View Full Version : Qantas will be dead in 6 months

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16th Apr 2009, 14:23
Qantas faces being gutted and restructured around Jetstar model: aviation expert | Business | News.com.au (http://www.news.com.au/business/story/0,27753,25340778-462,00.html)

QANTAS will no longer exist in its current form if the downturn that is crippling the industry lasts another six months, one of Australia's leading aviation experts has claimed.

Centre for Asia-Pacific Aviation director Peter Harbison said that a currently unprofitable Qantas faces being gutted and reconstructed around a more profitable Jetstar model.

He also told The Daily Telegraph (http://www.news.com.au/dailytelegraph/story/0,,25340152-5001021,00.html) yesterday that the 3300 jobs already axed at the airline would be easily superceded in the coming months if conditions did not improve.

The airline confirmed on Tuesday it was currently losing money and was likely to chalk up a loss of up to $180 million in the first six months of 2009.

To help stem further losses, it also announced a 5 per cent reduction in capacity, the axing of a further 1750 frontline staff and senior managers, grounding of 10 aircraft and multiple delays of new aircraft on order.

Qantas blamed a dramatic fall in international travel for its unglamorous slide into the red. Its bottom line is also being decimated by a cut-throat airfares war that has had ticket prices fall to unprecedented levels.

Those levels simply can't be sustained, Mr Harbison said.

"If this environment continues, we basically have an unprofitable Qantas airline that doesn't have a future.

"Even if we stay at the same level for six months, they really have to look at ripping the airline apart and doing something dramatically different.

"There will definitely be a lot more jobs cuts but, more than that, the whole structure of the company will have to change."

Contrarily, Qantas' budget carrier Jetstar continues to trade positively, largely due to its slim cost base and appeal to budget-conscious travellers.

Mr Harbison said (http://search.news.com.au/search//0/?us=ndmnews&sid=462&as=news&ac=business&q=Harbison said)Qantas would not have made it through the current recession if it had not launched Jetstar in 2005 to counter Virgin Blue.

While Qantas management expressed confidence in the airline's future, its boss Alan Joyce seemed to echo those sentiments yesterday

He told Business Spectator it was Qantas' broad portfolio - namely Jetstar and the performing Qantas Frequent Flyer program - that was aiding its survival.

16th Apr 2009, 15:17
If there is any truth to the accusations that Jetstar's performamce in the past few years has been as a result of some crafty accounting that has shifted costs to Qantas' books, we'll soon have indications to confirm or deny.

16th Apr 2009, 20:27
16 October 2009. Lets wait and see.:ugh:

16th Apr 2009, 20:33
Actually, better sell off the profitable stuff before it all goes under.:ouch: How much for the orange gear?

16th Apr 2009, 23:30
Transferred from Qantas pilots chat room:Financial Review on Wednesday the 15th of April;

"While Qantas likes to promote the rapid growth of it's low cost offshoot Jetstar, the downgrade highlights the fact it remains highly leveraged to long-haul international and premium travel.
"There is no arguing Jetstar's success but it contributed less than 10 per cent to group earnings before interest and tax last year."I do not envisage any "intention" to change any "initial" plans that we have been told to date...

16th Apr 2009, 23:41
Struggling, I think that last point was a quote from the poster, not the fin review.

Oliver Klozof
17th Apr 2009, 00:47
Is this the same Harbison that predicted Rex would last 1 month???

I think your crystal ball is a little foggy Mr Harbison...

17th Apr 2009, 01:04
Recent announcements that the Roo is bringing back home heavy maintenance that was being carried out in: HKG, KL & MNL seems to indicate that Harberson’s view that Qantas is proceeding with the 'Dixon Plan' is somewhat short-sighted.

How myopic his view is won’t be known until the Qantas Group actually revokes proposed crewing of its Trans Tasman operations with New Zealand based pilots.

Personally believe it is reasonable to presume that the Roo will become increasingly willing to appease the Government and the Unions in order to get up necessary changes to the Qantas Sale Act so it can consolidate globally.

Real shame AIPA let its GM go. Can't use industrial tactics to solve Trans National issues. :=

17th Apr 2009, 01:25
Read the same article myself, the quote is from the Fin Review.

Was also gobsmacked to read that overseas maintenance will be returned to Australia in an effort to reduce maintenance costs. I thought that was the reason maintenance was transferred OS in the first place.

They're just making it up as they go along.

Back Seat Driver
17th Apr 2009, 01:50
Gone by October hey? - Bugger
Anybody want to swap me for LSL over Christmas - New Year period.

17th Apr 2009, 01:54

I meant the quote "I do not envisage any "intention" to change any "initial" plans that we have been told to date..." was not from the article in the financial review as per my post. Which is why struggling has edited his post. Minor point.

A Comfy Chair
17th Apr 2009, 02:44

This is all part of the NEW Dixon plan.

Funny how the man responsible for slashing engineering jobs in Australia is now on a Queensland board designed to retain, and develop, new jobs in Queensland.

Watch the overseas jobs come back to Australia and Dixon make a pretty penny in the process.

17th Apr 2009, 03:16
I think it was predicited by many people from day 1 of Jetstar, after enough years the Jetstar brand or at least some of it will be rebranded back into Qantas coulours.

There is no way you are going to let one of the most recognisable marketing icons such as Qantas go under. What management ideally want is Qantas coulours and pay Jetstar salaries. It is going to happen. You know why, because the Jetstar excercise has already proven to management that pilots, flight attendants, check-in people etc will fly/work for those lower salaries. It is just a process of slowly introducing that into mainline.

If it doesn't happen, then maybe Mr Harbison is right. This is no normal recession, not just a downturn and then come out the other side. This recession is significantly going to change the way lots of businesses/industries run.

Qantas will have to be a very different beast to grow and continue as a great airline.

This is not meant to be a negative post, just that i think reality will be very different now.

17th Apr 2009, 04:22
There is no way you are going to let one of the most recognisable marketing icons such as Qantas go under.

I concur.

What management ideally want is Qantas coulours and pay Jetstar salaries. It is going to happen.

Well if that is the case then why have they just signed off on an EBA that increases pay rates, increases Minimum Guarantee and a host of other increases?

Jetstar is an integral part of the QANTAS Group - but it is not going to, like some will suggest, cause the demise of QANTAS Mainline.

I think this site should be renamed the Professional Pilots Nonsense Network.

Mstr Caution
17th Apr 2009, 05:17
the Jetstar excercise has already proven to management that pilots, flight attendants, check-in people etc will fly/work for those lower salaries.

The fact is, that in good times. J* did have problems getting experienced crew to work for those "lower salaries".

Remember the 457 visas for foreign crew.

The economic cycle has turned, they'll get the crew now. But once we emerge from the downturn. Those who have gained experience will look to greener pastures.

17th Apr 2009, 05:19
If that nice Mr Harbison says its true, then it must be true.

Buster Hyman
17th Apr 2009, 05:38
How many LAME's were let go when all the MX went offshore? Could it now be cheaper here because QF will re employ them at lower or casual rates?

I'll just go & put my cynic back in the box shall I?

17th Apr 2009, 06:26
Is this the same Harbison that predicted Rex would last 1 month???
I think your crystal ball is a little foggy Mr Harbison...It's also the same Harbison that predicted Singapore Airlines would be flying the trans-pacific route by mid 2006.

PETER HARBISON: "Right or wrong, I think it's going to occur probably in the next six months, and we'll probably see Singapore Airlines operating that route some time in 2006."

Source: 7.30 Report - 19/01/2005: Australias airline industry heads into another turbulent year (http://www.abc.net.au/7.30/content/2005/s1285329.htm)


17th Apr 2009, 07:36
I guess if we all flew aircraft with the degree of accuracy that jornos employ then jornos would have a lot more to write about! :}

17th Apr 2009, 07:48
As ironic as the following quote by Comfy would be:Watch the overseas jobs come back to Australia and Dixon make a pretty penny in the process.

Such an outcome can only be good for both Australia and Qantas.

Here's hoping. :)

17th Apr 2009, 08:08
You adapt to changing market conditions or you die, period.

This goes for a "one man band" right up to a "dinosaur".

17th Apr 2009, 09:03
I think with all thats going on EBA wise at the moment ( payrises etc ) that any form of promotion will likely be on Jetstar type terms, ie: Qantas has further reductions in services but aircraft and flying get shuffled over to the Star. They won't be able to crew it from anywhere else BUT mainline.

Shame really. And Harbison is a GOOSE!!


17th Apr 2009, 09:31
I don't belive for one minute than QANTAS will be dead in six months, but it may be a much leaner operation.

JNB frequency will probably be reduced, LAX-JFK will be axed (How full is the 744 from LAX-JFK?) BUE is on dodgy ground, as are the FRA flights and at least one flight a day from SYD to LHR will go to Jetstar (probably to LGW or STN)

Additional A330's will go to Jetstar to cover for the non apperance of the B787, and Jetstar will pick up some Saturday afternoon / Early Sunday morning services on the BNE-SYD-MEL triangle, as well as MEL-ADL off peak services 7 days a week.


ditch handle
17th Apr 2009, 09:36
There sure are some fools pontificating bullsh1t around here.

17th Apr 2009, 09:42
There sure are some fools pontificating bullsh1t around here.

Agreed......waste of time really :rolleyes:

Des Dimona
17th Apr 2009, 11:18
There sure are some fools pontificating bullsh1t around here.

Oh yes - and who would they be ???

17th Apr 2009, 11:25
I doubt Qantas will be dead in 6 months. If they are becoming so, the government sure wouldn't allow it to become under. Afterall, it is the nation's national carrier. The government would surely step in to help.

Buster Hyman
17th Apr 2009, 13:01
The government would surely step in to help
I remember hearing that in Sept. 2001...:(

17th Apr 2009, 13:37
Harbison is a ******...

Qantas dead in 6 months and J* saving the world(despite contributing less than 10% of earnings-Aus FIN review) naturally no mention of the cost of the J* model..

Change hands peter :mad:

17th Apr 2009, 14:28
it is the nation's national carrier

no its not, its a privately owned company.

but sadly Mr Dudd will bail them out....

17th Apr 2009, 14:46
How many aircraft does Jet* International have?How many destinations?
Jet* is not currently in a position to do much of anything
If QF falls over who is going to prop up JetStar?
Qantas is going to have a long and healthy life.So lets all calm down

17th Apr 2009, 15:26
Nothing is sure. None of us knows what the future will bring.

Who forecast this economic collapse? Nobody. Then who the hell can forecast when a recovery will take place if indeed there will be one, or who knows a way to instigate a recovery?

17th Apr 2009, 16:31
"Who forecast this economic collapse?"

Many many people.

17th Apr 2009, 22:38
There is no way the Government will let QANTAS collapse............
Think about the volume of travellers there are on any given day flying interstate. There will not be enough capacity to cater to the demands of the flying public if QANTAS folds. It's as simple as that.
If QANTAS goes under, so will the economy.
ANSETT was a different story; the government new that there was no need for two major airlines in Australia and that there would be sufficient travel infrastructure with one major Aussie Carrier.

17th Apr 2009, 23:48
are you the same bloke that fronted buster hymen and the penetrators in the seventies:)

18th Apr 2009, 00:16
There will not be enough capacity to cater to the demands of the flying public if QANTAS folds
im sure if QF folds, the extra capacity needed will be found. thats what other airlines are for! Nothing shitsme more than seeing companies bailed out with taxpayer $$ to "save the economy" when a company dies, others WILL take their places!

if QF does go under, im sure VB, Tiger, Air NZ, United, BA, and others will fill the gaps in capacity quite rapidly.

18th Apr 2009, 00:29
JNB frequency will probably be reduced, LAX-JFK will be axed (How full is the 744 from LAX-JFK?) BUE is on dodgy ground, as are the FRA flights and at least one flight a day from SYD to LHR will go to Jetstar (probably to LGW or STN)

Crap.. Joburg has been making money for Qantas for as long as they have been operating the service (and copious amounts of). Frankfurt only loses money on the days when Qantas runs late.

What The
18th Apr 2009, 00:39
Doesn't QF have in excess of 3bn in cash reserves?

Hardly likely to go under considering they are still expecting to make a profit even in this tough environment.:ugh:

18th Apr 2009, 01:17
Not that I think they will either but never say never in the business world. Do a search for a few months before Ansett went broke - they posted a profit the year before they went broke, and were proclaiming a 'war chest' of millions of dollars as well didn't seem to exist! And lots of regulars on here were proclaiming it would never happen either.

I still proclaim that they plan to run QF into the ground and prop it all up in the form of transferring work over to JQ all on their payrates etc. Once QF is nearly 'ground' up as it stands and JQ is huge and a massive low cost base - then part of Jetstar could rename to the 'new' Qantas. They can't make people transfer to JQ on lower wages - but if they are made redundant from a bleeding QF then it's that or nothing.

I could be wrong - but it is a rumour network!

18th Apr 2009, 01:33
I give up. Whats a "wala"?

18th Apr 2009, 01:39
Sorry - altered

18th Apr 2009, 01:44
Firstly, let me say that I too don't believe the 'Q' brand name will go the way of Ansett.

However, after reading the second paragraph of puff's post #39, (before he altered it), I think we could safely end the debate and take what he's said as the way it's going to be. Maybe not necessarily in six months, but sometime, probably sooner rather than later.

If there's someone out there who doesn't think this is Mr Joyce's "option of first preference", (as it was Mr Dixon's), I've got this bridge you might like to buy...

18th Apr 2009, 01:52
The difficulty with your view Puffy is that it doesn't take into account that: Jetstar's success contributed but 10 per cent to Qantas Group earnings before interest and tax last year." Murdering the Roo to save a potentially rising star is just too risky.

Much safer to push 'Joey' out of the pouch when it can fend for itself and set up a 'new world airline' that is much more capital efficient than both Qantas & Jetstar can ever hope to be.

In the big scheme of things, all this nasty industrial argy bargy, really is just small change.

No need to worry though - if AJ doesn't get it, ultimately the Government and the Shareholders will do it for him; unless of cource the global economy and the airline industry suddenly unexpectidly recover and things spring back to what they were. ;)

18th Apr 2009, 02:01
It is great to see so many JQ optimists out there. Keep it up, it is good for morale which has taken such beating in recent months.

That said, JQ will always be the black and decker version. Nothing has changed and nothing will. The model is low service low cost. Changing the model to full service is tantamount to changing QF to low cost. It simply won't happen. Why? Because QF is where the money is. Without QF, JQ won't survive.

Capt Kremin
18th Apr 2009, 02:35
Qantas announces a 5% reduction in flying and Harbison pronounces it on life support and that Jetstar must save the day!

Give me a break.

Lets have a look at the headlines from the last couple of days shall we?

Singapore Airlines announced a 17% reduction in its fleet.
Cathay Pacific announced an 8% reduction in flying.
DragonAir announced a 13% reduction in flying.
Southwest Airlines announces its third consecutive quarterly loss.

Anyone notice a pattern here? Well run profitable airlines all suffering the same malaise it seems.

If I can offer a personal opinion on this thread. There are many contributors to Dunnunda who have sufferred from various ructions to their working life that were out of their control. A lot of them have done it hard. Thats life in this game unfortunately.
Human nature being what it is though, a lot of these pilots have seen their QF brethren seemingly sail through on good T&C's, good equipment and little to worry them while they have been doing it tough... There seems to be an overwhelming urge from some of them to see QF pilots finally get theirs...
Hence some of the posts on this board.
You may get your wish, I don't know. I can guarantee you however that any fleeting pleasure you will get out of QF's potential demise will be short-lived, and you won't be any better off after it... quite the contrary.
(dismounts the pulpit)

Mstr Caution
18th Apr 2009, 03:04
AJ was quoted as saying as recently as a few weeks ago (words to the effect) J* will never exceed the size of Qantas mainline during his tenure as CEO.

In the paper today he's also quoted as saying - on given international routes J* is not the way to go.

I really wouldn't expect much else from the QF management camp other than the line, J* continues to exceed expectations. Since these are the same individuals responsible for the entity. Admitting other than success for the J* operation would be an acknowledgement of their own failure.

18th Apr 2009, 03:29
Sort of like the floors of accountants deciding to axe themselves...
Not likely to happen...

Easier to reduce operational staff

18th Apr 2009, 03:54
Qantas will be dead in 6 months

Come on guys, this was obviously a finger error, what Harbison meant to write was:

Centre for Asia Pacific Aviation will be dead in 6 months.

How many times can this guy get it so wrong yet still survive?

QF Observer
18th Apr 2009, 12:04
Once again I find myself wondering how some of you people think. Lets get some 'facts' out there.

Sept 2001 - The International Air Transport Association had announced its member losses will amount to US$30 billion between September 2001 and the end of the 2003 calendar year.

2001/ 2002 - Qantas announced profits of $631m despite the aviation industry being turned upside down due to Sept 11. Results some what propped by demise of Ansett on Sept 14 2001.

Nov 2002 - Outset of SARS and turmoil in aviation industry

2002/ 2003 - Qantas announced profits of $502.3m once again despite aviation industry copping it across the board.

2003/ 2004 - Profit $964.6m
2004/ 2005 - Profit $1,027.2m
2005/ 2006 - Profit $479.5m
2006/ 2007 - Profit $1032.1m
2007/ 2008 - Profit $1,408m
2008/ 2009 - Profit Forecast $100 - $200m

Despite everything that has being going in respect to the extremely volatile airline industry, fuel prices, current economic climate, SARS, War on Terror, War in Iraq, Sept 11, Qantas has responded extremely well, much more than can be said to Qantas competitors.

I have absolute faith in the ability of the board and senior management to see Qantas out of this trough and to bigger and better things.

Do I think the airline industry will be the same: NO. There will be more merged entities/ partnerships. I will bet my house on the fact that Qantas will be in the mix and leading the charge in the brave new world of the airline industry.

You cant help wonder how Qantas employees who actively post in this forum continue to beat their own company down, I think this is UN-Australian. As I have previously mentioned, this is the time where staff/ management/ and shareholders alike need to band together and do what it takes to continue to offer the services that Qantas offers to the 35 million passengers it carries every year, not to mention the employment of 34,000 staff, most of which are Australian.

Let the records speak for themselves, Qantas will come out of this a better organisation.

Optimistic Shareholder

18th Apr 2009, 12:33
Totally agree with that!
Numbers speak for themselves.

18th Apr 2009, 12:46
Optomistic Shareholder. The problem, as Qantas staff see it, is that in these tough times under Dixon, we were told we needed to tighten our belts, take wage freezes and then, wage increases that fell well behind CPI.

Meanwhile, in these tough times, Dixon and other senior managers had their noses firmly in the trough. Remuneration packages became obscene. Managerial and other superficial positions grew and grew whilst frontline staff remained same and in some case, were reduced.

Qantas survived and suceeded under Dixon and became top heavy. But there is a whole lot of potential to be a whole lot better.

I am optomistic about Alan Joyce. I honestly hope he can turn around the damage done by Dixon. De-segmentation in certain areas is a welcome step. Likewise, the removal of 590 managers. Read that again. 590 managers. WHY does a business of around 36,000 employees need so many managers? (after the departure of 590, how many will remain)? That is one manager gone for every 60 emloyees. Or, aproximately 4 managers for each aircraft in the fleet!

There is a lot of bitter sentiment amongsed staff, left by Dixon. If Alan Joyce can re-engage staff, Qantas will emerge from this crisis stronger than ever.

18th Apr 2009, 13:32
Qantas was once run by individuals who had aviation in their blood.It was what they loved.
Many of us still have that love of Aviation and Qantas.
Ward,Borghetti,Lindeman all had great affection for the company and aviation.They had been involved since theri youth
Dixon didnt give a toss.For him it was all about the creation of wealth ...his own.
I doubt that Qantas will ever be run with the same passion that it once was.
Today we have the "visitors".Come in make a few changes.Put their stamp on the business.Earn a few million and then leave.
Then the cycle begins again.
Unfortunately Qantas employees will wait in vain for the second coming.
There will never be another Keith Hamilton.John Ward or John Menadue.
We are stuck with the blow ins.
The sooner we all move on the better.
We have seen the good days at Qantas...they are now behind us

18th Apr 2009, 16:52
QF Observer Post 49

There were many factors why QF did well during those years of SARS, Sep 11 etc.

some of the factors that makes this downturn so much more severe and could not be compared to previous disasters are:
Lehman Brothers Bankrupt
AIG nationalised
Citibank/ Bank of America almost nationalised
when the banking system collapse as in the situation we find we are in now, banks are not willing to lend money unless you have excellent credit rating QF credit status is just 2 notches above Junk status, BA is Junk status and that why they are losing millions of sterling each month.
With such bad credit rating, and recently only managed to raise around 500 plus million in cash by selling shares super cheap, QF needs to borrow money. QF keeps saying their cash reserves is over this and that billions but so far the facts have not shown that to be even true. Share prices are dismal, they need to even top up their own super plan with over a period of 3 years liability added to their balance sheets
On top of that we now have Delta and V Aus competing on pacific not just from sydney but also brissy and Melbourne.
We then have MH continuously and relentlessly discounting fares like there's no tomorrow. AJ himself said the prices have gone down to 50% and is eating into margin, this is not sustainable.
Add to that QF has also got such a high labor cost base, compared to other airlines.
Not to mention Japan, germany, UK, US, Singapore, HK all very important markets all in deep deep mud of recession. No economic experts have been able to even guess when all these countries will come out of it.
I forgot too the brand is damaged by regular consistent safety problems. Some of which was so serious people were injured. None of the above factors happened in sept 11, in SARS etc.

If those above factors continue to prolong over 6 months, it will be the end of Q.

according to sydney morning herald article on april 19 CX slashes Flights,

"This slow-down will be deeper and longer" than previous recessions, said Winson Fong, of SG Asset Management in Hong Kong. "The bad news will continue to come."

"A toxic combination of low fares, a big drop in premium travel, weak cargo loads, poor yields and a negative currency impact is making it more important than ever to preserve cash," said the airline's chief executive officer, Tony Tyler.

Now if you add a dose of chicken flu outbreak :eek: and u will have a recipe guarantee Q's demise.

Has anyone thought about how long will oil prices stay low? Will it suddenly go up again? Who knows?

:= remember chicken flu has not been completely eradicted with occasional eruptions in pockets of Asian and Europen region.

*I cannot get over the fact that 590 managers including senior managers are shown the door, this means these 590 manager's contribution (I'd be polite here) is something the company could have done without all along... This is equivalent to making no contribution whatsoever, that's a lot of money wasted...total waste of money. Once out the door, these managers know they will not get any comparable money that they get at Qantas for basically moving the mouth and fingers and making no contribution. I hope they are prepared for this.

18th Apr 2009, 21:26
Qantas is one of only three airlines in the world that has an investment grade credit rating.
Its credit rating has nothing to do with its cash burn rate.The CBR is the relationship between its day to day operating costs and its revenue.So far its standing up.
It is obliged by law to be truthful about its cash reserves which currently stand at $A3.5 Billion.
The top up for its defined benefit scheme this current financial year is $A66million unlike BA which is in the hole for !.5 billion pounds.
Qantas share price has been trashed along with rest of the worlds stock prices.Qantas has not been singled out
Airlines are a cyclical business and require large capital investment in the form of aircraft purchases.When stock markets go south so do airline stocks.
Qantas has become overmanaged in the last 8 years and AJ is redressing that imbalance.That is about the only statement that was true in the last post.
Read and remember.....this economic downturn will be over in a year.
Airline revenues will be back to normal within this time frame.
Qantas will be here when others are long gone

18th Apr 2009, 22:31
on the street is that QF wants the QF sales act amened so they can more easily go for a merger. my oracle tells me the QF/BA talks will be on by the end of the year agin.:sad:

18th Apr 2009, 23:31
QF will not merge with BA. They are a moribund inwardly looking dinosaur that will be lucky to survive unless they undertake a massive restructure and the unions start to work with the company to ensure the survival of the goose that laid the golden egg for them

Qantas is more likely to look towards a carrier like Etihad who will make QF one stop to anywhere in the world and bypass singapore

Its all part of a broader strategy that the recent Etihad codeshare announcements are a precursor to

What The
18th Apr 2009, 23:47
Add to that QF has also got such a high labor cost base, compared to other airlines.

Do you have some facts to back up that statement?

19th Apr 2009, 00:00
structurally Qantas' labour costs are not dissimilar to any large Australian Company. These would best be described as legacy conditions.

With Globalisation and liberalisation of trading between countries; overseas airlines that do not have OHS laws, Workers Compensation, Long Service Leave and a standard of living like Australia has have made in increasingly difficult to compete on cost

Qantas is not unlike any Australian company that finds it challenging to compete with lower cost imports. The wages are only high relative to competitors that in many cases do not compete with Qantas on a level playing field

19th Apr 2009, 00:33
Gee, you can tell it's school holidays.

BA is Junk status and that why they are losing millions of sterling each month.

Right. I get it. If your company gets rated by a (failed) ratings agency as junk status, then you instantly start losing money?

So BA losing money has nothing to do with (from the same post about CX),

A toxic combination of low fares, a big drop in premium travel, weak cargo loads, poor yields and a negative currency impact is making it more important than ever to preserve cash

So BA are losing money because of their junk status, but CX are losing money because of the GFC. Where's the logic in that, iriver?

Pegasus, nice summary.

teresa green
19th Apr 2009, 01:51
WRONG, Who Flung Dung without JQ, QF will not survive. The world has to become leaner and meaner, and that includes airlines, the days of top heavy carriers are over and that includes domestic. I have no doubt QF will survive, albeit in a leaner and meaner way, JQ will continue to grow but in a different way to QF, but they will both need each other to survive in the new world order against more cashed up and aggresive eastern and aisian airlines. Where this takes current QF pilots and engineers is anyones guess, but the pressure will be on for more work and less money, no doubt going on previous severe downturns, very senior Capts will be offered early retirement, trouble makers will discreetly be seen no more, professional First Officers will be shown the door, cadets will be sent bush, S/Os this time unlikely to be seconded, could find themselves on extended leave, and the rest will get less flying, some only enough to keep current, having lived and worked thru no less 3 severe downturns this seems to be the pattern, I don't think many of you are going to end up on cropdusters, but there are worrying times ahead, and if I were a young bloke like most of you are, I would have plan B in order like a bit of moonlighting or making money out of a interest you have, until the whole box and dice settles down again as it surely will.:confused:

19th Apr 2009, 01:56
Both brands (JQ and QF) complement each other through good times and bad. One could not survive without the other. Upper brass have publicly stated this, and it is a clever stratergy.
There will always be budget travellers, and travellers that want to fly the full service brand.

19th Apr 2009, 02:19
Paxing's statement: [quote]...QF wants the QF sales act amened so they can more easily go for a merger...

Is close to the bone I believe.

Australia's Aviation Policy Green Paper released in December 2008 states in part that a liberalisation agreement could:[quote]....Remove many if not all existing regulatory limitations...Australia has increasingly sought to move towards a bilateral ownership founded upon Principle Place of Business based on who has regulatory oversight of the airline, rather than who owns the equity of the company...
Nonetheless, with Whom and How QF Group will globalise, is far from clear and is unlikely to be answered until sometime after the National Aviation Policy Review has resulted in new legislation being passed by the Parliament. Whenever that may be.

In the meantime can only hope that AJ’s Team understand that any Sale Act changes QF would like to see will only be possible if Government, Unions, Shareholders and the Travelling Public come to a consensus view that any such change will be to their benefit.


19th Apr 2009, 02:23
Jetstar was setup to deal with Virgin in the domestic arena.It has been successful in stopping the Virgin march.
It has not however been successful in the international arena.It has threes faces and no direction.
Qantas survival does not rely on Jetstar.Jetstar's survival relies on Qantas.
From TG's reasoning any major carrier that does not have a low carrier version in its stable is doomed to failure.Thats a stretch.
The relationship between LCCs and their mainline parent is generally parasitic.The LCC relying on the parent for everything from a Res system to maintenance.
It will be interesting to see where these relationships go

19th Apr 2009, 03:51
I'm sick and tired of people throwing profit figures around that they've probably only heard bandied around second-hand. So I decided to have a look at the 2008 annual report and nut out some figures myself.

Firstly, if someone starts out by saying that JQ contributed 10% to the group's income, they're already misrepresenting their own argument - the comparison has to be between Qantas and Jetstar. The rest of the group's income is meaningless to the QF v. JQ debate; it includes (amongst other parts) catering, frequent flyers scheme, etc.


QANTAS (which, by the way, includes mainline, Qlink, engineering and ground services - the latter two of which, in the 2008 year, received income from JQ) had an after tax profit of $653.6M.
Jetstar's was $80.1
That's not 10%, it's 12.3%, or 23% greater than was first suggested.

QANTAS fleet - at the end of the fiscal year - comprised 188 aircraft (I used conservative seat estimates to come up with 35313 seats in the fleet). This gave a profit per seat of $18509.
Jetstar fleet - at the end of the fiscal year - comprised 36 aircraft with an accurate seating availability of 7194 seats. This gave a profit per seat of $11134.

QANTAS revenue was about $12.7B.
Jetstar revenue was about $1.56B, or 12.3% that of mainline.

Now what I think is the important point amonst all this is that the percentage revenue and percentage profit are, effectively, identical.

What makes this important is that during the fiscal year;

Jetstar grew it's narrow-body fleet by 25% - with all the inherent cost in that scope of growth,
Jetstar had no premium passengers to help add to the bottom line,
Jetstar had no third-party income similar to that which was added to QANTAS bottom line from income received by engineering and ground handling,
Jetstar operate almost exclusively in a low-yield/high competitive route environment, whereas QANTAS received income from a percentage of high yield/low competitive sectors flown by international longhaul and Qlink,

With all that in mind, it's clear that if JQ had some of the benefits of QANTAS income, then it follows that it's percentage profit (seeing how it's identical now) would have to be potentially far greater.

That's probably why it's a foregone conclusion that JQ will continue to get more of the 'weaker' mainline flying. It is probably also the reason why it will indeed get some of the 'stronger' mainline flying - to increase it's brand-exposure to all markets.

JQ is already marketing StarClass as it's '...International Business Class...' in the printed media. It wouldn't take much to change the marketing blurb to refer to it as BusinessClass should JQ be given some of the more 'premium-patronised' routes in the future.

Much will change before it all settles down again. I have no doubt at all that QF will still be around. Nor do I doubt that JQ will be a much bigger part of the group at that time. Don't forget that NJS, Eastern, Sunstate and (in the past) Impulse have all flown QF liveried aircraft on behalf of QF. There'll be nothing stopping JQ from doing it in the future if the executive deem it will result in a stronger bottom line in the tougher environment ahead.

Good luck to all.


Just read your post. Nonsense more than fact. JQ does not rely on QF for things like Reservations, nor for maintenance (the 'temporary' A330 situation aside).

Any parasitic suggestion would be limited to routes. And that is the whole reason for having a LCC; to fly routes that are unprofitable for the mainline element.

It's all sh#ts and giggles to say that international JQ ops are not making money - but I never see any proof. Come up with proof! Oh, my apologies, I know what the reply will be - something along the lines of "...it's not shown as a loss, because QF is propping it up so that it looks like its making a profit...".

I think that there would be several government agencies who would be very interested in that kind of behaviour if it were true.

19th Apr 2009, 05:47
All the JQ/QF arguement in the world may not save the Qantas Group from what is going down in GM right now. Ie:
DETROIT/NEW YORK - The Obama administration has directed General Motors Corp to prepare a new restructuring plan that would pay off bondholders and the automaker's major union in stock in exchange for $US48 billion in debt, people briefed on the plan have said.

The US Treasury, which has provided $US13.4 billion in emergency funding to keep GM operating since the start of the year, has indicated that it could also convert those taxpayer-backed loans into GM stock, the sources told Reuters.
GM, which is working to complete a restructuring that could include a bankruptcy filing, plans to make the new proposals to bondholders and the United Auto Workers union within the next two weeks, the sources said.

Unless the Company can come up with an innovative plan to offsett the havic the GFC will continue to impose on the entire global aviation industry for sometime yet. The aviation policy quote by Ginger is on the money I reckon.

As for Harbison's quote:QANTAS will no longer exist in its current form if the downturn that is crippling the industry lasts another six months

The words in its current form are most significant.

19th Apr 2009, 08:08
The one in Melbourne?
The one in Singapore?
Or the one in Vietnam?
Please advise who does the maintenance and who provides the Res System

19th Apr 2009, 08:30
There's only one Jetstar.

It's res system is provided by Navitaire (called New Skies).

It's maintenance is proudly brought to you by the Jetstar Maintenance team currently headquartered in Newcastle.

As the A330 is - currently - considered an interim fleet, it was decided not financially/operationally expedient to train JQ's engineers to be A330 qualified. So a LOA was reached with QF Engineering to supply our engineering needs while that type is in our fleet.

No idea about Jetstar Asia - I'd assume it was the Singaporean engineering company.

No idea about Jetstar Pacific - I'd assume it was the Vietnam Airlines engineering company.

I'm pretty sure they use the Navitaire system for res as well.

I hope that's answered your queries.:)

19th Apr 2009, 08:36
You mean the domestic version?.
It services the entire Qantas Group.
So Guess who pays the bills.Qantas not JetStar
Who built the JetStar Maintenance facility in Newcastle?
Qantas Group
Where did they get their LAMEs? and who trained them?
Any one like to Guess?
Who provides the SIM time?
Where are the CC trained?
JetStar pays for Zip.Its all down to the parent.
JetStar as a startup would have required hundreds of millions of dollars to commence operation.
The initial capital was stumped up by Qantas Airways LTD.
Access to gates and slots?..... courtesy of QAL.
Look at Japan.
There is a Q to obtain slots in NRT.JetStar goes straight to the front of the line.
Boy did that piss a few airlines off
Cost of fuel?Courtesy of QAL hedging
Brian Gray tried this on his own and failed.
When you have a big Bro' like QAL lets just say your future is guaranteed
Cost apportioning ...ever heard of it?.Its akin to money laundering
Jet Star is a protected species

19th Apr 2009, 10:08
Domestic version? What is the domestic version?

I thought I made it clear to you - there is only one Jetstar! If that is the company you mean; the company that flies domestic and international in narrow body and wide body aircraft, then we're talking the same language.

That's where we stop talking the same language!

Everything is paid for by the Qantas Group? Yes, you're right: everything (for mainline, QLink, catering, engineering, holidays, etc, etc) is paid for by the Qantas Group. Why? Because every element is part of the Qantas Group. They each leverage off the buying power of the group to pay for their own out-goings.

If you're saying that JQ pays for nothing in the sense that auditors would be able to confirm that JQ pays for nothing, then you are indeed an idiot of biblical proportions. The 2008 (and the previous 4 or 5) annual report shows revenue v. profit. How do you account for the difference? It's the outgoings that JQ have to pay to various service/product providers. As a member of the QF Group, I'm sure we do get the benefits of the Groups hedging policy - but so do the regionals and probably Jetconnect too.

Perhaps I can concede that the start up costs were footed by the Group. But then again, any start up has to have start up costs footed by someone - it doesn't come free. As for the "...hundreds of millions of dollars..." of start up costs?! Perlease... What was the figure that Sir R put up when he started DJ? Half of one of those hundreds of millions.

As for the rest of your fiscal assertions? Each division of the Group has to sink or swim on P & L that each submits at the end of the fiscal year. If you think that a publicly listed company can cook the books in such a cavalier fashion, in a way that regulators can't see through, then perhaps the best you should aspire to is to stick to writing badly written posts on public forums.

19th Apr 2009, 10:15
Large companies like QF using cost apportioning with subsidiaries is not naughty or illegal.So calm down.
The Jetstar in Singapore has other owners apart from QAL.Likewise the Vietnamese version.The Melbourne version is a wholly owned subsidiary.Its the same company in name only.
You think there is only one JetStar?.Well then I have an antique coathanger for sale.
As an accountant and googler you make a good pilot.
Stick to the prong big boy.Oh,you do have a prong...... dont you?

19th Apr 2009, 11:02

Nice try, but in this forum, on this topic, logic has no friends.:ugh:

Better to say:

"Your right hotpants, thanks for the free ride, keep up the good work." :E

19th Apr 2009, 12:21
It services the entire Qantas Group.

FP, I'm sorry to say that you are completely wrong about this one. Big Brother has never used Navitaire. That POS system can't handle what Qantas does. Qantas uses Amadeus in recent times, and used Qube before that.

Now I won't argue about who pays for JQ's use of Navitaire!! But of course, QF wouldn't exist if JQ wasn't around for the synergies, blah blah blah BS.

teresa green
19th Apr 2009, 13:19
Forget about who paid for what, or JQ V QF, it is now all in the past, what is important for you all is what happens now, where does it all go from here ?? It is becoming increasingly obvious that Virgin is teetering, and blind freddie could see some fairly audacious changes ahead for the whole industry, if you could see 12 months down the track, I suspect you would be gobsmacked, time to make your unions strong, stand united, and tighten seatbelts, it is going to be one hell of a ride for a year or so and I don't envy you one bit, but the QF Group will survive I am sure, any Govt, that allowed Qantas to die, would be shown the door, as they well know, as does AJ, one small comfort for those worried about future employment in Pilot and Engineer ranks. Its pointless stating AN's case, different times, different problems, the demise of TAA and AN was distressing to say the least, but THE RAT is moving up the food chain bigtime, and Australians lazy and laid back as they can be, would be be disturbed from their apathy, when QF's last rites were read, and there would a roar from the masses, and some hurried Parliment House meetings as MP's were besieged by their constituents, "whadya mean ya selling off the freckin airline, over my freckin dead body" it would be equal to selling off the AFL,NRL and flogging the War Memorial to the Japanese, it just ain't going to happen , not in my lifetime anyway.

19th Apr 2009, 13:30

Thanks indeed. If I can, I'll just back you 100% in what you said.:ok:


I wasn't willing to 'assertively' push what I wasn't 100% certain about, so thanks for the Amadeus info.


I haven't always agreed with your posts, but on this one, I'm with you all the way. Let's all hang on, look after one another as best as we (and the federal workplace legislation) can and just enjoy the ride!

19th Apr 2009, 13:58
Navitaire must be misrepresenting itself.
There on its website under customers is Qantas Airways.
Gosh an aviation company telling porkies.
All the Qantas Group tails are there.Someone should inform them of their error.
Kotoyebe its down to you.Sort them out babe

19th Apr 2009, 22:45
firepussy you have unwittingly hit the nail on the head with your comment about "protected species".

As a major airline Group you would really hope that Qantas could start and nurture an LCC better and cheaper than could a stand-alone competitor. In fact it would be absolutely appalling if it couldn't do so. So Qantas is "protecting" JQ by effectively allowing it to operate at the QF Group's marginal cost. (big simplified generality but you get the drift).

In the same way JQ is "protecting" Qantas. If you have the time and wits, get a calculator and see what happens to the QF books if you take a JQ sized chunk of revenue and costs out of the Groups results. Not pretty at all. Then go the one step further that, firepussy, marks the professional vs the amateur analyst, and imagine that a stand-alone LCC was stealing QF traffic and that as a result QF yields and Load Factor fell by say 3%. Throw in high fuel prices and a sagging world economy if you're good at scenario analysis.

That would be, for the Qantas Group the China Syndrome, a real meltdown. Yes....happened to United, Delta, Northwest, American. Pension plans headed south, planes parked, wages ruthlessly cut, routes folded etc etc. Not even vaguely pretty.

The essence of symbiosis, synergy, collective strength, economies of scope or whatever you call it is that the QF Group's two brand strategy secures all Group jobs to the benefit of all. It is not perfect.....it has been poorly handled....it is executed by some folks with way too much wide-eyed naivety and ideology.....but it works and for that all QF Group employees should be thankful.

And back to the scenario analysis....add to your thoughts a near future sceanrio with Tiger flying 30 aircraft domestically feeding into a Singapore Airlines operation on Pacific routes with the A380 and the 777-300ER. Virgin dying or contracting and desperately running "two for one" deals that slash yields.....at that time a QF Board that didn't have already have in place a mature Jetstar strategy would be criminally derelict.

19th Apr 2009, 23:38
Do you wear a pointy hat with a half moon on it?
Do you own a Nimbus 2000?

20th Apr 2009, 00:04
QANTAS chief executive Alan Joyce concedes Jetstar has limited capacity to relieve its parent of profit pressure, after the national carrier downgraded its full-year 2009 profit forecast by 80 per cent.
Mr Joyce told ABC TV that the company was approaching the limit of its ability to transfer capacity to Jetstar in order to cushion the profit and yield squeeze that led to last week's profit downgrade.
"We have done a lot of that in the last year. There is a limit to what we can do and I think we're getting to that limit," he said yesterday.
"A lot of the problem markets now for Qantas are probably markets that Jetstar's not the right model for: the Los Angeles market as an example."
Qantas slashed its 2008-09 pre-tax profit guidance from $500million to between $100 and $200million last Wednesday, and said it would retrench up to 1750 staff -- about 5 per cent of its workforce.
The airline will also ground planes and defer aircraft orders as heavy discounting takes its toll on yields amid a nose-dive in demand for air travel since the collapse of Lehman Brothers last September.
While Qantas Frequent Flyer, Jetstar and regional operations are still profitable, international operations -- its biggest divisional earner -- is leaking cash, especially at the front end of the planes.
"In the business class and first class -- the premium cabins -- we're seeing a drop internationally of over 20 per cent," Mr Joyce said.
"In economy, the volumes are actually holding. It's the yields that's the problem, so that we're actually getting less in terms of airfares because there's a lot of discounting."
In a separate interview on Sky News, Mr Joyce said the airline's previous market forecast had allowed for a drop in premium traffic of between 20 and 30 per cent, but the latest profit downgrade was due to fare discounts.
"Even in the last two weeks we've seen our competitors taking a 50 per cent discount on fares and we've matched (this) to remain competitive and that's causing our revenue to take a hit," he said.

Buster Hyman
20th Apr 2009, 00:51
"In economy, the volumes are actually holding. It's the yields that's the problem, so that we're actually getting less in terms of airfares because there's a lot of discounting."
You'd think that after all those years of gouging the eyes out of punters on the virtual duopoly that was the Pacific Route, they'd have a few dollars in the kitty...:hmm: Perhaps Mr Joyce can send me some money as part of a stimulus package & I'll buy a ticket or two?:p

20th Apr 2009, 03:03
I'm just glad jetstar negotiated good rates for aircraft, fuel, shared (ie use of Qantas) training facilities and staff, (and who do we bill Jim?),(that's right, we don't, as these shared employees that deliver security training etc, are qantas emplyees! They'll pick up the tab.) engineering back ups when it turnes to S#$t, the great booking system that it delivers to the qantas group and the phenomenal support it delivers to Qantas mainline.
Hell, when I think travel to anywhere in the world, I think jetstar.:yuk::yuk:
Look forward to chairman Harbisons next prophecy.

20th Apr 2009, 03:28
Teresa G, stirring stuff, you post... and quite right too in the Oz Great Unwashed's reaction to a QF selloff.

Except for one small, uncomfortable point. The money men wouldn't sell off (out?) the QF name, just the people working in it. It's been said by smarter people before me... Since '89 proved it could be done, (all too often) with the willing help of some staff, Plan 'A' has always been to progressively reduce QF to an ever smaller core, handing over as much as possible of its so-called 'non-core' operation to people on far reduced pay and working conditions, until one day, (not, I think, 6 months from now), they simply re-brand all those peripheral, non-core functions as QF, and hey presto!, the 'new, leaner, meaner QF' is born.

...and the Great Australian Unwashed will neither notice nor give a damn - unless the change involves higher ticket prices for them.

20th Apr 2009, 08:31
Spot on
The end game has always been the scenario you paint...
The scary bit is that they don't fully comprehend the limitation of the "model"; they look at it in isolation: as though Qantas is the only airline. Barring brinkmanship it is largely arrogance/ignorance that drives the mentality that you simply transfer all the work and one day bring it back in re-badged...

The problem remains is that the "model" assumes competitor behaviour is static..In a downturn Emirates, Singapore et al will throw everything including the kitchen sink at this poorly conceived model and dilute whatever so called yeild remains, all the while providing full service.

The premis that a so called "low cost model" is viable ASSUMES you maintain volume if not yield. In days such as present, this assumption always was and is today even more obiovusly flawed..Not that Kohler noticed..

And one other interesting point I recently realised...
Is that when my own AIPA executive fly J* for their holidays (star class of course as they are Captains) they undermine any credibility the claim when negotiating for more $$

20th Apr 2009, 14:16
to all those who think the Australian public will not let Qantas collapse, this interesting comment makes sense.

As an Aussie expat living in Hong Kong for the last 5 years I am delighted and relieved to have access to a choice of excellent Asian airlines which have services that leave on time, arrive on time, are price competitive, have professional and courteous cabin staff and more frequently than not are piloted by Australian pilots which Qantas rejected. By any measure Qantas it is a second rate airline that has cleverly tapped into the patriot in many an Australian who feels proud to fly in a plane with a kangaroo painted on its rear, irrespective of the quality of the experience.:ok: Dr Johnson once defined patriotism as the last resort of scoundrels. Qantas have got away with it for years. What would they have done without Peter Allen?:D

Buster Hyman
20th Apr 2009, 14:52
Hmmm...I've always had an issue with "The spirit of Australia"...if it's true, then it serves us right I guess.

21st Apr 2009, 10:36
Some more interesting articles about Q's axing fo staff, this one talks about skilled IT staff probably too sacred to bits now as they have to re apply for new positions and justify their skills and if do not have the skills, will have to be shown the door, accordingly, Blackberry was a dismal failure. All that money spent: for nothing! And Telstra lost its contract with Q. These articles give you a perspective of what other work groups in Q is facing, we have been very centric in the company as a whole, the company does not revolve around cabin services only. There are many important departments such as IT. Any large company will fall apart without an efficient IT department, but can still operate for a long time with 2nd rate customer services.

Jobs at risk as Qantas centralises tech management

Mahesh Sharma | April 21, 2009

QANTAS'S technology department will get a further shake-up and may suffer more redundancies as a new operating model is adopted within months.

It has also scrapped its BlackBerry project, which was intended to improve inflight customer service.

It is understood the new structure -- to operate from June -- will integrate all employees across the technology business units into a single resource pool.

Staff will work across a range of technology projects overseen by multiple managers.

The technology revamp comes as the airline prepares to dump Telstra as the supplier of a $750million outsourcing contract as part of a squeeze on suppliers to cut costs.

Sources said the overhaul, which had been in the works since the middle of last year, would make it easier for Qantas to axe staff.

A recent cull of 90 managers by chief executive Alan Joyce claimed chief information officer Jamila Gordon and several other technology executives.

Qantas also flagged 1750 job cuts -- on top of 1500 shed last year -- and forecast that last year's profit before tax of $500 million would be down by as much as 80 per cent this year.

The most recent job losses include 500 management positions and 1250 full-time positions, which will mainly be operational staff based in Australia.

It is understood the technology shake-up was led by Qantas program delivery general manager Mark Eeles -- a former delivery head at Vodafone Australia -- who joined the airline in the middle of last year.

Sources said Mr Eeles and several other technology executives presented the new structure in a "lecture" last month at Qantas's new $10 million customer service centre of excellence in Sydney.

The national carrier has attempted to keep the new operating model under wraps as the information was not delivered over email.

Staff have been asked to list their skills and the new model will cut all previous roles to two work types -- project managers and business analysts.

Managers will oversee teams of about seven people and be responsible for everything from an employee's holidays to their career path.

Insiders said, however, the changes were simply reverting to an IT operating environment that was previously dumped by Qantas.

"This was the model Qantas had previously, before they changed it to the one they have now," a source said. "Now they're going back to what it was before. How does that work?"

Another source said the new structure was designed to "get rid of people that don't fit the new model" and management would have problems co-ordinating staff working across multiple projects.

"In this model the other people assigned to the same project as you could all have different managers and each manager could possibly give you holidays at the same time as everyone else," the source said.

"Your time will be used between projects. You have to verify which deadline is the most important to meet.

"If you go to your manager and tell them you have two deadlines colliding they would have to go to meetings and sort it out, which would mean you still have to decide yourself. Crazy."

A Qantas spokeswoman declined to comment on whether a new technology operating model was being adopted.

"Qantas has recently announced that some parts of the business will be impacted by staff restructuring as part of an overall review of our business segments, this includes the information technology operation," the spokeswoman said.

"Qantas is always monitoring its business practices for maximum efficiency and customer satisfaction."

Mr Joyce said efforts to rein in Qantas IT costs were well advanced.

Asked on ABC's Inside Business program to comment on Qantas technology systems being a "bit of a joke in the industry", Mr Joyce said: "We spend a lot on IT ... we spend around 3.5per cent of our revenue on IT."

Jetstar spent less than 1 per cent of its revenue on IT, probably because it had better systems because they were designed for a start-up carrier, he said.

"We're looking at getting better value for money, investing in the right areas, building up state-of-the-art systems that deliver really good productivity -- process efficiencies that really enhance the quality of the business," Mr Joyce said.

Meanwhile, data transmission problems and occupational health and safety hazards have forced Qantas to suspend the roll-out of BlackBerry devices to staff almost a year after the project kicked off.

It is understood the airline recently put the brakes on the BlackBerry exercise and will review the technology, which could result in the replacement of thousands of BlackBerry devices distributed across the business.

Customer service managers were to use the BlackBerrys to transfer information during airline procedures.

The national carrier is scrutinising all technology contracts and projects in a bid to cut costs and bunker down amid the financial crisis and economic downturn, which has severely hit the global airline industry.

The BlackBerry rollout was driven by former chief information officer Jamila Gordon, who was axed as part of the management cull.

The latest suspension draws the curtains on a project that was troubled from the beginning, according to staff.

Sources said it took up to 45 minutes to send a single document.

"There are 10 to 12 documents to send during each flight and it was almost impossible to send them," staff said.

Qantas encountered another hurdle after the project was approved, when the occupational health and safety department declared the devices were a potential safety hazard because of the amount of typing required on the BlackBerry's small keyboards.

The airline was forced to buy hundreds of additional keyboards that staff could plug in to the BlackBerry and use to type in the required information.

Qantas declined to confirm the project had been suspended.

Airline to cut $750m Telstra desktop deal

Mahesh Sharma | April 21, 2009

QANTAS is planning to cut its seven-year, $750 million Telstra desktop services outsourcing contract.

The contract is among the airline's largest and longest running technology deals as it starts to squeeze suppliers in a bid to slash costs.

It is understood Qantas has selected Japanese outsourcer Fujitsu to replace Telstra from June as its provider of domestic data, voice and desktop services.

The value and scope of the new contract have not been revealed.

The change is part of a cost-cutting push at the national carrier, which is fighting the dual pressures of the financial crisis and the global airline industry downturn. Qantas has forecasted full-year profit before tax of $500 million for 2008-09.

Instead, the airline will deliver a profit before tax of $100 million to $200 million.

Qantas chief executive Alan Joyce also announced widespread restructuring of the airline to cope with the downturn, with plans to axe up to 1750 more jobs, ground 10 planes and delay delivery of the next generation of jets.

Last month Qantas chief information officer Jamila Gordon and a number of key technology executives were made redundant as Mr Joyce culled 90 management staff from the airline. Ms Gordon left Qantas about two weeks ago and her responsibilities have been absorbed by corporate services and technology executive manager David Hall, previously finance chief at Jetstar.

Mr Joyce is scrutinising the long list of Qantas technology and outsourcing deals, of which the massive Telstra contract was the No 1 priority.

It is also looking at a 10-year, $650 million data centre outsourcing deal signed with IBM in 2004. Qantas moves to dump Telstra were flagged by The Australian last week but the airline has not revealed details of Fujitsu's role.

It is unclear whether Qantas will be penalised for ending the Telstra contract prematurely. It was due to expire in two years.

A Qantas spokeswoman said the airline planned on making an announcement about the Telstra deal in the middle of this year.

Qantas had previously said it would make an announcement on "the result of our desktop request for proposal process prior to the half financial year", and it was still expecting to do that, she said.

Fujitsu's expected appointment ends a relationship that has troubled Qantas staff for years and is understood to have once resulted in the airline's engineering business buying keyboards from Harvey Norman because Telstra's rates were too expensive. It is believed that in 2007 Qantas Engineering wanted to purchase several hundred keyboards, but under the Telstra contract they would have cost $180 a month.

After months of to-ing and fro-ing Qantas Technology approved a business case to purchase the keyboards from Harvey Norman because they could be categorised as a commodity.

It was a simple common-sense use of funds, an informed source said.

Qantas market testing of the Telstra contract late last year showed the telco's rates were several times higher than competitors were charging.

ditch handle
21st Apr 2009, 10:45

"The airline was forced to buy hundreds of additional keyboards [for the blackberry] that staff could plug in to the BlackBerry and use to type in the required information."


Bullshit. Onboard CSMs were given a list of keyboards that they could buy at their own expense.

schlong hauler
21st Apr 2009, 12:54
The talk of rebranding or morphing Jetstar into Qantas imho is very difficult to do, based on which AOC the new Qantas would be operated under. It for the same reason that Qantaslink is called Qantaslink and not Qantas. Different AOC, different name. The trade practices act has rules that forbid false and misleading advertising. Its only my opinion but I believe that a Jetstar operated aircraft painted and marketed as Qantas Airways is misleading and a false representation. Jetconnect gets away with it because its operated out of NZ and is therefore not under the jurisdiction of our ACCC. If Jetstar were rebadged as Qantas and operated under the Qantas AOC like the original Australian Airlines was, then the industrial landscape would be suicide for the board. Perhaps I am wrong and wishful thinking is clouding my views. Any lawyers like to comment?

21st Apr 2009, 13:05
Fujitsu's expected appointment ends a relationship that has troubled Qantas staff for years and is understood to have once resulted in the airline's engineering business buying keyboards from Harvey Norman because Telstra's rates were too expensive. It is believed that in 2007 Qantas Engineering wanted to purchase several hundred keyboards, but under the Telstra contract they would have cost $180 a month.

I have heard several other obsecene figure in relation to Telstra supplied equipment. The sooner Telstra is given the boot, the better.

21st Apr 2009, 13:13

Not a bad thought, but the reason Qantas Link operate under that banner is for branding purposes, not anything to do with the AOC.

Impulse have set the precedent in this regard; they operated under the Qantas Link banner for some time, whilst still operating under the Impulse AOC.

I don't think there'd be anything to stop JQ crewed aircraft being operated as Qantas flights in QF colors. That doesn't mean that I think it is a certainty, but I've always thought it was a very tempting card to have up the Executives' collective sleeve.

21st Apr 2009, 13:49
I have heard several other obsecene figure in relation to Telstra supplied equipment. The sooner Telstra is given the boot, the better.

One would imagine Telstra's corporate traveling needs for their staff may have similar backlash given Qantas fares aren't exactly best values compared to competitors, nor is cabin services 2nd to none. Imagine too Telstra cancel their travelling needs with Qantas.

We do know that the federal Government have now started installing a multi million dollar state of the art video conferencing system just so they do not have to rely on Qantas to jet their staff around at 15 million dollars a year of tax payers money. That's more business to be lost from Canberra for corporate travelling accounts, which by the way , is a huge account to be lost for Qantas.Premium class, anyone?

21st Apr 2009, 16:18
Blackberry's to improve customer service; IT facilities to improve customer service; telecommunications services to improve customer service; yada, yada, yada.

If the aircraft simply took off ON TIME and landed approximately ON TIME and made connecting flights ON TIME, customer service would improve dramatically, regardless of perceived improvements to IT. Cabin service would improve exponentially because passengers wouldn't be taking their frustrations out on the CC. Qantas' IT fiddling wasn't designed to improve customer service. CC already had their hands full. Instead, it was designed to improve the ability of supervisors to put their noses in on each flight. It's no wonder the IT boss got sacked. The project scopes were never established properly to begin with. And after that, she was just throwing money away.

One of the worst things that Dixon did was to slash engineering. The aircraft serviceability plummetted and customer service went in the crapper. He was living a dream to impose cutbacks on what he perceived to be a bloated workforce while rewarding his inner circle of confidantes.

Customers will put up with a lot of cutbacks or rare inconveniences, but regular episodes involving an inordinate amount of time sitting in an airport terminal waiting for a serviceable aircraft, or hassling a desk clerk to rearrange connecting flights, is not one of them.

550 managers? Why stop there?

21st Apr 2009, 22:07
Qantaslink is just a trading name the AOC's are Eastern Australian Airlines, Sunstate Airlines and National Jet Syetems

21st Apr 2009, 22:33
With regards to Qantas dumping Telstra IT (a good move) which charged QE $15,000 approx for each networked P.C. station, $150 for a replacement mouse etc.
Just wondering if anyone from the old "QANTEC" IT Dept care to share their thoughts on OUTSOURCING (outside of Qantas). Who did it and why. Obviously it was a bad idea!

Hugh Mungus
21st Apr 2009, 22:53
Just reflecting on last Sundays interview with Allan Joyce on ABC ...He stated that First and Business in Mainline was down by roughly a "Turd "..didnt realize that they have become a measure of viable performance ..just like RSKs..etc Hmmmm must keep up with modern accounting practices ;)

21st Apr 2009, 22:54
According to The Hindu Business Line, Qantas IT had been outsouced to Indians since 2006 :eek: also oddly that firm had been caught out cooking their books, and I think Qantas out to save a few pennies, still do not mind the criminal proceedings against this Indian firm.

The Hindu Business Line : $142-m Qantas Airways deal for TCS, Satyam (http://www.thehindubusinessline.com/2006/11/10/stories/2006111005060100.htm)

Captain Marvel
22nd Apr 2009, 01:48
We do know that the federal Government have now started installing a multi million dollar state of the art video conferencing system just so they do not have to rely on Qantas to jet their staff around at 15 million dollars a year of tax payers money. That's more business to be lost from Canberra for corporate travelling accounts, which by the way , is a huge account to be lost for Qantas.Premium class, anyone?

Yeah right! Can you imagine the pollies or bureaucrats giving up their Qantas Club memberships, premium travel perks, travel allowances, or "study" tours. I'm sure they'll fully embrace video conferencing! Not!

schlong hauler
22nd Apr 2009, 02:54
Thanks for your replies. Looks like my theory is cactus!

22nd Apr 2009, 06:50
Best news I've heard all day about Telstra getting the flick. Over 1 grand for a wireless mouse because it's not 'standard' equipment. What a joke! Oh but that includes 'servicing' over the life of the mouse:ugh: Perhaps once they're out of the picture QF's books might start to look a bit more healthy. Who on earth put their signature on that contract!

22nd Apr 2009, 07:15
Who did such a bad deal?
Good thing she got the flick

22nd Apr 2009, 08:43
Got a job with telstra I heard. Then she had to leave.

22nd Apr 2009, 09:18
That was Fiona Balfour and she got punted about 18months ago

22nd Apr 2009, 09:27
as CL on QF first class. go figure:ugh:

22nd Apr 2009, 14:17
When AJ came out to talk about the 1750 slashings, he said something very important:
he says that this is contingent on the fact that the next 6 months would see the world economy improves from what it is right now.

Well. since AJ made that announcement, The prime minister and Reserve bank have both stated the country is yes, in recession.

And the International Monetary Fund ( financial gurus not to be underestimated) have also reported that world debt is now over 5 trillion dollars Aus.

The obama administration had also came out to say that those toxic assets and bank debts still won't go away and will not go away for quite some time. This means credit flow will be clogged. With the imminent collapse of the American motor industry, more bad news to come. United Airlines is also bleeding bad and have cut fares, even on the pacific route.

So there you go, the bright economic outlook in the next 6 months.:D
I do think the next 6 months will be far worse for traveling, tourism, recreational industry as more firms sack people and output shrinks.

Japan would contract 6% in output, Britain and most of Europe will sink even deeper into recession mud.

The IMF also said that it is a watch and see thing, meaning the Obama admin. bailing out all these failed firms may not work at all, and in that case, it would be far worse then not bailing them out at all because tax payers are now burdened with such high debts.

According to IMF,
Economies will shrink accordingly:
US 2.8%
UK 4.1%
Japan over 6%

Aus unemployment to go over 7.8%

This is all very very scary news for Qantas.
Qantas does need to cut costs at all; cost or it will simply go bust.
This has nothing to do with media scare, it is a fact what IMF reports.

And IMF has revised their forecast further down than what it did last.

All the important markets on Qantas routes (Asia USA UK )are all showing no signs of any improvement whatsoever.

Corporate travel has decreased significantly and will continue to go further down as every country have rising unemployment. Private travel is confined to a weekedn drive to the blue mountains only.

It does not matter if air fares have fallen, travelling is a very expensive exercise, especially overseas, currency Xchange rates, accomodations, food, shopping, all unneccessary spendings that can be cut completely from any household.

Supermarkets and landlords are the only business making lotsa monsy at the moment. Peeps are even cutting their consumption of lattes from cafes.

not good.:sad:

Dun and Bradstreet Australia had also come out to say that 150,000 businesses in Australia will fail because they cannot pay their bills. And banks not willing to lend to businesses. All these cannot be good for Qantas despite their little 2 point something billion in the piggy bank, constantly using that as an ammunition.

22nd Apr 2009, 14:33
Those holding their breaths that the next 6 months might bring forth juicy mandarins and blossoming bergamot might really have to think twice.

Delta Airlines just openly stated in tomorrows papers,. not sure if it is the Australian or Sydney morning herald

that "Delta flying to Australia will spell disaster for Qantas" as headlines.:eek:

oh wait don't worry, use that untapped 2 billion dollars in the piggy bank, after all, that's the only thing that will prevent a bankrupt.

22nd Apr 2009, 15:25
We'll be a disaster for Qantas: Delta

Matt O'Sullivan

April 23, 2009
DELTA AIR LINES has challenged Qantas's dominance of the Australia-United States route after describing its foray into the market as a "disaster" for the incumbent airline.
Qantas stands to lose more than 200 passengers a day - over half the seats on a standard jumbo jet - when Delta begins daily flights between Sydney and Los Angeles in early July.
Even before Delta launches services, the trans-Pacific route has been transformed in a matter of months from being one of Qantas's most profitable international legs to become loss-making, largely because of a dramatic drop in demand for business and first class travel.
Delta's network planning chief, Glen Hauenstein, said its flights in July would be "relatively full" because more than 30 per cent of seats were already booked.
He said there was demand to fly the route because under previous arrangements Qantas picked up more than 200 passengers a day through an interlining agreement with Delta and Northwest Airlines. The two US carriers merged last year.
"So the demand is there and … if you're the incumbent carrier this is a disaster - if you're the non-incumbent carrier, this is an opportunity," he said during Delta's first-quarter earnings briefing.
"And the question is long run, as being the world's largest carrier and having the extensive route network that we have, do we want to have outlet to Australia? The answer is clearly yes."
Delta's Boeing 777s will increase passenger seats on the route every week by almost a quarter, or 4900, to 25,000, just as the aviation industry suffers its worst downturn of the jet age.
Air fares on the route have fallen about 57 per cent since September, according to Macquarie Equities, due to both a dramatic slump in demand and Virgin Blue's long-haul carrier, V Australia, joining Qantas and United Airlines on the trans-Pacific in February.
However, Delta's decision this week to charge $US50 ($71) to check in a second bag on international flights from July 1 could face a passenger backlash.
United has revealed in its latest earnings briefing that it is already suffering on the route. Of its Pacific network, Australia and China suffered the biggest declines in revenue in the first quarter.
United also reinforced the extent of the slowdown by revealing that its total premium traffic fell 30 per cent in the quarter.
The biggest threat to Qantas on the route is Delta's ability to attract US customers because of its extensive US domestic network. The route has historically provided about 10 per cent of Qantas's total passenger revenue.
Qantas management suggested last week that none of the carriers will make money flying between Australia and the US in the current environment. Qantas said premium travel on the trans-Pacific and London-Australia routes had fallen about 20 per cent.
V Australia began thrice-weekly services from Brisbane to LA this month, two months after it launched daily flights from Sydney to the US. It will launch three return services a week from Melbourne in September.

Spanner Turner
22nd Apr 2009, 16:41
Qantas will be dead in 6 months

Qantas got through The Great Depression as well as "The recession we had to have". :D

Also, a handful of wars/conflicts, energy/oil crises, privatisation, labour strikes, changes of Guvmint, an asian economic crisis/bubble burst, some buildings being crashed into in NYC, some birds having a cold, attempted sell-off etc, etc, etc.

Everyone have a BEX and a good lie down. !!

:) :) :)


Heavy Metal
22nd Apr 2009, 16:52
"So the demand is there and … if you're the incumbent carrier this is a disaster - if you're the non-incumbent carrier, this is an opportunity," he said during Delta's first-quarter earnings briefing.

By they way, he also announced a 2009 Q1 loss of US$794 million.

Opportunity for what? To lose even more money? At this moment, seats on QF from west coast U.S. to Oz are being advertised for as low as US$550 return, just to fill empty seats. How is saturating the market even more an opportunity? Delta lost billions last year, and is on track to do the same this year. The only plus side for them is they can irresponsibly lose billions, and then cry for chapter 11 bankruptcy protection, something not available to Qantas. Maybe outlast is a good enough strategy. Definitely not an even playing field.

22nd Apr 2009, 16:59
another travel entity on the brink of collapse, anything like that does affect Qantas

Fresh from the oven...
THE global Stella tourism empire, which owns the Harvey World Travel chain and manages one in five Gold Coast holiday apartments, is in danger of collapse, threatening to cost banking giant UBS hundreds of millions of dollars.
Private equity firm CVC Asia Pacific and UBS are understood to have lost up to $1 billion on Stella after buying two-thirds of the struggling giant last year from the now-collapsed high-risk Gold Coast financier MFS.
Under that deal, UBS and CVC Asia Pacific pumped about $1.3billion into Stella, which controls more than 21,000 hotel rooms and 1200 travel agencies globally. That stake is now worth between $250 million and $350million, experts say.
The Australian understands accountants close to UBS have recommended the bank place Stella in receivership, or sell assets immediately, in a bid to stem further losses. If a receiver was appointed, it would be high enough in the corporate structure to allow the operating travel companies to continue to trade.
In 2007-08, Stella delivered earnings before interest, tax, amortisation and depreciation of $17 million, less than one-tenth the figure forecast by MFS before its collapse a year earlier.
In recent months, UBS has been forced to extend its loans to Stella, and CVC has allowed the travel group to postpone a $25million loan repayment.
UBS declined to comment yesterday and CVC Asia Pacific did not return calls.
Stella's expansion into the British market, which represents half its assets, has proved most costly, with spending on travel and accommodation plunging amid the economic downturn.
Stella operates the Breakfree, Peppers and Mantra Hotels holiday accommodation brands across Australia. The group also operates about 1200 travel agencies through the Harvey World Travel, Travelscene and Gullivers Travel Group. Under the direction of its founders, former Gold Coast criminal lawyers Phil Adams and Michael King, MFS expanded into the travel sector from 2005 when it merged with "management rights" operator Breakfree.
That merger, which valued the Gold Coast-based Breakfree at about $300 million, was followed a year later by MFS's acquisition of Breakfree Gold Coast rival S8 in a cash and scrip deal worth about $700 million.
The acquisitions ended almost a decade of feuding between Breakfree founder, former Sydney Swans player Tony Smith, and S8 owner Chris Scott. Each company previously attempted to take over the other.
The takeover of both groups by MFS made both Mr Smith and Mr Scott tens of millions of dollars on paper, but because a substantial portion of the payments was made in MFS shares, which subsequently collapsed, much of those gains evaporated.
Mr Smith last year sold his Gold Coast dream home, then still just a construction site on the Hedges Avenue millionaires' row, for about $30 million.
He was also forced to sell two adjoining properties at Tamarama Beach in Sydney's eastern suburbs, which he bought in 2007 for $11.3 million.
S8, which was built around buying up Gold Coast apartment rights, began to diversify in 2005 when it took over the then-listed Harvey World Travel in a deal valuing the company, which has more than 550 retail outlets in Australia, New Zealand, South Africa and Britain, at about $85million.
MFS, under Stella, continued the "vertical marketing" concept of offering everything from accommodation to booking flights, and expanded into the British market, buying the Travelbag and Travel 2 Travel 4 chains.
According to Stella's full-year accounts, its South African subsidiary had breached the terms of an $85 million loan because it had filed its accounts late.

22nd Apr 2009, 21:50
What do you when you are losing hundreds of millions of dollars?
Well if you are Delta Management you open another route that will lose you even more money.
The contribution to Deltas total revenue from the trans pacific Us/Oz route will be less than 1%.At the fares being offered it will certainly contribute to their losses.The real damge will be done to United.American carriers are not known for their service.They will run 777s on the route.While these are a nice aircraft they are no match for the luxurious A380.
The Delta CEO in describing Deltas entry as a disaster for Qantas is just being a typical over confident loud mouthed yank

22nd Apr 2009, 22:26
Qantas got through The Great Depression as well as "The recession we had to have". :D

Also, a handful of wars/conflicts, energy/oil crises, privatisation, labour strikes, changes of Guvmint, an asian economic crisis/bubble burst, some buildings being crashed into in NYC, some birds having a cold, attempted sell-off etc, etc, etc.

Everyone have a BEX and a good lie down. !!

http://static.pprune.org/images/smilies/smile.gif http://static.pprune.org/images/smilies/smile.gif http://static.pprune.org/images/smilies/smile.gif
you forgot Qantas got through all of those with Zero competition on the pacific route and that route accounts for 10% of its entire bottom line.
Now there's V Aus, Delta and United to compete with, together with a tarnished safety record and the other factors like no credit flow.

you're too complacent to be lying down:rolleyes:

22nd Apr 2009, 22:51
KaBoom, the 380 may win compared to a 777 in the Flight Attendents perspective, but think of it from a business perspective. How much cheaper is it to operate a 777? It is not much more than half the fuel burn of a 380 on a specific route for one thing.

You may argue that pax will pay extra for the 380 and service, but you could probably afford to sell the seats on the 777 but about half what the bus could afford them for.

22nd Apr 2009, 23:02
777's on the route with 250 bums on seats will turn a profit (a guess) and can run more regular flights if the numbers warrant and can be intermingled with domestic and other international ops. An A380, that can't be used domestically and has limited integration on other international flight ops, with 250 BOS won't be on the route for long.
Not defending Delta, but if the domestic market is slowing, new international routes utilising excess capacity makes sense. What's Qantas intending to do with the A380 if the market continues to tank? One or two flights per week won't compete against a daily service.

ditch handle
22nd Apr 2009, 23:27
iriver88 [or is it JBM?],

perhaps you'd better off knowing something of the issues you pontificate about.

Qantas has always had competition on the Pacific route and strange to you as it may seem has competed with Delta on the route before.

It wasn't all that long ago that QF made no money on the route.

QF survived.

I'd be far more concerned about the airline you work for........


Qantas has multiple daily flights to the US.

22nd Apr 2009, 23:33
Thank you for pointing that out. I do the trip regularly. My travel agent has been lying to me.

ditch handle
22nd Apr 2009, 23:36

"Qantas intending to do with the A380 if the market continues to tank? One or two flights per week won't compete against a daily service."


You're alluding to a situation whereby QF go from multiple daily flights to one of two a week?? :rolleyes:

The Professor
23rd Apr 2009, 00:12
The only one close to the mark is shiftpattern.

A large chunk of QF flying is going to go to jetstar branded as QF. Staff will have one choice, move to jetstar or leave. Jetstar was NEVER set up to last in its current form for more than the short term.

Jetstar is the weapon of choice to finally cut a swathe through the highly unionised and inefficient QF mainline staff.

23rd Apr 2009, 00:39
Jetstar is the weapon of choice to finally cut a swathe through the highly unionised and inefficient QF mainline staff.

As someone who deals with Jetstar daily, let me tell you, there is NOTHING efficient about them. Unless of course, you call not having enough staff to pick up the phone, efficient.

23rd Apr 2009, 00:40
Ditch handle, I'm just trying to stay out of hypothesising on the 6 month future of Qantas, but when someone makes a comment that one aircraft is better for the route than another based on just one aspect: luxurious services, then I can't help making a little counter-argument. There are horses for courses and the international travel market is changing rapidly. Similarly, the argument that Qantas will survive because it always has is equally myopic. There are other big companies that have become victims of circumstances and it's naive to think Qantas is not immune. The A380 is a big liability if it can't turn a profit. Other aircraft can be put on other routes, but the A380 is more specialised on route application and not as flexible. In addition, while Americans in general, are considerate, thankful and supportive to Australians, they're going to support home-grown companies first.
Personally, now that I am obliged to make a comment, I think a 6 month deadline in the title of the thread is just being provocative, however I also think a merge of Jetstar and Qantas is now very much on the cards; not to beat up on the unions as has been suggested, but for economic rationalisation. The market is contracting and Qantas/Jetstar, like many other industries, needs to rationalise to balance supply with demand. However, if a merger/absorption does happen, you can bet the Qantas/Jetstar executives will try and retain Jetstar T&C's as much as possible while retaining the Qantas name. They'd be silly if they didn't.

23rd Apr 2009, 00:44
ditch handle - AFAIK Delta have never done the LAX - SYD Pacific route before - but I am sure Continental and American have.

ditch handle
23rd Apr 2009, 00:50
Discussion around the survival of Qantas has come about due to the effects of the WFC.

The WFC is an aberration. An out of line, cyclical event. Sooner or later it will end.

Prior to the effects of the WFC [last year] Qantas reported a profit in the order of AUD $1.5 billion.



you claim not to want to hypothesize about the future and yet you post this-

"What's Qantas intending to do with the A380 if the market continues to tank? One or two flights per week won't compete against a daily service."


Do you seriously suggest Qantas is going to go from multiple daily flights to one or two a week ?



yes you are probably right. I was thinking of American at the time. My mistake.
The point remains however that there has always been competition on the route.....

23rd Apr 2009, 00:54
The Professor....Can you tell me who is responsible for the current economic mess....

The highly unionised and inefficient workforce ...or the highly organised but manipulative and greedy management and boards of several banks and large organisations?

Basically what you are saying is that the less people are paid the more efficient they become....pity that this same philosophy is not applied to directors and CEO's...
Jetstar was NEVER set up to last in its current form for more than the short term.

Jetstar is the weapon of choice to finally cut a swathe through the highly unionised and inefficient QF mainline staff.
However..you are honest enough to admit the real and only purpose of J*.

23rd Apr 2009, 00:59
Prof...you always talk in absolutes as though there is no other point of view to be considered.
Secondly the American Aviation industry is a mess.Try comentating on that for a change.An American telling others how to run an airline is highly amusing.
Also Joyce has publicly stated that Jetstar has gone as far as it can with shifting capacity on to loss making QF routes.
Delta's only threat to anyone is to itself.$794 million loss indicates that perhaps there is something wrong with their business model.Selling seats at $550 return on the Pacific is not a good way to make profit.Higher yield business travel has contracted by 20% so good luck with the yield there

max autobrakes
23rd Apr 2009, 04:46
I would have thought that there would be other airlines in Australia with less healthy bottom lines than Qantas' ,going to the wall prior to the big Kahuna.

23rd Apr 2009, 08:18
Delta's only threat to anyone is to itself.$794 million loss indicates that perhaps there is something wrong with their business model.self serving statements like that makes no sense

that's tantamount to saying Qantas's loss of 500 million (or maybe even more as it is only a conservative estimate) this financial year indicates that surely something is wrong with the Qantas business model. Delta service a much bigger country domestically with three times more competition than just one virgin blue, so the loss I'd say is far less alarming than what precious Qantas with little to nil competition is losing at the moment and on a daily basis.

Just because Qantas had gone thru a couple of world events that affact aviation does not mean it will go through this one unharmed.

As did Lehman Brothers had gone thru so many world events, it has been doing business far longer than Qantas had been flying: over 100 years. it has gone thru the worse of times and yet, it collapse this time. So did AIG, the biggest insurer in the world, now nationalised. These are very profitable business that are far less sensitive than aviation and much less labor intensive than Qantas. Still they have to succumb to this WFC.

To think that a small player like Qantas would come out with more profit and nil cuts to labor cost is really dreaming, just that.

23rd Apr 2009, 08:40
When was the last time Delta made a profit?
That $700 million loss was for Q1 not a full year
Just like GM and a number of othe American companies Delta lives behind Chapter !!.This just about guarantees longevity for any company no matter how badly run.Commerce has been around for few hundred years so that ridiculous Lehmann Brothers analogy with aviation and Qantas in particular is absurd.
If all the companies you mention were well run they would still be in business.Technically some of the financial companies have been insolvent for years.
Intersting to note that al the major economic drama in the last 100 years has emanated from the states.
Qantas will survive this because it essentialy a sound business.The Delta intrusion is simply an annoyance which will have greater ramifications for VAustralia.It will also serve to keep SingAir off the Pacific.Incidentally it has only been the last few years that QF has made a substantila profit on the route

Capt Kremin
23rd Apr 2009, 09:58
The actual Lehman Brothers sold the business in 1969. Since then it was run by American Express until 1994. After that AMEX divested itself of the business. It lasted 14 years after that.

Iriver88, we all get it. You can't wait till QF goes down. But do us all a favour and stick to what you know? That should keep the posts to a bare minimum.

23rd Apr 2009, 10:15
why is qantas so precious? so many other well known companies have gone under and some have come out better, others have gone forever. I do not have to wait for qantas to fall apart, it is a foregone conclusion that it will happen. Those thinking that their jobs are so secure at qantas can continue to dream, no one is stopping you.

Qantas needs to have a huge revamp in its costly labour expenses, Unless mass sackings happen, it will not be able to revamp this high labor cost. For far too long peeps at Qantas have been paid more than what they actually output.

A comparison with American counterparts will see the huge difference in front line staff here being paid way too much for that same output.

The news gets worse for the Australian economy in the next 24 months, and somehow, peeps here think qantas will not be affacted one iota. IMF forecasts was worse than first thought, even the Federal government cannot guarantee no double digits unemployment. In short, it will increasingly be a more difficult place to operate a business. And somehow all at Qantas think precious Qantas will be the only company in Australia totally unaffected with nil sackings whatsoever. Have these people being hypnotised by team managers?

If not, let's begin in unison, "qantas will be the only most profitable business despite everything else is crumbling like cookies" "No one will be sacked , thank God for unions"

there you have it, happy?

23rd Apr 2009, 10:41
What year did you fail economics?
There has been some drivel posted on PPrune over the years but your last post wins the award for the greatest load of dross ever posted in these hallowed halls.
Who said anything about redundancies not being inevitable at Qantas? .No one.
The workforce at QF has been subjected to continous redundancies over the last 10 years.1200 CC have been made redundant over the last six years for example.
Qantas will survive...that is a given.Its structure and direction will be different but it will survive.
Every economic glitch brings about change everywhere.This one is no different.Its all about adapting which is sosmething that QF has been doing since it floated.
Limit your posts to something you know about.Perhaps the price of ferrets in The Grand Bazzar in Istanbul may be your area of expertise.Clearly economics and business cycles are not

23rd Apr 2009, 11:07
It's best to stick to the facts. Some useful facts: QF estimates profit to be around 100-200 million; and 3.2 billion in cash. Not too bad in the current economic climate. Your posts- sensationalism at it's best. Ever thought of getting into media :eek:

23rd Apr 2009, 11:14
88 probably the year you were born.Hence the infantile posts.You need to have a lot of supportable fact to post here.You will get flamed mercilessly.As you are no doubt finding out.
You have made 16 or 17 posts all in the space of a few days.Time to draw breath and re evaluate before you crash and burn

23rd Apr 2009, 11:54
iriver88, the MP3 player? (http://www.iriver.com.au)
Qantas's loss of 500 million The above quote exposes you as a fool. Please check your facts.

ditch handle
23rd Apr 2009, 12:01
Check it's posts.
It's a troll if ever there was one.
Best ignored

23rd Apr 2009, 12:38
iriver88, man you're like a broken record. Unfortunately I agree with some of what you say but far out, you harp on. I'm sure most know QF will not be untouched during this time but you sound like you've got a calendar on your wall at home so that each day you get home from your journalism degree you can cross off another day until QF goes under.:suspect:

23rd Apr 2009, 14:56

It doesn't take much to look through your old posts and see that the only conversations you engage in, are the ones that involve QF failing.

Well good on you mate. Take it else where because I for one am getting sick of listening to you.

If it's because you didn't get in, then move on.

If it's because you 'haven't tried and are not interested' then vent elsewhere.

No real reason for this rant, just getting a little annoyed seeing your nickname and negative comments after it.

23rd Apr 2009, 15:47
This is the problem at Qantas, even their front line staff are just as arrogant as Geoff Dixon! Peeps in Qantas behave just like geoff, arrogant, take no personal responsibility for their actions, always looking for others to blame. I have found this to be typical Qantas. Incident at Perth, oh it was a turbulence, exploding O2 bottle, oh it was not our fault, let us find out it must be Boeing. tardiness? oh it was the Engineers strike. FFS when is it that Qantas learn to take some responsibility? Same with their staff, the legcy lives on, oh nothing will happen to the mighty Big Q, anyone who expresses an opinion contrary, they are so negative, they are shit, they are trolls. And please do not flatter yourself, one look at the quality of staff Qantas had taken on shows some really discerning taste, one was sacked before and the re employed only to have sex with passengers in a toilet, another one was found eating sand and metally unstable then locked up in immigration detention but was once upon a time a Qantas staff. Yet another made anti semetic comments in front of passengers...and many others not reported in media who steal, break custom rules, lie even assault one another.

23rd Apr 2009, 18:24
i think if you attacked the employees of any Company they would come out and defend themselves. A company like Qantas (as incompetent as is has been for many years) doesnt survive after privatisation unless they are doing a few things right.

At the moment they are one of only three airlines in the world that will show any sort of profit. They are feeling the crunch of an economic crisis never seen before in aviation and we have seen a few recently, and yet all but Peter Harbison and 88 are indicating that qantas will survive albeit after a number of changes.

The Qantas board have started the culling of a number of executives and management where QF had become top heavy. Maintenance is being bought back onshore and a range of other necessary changes to ensure the survival of Qantas will be undertaken

88, nobody disputes that there are a lot of businesses that will go to the wall before the WFC is over, the staff of every company want their organisations to survive and will naturally talk it up. Its not arroganice its hope and confidence.

Qantas receives far less protection and propping up than the american airlines who file of chapter 11 and restructure more often than i have birthdays. Qantas is not state owned and gets little support other than what most countries do to protect their own national carriers with traffic rights.

Qantas has flourished against a level of competition from state owned airlines who are subsidized and given tax breaks and made huge profits. It is also probably the most heavily unionised company in Australia and still managed to achieve all of this.

To suggest that unions have been bad for Qantas is to ignore the facts above. If Unions have been so bad Qantas would have gone the way of the dodo years ago.

I would suggest that incompetent and greedy management have been far more dangerous to the survival of Qantas than the Unions. There hasnt been a Qantas union that had an official jailed or fined for fraud.

Qantas has one former exec in jail in the states and a 69 million dollar fine paid to top it off. That wasnt a Union or arrogant worker it was a management out of control.

Most of us are hopeful that the Gordon Gecko of Qantas Geoff Dixon hasnt damaged us beyond repair. You might think Qantas Staff arrogant but dont underestimate their committment to the airline and they will do whatever it takes to keep it flying.

They may hate their managements excesses but they dont hate the brand nor will they see it go the way of the dodo without much sacrifice if necessary. Just remember the doomsayers have been predicting the demise of Qantas since 1993 and they came through Gulf Wars, SARS, Asian Economic meltdowns, recessions and more and more Competition and are still plugging away

23rd Apr 2009, 23:18


Pinky the pilot
24th Apr 2009, 01:18
What Keg said!:ok:

88; When you start attacking individuals your credibility (at least with me) snap rolls and dives.

24th Apr 2009, 04:50
People get your facts straight.

No one has attacked any one of you here personally.

All I said was the company could not possible survive in these conditions unless over paid staff are gotten rid off (which do not output much anyway)

For some strange insecure self esteem reasons, members here take it to meant everyone here was deemed incompetent.

Maybe there was some truths to that to begin with.

24th Apr 2009, 04:56
overpaid staff is the question?:ugh:

Dropt McGutz
24th Apr 2009, 05:40
Okay 88, how about providing some figures to support your argument and give other readers your thoughts on what they should be paid. I gather that you have the figures to support your argument don't you? What percentage of the companies costs are due to these overpaid people? Please enlighten us all.

24th Apr 2009, 06:12
People get your facts straight.
No one has attacked any one of you here personally.
This is the problem at Qantas, even their front line staff are just as arrogant as Geoff Dixon!
88 contradicts himself at every opportunity before any of us can respond to his posts....

He is simply anti QF and thinks that QF staff are overpaid.... That could be because he is anti union....or perhaps did not get a job with QF ..or works for another carrier that pays less and therefore is simply jealous....

Where is that ignore button again...:E

24th Apr 2009, 08:33
As with all trolls, I give them the benefit of the doubt but when it becomes obvious what they are really here for........
This message is hidden because iriver88 is on your ignore list (http://www.pprune.org/profile.php?do=editlist).

24th Apr 2009, 09:08
The 380 could not have come at a worse time. Just as Virgin starts a Syd-USA service, and with Delta also about to start soon. At least they will be operating the B777 which will not be as hard to fill. The 380 maybe a beaut plane during boom times, however during a global recession, a recipe for disaster as they are harder to fill. AJ and GD's original numbers for A380 and B787 orders seemed a little ambitious/outrageous at the time. Our tourism industry could never supply that capacity.

ditch handle
24th Apr 2009, 09:14

"AJ and GD's original numbers for A380 and B787 orders seemed a little ambitious/outrageous at the time."


As an airline operating a far older fleet of aircraft than it's international and domestic competition does the term "fleet replacement" mean anything to you?

24th Apr 2009, 10:57
does the term "fleet replacement" mean anything to you?

You mean the 65-115 B787 aircraft to replace some of the QF fleet, and Jetstar's 6 A330's. Thats more than just fleet replacement mate (you don't need to be a Einstein to figure that out). And thats not even taking other aircraft types into consideration yet.

Either way, call it capacity growth or fleet replacement, it is still a tall order. The worlds economic position is obviously lost on some people I in here I guess.

ditch handle
24th Apr 2009, 11:33
It seems that some people around here have come to the conclusion that WFC is not an aberration but rather something far more permanent.

One would almost imagine by your comments Ngineer that QF's decision to upgrade it's fleet and increase capacity is all going to happen now. In the depths of what most seem to consider a "downturn", from which an inevitable recovery will flow.

Given that QF currently operate 29 767s with an average age over 16 years I would have thought the firm orders for 65 787s [shared with Jetstar] not "outrageous" especially given that the process of re-equipping is going to extend beyond 2020.

It doesn't take an Einstein to see beyond this current downturn.

ditch handle
24th Apr 2009, 23:13


24th Apr 2009, 23:17
yes, it's that geriatric ditch handle making a mess during discussion time again!

Please somebody clean this geriatric right now!:eek:

ditch handle
24th Apr 2009, 23:44
Here is a salient message for all of us.

When you are prescribed anti-psychotic medication you really should take it.

25th Apr 2009, 00:29
I have observed this forum for a very long time, and the posts from this person are the most obtuse I have ever seen, to say the least. I would suggest mods to remove them as they acheve little, and add nothing to what has so far been a mostly productive discission from concerned staff and customers. This person appears to have a personal vendetta, and the last large post was so weird, well, what can I say? Jet blast perhaps?

25th Apr 2009, 01:44
He must have found the code to the Parental lock-out.:)

25th Apr 2009, 03:03
No one has attacked any one of you here personally.
Yes peeps
As I said 88 contradicts himself so why would you think the rest of his posts are any different.....:yuk:

Capt Kremin
25th Apr 2009, 03:31
My money is on this guy.... Q antas (no U ) have cleared mentally ill pilots to fly U. Donald Duck says no.. (http://www.crayola.com/)

25th Apr 2009, 04:56
peep = person
peeps = people


Clontarf Boy
25th Apr 2009, 05:12
Capt Kremin said My money is on this guy.... Q antas (no U ) have cleared mentally ill pilots to fly U. Donald Duck says no.. (http://www.crayola.com/)

I hope his aircraft navigation is more accurate than his links.
The correct one is http://www.qantaspilot.com (http://www.qantaspilot.com/)

Now that Professor Jonathan Phillips has said that it was very irresponsible of Qantas to clear this pilot to continue flying and that CASA said that under the ANO's they would not now clear a pilot with the same conditions, WHY do Qantas try and defend their actions when it is in black and white that they ignored the ANO's.
How many more rules will they ignore to save money for the directors?

Dropt McGutz
25th Apr 2009, 06:23
I think somebody really needs to grow up. He still hasn't replied to my qusetions either.

25th Apr 2009, 06:28
I haven't seen iriver88's posting history, so I was going to respond to his rant here as seriously as I could, given the sheer quantity of rubbish in it.

Then I read his 2nd last post.

Then I realised he has personal "issues" which make a response pointless.

25th Apr 2009, 11:20
Guys, I actually find iriver88's posts easier to accept if I dont read them!

click his name, choose add to ignore list.


25th Apr 2009, 12:03
wow....I just don't know what to say iiriver............

you don't fly? do you?

25th Apr 2009, 12:36
more likely on a broom :)

25th Apr 2009, 13:39
........please explain..............

tail wheel
25th Apr 2009, 23:08
Adhere to the thread topic or the thread will be closed.


25th Apr 2009, 23:12
Some of Mr Iriver's sentiment has credibility. In my recent travel experience on Qantas, I planned travel on four sectors, two international and two domestic. Of these flights two were cancelled, that's a 50% strike rate! Qantas also lost our bags! I insisted that the bags were incorrectly tagged, the staff member concerned assured me that he knew and was having that bags retagged immediately. Naturally, Sunday night, Qantas, this didn't happen.
Qantas is deplorable, although Jet* is nostalgic, as it takes you back to travelling in the 1930's when flying was much more hit and miss.

The hypocracy is a bunch of kids running round the world singing, " I still call Austraia home"! One is then confonted with "kopin carr" of an entire Thai crew.

Finally, I think Mr. Iriver deserves a hearing and has some important points, it is typically Qantas to arrogantly belittle any such points.

Flying Qantas reminds me of the Movie, The castle, "tell em their dreaming", when Qantas considers itself a "full service airline".

I accept that VB does not provide a competitive alternative, but imagine if they did? What trouble would the Q be in now?

25th Apr 2009, 23:38
I thought this website was for aviation proffesionals and not digruntled self loading freight?

Crew rest.
26th Apr 2009, 00:07
Why has QF been canceling the A380 on SYD-LAX and replacing with B744? Low loads or other issues?

26th Apr 2009, 03:43
The A380 loads are holding up ok.
The aircraft ittself is all flash and new.
There are several engineering issues presenting themselves, although as I am not on fleet I do not know the specifics. However I am told from an area in the company that watches reliability that the aircraft is not performing as expected. I remmeber explaining to many old timers I flew with that the A380 lacked "conformity".

I explained the nature of the operating environment. Airports privately owned, airlines privately owned, competing financial pressures. To my mind a aircraft that departed from the known characteristics, including wingspan, gate requirements, pavement strengths, passenger loading areas etc may be in for a hard time. I was told in no uncertain terms that the same thing occurred when the 707 (100ish passengers) was replaced by the 747..That is true the logistics of the aircraft resulted in taxiway changes, aerobridge redesign, terminal upgrades etc.

The real difference this time is that the airline operating it and the airport receiving it are not owned by the government. In the case of the A380 LA airport has already stated that the aircraft is not suited when in their airspace..

Naturally all these issues were known. Engineering would have known, flight operations would have had an incling. No doubt airport and ramp would understand people and baggage logistics. Talking with cabin crew collegaues I was told the galleys are way too small and fail to cater for the reuirements of the cabin, insufficient space to tray up meals, no works space etc etc, I am certain none of the people who could have guided the process were ever really consulted. Another hallmark of tail wag dog approach...A benchmark of Q management since I began there

For the sake of all of us at the Q, I hope the aircraft works :(

Qantas Airbus A380 too big for Los Angeles airport | The Daily Telegraph (http://www.news.com.au/dailytelegraph/story/0,22049,25128459-5013605,00.html)

My concern is not the sort of tripe spun by idiots like Peter and the institute (Just what sort of institute is it...and who else besides him is in it??)
My concern is the business continues to ignore those professionals in their own field. You want to understand engineering process talk to your engineers, want to understand the logistics of cabin service, talk to cabin crew, want ot understand implications of operating to certain airports, talk to your pilots. There are numerous examples...
I fear the top down approach will not assist one iota surviving this downturn. It may be a little more than a cyclical downturn. If so, "management" prescribing any process without listening to those in the know (for the accountants-the pesky units of operational labour) then we are in for a very hard time.

Jed Clampett
26th Apr 2009, 08:46
More of the Dixon eras poor decisions will soon be coming home to roost. The idea of putting all that capacity into only two ports, LHR and LAX, to boost shareholder returns could soon reduce shareholder returns dramatically. The two countries where the WFC is having a huge impact on the tourism industry and now Swine flu is raising its ugly head may finally turn the A380 into a dead duck. Oh for some B777s and some other destinations where we were making a small profit to smooth the road ahead. I won't hold my breath.:(

26th Apr 2009, 10:11
Why Jed do you think the most obvious decisions aren't made?

Load mainline up with cost, then bust it and re-birth as Q lite....
If it isn't workchoices it is somethign else!!! :mad:

26th Apr 2009, 11:53
Is Joburg A380 ready?
Keep hearing that QF is looking to send it there.
Does anyone fly the A380 there?

27th Apr 2009, 01:30
the Qf 380 will go to JNB. its hard enought o get a 747 out of JNB let alone something new.:8

1st May 2009, 07:02
Interesting statistics reported in today's Airline Transport World . . . apart from the severe yield drop, I didn’t realise that JetStar domestic carries nearly half the number of passengers of Qantas domestic – and the gap is closing!

Qantas suffered one of its worst-ever collapses in yield on international flights in March, according to a Centre for Asia Pacific Aviation analysis. QF's international yield plunged 11% year-over-year in March following a 2.4% fall in February. CAPA said yesterday that March domestic yield dropped 10.1% after falling 9.7% the prior month. March international passenger numbers were down 15.8% and domestic numbers declined 2.6% to 1.4 million. Low-cost subsidiary Jetstar Airways saw international passengers rise 36.3% to 186,000 and domestic increase 1.8% to 686,000. Overall, group passenger numbers decreased 2.7% to 3.2 million on a 6.4% fall in RPKs to 8.11 billion. Capacity dipped 4% to 10.3 billion ASKs, lowering load factor 2 points to 78.3%.

1st May 2009, 08:56
Jetstar codeshare on many QF flights hence the increase in numbers and therefore muddied (or muddled) waters.

2nd May 2009, 23:30
Indeed, we frequently have the pleasure of hosting Jetstar passengers on their heavily discounted fares flying codeshare flights on mainline Qantas aircraft. And if the seats weren't bolted to the aircraft floor I'm sure they'd try to take them with them as they get off.

I'd also be very wary of data coming out of the Centre for Asia Pacific Aviation, which in turn is fed to them by Qantas.

wirgin blew
3rd May 2009, 00:36
The numbers quoted are posted by QF on the ASX website and are derived from BITRE. CAPA just interpret them.

3rd May 2009, 01:20
Dutch Role

Were the bikers involved in the T3 murder, who arrived on a QF flight, JQ codeshare passengers ? or did they pass the bogon test and allowed to travel on QF.

Transition Layer
3rd May 2009, 01:53
They probably paid full fare on Qantas...bikies aren't short of a quid after all!

CUBs - Cashed Up Bogans

3rd May 2009, 03:03
Pretty tough calling bikies bogans behind the safety of annonimity. Bikies come from all walks of life. They are not all unemployed and living in poorer suburbs.

3rd May 2009, 04:38
No matter who our passengers are or regardless of where they come from, the common fact is they're all reaching into their pocket for some hard earned money to buy a ticket.

They might just deserve our respect:ok:


4th May 2009, 06:15
'specially when they are bashing someone over the head with a stainless steel post in the terminal!

4th May 2009, 08:09
buying an airline ticket does not automatically gain you respect!

how about behaving in a civilized manner! and being respectful!

Sonny Hammond
4th May 2009, 12:41
Neither does working your ring out for ten years to get a job in an airline apparently.

Going Boeing
4th May 2009, 15:36
Near miss almost tipped Qantas into oblivion - Sydney Morning Herald
Adam Schwab
May 5, 2009
IT WAS the $11 billion mega-deal that promised blue skies ahead for all involved. But its failure by the slimmest of margins exactly two years ago has saved not only Qantas, but billions of dollars of debt finance

IT WAS the $11 billion mega-deal that promised blue skies ahead for all involved.

But its failure by the slimmest of margins exactly two years ago has saved not only Qantas, but billions of dollars of debt finance - supplied by foreign and Australian banks - which would have likely been lost had the private equity-led Airline Partners Australia bid succeeded.

Tourism may also have suffered. The privately owned airline would have taken the axe to unprofitable routes.

The APA consortium - consisting of Texas Pacific Group, Macquarie Bank, Allco Finance and Onex Partners - managed to garner acceptances for only 45.7 per cent of Qantas shares by the close of the takeover. APA would have reached the 50 per cent threshold but for a US billionaire, Samuel Heyman, who over-slept and submitted acceptances for his 4.9 per cent stake in Qantas a few hours too late.

The audacious takeover landed at the zenith of the frenzy in mergers and acquisition. As 2006 drew to a close, the private equity and sharemarket boom was in full swing. Debt was plentiful as companies were encouraged to "gear-up" their balance sheets to boost returns for shareholders.

In this environment one of the largest private equity players, Texas Pacific Group - whose founder, David Bonderman, turned a $US66 million investment in Continental Airlines into a profit of more than $US600 million - decided to team up with Macquarie Bank and Allco Finance.

One of APA's trump cards was its plan to retain Qantas's senior management team. They would oversee a multibillion-dollar capital investment program over five years, along with the introduction of 70 planes to increase capacity by 40 per cent.

Based on the $5.45 a share offer, the acquisition would have cost APA about $10.8 billion. Of that, the consortium had secured commitments from lenders to provide senior secured term facilities worth $US6.1 billion.

APA members would have tipped in some $3 billion in equity but the bidder's statement noted that the company planned capital reductions of about $4.5 billion and the payment of dividends up to 100 per cent of Qantas's retained earnings during the term of its ownership.

The onset of the global financial crisis has turned what looked to be a marginal takeover proposition into what would have been a diabolical mess. To carry out the buyout, APA had planned to assume a debt burden of more than $10 billion. Two years later, Qantas's current market value is $4.6 billion.

But even before APA's mooted capital investment program, courtesy of the company's expanded debt load, Qantas would have been hemorrhaging about $1 billion a year in interest payments alone. Coupled with its expected operating losses, it is highly unlikely the private equity consortium would have been able to meet its financial obligations

Lenders to the consortium included Morgan Stanley, Citigroup, Deutsche, Goldman Sachs, Royal Bank of Scotland and Greenwich Capital Markets: a who's who of the financial crisis.

In its bidder's statement, APA confirmed binding commitments from lenders for $10.7 billion. The financing package even contained a provision for Qantas to "to make interest payments in kind, in lieu of cash".

Little wonder there is a feeling the lending consortium dodged a bullet. But APA's banks are not the only ones breathing a sigh of relief.

The consortium also included equity participation from 11 Qantas managers, including former chief executive Geoff Dixon, former chief financial officer Peter Gregg, the recently retired human resources boss, Kevin Brown, and the current Qantas chief executive, Alan Joyce.

Under the participation agreement, management would have used limited-recourse loans to acquire "time" and "incentive" based shares under a long-term incentive share plan, representing up to 4.5 per cent of the company.

Given Qantas's subsequent financial performance, it is almost certain the equity instruments granted to senior management would have been worthless.

Fortunately for Dixon and Gregg, not only did the bid fail, but the Qantas board graciously offered them significant retention payments, primarily in the form of Qantas shares, to remain with the company. These made Dixon the highest-paid airline executive in the world in cash terms before his retirement at the end of November. In 2007-08 he received $11.9 million, which included his $4.5 million retention payment.

The retention payment to Dixon involved the allocation of 1 million free Qantas shares. The stock was notionally subject to a 10-year holding lock, but Dixon was still able to sell all the free shares within two years.

Allco, of which APA's main spokesman Bob Mansfield later became chairman, has slipped into administration, crippled by its own debt burdens and controversial related-party transactions involving its founder, David Coe, who was also at the forefront of the Qantas takeover.

Had the APA bid succeeded, Allco would have held an 8.4 per cent economic interest in Qantas, while its listed offshoot, Allco Equity Partners, would have owned 25.9 per cent. AEP, a separate ASX-listed entity, has since run a mile from Allco and wants to change its name to Oceania Capital Partners. Macquarie, of course, has survived and moved on, albeit having just experienced a rough year in which its profits halved.

The previously invincible Texas Pacific Group has also had a difficult patch. It headed an ill-fated equity injection into US bank Washington Mutual last year that led to losses of $US1.3 billion for the group.

And Qantas? While its shares rose shortly after the takeover failed, reaching $6.06 in December 2007, it has since fallen to $2.13 - 60 per cent less than the APA offer price after fuel prices and then the global recession shredded its bottom line.

It faces a second half loss in its current financial year. As a result, Joyce has said 1750 Qantas workers will lose their jobs.

But one suspects that had the APA bid succeeded, far more Qantas employees would be seeking work, there would be some very sorry financiers, several far poorer former Qantas executives and most likely a renationalised icon.

Adam Schwab is a corporate lawyer.

4th May 2009, 15:51
Dixon still walks away with millions despite not knowing , as a CEO that his company was engaged in price fixing cartel. How could a company be so big that the CEO does not know that it is engaged in price fixing?

yet few sick days and you have managers hounding you and calling you and sending you letters...and clause 11 for trivial matters such as nuts and chocolates

But price fixing, a criminal offense was left unchecked?

The judgement from the European courts will be out next month on how many millions in Euros will Qantas be fined , followed by New Zealand Authorities on how much Qantas will be fined.

The European fine will hurt Qantas bottom line, EEC have been known to hand down very very painful fines for price fixing.

precedence in the past included a percentage of the profit as fines during the entire period of the criminal offense. With Euro so strong as a currency, that could mean more than the US fines.

Me Myself
4th May 2009, 21:51
The economic cycle has turned, they'll get the crew now. But once we emerge from the downturn. Those who have gained experience will look to greener pastures.

Master caution, surely you are jesting..............right ?? You haven't understood what hit you ??
Those who have gained experience ?? ..........like flipping burgers after they've lost their flying jobs.
This crisis is in for the the long term and if anyone is going to get experience at, well, this is going to be at...............looking for a job.
A mate of mine working for QF has been telling me this story eversince Pornstar started and it doesn't take a Phd to figure that one out.
It'll be QF colours with Jetstar pay......................and people will be stampeding to grab a job with Qanstar.

4th May 2009, 23:18
Whilst the CAPA statement:" QANTAS will no longer exist in its current form if the downturn that is crippling the industry lasts another six months.."
Is arguably misleading and well short of the full story, a next generation mega-deal promising blue skies ahead may yet be what Qantas needs to survive?

During the next decade, the Roo will need to finance thirty billion dollars worth of next generation aircraft.

Can only hope those responsible for the next restructure have learnt from the APA fiasco and Qantas won't be at risk of being tipped into oblivion next time round.:=

Mstr Caution
5th May 2009, 00:44
Me Myself.

Have QF mainline, made any crews redundant yet? Nope.

Have the crews surplus to existing requiremets be quantified? Yep

Is the company currently working with AIPA to exhaust all avenues to avoid redundancies? Yep

Is there currently a open vote for an variation to the certified agreement? Yep

Are there remuneration increases in the agreement on offer? Yep

The GFC is certainly having it's effect to airline operations, but unlike post September 2001 or SARS/Birdflu the company has not approached mainline crew to accept pay freezes. Why haven't they?

5th May 2009, 00:56
Because next time round Mstr, those in high places know any proposed restructure will need to be more like an employee buy-in, rather than a management buy-out.:ok:

Me Myself
5th May 2009, 08:35
Master Caution

You obviously have more inside info than I can possibly have, not working for QF.
However QF is, in my knowledge the only major operating 2 business models. Weren't the 787 going to Jetstar ?
I am not saying this is going to happen tommorrow, but in the long term certainly.
Still, hoodles of people will still want to work there...............and I would be one of them. Even if prices in Sydney and Oz have become totally insane, it remains in my view one of the best places to live.
I have really never understood Aussie pilots leaving Australia to burry themselves in the sand or get buckets of water during the monsoon. ( I'm talking about those who DID have the choice to stay ).
So, copy your post but this remains QF least kept secret eversince your irish boss was hired.

5th May 2009, 09:46
to maximise tax advantages and boost the numbers in the books, any sort of drastic action that would have been taken would be done before june 30 which is the end of this financial year. All redundancies payout is a tax advantage for the company as an operating expense.

This together with the European courts announcement of the amount of fines in millions of euros for criminal price fixing next month would fit nicely into the balance sheets as operating expenses for tax credit.

The fines will be way way more than the total cash payout for all redundancies combined from last years 1500 and this years 1750.

Me Myself
5th May 2009, 16:47
This together with the European courts announcement of the amount of fines in millions of euros for criminal price fixing next month would fit nicely into the balance sheets as operating expenses for tax credit.

Heads Down
Being Up Over and not Down Under I am not aware of this Qantas fine story. Would you care to enlighten me. This kind of news is usually all over the tele. The european commission loves to appear mean and strong.........thus essential to our welfare ( just jesting, in fact they are ) , specially now with the european parliament election coming up.

5th May 2009, 18:11
I have read many news sources in the past about price fixing crimes in EEC, there has been precedence set where the fine is actually a percentage of the profit made during the period the crimes was committed. This was like a 3 year period the price fixing occurred. I would say with elections coming up (I am unaware which country) then it would be fair to say they would be even tougher on crimes to win more votes. After all, no citizens in their right mind (unless it is Australia, that's why Dixon got off a criminal sentence) would allow corporate criminal activities go un punished.
There are other threads on this forum that discuss the Qantas price fixing crime committed, it plead guilty to American courts so got off lightly with a business expense fine and a scapegoat who will go to jail for 6 months. It has also got off very lightly in Australia because the law in Australia did not deem price fixing as a criminal act. Now it is awaiting for the EEC courts judgment and NZ authorities judgment, The guilty verdict is a foregone conclusion.

29th Jun 2009, 13:27
Just bumming this thread as I think this is the most relevant. It seems the stand off between Qantas and the engineers last year has caused more problem. Air New Zealand has moved their contract for engineering to Cathay Pacific.

Air New Zealand to replace Qantas for engineering work | The Australian (http://www.theaustralian.news.com.au/business/story/0,28124,25705921-23349,00.html)

29th Jun 2009, 13:42
Qantas has been bumping up what it charges for Ground Handling and Engineering for other carriers.
Many of these carriers have decided not to accept these increases and have either gone elsewhere or are in the process of setting up an in house alternative.
Qantas felt that they were providing these services on thin margins.
Its all about jobs.Many of those servicing other airlines but working for Qantas may sadly be out of a job.

ditch handle
29th Jun 2009, 13:51
Qantas has been raising charges to purposely price itself out of the third party ground handling market, thereby creating a situation where it "needs" :rolleyes: to make staff redundant.

29th Jun 2009, 16:09
Qantas has been bumping up what it charges for Ground Handling and Engineering for other carriers
How come when you go to Ausi it takes three guys to push you back when everywhere else it's one or two? Serious question. I'm not knocking , the service is great, the engineers of the highest calibre. But three?
Maybe I've just been lucky everytime I pass through. Or is this the norm and thats why they have to increase their charges?

The Professor
29th Jun 2009, 20:18
"How come when you go to Ausi it takes three guys to push you back when everywhere else it's one or two?"

Job building.
Jobs for the boys.
Industrial fat.

Stupidity really. These inefficiencies are built into every facet of the way they operate aircraft. Such outdated practices are pushing QF to extinction.

Except the brand of course, it will survive. But the staff on current conditions will not.

Going Boeing
29th Jun 2009, 23:11
In LA, it's normally four for pushback/tow-in. One on headset and three wing walkers - I believe that local safety procedures require it.

29th Jun 2009, 23:26
That's true, but there's no way those cats are paid the same as pushback crew in Oz. From my experience those guys took a slight pay raise over Maccas to do the job.

29th Jun 2009, 23:27
Job building.
Jobs for the boys.
Industrial fat.
Have to agree with you there Prof, I am assuming you are talking about management.
Just look at the expenses that were incured with the previous segmentation strategy, multiple managements, administrative staff, inefficiencies due to lack of scale.
How many millions were flushed down the toilet with that now abandoned strategy?
The last publicly disclosed figure was there were approx 920 executives working for the Qantas Group.
In relation to the year ended 30 June 2004, Shares will be offered to approximately 920 Qantas
executives because Qantas achieved certain “balanced scorecard” targets set by the Board in
2003.Source 2004 AGM Notice (http://www.qantas.com.au/infodetail/about/investors/AGMNotice2004.pdf)
Managment numbers only expanded from there with the segmentation strategy.

29th Jun 2009, 23:32
"the Kiwi carrier was also seeking to recover costs incurred
when the Australian airline’s engineers held strikes last year"

I can't recall any lames that were on strike.
A few stood down by management for not
getting out of bed at 0400 on their day off.
Alaea exec prevented strikes in that case.

29th Jun 2009, 23:33
The Professor is right but only in Kazakhstan where they use two operators.....

This is not for any cost saving but because they could only get two...one for the pushback and the other to keep an eye out for any rampaging yak on the tarmac....

It will be interesting to see the response from the Professor about the
Job building.
Jobs for the boys.
Industrial fat.

Stupidity really. These inefficiencies are built into every facet of the way they operate aircraft. Such outdated practices are pushing QF to extinction.

Apparently,this is what is happening in the US and the professor believes that it will drive QF to extinction.....

Of course The Professor might have been talking about the corporate world particularly in Australia with it's ridiculous,greedy and immoral payouts to board members when he said...Job building.
Jobs for the boys.
Industrial fat.

30th Jun 2009, 01:58
How come when you go to Ausi it takes three guys to push you back when everywhere else it's one or two?
In QF? Certainly on all my domestic sectors (which is virtually all of them over the past 4 years) I've only noticed the tug driver and the ground engineer. Where did the 3 come from?

The professor is of course talking about Management when it comes to inefficiencies, industrial fat (literal fat too), blackmail. To this we could add: lethargy, selfishness, cluelessness, cooking the books, miscommunication, poor decision making, and a myriad of similarly descriptive words and phrases.

30th Jun 2009, 09:46
The professor is of course talking about Management when it comes to inefficiencies, industrial fat (literal fat too), blackmail. To this we could add: lethargy, selfishness, cluelessness, cooking the books, miscommunication, poor decision making, and a myriad of similarly descriptive words and phrases.

...all while paying themselves world leading airline management salaries and claiming the apocolypse wiill instantly happen if their workers get paid more than 3%...

30th Jun 2009, 12:50
Will some one please separate Jetstar accounts from QF.
How is it that QF carries pax from canx due low load JQ services to allow them to operate efficiently. Nothing against JQ but the books are cooked all to often to achieve political agendas. JQ propping up QF my @<hidden>

The other point, QF engineering carries out full engineering service during every transit with on time performance better than most including the LCC's that have divested themselves of this responsibility.

QF's Melbournes Heavy maintenance average hourly maintenance rate currently sits at less than John Holland and QF's offshoot Forstaff at Avalon. This is with a fully unionised full benefit work force!

Every time QF has haemorrhaged over the last number of years, you can look squarely at the incompetence of management.

Imagine if QF worked with their workforce.

Its a pity the QF bar is being dragged down, not the others pushed up.:ouch:

30th Jun 2009, 13:02
Hear Hear Rudderless :ok:

1st Jul 2009, 01:12
I think the accounts are far too heavily entangled for that to happen now, rudderless1.

You'd have to be living under a rock to not know some of the real-life examples of how money is moved between the two airlines, but unfortunately I don't think there is anything illegal going on. "Moral", "ethical", and "misleading" are not terms which are defined in QF Management manuals. The principle measure in the Qantas Group of whether a managerial action is acceptable, is whether the action has a low probability of resulting in a prison sentence.

Qantas shareholders, especially the institutions, don't care about the nitty gritty details or the colour of the tail. It's just the big $ figure at the end.

1st Jul 2009, 01:52
Although Qantas isn't "too big to fail", it's definitely "too Australian to fail".

A populist bedwetter like Rudd will never let Qantas go under - and most Australian taxpayers would support him, as long as they get a reasonable deal.

Falling Leaf
1st Jul 2009, 05:31
History suggests that if the worse were to happen, the Govt would step in and re-nationalise the airline.

In the late 90's the NZ Govt was crowing about how they saved the tax-payer 1 Billion over 10 years by getting rid of the Skyhawk Squadrons. A month later they spent that Billion bailing our ANZ, who I think at the time had SIA as one of their major shareholders!

teresa green
1st Jul 2009, 05:46
The Govt, would cetainly step in, it would be suicide for them and they know it. Flogging or closing down QF would be like selling the AFL to the yanks, the NRL to the poms, and the War Memorial to the Japanese, the reaction from the punters would be the same, there are some things in this country that are sacred, and QF is one of them, the govt would be running around like blue ars#d flies trying to find the money and the solution, but let it go, never.

1st Jul 2009, 06:12
For the month of May Qantas Mainline(International) yields have declined have declined by 24%.
The high yield P and J class travellers are just not flying and the seats are being taken up by those wishing to use Frequent Flyer points.
In part this decline has been bought about by the WFC.
Contemplate another cause:Qantas as an Airline is in disarray and travellers are simply avoiding flying with the Red Rat.
Qantas has been cutting away at the product for around 10 years and it has cut too far.The public perception of Qantas is that of a business in decline.
Poor morale,lack of resources,aging aircraft,an IFE that has a high failure rate are all contributing factor.The stoush with Maintenance staff over a 5 % pay increase saw the Qantas Schedule disintegrate.
In short...the Brand has been trashed.
Travellers now have better choices:Emirates and a resurgent Sing Air.
Why would you fly with Qantas?
Nationalistic Pride is no longer a valid reason
10 million Dollars on the Hall of Excellence at Alexandria is indicative of a business that has lost its way
Sixty Seven percent of staff would not recommend Qantas to family and friends as a desirable place of employment.A similar number would not tell people at party that Qantas is where they are employed.
Once employees would wear QF T shirts to a BBQ...not anymore.
Joyce is aware of this.But where does he start?
Big Job.
It may be beyond Joyce and his Chairman.

1st Jul 2009, 06:28
Hmm i must be in the other 33%.

Maybe the reason it all seems bad is because we are used to having doom and gloom shoved down our throats by Dixon. Well, he's gone, and from what Ive seen the company are trying hard to 're-engage' us. Perhaps less whinging (especially in front of pax) and more positive attitudes would help alter the public perception.

However...what can you do about bad (read: cheapest) IFE? Nothin. I feel for the CC that have to deal with this on a daily basis...:ugh:

1st Jul 2009, 07:35
IATA’s ‘Financial Health Monitor’ for May/June reads like a horror story:

Net losses exceeded USD3 billion in 1Q2009,
Oil and jet fuel prices have risen over 30% squeezing airline cash flows,
Air travel volumes hit a floor in April and May,
The industry continues to resize, new aircraft deliveries slowed buts fleets continue to expand,
Excess capacity rising as result, forcing both transport prices and yields down at faster pace,
Airline stock prices fall 2% in June as equity markets worry about cash squeeze on sector.Thank God for Government funded life support.

Bad Hat Harry
1st Jul 2009, 08:19
Short Term
Cost cutting,Increased Profit %of market share begins to decline and fleet ages.Overall quality of service begins to decline
Long Term
Yield and profit decline. % market share decline accelerates.Fleet continues to age. Overall service continues to decline markedly.
Surely Dixon was a saboteur

1st Jul 2009, 08:47
Customers? No!
The perpetrators have all escaped unpunished

1st Jul 2009, 09:53
i'm happy!
dicko's gone.
gotta feel sorry for tourism oz or whoever he's working for.
look what is happening with inbound tourism into oz in the short time at his new job.

Metro man
1st Jul 2009, 10:00
It is possible for a national airline to fail ? Look at Swiss Air and Sabena. Will QANTAS fail ? Probably not, but will things continue in their present form ? I doubt it.

If a company can make enough profits to support gross inefficencies and pay staff well in excess of the work they perform then fine. But eventually someone comes along and spoils the party.

The UK print unions were having a lovely time until the 1980s when the Star newspaper started up with new technology and working practices. A printer on a national newspaper earnt twice as much as an airline first officer, for one or two nights work per week, and could not be sacked.

The United Auto Workers at General Motors were on a good wicket too, until the Japanese and Korean car makers came along.

And who wouldn't want to work for an airline ? Be a unionised baggage handler and earn more than a turbo prop pilot. Be senior cabin crew and collect close to a first officers pay even though you are well past your prime and spend your work hours in the galley complaining about how things aren't what they used to be. Best of all, be a senior Captain on $250 000 with a defined benefit pension doing one or two nice trips per month and reserve the rest of the time, flying < 500 hours per year.

Now we have low cost carriers, non union (except South West), low overheads, efficient (same work with fewer people on less pay in less time), lower terms and conditions while working to max.

In future there will be two choices, low cost - low service or full price - full service. If you want to be the latter your product must justify the extra, and you will have to trim the fat to make difference reasonable. An extra 30 - 40% you can get away with IF you are reliable and give value for the premium. Charge an extra 200 - 300% and the issues with low cost airlines become a lot less important compared to the savings.

A smaller QANTAS with new aircraft on a reduced network with the fat and unsustainable working practices removed could be a serious contender. Singapore Airlines and Cathay are obviously able to justify their prices to those who will pay more for service. Unfortunately these people are heavily outnumbered by those whose only concern is price.

1st Jul 2009, 10:22
"pay staff well in excess of the work they perform"
Says who?
This may have been true 20 years but definitely not today.
The average gross pay for an FA is $60K.
The average wage for an Australian is $63K .
Pay increases of 3%p.a(with productivity offsets) is basically keeping pace with CPI and nothing more.
Dixon on the other hand was the highest paid Airline CEO in the world.
Over the last 5 years his renumeration increased by over 400%.
Dixon did a very good job of convincing eveyone that all staff employed by QF were overpaid.
In the lst 5 years Qantas managed to reduce its labour bill by 22%.
Australia is not the third world(yet)but Dixon wanted to pay everybody third world wages.
This vision didnt include Dixon or his trough feeding coterie.
No one on the shop floor at Qantas is overpaid.
The LAMES and pilots hadnt had a pay rise for four years.They were going backwards at a great rate of knots

Dropt McGutz
1st Jul 2009, 11:30
Quote: "Best of all, be a senior Captain on $250 000 with a defined benefit pension doing one or two nice trips per month and reserve the rest of the time, flying < 500 hours per year." I'd like to know where you thought that doozy up because it just doesn't happen.
Oh. And the new long haul fight attendants are earning around $35,000 per year I believe too.

Metro man
1st Jul 2009, 15:22
"pay staff well in excess of the work they perform"

Some of the staff, not all. Who thinks the baggage handlers are worth what they get for basically unskilled manual labour. Would a similar job in the local council have the same pay and benefits ?

The average gross pay for an FA is $60K.
AVERAGE pay, brought down by the lower wages of the new hires. What about the senior boilers, long past it, costing close to a first officer in pay and benefits. Would you they get the same pay in a similar job else where ? As a passenger would you rather be looked after by "Singapore Girl", or a scowling old battle axe who regards you as an inconvenience ?

Anyone think there are too many overpaid managers ?

Engineers however are underpaid considering their skill and responsibilities.

"Best of all, be a senior Captain on $250 000 with a defined benefit pension doing one or two nice trips per month and reserve the rest of the time, flying < 500 hours per year."
British Airways have them, Ansett had them, sure you haven't got a few ?;)

No one's going to dispute that QF pilots are better paid than J*/Virgin/Tiger ones. If they want to keep it that way they need passengers prepared to pay more for a better travelling experience.

Dropt McGutz
1st Jul 2009, 23:00
"Best of all, be a senior Captain on $250 000 with a defined benefit pension doing one or two nice trips per month and reserve the rest of the time, flying < 500 hours per year." British Airways have them, Ansett had them, sure you haven't got a few ?

Mate, I work there. I know that statement is crap. And yes those "old boilers" are on around $60,000.
And I believe the baggage handlers are cheaper than the Virgin ones now.
Maybe you should get your facts right before writing such crap.

Metro man
2nd Jul 2009, 01:19
Add in allowances, superannuation, hotel costs and the old boilers don't look quite so cheap.

In Singapore, baggage handler is one of the lowest paid jobs in the country and SIA aren't concerned about them going on strike.

Look at the competition on longhaul; Cathay, SIA, Emirates, Etihad and soon Qatar. Three of those are Skytrax 5* rated Airline Reviews, Airport Reviews, Flight Reviews, Seat Reviews and SKYTRAX Airline and Airport Star Ranking (http://www.airlinequality.com/), all have lower labour costs due to the ability to employ from Asia and the Indian sub continent. Qatar Airways don't need to make a profit with all their reserves of natural gas, as long as its big and prestigious let the money burn.

Domestically who knows ? Virgin have problems of their own, Tiger not yet in the black but British Airways weren't too concerned about a small Irish Airline starting low cost flights. Ryanair - Book Cheap Flights to Europe - Cheap Flights from the UK (http://www.ryanair.com)

I remember seeing the head of the United Auto Workers saying that things at GM were so bad :"Even if we worked for nothing, it wouldn't help." Don't let things get to that stage.

A reduction in QANTAS pilots terms and conditions helps drive things down for the rest of us, and a large number of pilots on the job market at once doesn't help either. If things can keep going as they are, fine. If not please sort it out before it affects everyone else.

Enema Bandit's Dad
2nd Jul 2009, 01:55
Hotel costs? Where do you expect them to sleep? :}

2nd Jul 2009, 02:04
That Crew Rest is going to start looking good after a night on the Crew Room floor.

2nd Jul 2009, 04:07
allowances for crew are the same, everyone has to eat.
can't figure out why worker bees, i.e pilots hosties baggage handlers engineers etc seem to be your target. what about the bloated pays for management, compare them with singers, cathay, thai et al and us bees are cheap, cheep cheep

Going Boeing
2nd Jul 2009, 04:51
indamiddle, some of the Asian carriers require their CC to share hotel rooms. That gives them a significant price advantage when coupled with the lower rates of pay.

2nd Jul 2009, 06:06
Thats a great cost saving measure that certainly needs to be given a go.

Therefore I suggest since the pilot salaries far outweigh those of cabin crew and savings can clearly be made in this area by room sharing you can trial this clever idea first for say 12 months and if it proves to be the cost saving initiative you say it is im sure cabin crew would be more than willing to give it a go (I can see a few legal disputes but hey its all about cost saving).

Metro man
2nd Jul 2009, 06:18
some of the Asian carriers require their CC to share hotel rooms

Not just hotel rooms, I know many cabin crew living five or six to a three bedroom unit because they can't afford to live on their own. In Australia an f/o would earn "about" 2.5 times what a flight attendent makes. Over here it's 5-6 times as much.

can't figure out why worker bees, i.e pilots hosties baggage handlers engineers etc seem to be your target. what about the bloated pays for management

I stated that engineers were underpaid and managers were overpaid. As a pilot myself, a reduction in QF pilots terms and conditions does me no good at all. Our GM would love to use a QF pay cut as an excuse for one for us.

I've seen union vs non union loaders from my freight days. Basically the union ones used twice the number of people, took twice as long and got paid twice as much.

On the domestic routes cabin crew cost differentials with the competition aren't as bad as international. A flight attendent in Australia expects a certain minimum even if working for a low cost. On the international routes the competition have far lower cost, non unionised staff.

If QF can be profitable against the competition in its present form, all well and good. If EK, EY, SQ, CX, QATAR etc are supplying a better product at a lower price something has to give.

I don't want to be paying a "QANTAS ticket tax" so the staff can be paid their entitlements.

2nd Jul 2009, 06:25
All im hearing out of you metro man is "Hi, i am a sc#b who doesnt want to pay for good service cause i don't earn enough flying planes for an unsafe LCC and sc#bbin on all good aussie pilots. Truth is im a crap pilot and couldn't make the cut at QF.":mad:

Dropt McGutz
2nd Jul 2009, 06:44
Let's not forget that Qantas is at a distinct disadvantage from a taxation point of view. Most carriers can depreciate their equipment over three years but not Qantas. They have to wait ten. What about carriers that don't have to pay income tax such as EK or lesser amounts such as SQ compared to Australia? Gives some carriers a nice advantage doesn't it?

2nd Jul 2009, 07:21
When someone has an illogical obsession they often start to contradict themselves and Metro man is doing it now....
AVERAGE What about the senior boilers, long past it, costing close to a first officer in pay and benefits.
I Australia an f/o would earn "about" 2.5 times what a flight attendent makes. Over here it's 5-6 times as much
Care to comment metro man????
Once it was close to.....and now it's 2.5 times.....WTF:=
I get the feeling as well that this is someone in the office in Mascot.....wishing they had the cost structure that Asian airlines do but at the same time paying management the same as QF does....

Comparing QF to Asian airlines is like comparing apples and oranges....completely different cost of living,tax set ups,culture etc...
I don't want to be paying a "QANTAS ticket tax" so the staff can be paid their entitlements.
Perhaps Metro man is someone who had to move offshore to get an airline job after all...or just a job and is still peeved at those who have a job at Qantas....:E

Metro man
2nd Jul 2009, 07:29
And qantastrike, you ALWAYS buy Australian to support the good old Aussie worker even if the product is of higher price and lesser quality ? Nothing foreign made in your house.

Why not ban everyone except QF and BA from the kangeroo route. Both carriers could agree on a $3500 LHR/SYD economy return fare with no undercutting. Should be enough to maintain all the union agreements and payscales, on both sides. Ban foreign cars as well, make everyone buy Ford or Holden. No more clothing imports, get the textile industry back up again.

Exactly as Dropt McGutz says regarding tax and depreciation, though SQ do turn the fleet over at a relatively young age where as QF kept the 747 classics a bit too long.

All I doing is pointing out what you have to compete with. Look at the state of British Airways at the moment. Massive pension defecit and asking staff to work unpaid.

BTW. As an f/o I'm financially about the same as a Captain in J*/Virgin/Tiger Australia and can pay for the level of service I want. With the recent number of QANTAS incidents you're not really in a position to lecture on safety are you ?

Metro man
2nd Jul 2009, 07:38
Once it was close to.....and now it's 2.5 times.....WTF

Senior boiler wouldn't be too far off junior f/o, especially if flying premium allowance routes and the f/o got a poor roster.

2.5 times refers to low cost and is a rough estimate. If anyone has detailed pay scales and actual examples available and can show its really 2.1738 times or 2.8976 then I stand corrected.

Perhaps Metro man is someone who had to move offshore to get an airline job after all

Absolutely, along with many other Aussies. Not unusual for incoming Aussie Captain/F/O to hand over to outgoing Aussie Captain/F/O.

2nd Jul 2009, 07:48
Bingo we have a winner......:E

Metro man step away from the computer.....before you make too many people laugh.:8:8

2nd Jul 2009, 07:52
allowances for crew are the sameYou have quite obviously never seen the allowances Emirates pays their crews, a fraction (and a small one at that!) of what QF pay their crews. In some ports, (admittedly only a very small number - so far) they don't even pay allowances. It's eat in the crew hotel at the assigned times - great after a back of the clock flight - NOT! (no room service allowed unless you pay for it yourself). Don't make it to the "standard time only" brekkie/lunch or dinner? Then either go hungry or buy your own meals from your own funds.

2nd Jul 2009, 08:21

Can you tell us how much income tax the crew in Dubai pay?

Can you also tells us about the accommodation costs there as well as other perks which you get in the sandbox?

However,back to the issues about allowances...allowances for crew are the same
I think you will find the quote in question referred to a comparison of allowances paid to crew from the same airline....not to a disparity in allowances between airlines.

ditch handle
2nd Jul 2009, 08:57

the following gives a fascinating insight into employee conditions in the part of the world you allude to-

The dark side of Dubai - Johann Hari, Commentators - The Independent (http://www.independent.co.uk/opinion/commentators/johann-hari/the-dark-side-of-dubai-1664368.html)

Worlds best practice, eh Geoff..........:rolleyes:

2nd Jul 2009, 10:37
I am sorry lower Lobe,

Metro man speaks the truth and it does seem to hurt. As an ex QF employee ( I was an engineer) my last flight internationally was three years ago J class with Qantas and it will be my last (and I live overseas).

Crap service by grumpy old boilers or ladyboys who look at you with disinterest. Why on earth would we want to fly SQ , on time with their beautiful attentive flight attendants rather then the feminist nazi brigade on the red rat.

Face it QF ( in flight service wise I still have respect for the tech staff) is unrecognisable for the great Airline it once was, it is crap!

2nd Jul 2009, 10:40
Metro man With the recent number of QANTAS incidents you're not really in a position to lecture on safety are you ?

What Qantas safety incidents would that be Metro?
If I'm not mistaken the "incidents " you are refering to probably would have ended up as catastrophic accidents if it wasn't for the fact that the crews did what they were trained to do and did it well.
I hardly see that as a negative but rather as a glowing testimony to training pilots and cabin crew to standards above and beyond the bare minimum legal statutory requirements.

2nd Jul 2009, 11:38
QF has approximately 4500 CC
78% of them are female
There are less than 500 over fifty five.There are less than 100 females over 55 who are flying and a number of these transferred from domestics.
The average age of a CC member is 37.
I see good looking young hosties every time I go to work.
Very rarely do I see an "old boiler"
Australia and QF are not ageist or intolerant of others sexual preference.
Seems we have a few homophobic misogynists posting here.
You know the type: overweight balding with bad teeth who couldnt get laid in a bordello

Enema Bandit's Dad
2nd Jul 2009, 12:05
Gosh, that sounds like my mum! :eek::uhoh:

White Pointer
2nd Jul 2009, 13:12
Interesting to see the demographics if you break them up by division. All the young ones are QCCA or domestic, while all the traditional LHCC are prehistoric (with attitudes to match).

Handbag swinging here it comes!

2nd Jul 2009, 17:06
white pointer, you hit the bleedin' obvious right on the head.
as QCCA crew only started flying 18 months ago of course they would be younger.

2nd Jul 2009, 22:31
Indamiddle.....You have to read Whitepointer's post to understand what he/she has against QAL to understand....here is an example
Lowerlobe, are you saying if we voted no to the NY shuttle we would be back slipping there and better off? And if no Australian ventured up to London the base would be dead and buried?
she is anti seniority...anti QF L/H....pro giving into the company....pro S/H..
All the young ones are QCCA or domestic
Don't you love that bit...there are no old girls in domestic according to White Pointer....:8:8:8:8

Also as I said WP....the company got a yes vote and did it bring back the slip....but noooo you can always trust the company......:D:D

The sad part is that she talks about hand bag swinging but she starts the argument and that shows how bitter and twisted she really is....

Orangputi...Well,I too have travelled a fair bit since I left flying with QF and I have to say you are full of it.Since all the airlines have cut back it seems as though there are lots of airlines that are not what they used to be.

However,with QF I have had some very good flights with the exception of IFE problems and other tech issues causing a delay...and you can hardly blame that on Cabin Crew....But with your description of the SIA girls it is apparent that you are one of those who just likes Asian women so no amount of logic will please you.

Crusty Demon
2nd Jul 2009, 23:08
After not visiting this site for months, it's good to see that Cabin Crew posts and issues are still really raising the standard of information on this forum. Drama Queens are out in force.

Every thread that mentions Qantas turns into slanging match involving the much unloved and unrespected QF LHCC forum posters are who not wanted anywhere else due to poor form. Frustrating for those of us who don't want to be involved.

Looks like a return to this forum was a waste of time.

2nd Jul 2009, 23:56
I fly an aircraft type which uses both LH and SH cabin crew and I can assure you that neither side has a monopoly on age, attitude, competence, or efficiency.

3rd Jul 2009, 00:01
Crusty Demon.....It seems as though you have a short term or selective memory...

You(pilot) also attack the pilot conditions used by Jetstar but when cabin Crew disagree it's somehow different to you....So you're right...

Maybe it's best if you stay away:yuk:

DirectAnywhere.....If you look at the pay and conditions for the upper management and the board it's a systemic problem and not just for cabin crew,pilots etc....

The main problem is not so much the pay issue of crew instead it's rather an organizational problem that is the cause or the answer to cutting costs...

The old inverted pyramid issue of the airlines management structure is the heart of the problem...

A study years ago looking at a certain level of management found that compared to another much larger airline, we had far more levels of management....so if you want to make the airline more efficient and competitive one way would be to reduce the levels of upper management....big time.

The problem is that which part of the company gets these reports.

Whenever the company commissions a consultant to tell them where the problem is....the ones that should go are given that very analysis.....

And what do they do with the report...file and bury it to save their own jobs.....

3rd Jul 2009, 00:15
It's always handbags at twenty paces in a LHCC thread. They just cant seem to come to terms with the realisation that their little empire is crumbling around them, because of them voting in the b scale for QCCA crew in the last EBA. And all for a bit of cash in the hand :{

Bring on the QCCA crew, bring em on! (That's the only reason that the CC demographic has become younger in the last million years of Qantas LHCC) :D

3rd Jul 2009, 00:15
For all those that poke fun at older QF CC you should bear in mind that like you they were young once.Youth is fleeting .Enjoy it while you can.
All those older crew members were the ones that gave Qantas the reputation it enjoyed between the 60s and late 80s.A friendly efficient cabin crew with a can do attitude.
Mind you they were well resourced then.IFE worked, there were more crew and the place was like a family.Qantas ran on mutual respect.
Today the brand gets hammered and older employees are an easy target.
As far as wages go.Two things increased CC wages.The introduction of the bid system in 88.This was forced on the crew.The second thing was the floating of the A $ in 1984.
I made more money working on harbour cruises(in the late 70s and early 80s) as a Cruise Director than I did working for Qantas.
Qantas was a proud fun place to work.Everyone on the same page.
Now employees and management dont even read the same book.

Metro man
3rd Jul 2009, 00:35

Thank you for the most sensible reply so far. At least some one can see the reality of things.

QF have had an easy time across the Pacific until recently, basically competing just with United Airlines who have the same cost and staff issues. Someone going to Europe can fly via Singapore, Hong Kong, Kuala Lumpur, Bangkok, Seoul, Taipei, Dubai, Abu Dhabi and soon Doha. With the Asian and Middle Eastern hubs, the days of just QF/BA to Heathrow and connect on from there are over.

What used to involve landing in a countries capital city and then catching a domestic flight onward has been replaced by, fly to a hub such as Dubai and catch a direct flight from there, SYD one stop to Birmingham or Glasgow. Great for business, and why not have an exotic stop over if on holiday.

I often fly with pilots who have been laid off or whose previous airline went broke, including a few ex Ansett. Things need to be sorted out before you find yourselves in the same boat. If not the following may prove usefull:
Aircrew Contract Search (http://www.bestweb.co.nz/pilot/index.htm)

West African saying - "He who tells the truth is not well liked."

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