Qantas to start another airline offshore?

[slim]

From today's Australian;

Qantas eyes Asia

QANTAS is considering starting a new Asian-based airline aimed at the business market in a move that would pave the way for more Asian-based engineering facilities. The plan is part of Leslie Grant's review of the company's international operations that is due to be completed by the end of the year.

The move is somewhat sensitive now in view of looming industrial action with its engineering workforce.

But the aim of the plan would be to extend the airline's reach into Asia and in the process reduce its cost base.

Intra-Asian operations are tough without a joint venture partner, given sovereign flight restrictions.

By linking the engineering base with the new airline, Qantas boss Alan Joyce could get around sensitivity over servicing Australian-based planes offshore.

The new airline is targeted at business complementing Jetstar Asia and based around A320 jets but with as few as 100 passengers.

Qantas is not commenting on the proposal, which is being considered for launch in the next couple of months, other than saying everything is on the table.

:rolleyes:

[waren9]

Another piece of the jigsaw? Is this the entity that takes delivery of the QF group 787's?

[standard unit]

Another example of QF management leveraging off Qantas's success in order to ultimately, kill it?

[The Kelpie]

.....an airline which would not be an 'end of route' carrier- something that Joyce claims is part of why QANTAS is uncompetetive and why airlines such as Emirates and Cathay have an advantage over the rat.

Perhaps there was more truth than was realized to Chasers version of the QANTAS choir when it referred to the 'Asian Kangaroo'

More to Follow

The Kelpie

[slim]

The timing is interesting. Just as the QF engineers ramp up their PIA and pilot's move closer to theirs, out pops a story about an airline/engineering base offshore. Leaked by QF perhaps as a scare tactic?

[TBM-Legend]

What would my great uncle Lester Brain think of this? I think he'd be happy....

After all he left QF to be the first GM of TAA...

[Dragun]

All the rhetoric aside, is this airline genuinely finished in it's current form? There really is nothing to stop shell companies being created continuously is there? I feel sorry now for the guys who joined in the last batch of recruitment. It'll be a good 15+ years to FO in any city now with the possibility of a command dwindling by the month for good.

Very, very sad.:(

[blow.n.gasket]

This from a Qantas Pilot mate of mine.
No wonder Qantas Pilots are wondering if they'll have a worthwhile career soon!



With this in mind, information has come to the attention of AIPA which purportedly indicates a deliberate intention of Qantas to outsource and offshore the crewing arrangements of Qantas aircraft (this is in addition to the current Jetconnect operations). These rumours include, but are not limited to:
Qantas applied for an AOC (Aircraft Operator's Certificate) in Malaysia;
Qantas applied for 5,000 seats per week out of Fiji;
Project Dragon, now apparently Project Darwin – headed by Lesley Grant – purportedly investigating the possibility of establishing a new ‘premier’ airline based in South East Asia. See today's article in The Australian);
Management is planning to establish a contract company for the purposes of crewing all Qantas and Jetstar B787s.
If one considers these rumours, combined with Qantas’ attitude outlined above, it leaves AIPA and its members with no alternative but to assume the worst.

[stubby jumbo]

As Darrell Kerrigan once famously said:

Tell 'em they're dream'n son!"

Are these Clowns serious........a "premier" airline based in Asia?
Up against SQ,MH,CX:ugh::ugh::ugh:

Things must be getting desperate......after the foray into Vietnam,non purchase of the Tripler......this one will have to take the cake.

Whats the metal going to be called:

JETSTAR BINTANG :E

[Angle of Attack]

Management is planning to establish a contract company for the purposes of crewing all Qantas and Jetstar B787s.

Its not planning it has already been setup, mainline will not crew 787's full stop

[daveyjones744]

The Irish dude will setup the business class version of Jetstar. Next push more aircraft to the new and old Jetstar. Retire the B744.


Offer the the A380 Pilot's new contracts with Jetstar type salary. B737 b767 aircraft retired. Jetstar A320 A330 and B787 will team up with the old boys from the A380 who have signed their new pay cut deal or retire. New paint job and you have the new Rebrand Jetstar to Qantas then that will equate to the new low cost and business class Qantas.

See **** like this happens when a group of people walk around with their collective heads firmly planted up ones a...e......

[rodchucker]

Let us hope that the level of deception by the Rat and its bastard child to the Senate inquiry do not go unnoticed by the honourable senators.

Rarely has such demonstrably deceptive conduct been shown in Australian corporate history ( excluding James Hardie, but this is up there and possibly exceeds even that debacle).

Where is the corporate regulator when you need them, although even their track record is hardly inspiring and no doubt encouraging this type of behaviour by their inaction. Perhaps a change of Chairman will result in a need for some heads on poles rather than a political game.

Senators over to you and please show us you have the strength of character that the travelling public need at this time.

[jaded boiler]

"mainline will not crew 787's full stop"

Yep, that EBA 8 sure was a s*&t deal, with all red tail 787 flying to be done under the LH award on 400 pay rates...

[73to91]

QANTAS is considering starting a new Asian-based airline aimed at the business market in a move that would pave the way for more Asian-based engineering facilities. The plan is part of Leslie Grant's review of the company's international operations that is due to be completed by the end of the year
Well I immediately thought after reading this that Grant's review was nothing but a sham then. You guys still working there know what's needed, I know plenty of staff who know what's needed and I know some retirees who know whats needed to get QF back to where they should be and its not a new Asian based airline, its not an airline in Oz or Asia aimed at the bisiness market (don't that have that now called QANTAS ? ).

So no doubt she was given a plan by AJ & BB, told to go away and make it look like she was working on the publicly stated project :ok: but she returns 6 weeks later with the original plan provided by AJ & BB.

With this point, Qantas applied for 5,000 seats per week out of Fiji I have always thought that NAN could be used as a hub to get to points further east than LAX - maybe this would get Jet* there?

[Oriana]

Management logic:

"There will be a few thousand refugees/illegal immigrants sent to Malaysia.....Imagine how cheap we can get them to crew the operation":hmm:

[-438]

Major Airlines all over the world are consolidating with mergers seemingly the way to go.
Qantas management who are smarter than the rest of the worlds airline managers are creating new airlines to cannibilise each other.
How do I know Qantas management are smarter than most other Major airline management? They must be because they get paid significantly more than most other major airline managers.

[another superlame]

Why is Leslie Grant still here? I don't believe she offers anything of substance to Qantas and this just proves it.

[Al E. Vator]

Lester Brain - now there's a name that should be used as THE template for setting-up and running a sensible airline. He was in charge of a new airline and responsible for fleet selections that blew the opposition out of the water. He clearly had wisdom and a passion for the task at hand.

These dunces that call themselves 'managers' now are a shambolic, self-serving disgrace. They are ONLY in it for themselves. Their bonuses and shallow ego boosting career moves are all they care about. They don't care if they run an airline or a sprocket factory as long as their wallets and egos are satisfied.

Sadly it the the icon Qantas that is suffering. Even more sadly it is the staff that are suffering. Staff that in many cases have been and will remain with Qantas far longer than the numpties running it ever will be.

How did it come to this.

[SeldomFixit]

Labor Governments.

[standard unit]

12 years of the Howard Liberal government.

[stewser89]

Sorry Seldom I can't see how it would be different under a Liberal government. Are you privy to a secret plan by Tony Abbot to nationalize Qantas (I'd almost vote for him then)

Otherwise, what planet are they on, 'Premier Asian Airline' isn't there enough airlines already competing in Asia on both LLC and Legacy level.

QANTAS best playing card is that its Qantas. Its the Flag Carrier, its the only Australian Airline. Not Jetstar or Jetstar Asia or any other business title. Rather than trying to start new airlines shouldn't they be revamping and streamlining their products to compete with a new energized Virgin product. Perhaps we will see Virgin try and pick up the flag carrier mantle like they did with BA years ago.

My 2c

Perhaps they should ditch 'Spirit of Australia and give this a whirl, Qantas Still 51% Australian (till we get around the Qantas Sales Act.)'

[drshmoo]

This is a very sad day :-(

Another silo is to be set up to destroy what we and our forefathers achieved.
I hate how our (QF) profits will be re routed to pay for another bunch of pilots that are to be used as industrial leverage to wipe me and my career from the face of the earth.

I love my job at Qantas but the future looks so dark I need night vision goggles. Looks like we will be S/Os for a very long time while they give window seats to blokes off the street to fly aircraft financed by mainline pilots work to Asian inexperience or Aussies wanting to jump the queue in shiny new A320s.

This Jetstar group crewing, does this remind anyone of the Waterfront dispute lead by chris corrigan?

[astroboy55]

shmoo are you referring to the article in the AFR today? I have seen the first 2 lines of it online but cant access the rest. Something about a QANTAS Singapore or something? Any chance you can give more details?

[xjt]

SHANGHAI has firmed as Qantas' preferred option for an Asian depot to resuscitate its international business by transferring those services to its discount airline Jetstar and avoid the costly long-haul trips to Australia.

The flag carrier, which yesterday scotched reports it was planning a Singapore or Malaysian hub, has launched a review of its overseas services.

A taskforce is expected to report to the board within months.

"The focus is on Qantas's long-haul business and we are keen to get it back to where it is providing an improved return on capital as soon as we can," a Qantas spokesman said.

However, this sparked renewed talk that Qantas might be planning for Jetstar to take over the bulk of its international operations in a bid to avoid unionised labour.

The spokesman refused to comment, and also dismissed as "pure speculation" reports that it was planning a new hub in Singapore or Malaysia to avoid flying some of its services all the way back to Australia.


Qantas chief executive Alan Joyce told BusinessDaily last month it would pursue a hub in Shanghai.

An analyst said the Qantas taskforce could not ignore establishing a base for Jetstar in Shanghai and offer the airline's services as a "real alternative to the Flying Kangaroo".

"The old Qantas model will not be around in anything like its present guise for too much longer, because if it continues the company will go out of business," the analyst said.

"This is the next logical step for two reasons: it allows Jetstar to address a far larger Asian and Middle-East market; and it gives the group the ability to assign the Jetstar or Qantas brands and cost structure to various international markets."

Qantas acknowledged its international business was underperforming.

"Our market share has fallen in recent years and we need to re-look at this area of the business," the statement said. "A project team has been established to look at Qantas' international product and service."

A very sad day indeed......what a disgrace.....analyst my a**....one just has to read the new j* pilot contract and the verbal crap that the so called chief pilot released this morning to see how well this symphony has been orchestrated ............

[B772]

You do not have to be a rocket scientist to see why QF International (non pacific) are underperforming. Uncompetitive number of frequencies, lack of destinations, poor inflight service, low quality catering etc etc.

[Metro man]

You do not have to be a rocket scientist to see why QF International (non pacific) are underperforming.

The only reason they are performing across the Pacific is because passengers don't (yet) have the option of Singapore Airlines or Emirates on that route.:hmm:

[chockchucker]

The only reason they are performing across the Pacific is because passengers don't (yet) have the option of Singapore Airlines or Emirates on that route...............


Which, if the federal government stand back and allow Qantas to set up shop in asia to circumvent the Qantas sale act and Australian industrial laws, should be allowed to happen.


No more Alan Joyce pleading to the government for protection from competition on the pacific route, and of Australian jobs, if he's shipping jobs off to asia anyway.


Certainly is a bad smell in the air about Qantas these days. Not surprising after management have now hollowed out the QF Mainline carcass almost as must as can be.:(


Although, I'm sure there will be a lifeboat on this Titanic for Messers Joyce, Buchannan and co.:mad:

[skybed]

:ugh:is to have the sales act changed!. this wold allow it to tie up with either IAG or other carriers.
The idea of setting up a base in shanghai amuses me. they get skinned in Singapore, Vietnam and what makes them think they get a chanche to set up shop in Shanghai? With another local partner owning 51%? bloody stupied but who listens!:ugh:

[whatever6719]

Im not sure about this caper.
Setting up a bunch of A320's (initially) to cater to a growing middle class in Asia with a "premium" product flying into/out of Singapore just doesnt add up.
The market out of SIN already has a world beating premium airline of its own, SIA which the Singaporeans are fiercely proud of. Why on earth would this market suddenly be tempted away from SIA, CX, NH, JL, MH, etc etc with all the points and status they may already have accumulated over years of loyal patronage, to suddenly go en-masse to "Qantas Asia".

What they will most likely aim for is to eventually have 787's that will take all the pax inbound from Australia that have arrived into SIN on QF and send them off to points in Europe or wherever, with crew based completely in SIN. Basically, any service into/out of SIN on the 787 will NOT be crewed by Australians (on Australian terms and conditions)
Apparently they cannot use the Qantas name in this venture so who knows
what they plan to do about that.
And the obvious trade off in all of this will be giving SQ Trans Pacific rights they have long been after....a real smart move (not!)

Or, this could just be a smokescreen. A tactic to use in the middle of contentious EBA negotiations.
Who knows!!
One things for sure, Ill give them points for creativity.

[Artificial Horizon]

I didn't read Singapore in that article, I though that is said Shanghai!! I suspect that this could be a pre-EBA negotiation warning shot. :{

[whatever6719]

Hi Artificial Horizon,
No, I was going off stuff I read in the Financial Review today (Saturday) which has quite an in depth analysis of it all.
Worth a look.

[Beer Baron]

I suspect that this could be a pre-EBA negotiation warning shot.

I don't doubt you as it seems anything is possible with QF/JQ management at the moment but it would be an obscenely stupid move. When the pilots and engineers are crying out for job security this story just drives home how desperately important a job security clause is.

[BeerMan]

AH, I believe that the reference is today's 3-4 full pages on this subject in the weekend Financial Review. It's front page too... QANTAS LEAVES HOME.

Can't get access on line, so cannot post.

What a state of affairs!!!

[blueloo]

Can anyone get access to this article on QANTAS in todays AFR?

How about primitive scan, and upload image if anyone has the paper?

[PoppaJo]

Hold on, I thought Shanghai wouldn't allow Low Cost airlines into their airport?

['holic]

Since when has it been good business practice to transfer capital and assets to a foreign entity over which you have no control? All it would take is a change in sentiment from the Singaporean investors or change in government policy and Qantas SIN could be speared off in a direction contrary to Qantas Group's best interests. Have any other companies successfully used this strategy?

This is apart from the fact that no foreign franchise (J* Asia, J* Pac) has made any money up to date. So why continue with this strategy, while neglecting the core business?

Also, the Australian public and politicians are well aware that this is a blatant attempt to circumvent the Qantas Sales Act, tax, employment conditions etc. How much goodwill had been lost? How receptive will Canberra be next time Qantas is lobbying for reduced foreign capacity? Will Qantas be able to take any action next time SIA applies to fly across the pacific? Not only has a Qantas given the Singaporeans a precedent to justify this occurring, it has now compromised its ability to lobby government to prevent this happening as it must keep the Singaporean government on side.

[mrdeux]

The QANTAS group's best interest is simply whatever lines the pockets of the management. They did not make this airline, but the current lot will most certainly be the ones who destroy it.

[breakfastburrito]

Note: if the images don't work, you can download a complete zip file PACK HERE (http://www.mediafire.com/file/dcn0wqooptoimis/afr_may_14_2011.zip)
(even though it may say file not available, clicking on the images should still work)


http://www2.mediafire.com/imgbnc.php/5f1c3af8edac3422403d20873037d2d5dbbaf0a9f292cafead93b10c1e33 9cdc3g.jpg (http://www.mediafire.com/imageview.php?quickkey=bhw8ocbw6vyyi0u&thumb=4)

http://www.mediafire.com/imgbnc.php/67879d77850a27c708c157e1951e7ae1df9d4d16a955b1c887071c83df72 1f6d2g.jpg (http://www.mediafire.com/imageview.php?quickkey=3n7p382rzzqonog&thumb=5)

http://www4.mediafire.com/imgbnc.php/f1770ff574b8ade8aa58f1f98f8a55c7e70d55549be9959b0e3048237c5d 15e43g.jpg (http://www.mediafire.com/imageview.php?quickkey=6x8dvjfxf6dr6uw&thumb=4)

http://www3.mediafire.com/imgbnc.php/9e0203393225b6c26ea9ead4fd1a70b06e6326be10b4fa89ff16e5c4970a f6153g.jpg (http://www.mediafire.com/imageview.php?quickkey=so6rek0j0ut1zd1&thumb=4)

[breakfastburrito]

http://www3.mediafire.com/imgbnc.php/9e0203393225b6c26ea9ead4fd1a70b06e6326be10b4fa89ff16e5c4970a f6153g.jpg (http://www.mediafire.com/imageview.php?quickkey=so6rek0j0ut1zd1&thumb=4)


http://www2.mediafire.com/imgbnc.php/5266b68de11e7ce2ae8bc52c0081ff29c6cf9026eaf27b0393f45b6729c8 64ff3g.jpg (http://www.mediafire.com/imageview.php?quickkey=8vwoda16ajqd891&thumb=4)

http://www3.mediafire.com/imgbnc.php/b825dc005628723c28589886dfa2ebf08283a441d8bc3e34a3baa358501e 40d13g.jpg (http://www.mediafire.com/imageview.php?quickkey=y5z65ij534xuuyz&thumb=4)

[blueloo]

Thanks for the effort BB!

[mcgrath50]

Good article overall. Finally the rest of the world are waking up to this!

[DEFCON4]

If management spent the same amount of energy trying to grow the business as they do trying to destroy it then Qantas would be a very competitive and profitable airline.
Cannibalization of mainline by Jetstar
Deliberate disengagement of the entire workforce
Illegal corporate practices
Poor fleet choices
A 1980s IT environment
Starving mainline of Capital
Deliberate trashing of the Brand
Obscene Executive bonuses.
These current EBA negotiations need not be so adversarial.Small compromises by management would lead to positive outcomes for everyone.
So unnecessary.
Its all about saving face by an incompetent management team that is totally clueless
Time and again employees have compromised for the future of the airline and have been done over.
The line needs to be drawn in the sand.This will be the last hurrah

[fishers.ghost]

The Financial Review piece is essentially an Obituary Notice

[I'm Driving]

The line needs to be drawn in the sand.This will be the last hurrah

I'd have to agree.
Nobody I talk to believes QF will survive the fight it's about to have. With current Management attitudes vs Employee attitudes, there will never be an agreement.
As far as I can tell, this will be a fight to the death. With all the information freely available on the net, it would appear the Employees have got nothing to lose.

[packrat]

There are some large funds who have sizable shareholdings in Qantas.
What do they intend to do to protect their investments?
Sit idly by and watch the Qantas share price tank ?
Time for an extraordinary shareholders meeting and a vote of no confidence vote in the board

[Merlins Magic]

[QUOTE](I'd almost vote for him then)/QUOTE]

Stewser89, your the first person i know to admit to voting for labour. :=

It obvious that taking the time to complete the engagement survey was a complete waste of time. Obviously they have not been read and if they have the company has no real desire to engage with its staff anyway.

Qantas management has failed to realise that the thing that has made the Qantas brand (not Jetstar) so strong and recognisable for so many years and given many Australians a feeling of home when you hear the Australian accent when boarding your flight overseas is the Australian staff that wear the uniform proudly. The Australian staff that greet you at the boarding gate. The Australian staff that come and talk to your kids during the flight. How many Australian staff will be staffing any venture out of Asia? Not me.

[Ka.Boom]

If QF goes down the gurgler are employees superannuation protected by legislation?.Will outstanding leave and other entitlements also be protected?
Lets not have a repeat of Ansett where employees got screwed

[watch your 6]

The oldest airline in the english speaking world has survived two world wars and numerous other disasters.It was the first embassador Australia had.It was the quintessential iconic Australian brand.It is being sysytematically dismantled by foreigners~~~One Irishman and a Kiwi !!
While all other australian brands have gone off shore or been bought by multi nationals Qantas has remained as one of the few icons to survive.
Australian jobs and tax revenue are now being exported by people who have no emotional connection with our Australian Airline.
Airlines represent their country of origin's character and community on the world stage.
Australia's star is about to be irreparably diminished by barbarians.
The government sits idly by while politicians receive gifts from Qantas management as a reward for their complicity in the airlines demise.
What the fark has happened to this country?

[Mstr Caution]

YouTube - Qantas Cabin Crew

Commitment - B*&^SH1T

[Nose wheel first]

If this "Qantas Asia" or "Qantas Lite" or "Qantas Star" (or wharever they are going to call it) gets off the ground I believe we will see the following....

Singapore or Shanghai (or wherever they eventually decide to set up) being used as the hub for all Aus & NZ to Europe/Mid East flights with the aircraft originating from the Asian hub. On top of that, the new airline will develop an entirely new route structure to service many other Asian and European ports not currently serviced by QF. Australia will be but one thread in the new Qantas Asia spiders web.

The REAL Qantas will be scaled back in it's entirety to conduct some Asia direct services, (Japan, Indo, HKG etc) albiet on a reduced schedule/frequency compared to what they do now. They will also fly trans Pacific services but nothing beyond that. As for domestic.... domestic will fly East Coast and trans continental routes with the odd regional route on which there is no current competition thrown in. Anything else will be the domain of One Star until their aircraft are all painted white with a rat on the tail again.

Would it be unrealistic to ask if some of the the A380's will at some stage be transfered to the new entity rather than having them all based in Aus? There are only so many Dugong loads of passengers you can fly to the USA every day and if they are currently flying through Asia to get to LHR why not base them in Asia where the cost of EVERYTHING is supposedly lower?

Maybe these things won't happen, or if they do, not to the same extent that I have suggested. I don't hold a whole lot of hope though.... Jet Connect effectively has the QF Tasman business to itself at the expense of QF (not forgetting No Star) Seeing as that has worked so well why won't an Asian based carrier?

[Nose wheel first]

Watch your 6....


The government sits idly by while politicians receive gifts from Qantas management as a reward for their complicity in the airlines demise.


Maybe that's because Julia Gillard is actually Welsh?

[fishers.ghost]

Lesley Grant was there when Air New Zealand failed and was nationalized.
Lesley Grant was there when Ansett Australia met its demise
Lesley Grant is now trying to kill off Qantas
Is this woman secretly working for Sing Air?
Grant is typical of Qantas managment.
Execs either have no airline experience or have been involved in the failure of other airlines.
Once control of Qantas was wrested from Australians the writing was on the wall.
Grant and Joyce are not australian.They have no emotional connection to Qantas or Australia.
The Qantas board has no airline experience.
As for Leigh Clifford he is little more than an aged miner sitting out his twilight years in a cushy chairmanship.What do miners know about airlines.?Three fifths of five eights of pharque all

[Mustaphabeer]

AJ et al all seem to think that outsourcing the company is the solution to all it's woes. well fight fire with fire and actually give them what they want....

Here's an idea that will send the shareholders and management into coniptions.

Mass resignations from all the key business groups of Qantas (Pilots, Engineers,CC and groundstaff), and all timed to coincide within the same short period.

What better way of sending a no confidence vote in the management.

Takes Balls I admit but other than striking and having the public offside, what other options are out there.

Contract agencies could be set up to employ all pilots, engineers, cabin crew and ground support staff to fill the void left, and at an extra cost to the company and without the KPI's being met would negate all management bonuses.

The lead time to employ, train and authorise Pilots and engineers is the key. No company worldwide would be able to supply the amount of people required to continue operations, and AJ et al would need to explain why 60% of it's workforce had had enough. Imagine him explaining that away to the share market.

Without the income that Qantas mainline generates, Jetsaitre would struggle with little or no support functions from mainline, and prove finally the amount of finacial support Qantas gives to them.

Just one from the outfield...

[Ngineer]

What the fark has happened to this country?

Excellent post!!

A/ It's called "corporate greed". IE: Greedy managers chosing immoral ways of earning themselves a nice fat bonus.

[Mstr Caution]

Mass resignations from all the key business groups of Qantas (Pilots, Engineers,CC and groundstaff), and all timed to coincide within the same short period.

That would be the cheaper option for the company. Better to just engage in PIA. If the end goal is to reduce the number of the Australian workforce, it would be better financially to recieve a Compulsory Redundancy, than to let them off lightly & resign.

Without the income that Qantas mainline generates, Jetsaitre would struggle with little or no support functions from mainline, and prove finally the amount of finacial support Qantas gives to them.Maybe include this as part of the PIA?, only engage in work functions or activities that relate to the company you are employed by.

[Mustaphabeer]

Appreciate that it may be the cheaper option for the company, but initially with leave payouts, reemployment costs, training costs etc would be a huge financial burden on the company.

If done before they had time to implement any replacement strategies They would have no option than to seek to employ from contracting agencies.

A company that loses 30 ~ 40% of it's key players from the work force in one hit cannot function.

There is no option open to them to resource in that short period of time

[dragonflyhkg]

QANTAS; just another corporate entity chasing profit at the expense of its workforce.

What’s missing within the QANTAS corporate rhetoric at present is the acceptance that there must be a balance drawn between the requirements of the employer and those of the employee.

The current management seeks the nirvana of controlling all costs to maximise business performance; profit. The nirvana is no balance at all. QANTAS does not control the cost of aircraft, fuel, airports, spare parts, etc. It’s only the workforce over which the company has any significant input to cost control. Within the current mind-set, as far as the management is concerned the employees are a tradeable commodity, an irritating fact of doing business that they’d love to do without.

Every employee in this country has a lot at stake within their continued employment; however it’s only shareholders that have the ear of management. Stakeholders are not recognised by corporate managements, regardless of the industry.

The Australian Dollar is now set for a lengthy period of stellar performance, a challenge for QANTAS and many other businesses and industries. The comparative cost of doing business with an Australian workforce is only going to become more skewed as time moves on. None of these circumstances however justify an attack upon Australian based employees, their conditions and continued tenure of employment. QANTAS management appears set to continue and escalate such attacks across its entire workforce, on the basis that it’s the only way to compete and remain profitable. The next best option is to find a cheaper workforce, so it’s off to third-world countries to have them do the work for you; export the jobs to Asia!

What the ALAEA is defending within the current industrial battle is the unjustified exporting of jobs. Without real justification, such action is immoral. The Pilot’s and Ground staff will be involved next, with a re-run of the same arguments by QF management.

There are tough times ahead for business managements and that’s going to require excellence in management. Alan Joyce and his management are going to have work smart instead of playing the old and tiresome game of industrial bullying, right down to the dated industrial rhetoric from the poison-pen of Olivia Wirth in the corporate communications department.

Wake up Australia!

Dragonfly

[27/09]

The Chairman has this in his bio

Senior Advisor to Kohlberg Kravis Roberts & Co

Have a read of the "Money Machine" by Sarah Bartlett, that should make a few things fall into place especially regarding the failed buy out a couple of years ago.

[argusmoon]

Australia is no longer a society or a community.It is an economy where all resources are competed for in an open market.That open market is global.The money chases the resources to the cheapest source.
Asia is where its at regarding cost.Particulalry the cost of labour.Qantas is simply following the trend.In the process they are destoying an entity that to many people is priceless.There are not enough concerned people to make a difference.The employees are concerned.Baby boomers are concerned.Any one born after 1975 probably doesnt give two hoots.For them there is no national pride,no emotional attachment to Qantas.Its show me the money and the newest gadget for them.Its not about next week.Its about today.Short termism rules.
Qantas management are concerned about their next bonus and not the future of the airline.If the business goes belly up they walk away with a golden parachute
Leigh Clifford is an advisor to KKR.Therein lies the connection between what is happening now and where the Big Qs future lies.That future is closer than many realize.
An exit strategy for employees needs to be well underway

[neville_nobody]

Asia is where its at regarding cost.Particulalry the cost of labour.

Except that every airline in Asia except Cathay pays for the ENTIRE cost of training all its pilots. Start doing the numbers on that and get back to us about how cheap Asian Pilot Labour is. Asian Airlines have flying schools littered all over Australia which are run at a cost to the airline. Yet QF/Jetstar get free pilots and they think that Australian costs are high. These Asian airilnes have guys doing training with 150 hours in Biz Jets.... What do they cost an hour to run?? $2000+ per flight hour??? gimme a break.:mad:

[argusmoon]

This reference to labour was a generalization.It was not specific to pilots
While pilots are central to running an airline their actual cost is comparatively small when viewed as part of the total
The cost of other employees is definitely cheaper in asia.The Qantas CC Thai base was testament to that.
I am not happy about what Qantas is doing.It is both amoral and immoral.
Neville your issue is definitely not with me dude.I'm on your side.
The Qantas management thinking is that if you knock over the pilots all other unions will cave in.Like it or not.Pilots fail,we all fail

[Budfox]

There are some large funds who have sizable shareholdings in Qantas.
What do they intend to do to protect their investments?


With the share price of QAN hovering perilously just above the float price of
$1.90 for private investors and $2.00 for institutional investors back in 95.
And with the recent release of broker upgrades with buy prices up to $2.99 or there abouts.
I would say that this is the opportunity for the big boys to have started reducing their exposure to QAN and limit their holdings. If that $2.00 price is breached that may be the final psychological barrier holding this up.

Its balanced on a knife edge and if USA tanks again then look out below !! Will be interesting to see a top 20 shareholders registry if $2.00 is hit.

Check out the chart since QAN first floated 16 years ago. Its almost back to its listing price :D

[argusmoon]

Fair point old son but it has already been raised in Post 44 above

[struggling]

So what will it be!!

· Shareholders backing management in the belief that the off shoring &outsourcing strategy now unfolding will pay off handsomely,
· Buyers of distressed assets picking over the remnants of Qantas after management and unions go to war.

In both of the above circumstances, employees will have little influence over what happens and can probably look forward to participating in a race to the bottom.

Or will a third alternative emerge?

In collaboration with others, far sighted employees could make themselves relevant to creating, say, a consolidated international airline, demerging Qantas & Jet star, etc, etc. Irrespective, staff will have to get a seat at the table before their interests will figure in whatever is set to transpire and getting a seat at the table means taking ownership of what is unfolding.

Those who prosper learn from history. To better understand what’s at stake and what can be done, read up on what happened at Alitalia, Swiss Air, Ansett and United.

One thing is for certain, for things to end well, things must change.

[Race Bannon]

Excellent suggestion.
It was first made when the company floated.Unfortunately nobody was interested.A particular Captain tried to gather some enthusiasm.In hind sight it would have saved all this current angst.Market capitalization divided by the number of employees will indicate the cost of a buy out

[777vs330]

neville_nobody
$2000+ per flight hour???
Nothing less than $6000 per flight hour for typical biz jet with instructor.

WRT the topic, all I can say, is hopefully the folks will stand firm. You guys are the last few frontiers that can still hold the fort for the ever eroding T & Cs for the rest.
You certainly have my support, and not let the management get away with their insatiable appetite for ROI.

[Budfox]

My bad

That was suppose to be in quote form from that post. :)
Guess that first post I made wasnt perfect :ok:
Good observation though !!

[cart_elevator]

Why exactly isn't there an employee representative on the board? Employees must make up a certain percentage of shareholders. So why has there never been a push to get an elected representative of all employee-shareholders to manage their interest at the board level? Surely with all of our accumulated shares we could get a seat on the board to represent us?

[HF3000]

Even if they could, one seat at the board representing interests other than the bulk shareholders would amount to zero say in the running of the airline. The staff would need several seats on the board to have any tangible effect.

[WorthWhat]

Now I know your dreaming, I'll give you some colour to sleep on.

First of all, no one is ever going to invite employees onboard just to secure industrial peace.

In reality, before employees get any seats at the big table, they will first have to control between 5% and 15% of the QAN shares on issue. Might sound feasible, but every time owning Qantas shares has been put up by some enlightened unionist, the proposal and the proposer were promptly shot down by loud mouths who can't see past their navel.

I know someone on this Forum has already pointed out that UAL employees traded a 15% wage cut for 55% of United, but even then, they only got 3 seats at the table and that was America.

It's a good idea, but not one that is likely to get up.

[skybed]

in Germany many large corporation have an employee represantative on the board!:ok:
Outcome: stable wage increases- little industrial disputes-long term profits:ok:

The Qantas Board could take some serious advise from the model!:ugh:

[33 Disengage]

SouthWest have an employee representative on the board and it has worked well for them.

[hewlett]

Perhaps QF will give the Fed Sec his old job back and let him be the employee rep.:D

[TIMA9X]

Qantas international losing money, warns chief executive Alan Joyce (http://www.pprune.org/Qantas%20international%20losing%20money,%20warns%20chief%20e xecutive%20Alan%20Joyce)
"Our international business is loss making. It has severe structural challenges."
Mr Joyce said that Qantas doesn't rule out the idea of establishing an offshore unit to help boost profits from international services in the future.

Now he says it. :bored:

Away we go now, off in another direction. What he is really saying, we have milked the cow dry (in favour of J*) now it's all the fault of the Australian workers. If he feels off shoring in Asia will be an easy solution, I say he is wrong as I lived in Asia for seven years. The Asian MROs are happy to to service Australian registered aircraft but would not take kindly to Australia setting up a Australian International airline in direct competition to the local encumbered. All sorts of funny business things would make it a hard slog for this current management. These guys really don't have a clue how it works in Asia, they just think they do!

[Keg]

"Our international business is loss making. It has severe structural challenges."

Yes, one of those structural challenges is the lack of a decent route structure. Paris? Rome? Athens? (Australia has biggest Greek population outside of Greece). San Francisco? Beijing? Anywhere in Japan apart from Narita? Chicago?

:ugh:

[Trent 972]

Hope all the Pollies like Fried Rice/Nasi Goreng and Chilli sauce when they travel on their 1st class freebies with the NEW Qantas. (Don't worry about the foreign pilot contractors who got their (alleged) licences in some failed eastern bloc country or another of those fake Indian 'Airline Pilots'. They will be accompanied by a 200 hour wonder cadet who is paying to be there. Just sit back, relax and trust that the system works). After all, AJ wouldn't lie about QF International being a failure, would he. Pig Sars he wouldn't.

[Normasars]

Don't worry about it Keg.


Jetstar will be in all those places and more really soon.:yuk:

[Metro man]

If they can't run a business properly at home, what makes them think they can make a success of it abroad ?

The potential is certainly there in Singapore, good location, access to cheap non unionised labour, growing market, favourable tax rates, stable with a good infrastructure.

But do they understand Asian ways of doing things ? The example of Jetstar in Vietnam shows otherwise.

[TIMA9X]

https://lh3.googleusercontent.com/_pFSzrseqLnk/TdDFOtPQhfI/AAAAAAAAAxE/UWNJcNcAAFM/s720/Singapore_QFi_5th-poding.jpg

[The The]

If they can't run a business properly at home, what makes them think they can make a success of it abroad ?



Too true!!!!

It has severe structural challenges

You said it AJ. The severe structural challenges are you, your senior management, and the board. Saving Qantas requires change from the top down.

[Oldmate]

QAN $2.10 today after a 4 page spread in the financial review on the weekend. The investors obviously love the Qantas Asia strategy Mr Joyce :rolleyes:

[DrPepz]

TIMA9X:

Isn't Qantas through 3K using a sham Singaporean structure to compete head on with SQ and its group of airlines? As I've said repeatedly, QF through 3K can now use SIN's very liberal ASAs to enjoy many of the rights that up till their arrival, SQ used to enjoy alone. Eg SIN-AKL is operated using the SIN AOC on the SIN-NZ Bilateral. Even NZ-USA can be operated using SIN AOC with 5th freedoms, because the SIN-NZ-USA Open Skies Agreement allows for 5th freedoms between NZ and USA.

Metro Man:

What exactly is the "Asian way" of doing things? Vietnam is not exactly Singapore, and Singaporean companies regularly get screwed when doing business throughout Asia too.

[Metro man]

I meant cultural differences, there are so many ways to cause offence or loss of face and you wouldn't even know you're doing it.

Jetstar Asia flying to Taiwan before mainland China wouldn't have gone down too well in Beijing for example.:hmm:

As for Jetstar's Vietnam experience, obviously they didn't pay off the right people.:E

However trying to pay off the "right people" in Singapore would have resulted in charges of bribery and corruption.

As the HSBC adverts state, local knowledge is everything.

[TIMA9X]

Isn't Qantas through 3K using a sham Singaporean structure to compete head on with SQ and its group of airlines?Hi DrPepz,
Yes, there are a few people in Asia who feel the Q/J* setup in SIN is a sham, and after today's announcement, Mr Joyce said that Qantas doesn't rule out the idea of establishing an offshore unit to help boost profits from international services in the future. AJ may have disturbed some old wounds back in Singapore with the above announcement that may create difficulties if Q were really planing to set up an international arm in Singapore. Probably safer for them to go to Malaysia and leave SIN as it is, leave sleeping dogs lie.
Remember the SQ knock back by the Australian government for OZ US rights strongly opposed by Q management at the time, apparently ruffled a few feathers with the ruling families back in Sin.
The recent knock back by Australia for the takeover of the ASX to name a couple.
It really doesn't matter how good the ASAs are in Singapore, they need the business as Changi is a big part of the island states economy, simple as that really.
SIN-AKL is operated using the SIN AOC on the SIN-NZ Bilateral. Even NZ-USA can be operated using SIN AOC with 5th freedoms, because the SIN-NZ-USA Open Skies AgreementSure, but NZ is a small market and a long way to go via if you want to go on to the US. In addition, Q has set up Jet connect in NZ which is a huge issue back here at the moment.

I suppose I still believe in that old saying, many airlines are governed by "Nationalistic Pride." I believe SQ is one of those airlines and Qantas is another. I can also remember the old 707s painted in the old MSA colours approching r16 SYD, before a family member working for Q was sent to Sin to help set up Singapore Airlines. SQ have done a brilliant job with their fleet planning, Qantas has not. Somehow the current Q management believe that after bleeding it dry to set up J* it is necessary to move the heart and sole of a 90 year old airline to Asia. It is here I draw the line, I guess I am a traditionalist, I believe in the "high standards culture" developed by Q pilots, Engineers and CCs and still one of the best in aviation, Qantas was well on the way to be 50 years old before AJ was even born! He possibly thinks he is Willie Walsh.:hmm:
Air India should have restructured 10 years ago: Willie Walsh - The Economic Times (http://economictimes.indiatimes.com/opinion/interviews/air-india-should-have-restructured-10-years-ago-willie-walsh/articleshow/8348711.cms) What has been the biggest difference to the organisation after BA and Iberia merged?

Willie Walsh: We haven't merged the brands, IAG is not a brand, it's a holding company. We have cleanly set out 2 operating companies, 2 brands. What has happened is we can now take an over-arching view, in the interests of shareholders. We have retained flexibility, which is very important, but we can also coordinate and control when the need arises - we're looking for Euro 400 million in synergy by year 5 - 60% will come from cost savings, and 40% from revenues. What we also now have in IAG is a platform, that will allow us to participate with anybody, as the aviation industry sees more consolidation. We're open to more partners, but there is no discussion on at the moment. Interesting read anyway. :uhoh:

.

[Pukka]

One of the main, and largely undisputed, points of view regarding employees among heavyweight business thinkers and the HR community in general is that 'people are our greatest asset'. This has even trickled down to our own lightweight management.
Quote:
‘We see our employee groups as our biggest asset. We probably have the most experienced pilots in the group, we have the most experienced engineers in the group, we have unbelievable customer service delivered by cabin crew. So we see these as assets, we have to get the engagement right and are really focusing on getting that right.’ AJ interview Airline Business 23/03/10).
There is no doubting that people do indeed have the capacity to be great. And good people can help things go smoothly, help the profits grow, build goodwill and a great reputation. But people can also be a whacking great liability. People can cock things up, do the wrong thing, make bad choices, destroy reputations and leave organisations in ruins.

Quote:
‘Qantas has an unbelievable history, an unbelievable brand. I'm very proud to be the custodian of this history going forward.’ AJ interview Airline Business 23/03/10).
While it is rare that individuals have the deep-rooted ineptitude to totally annihilate years of hard work and endeavour, they do nonetheless have the capacity to put an enormous spanner in the works.


Rome was not built in a day and it was not destroyed in a day, but it was neither built nor destroyed by anything but people.


We are watching the destruction of Qantas by people (assets). However, in our case the assets are in fact liabilities. Liabilities more correctly called management.

[Budfox]

If Qantas are determined to take on SA then they should know that back during the GFC that they had vast amounts of money in reserve for which they didnt need to turn a profit for years !!
SA has VERY VERY VERY deep pockets more so than Qantas. Qantas would get some extremely aggressive competition if they take this route, but heck maybe thats what they need to knock some sense into those boneheads up top echelons.
The day I see AJ and co taking pay cuts will be the day that they actually do have the best interests of this company at heart and want it to succeed. :ok:
Until then chance of AJ and co taking a paycut............ Slim to none :p

[TIMA9X]

And now this today
Unions backing us into corner with ridiculous claims, says Joyce (http://www.smh.com.au/business/unions-backing-us-into-corner-with-ridiculous-claims-says-joyce-20110516-1epwt.html)
Speculation that Qantas is planning to base a premium airline in Singapore or Malaysia has also raised the ire of unions, which say it is an attempt to cut wages and conditions.
Mr Joyce would not confirm or deny whether setting up a premium airline was an option being considered by a team he set up earlier this year to review Qantas's international operations.
Wow, how daft, today the share price is at about $2.10 and it doesn't have to be a war!

''When we have these outrageous claims on the table we have nowhere to go,'' he said yesterday.More like, outrageous fibbing Mr Joyce, and from your side of the fence, little wonder the unions are at their wits end in dealing with you. Have you no shame? The negativity coming from Q management towards its own brand is astounding, hardly an attractive proposition for potential investors. Oh yeah, and that elephant in the room, it's your management team, here lies the problem, and not with your staff.

go away. :mad:

[Mr. Hat]

I haven't read the whole thread so apologies if I repeat anything already mentioned.

There is a massive article in the AFR MAY 14-15 2011.

At the back of the paper is this articleHardball tactics may deliver rough ride (http://afr.com.au/p/hardball_tactics_may_deliver_rough_GUm5uyrnmeqHzncpHOHJgK)

Online you have to pay for it. Worth a read.
Good luck qf pilots.

(the article applies to all pilots)

[unionist1974]

what does all the hard line posturing coming out of QF bosses mean , well to me it is setting the scene for big changes . And the union leaders we have today cannot see through what is coming . In 2 years time the current Lab / Green/ Ind gov't will get the boot and by then the economy will be stuffed . So , what will the tories do . yes you guessed it, take to the IR legislation and what you feared today will become reality . for Gods sake you have a Labour Gov't yet the Unions are doing their best to crucify them . Wake up guys before you kill the goose/!

[FFG 02]

Guys,

Singaporeans/Malays or where ever are proud.
Get them onside and against Qantas. Their governments will do the rest.

Think about it. Get them thinking that their national carrier tarnished.

Who the F*&^% do you QF executives think you are coming over here teaching us how to run an airline.

Singapore - SIA & Silk & Tiger
Malaysia - Malaysian & Air Asia

QF cant get the ones they have right.
Just a thought

[Metro man]

An A320 operation would be competing with Silk Air, which is a feeder to Singapore Airlines as well an operator on routes which can't justify a B777.

Typically SIA fly to the capital city with a wide body and Silk go to the secondary cities with narrow bodies. Silk are a full service airline with business class. If their prices need to drop to compete then SIA can afford it. This sort thing happens to new operators in Australia remember, QF aren't shy to suddenly drop fares on previously expensive and uncontested routes as soon as a competitor appears.

QANTAS already compete with SIA on routes from Singapore to Australia and London/Frankfurt.

A QF base in Singapore with B777s would open a greater route network into Europe at a cost which couldn't be matched on the Australian mainland given the lower labour costs, lower tax rates, ease of doing business and favourable depreciation rates on aircraft in Singapore.

Of course these aircraft could also fly between Singapore and Australia as well. Soon the only Australian thing about a QF flight between Sydney and London could be the expat Aussie captain who can't get a job at home.

[DrPepz]

I have worked for CAAS/CAG in the past and am pretty sure that SIA gets no preferential treatment. The establishment has made it very clear that Singapore is bigger than SIA. In fact in the 1990s SQ was pissed that QF consolidated most of its European ops in SIN. But CAAS told SQ that if QF didn't consolidate in SIN they would do it in KUL or BKK so better that they compete next to you than against you in another country.

It is good that Changi has courted airlines other than SQ - From 50% 10 years ago, SIA accounts for just 35% of SIN marketshare today.

Despite the Aussie govt not giving SQ the SYD-LAX rights, the SIN govt has been very supportive of 3K's expansion in SIN. We typically as a country do not do tit for tats because as a tiny country we don't usually have the clout to influence global policy - plus Australia lets our army train in QLD for A$1 a year, so on a country to country level Singapore gets a lot out of Australia. Taking "revenge" over the ASX takeover and similar behaviour would be very counter productive and I don't think Singapore would stoop to such a level.

[Groaner]

In addition, Q has set up Jet connect in NZ

Err, picking nits maybe, but no they didn't.

[TIMA9X]

Thanks for your reply,
It is good that Changi has courted airlines other than SQ - From 50% 10 years ago, SIA accounts for just 35% of SIN marketshare today. I pretty much agree with all you say and find the above point interesting. Qantas is in a much worse position with its marketshare over the past 10 years even with the advent of J* because (in my view) its over reliance on Singapore, a fuel stop, to only 2 European ports LHR & FRA. Everything else in Europe ATH, FCO, CDG etc was a failure, a bit like SFO, on again off again. In the last few years for Q I suppose China has opened up for them, but believe would have a very hard time competing against the likes of SQ CX TG etc. They have missed the boat.
Geographically Sin is a little close to the Oz ports say 7 hours from Melbourne or Sydney, and a lot of people flying to Europe prefer BKK as it cuts another two hours off that long sector to Europe from SE Asia. Qantas in its typical style moved QF 5 out of BKK in preference for consolidating everything via SIN. bean counting at its best! With that dumb move they let EK in through the back door via BKK. (Pepz I think we have been here before?)
Q has never been good at developing thin routes, (wrong equipment) unlike SQ who have excelled. GD a so called marketing man really let Q down with route development in preference to squeezing the life out of the traditional routes, eg SYD/LHR and SYD/LAX always operated under the potential capacities for the route. GD used to pride himself with that old "where always full" line. It is also my view, there is not much more Q can do in SIN and would be better off establishing another hub, say BKK as it has a larger population base.
The current management at Q would struggle developing anything like a premium airline in Asia, it has enough trouble just simply running Q/J* as it is.

[rmcdonal]

They don't need to start a cheaper off shoot in Asia, they have one already in Australia. Its called Jetstar, and it now comes with Business class.
Qantas revamps frequent flyer program with new VIP tier (http://www.smh.com.au/travel/travel-news/qantas-revamps-frequent-flyer-program-with-new-vip-tier-20110517-1eqv2.html)
They have also renamed their 'StarClass' category to Business.

[TIMA9X]

Qantas's chief executive, Alan Joyce, has compared the theories about Barack Obama being born outside the United States to those surrounding his airline's alleged interest in starting a premium airline in Singapore.
Asked at news conference yesterday whether Qantas's loyalty partnership with the Singapore Inc part-owned Optus could be a sign of a more cosy relationship with the island state, Joyce responded: ''Absolutely not. That's the best conspiracy I've heard for a while.''
Optus's consumer division boss, Mike Smith chipped in: ''We are not intending to start an airline either, I should say.''
Joyce added: ''There is absolutely no link whatsoever, and that's probably a Donald Trump theory.''

Read more: No joy from Joyce on conspiracy theory (http://www.smh.com.au/business/no-joy-from-joyce-on-conspiracy-theory-20110517-1erdt.html#ixzz1MfIn9bTa)

More mixed messages, put your left foot in (the mouth) put your left foot out, and shake it all about AJ. :sad: