services the airline's narrow-body fleet, will veto the proposal.
Union representatives will take the proposal to members at meetings in Auckland and Christchurch for a vote on February 9 and 10.
The ballot results are due out on February 13.
EPMU national secretary Andrew Little said the number of redundancies proposed in the plan would not be made public until after union members had been informed.
He said the talks had been intensive, breaking only for the Christmas holidays.
Mr Little said the airline had also worked hard to save jobs.
"I think they have, in the last few weeks, been keen to make the union proposal work. I think they have seen value in doing what can be done to keep the work here in New Zealand."
Mr Little said he did not want to pre-empt the workers' reaction to the plan, given that it involved job cuts.
"Our members have been aware of what the issues are ... and I think they have to be given the time and space to consider the detail and make up their own minds before they vote on it."
- NZPA

Unbelievable.

[prospector]

It came over on the TV1 news tonight that ANZ engineers were earning, with overtime, up to $185.000.00, could someone confirm or deny that figure?if there are many people collecting that sort of money, even with overtime, would not expect much sympathy from the general public. And even some sympathy for outsourcing the work.

Prospector

[ZK-NSJ]

id much rather them earn 185,000 for 60 or 70 hr weeks then these other govt employees of tvnz who earn 450k + for 30mins a night 5 days a week

[Redstone]

It came over on the TV1 news tonight that ANZ engineers were earning, with overtime, up to $185.000.00, could someone confirm or deny that figure?if there are many people collecting that sort of money, even with overtime, would not expect much sympathy from the general public. And even some sympathy for outsourcing the work.
Prospector


And so continues the seemingly inevitable global race to the bottom. One would think that, if it were the case that the average wage for an aircraft engineer in N.Z. was around the $180,000 mark, it was a good thing. Something to be proud of. Something to aspire to. I suspect this may be the exception to the rule however, purely based on observations pertaining to the number of our trans Tasman brothers and sisters who are now gainfully employed this side of the ditch.

One has to ask oneself, if the company wanted a 20% reduction in wages and conditions just to keep the work in house, which way would I vote?

Hmmmmmmmmm.

[nike]

Management + Media = :yuk: :yuk: :yuk:

Year end bonuses better be absent come balance sheet time.

What a tough vote to make.

[Hanz Blix]

As a mate of many AKL staff I wish them all the best for the vote I hope all the engineers vote very carefully.

Prospector
I can confirm alot of them earn $100K + with overtime and shift work and they deserve it. They are a very highly qualified part of New Zealands work force, so don't start the green eyed monster envy debate on why they earn that much ok:ok:

good luck to all the engineers come vote day

[prospector]

Hanz Blix,

No intention of starting
'so don't start the green eyed monster envy debate on why they earn that much ok'
As long as I dont have to join in the sympathy chorus if or when they price themselves out of the market.

Prospector

[stillalbatross]

There are plenty of jobs out there in the western world that have headed off to places with lower cost bases and therefore lower pay and conditions. It's been going on in manufacturing for the past two decades, you either work yourself up the food chain or you perish. It is that simple.

AIR NZ is a charity basket case that is going to need handouts from arsehole to breakfast for the next 50 years if it doesn't do something about it's utter lack of competitiveness. It cannot keep on relying on the NZ taxpayer to bail out a company in an industry who's time has come. There are a zillion other engineering related companies all having to make major changes to cope with the chinese/indian or any of the other emerging markets and I can't see any of these countries disappearing overnight.

[Hanz Blix]

Prospector, sorry i wasn't getting angry or nancy with you I was just merly saying. i do appologise if it came across the wrong way:ok:

[27/09]

SA

Another of your off the mark posts I see, to go with your one last year that suggested Air NZ wouldn't see it past Christmas, they went on to post a profit if I recall correctly.

AIR NZ is a charity basket case that is going to need handouts from arsehole to breakfast for the next 50 years if it doesn't do something about it's utter lack of competitiveness. It cannot keep on relying on the NZ taxpayer to bail out a company in an industry who's time has come.

Just because other industries have opted to go overseas to use cheap labour doesn't make it right. The logical conclusion is that we all work for the lower wages that are prevalent in those overseas countries. Is that what you are suggesting here?

[stillalbatross]

Air NZ still hasn't made a profit remotely near that which could be considered reasonable in light of the hundreds of millions of dollars pumped into them. The govt could have made substantially more off the money giving it to a bunch of hedge fund managers. So I'll stand by my statement and say if you take away the last dpb handout to the charity case airline it is, you would find a big fat loss again with no sight of any good news on the horizon.

The logical conclusion is that we find industries that other countries can't do as well as us and we capitalise on it. Do you see anyone making fake Rolex watches in Ponsonby? No, because that is an industry we can't hope to compete with in NZ. This is no different, it's an industry we can't hope to compete with and sinking taxpayer money into a bottomless pit isn't going to change that, but getting the cost structure down and getting competitive might.

A few decades back we had a bit of a shipbuilding industry, engineers doing ships as opposed to engineers doing planes. Seems there are other countries who did this more competitively than us so now they do it and we don't.

Why is it all so difficult to understand. We all wanted a free market and de-regulation and unfortunately it's a double edged sword. Look on the bright side, you can buy cheap crap at The Warehouse now :O

[Tarq57]

we all wanted a free market and de-regulation

Who's this "we", white man?

[27/09]

Why is it all so difficult to understand. We all wanted a free market and de-regulation and unfortunately it's a double edged sword.

SA
Please don't count the rest of us with your desire for a free market and deregulation.

Our fair country (though I'm not sure it is your fair country, I suspect you may be an import) has been saddled with a lot of idealogical thinking over the last few years, much of it to the detriment of the average Kiwi.

The logical end result for us here in EnZed with the free market is that we all end up working for third world wages to be able to compete. Is that what you seriously want?

As well as the free markey economy we have had some shocking political decisions thrust upon us by our elected reperesentatives. We seem to be in a race to be the first to introduce policies that our other trading partners are reluctant to introduce. How many of our trading partners have the level of free market that we have. The US Europe and Australia certainly don't.

I will list a couple of the stupid/gutless political decisions.


Open skies with Australia, what a joke, Ansett was allowed a free reign in New Zealand but the same opportunity was denied by our Aussie brothers when Air New Zealand wanted to do the same there, our government did nothing. The only way in the end for Air NZ to get a foot hold in Australia was to buy into Ansett Australia.

Kyoto Protocol, little old new Zealand is going to show the rest of the world how it's done. Our emmisions are drop in the ocean, our contribution won't make the slightest difference, yet our industry is going to pay a very high price making us even less competitive on the world market. You can bet China and Asia haven't signed up nor have the US or Australia.

Domestically, look at the issues that have arisen with dergulation in the taxi industry.

Do I want a free market economy along with deregulation? No I don't, at least not the way we have it now. I am not suggesting a return to what we had before but there needs to be a balance somewhere in between.

Aa I said in an earlier post to justify the Air NZ engineers job losses because the same has happened to other industries doesn't make the job losses right. The losses in the other industries in most cases should not have happened either.

[Hanz Blix]

27/09

I agree with every single word in your post, it is possibly the best post I have read on the subject.

if the country had more people (politicians) thinking this way the country wouldn't be in the state it is at present.:ok:

[stillalbatross]

I'm not saying that it's a good thing but it's what Labour got in on in the 1980's. Have a think about the NZ marketplace preDeregulation when you were paying 10 grand for a Hillman Hunter because import tarrifs were ridiculous. If you don't want jobs going overseas then all that overpriced crap, the sole importers and everything else from the pre deregulation era comes back with it.

Judging by the hordes that ply The Warehouse isles on a regular basis I can't see things changing for the better (past) anytime soon.

[Tarq57]

I don't think anyone would want a return to everything that went with those days. But I think it would be excellent if there was some kind of mechanism to ensure CEO's viewed the future of their companies for a little bit longer than a tenure of about three years. What they are/were planning to do with engineering appears to me to be incredibly short-sighted. Personally would prefer not to travel ANZ if the heavy maint. is contracted out. But then, they're all likely to be the same, aren't they?:(

[27/09]

I'm not saying that it's a good thing but it's what Labour got in on in the 1980's.

Governments tend to get voted out rather than in.

Labour got in because the other lot were voted out. I don't recall deregulation being one of Labours election planks. We got a lot of things we didn't expect. Rodger Douglas and Co tore the guts out of New Zealand.