The Aus/NZ open skies agreement scary stuff
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The Aus/NZ open skies agreement scary stuff
The question I have is: If the aircraft in VH registered, it will probably be maintained in BNE by the VB maintenance organisation. Will the crew operate the aircraft with their NZ or Aussie ATPL? The only reason to operate it under the NZ rules is to have one or two less FAs.
How often will the aircraft have to visit New Zealand? If the aircraft goes Auckland to SYD to Fiji to Syd to Bali to Syd to Fiji etc for three days before returning to Auckland, isn't it Australian operation?
If it is basically an Australian operation shouldn't the Australian Federal Pilots Award be applicable? If the NZ based crew is paid at half the amount of an Aussie crew then what constitutes a Kiwi operation: maybe Auckland to Syd to Mel to Auckland but no more. There needs to be a test for what is a Kiwi or Aussie operation.
The worst case scenario is this: The half paid Kiwi based crews operate on five days trips and spend each night in an Australian city, Bali or Fiji hotel and FERRY back to Auckland. Perhaps a day or two of reserve in an Australian hotel as part of a duty block.
To rub salt into the wounds what would the Australian Tax Office say.? Could they go after the differential between the Aussie and Kiwi tax rate if your family stays in Australia to complete their schooling for example? This is a particularly pleasant thought: $800 to fly to NZ for interview, 21,000 AUD for 737 endorsement, $4,000 to live in Melbourne whilst getting endorsement, a few grand to move to NZ all to get 55,000 NZ dollars on which the differential goes to the ATO. It better be a very quick transition to command.
All in all this is not good.
My forecast is that if Open Skies agreement is signed by the end of the year there will be no growth in Australian based jet jobs for the next three years. All the growth will occur in New Zealand based Pacific Blue, Freedom or Jet Connect. There maybe a couple of SO jobs on the A330 for QF but nothing else. This may be taken up internally as the classic 737 are placed over to Jet Cnnect.
My other forecast is that this will kill Air New Zealand (but not Freedom). They in a difficult situation as it is but picture a scenario where Pacific Blue, Jet Connect (QANTAS) and Freedom will through so much capacity over the Tasman that fares will fall to an unsustainable level that will kill ANZ who relies on these route for their profitability. The over capacity won't affect Jet Connect or Pacific Blue's profitability as their business plan is to make money on the Australian market where they will have a cost advantage over VB and Qantas.
It doesnt have to be this way; the Australian and Kiwi market will grow strongly in the next few years (hopefully no terrorism or SARS permitting). The growth will occur as the ASK cost of basing crews in Aus or NZ maybe .1 cents which will be negotiable on a passengers fare (assuming the demand is elastic).
Open Skies will just mean that this growth goes to the Lowest Cost Provider as all companies ensure they will not have a comparably higher cost base.
My two cents...
How often will the aircraft have to visit New Zealand? If the aircraft goes Auckland to SYD to Fiji to Syd to Bali to Syd to Fiji etc for three days before returning to Auckland, isn't it Australian operation?
If it is basically an Australian operation shouldn't the Australian Federal Pilots Award be applicable? If the NZ based crew is paid at half the amount of an Aussie crew then what constitutes a Kiwi operation: maybe Auckland to Syd to Mel to Auckland but no more. There needs to be a test for what is a Kiwi or Aussie operation.
The worst case scenario is this: The half paid Kiwi based crews operate on five days trips and spend each night in an Australian city, Bali or Fiji hotel and FERRY back to Auckland. Perhaps a day or two of reserve in an Australian hotel as part of a duty block.
To rub salt into the wounds what would the Australian Tax Office say.? Could they go after the differential between the Aussie and Kiwi tax rate if your family stays in Australia to complete their schooling for example? This is a particularly pleasant thought: $800 to fly to NZ for interview, 21,000 AUD for 737 endorsement, $4,000 to live in Melbourne whilst getting endorsement, a few grand to move to NZ all to get 55,000 NZ dollars on which the differential goes to the ATO. It better be a very quick transition to command.
All in all this is not good.
My forecast is that if Open Skies agreement is signed by the end of the year there will be no growth in Australian based jet jobs for the next three years. All the growth will occur in New Zealand based Pacific Blue, Freedom or Jet Connect. There maybe a couple of SO jobs on the A330 for QF but nothing else. This may be taken up internally as the classic 737 are placed over to Jet Cnnect.
My other forecast is that this will kill Air New Zealand (but not Freedom). They in a difficult situation as it is but picture a scenario where Pacific Blue, Jet Connect (QANTAS) and Freedom will through so much capacity over the Tasman that fares will fall to an unsustainable level that will kill ANZ who relies on these route for their profitability. The over capacity won't affect Jet Connect or Pacific Blue's profitability as their business plan is to make money on the Australian market where they will have a cost advantage over VB and Qantas.
It doesnt have to be this way; the Australian and Kiwi market will grow strongly in the next few years (hopefully no terrorism or SARS permitting). The growth will occur as the ASK cost of basing crews in Aus or NZ maybe .1 cents which will be negotiable on a passengers fare (assuming the demand is elastic).
Open Skies will just mean that this growth goes to the Lowest Cost Provider as all companies ensure they will not have a comparably higher cost base.
My two cents...
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From my viewpoint
1) It will depend upon where the contract of employment is drawn up and which countries laws apply - would they really want to use a Kiwi operating licence just to enable them to have fewer FA's?
2) With your example roster for Kiwi pilots, are they paid their duty rates in Au or NZ $'s - if they are working on a contract drawn up in NZ, are paid from an NZ bank account and are taxed by IRD in NZ, then it would be an NZ operation of an AU owned company - don't see how Aussie tax vould be applied.
3) growth -v- Survival - most of Air NZ's profits are local. The loss makers are long haul (in particular the LHR route where there is mucho competition, with other ops SQ, MH, EK, CP, etc offering lower fares and better in-flight perks). I think they would like to grow their trans-Tasman stuff, but it is a competitive market. They may be in trouble IF (and it won't happen) a strong competitor came in on the local business. This won't happen as there is too much risk involved. The population is too small to sustain a true low cost op.
I don't think there will be much growth in any sector, only replacement of retiree's.
1) It will depend upon where the contract of employment is drawn up and which countries laws apply - would they really want to use a Kiwi operating licence just to enable them to have fewer FA's?
2) With your example roster for Kiwi pilots, are they paid their duty rates in Au or NZ $'s - if they are working on a contract drawn up in NZ, are paid from an NZ bank account and are taxed by IRD in NZ, then it would be an NZ operation of an AU owned company - don't see how Aussie tax vould be applied.
3) growth -v- Survival - most of Air NZ's profits are local. The loss makers are long haul (in particular the LHR route where there is mucho competition, with other ops SQ, MH, EK, CP, etc offering lower fares and better in-flight perks). I think they would like to grow their trans-Tasman stuff, but it is a competitive market. They may be in trouble IF (and it won't happen) a strong competitor came in on the local business. This won't happen as there is too much risk involved. The population is too small to sustain a true low cost op.
I don't think there will be much growth in any sector, only replacement of retiree's.
Like I said in the other post's on the subject, the only reason each of the companies are using NZ as an operational base is because of the lower labour costs. Kiwi's will do anything to get the job including screwing everyone around them on the price, just look at the building industry, scab bastards.
The bean counters know it, Dixon, Godfrey et al know it and will use it to increase profits, undermine their current work group and get fatter off their bigger bonuses.
Tell me this, if the kiwi's wanted exactly the same pay and conditions as well as operating the exact same number of flight attendants then "where is the significant advantages"?
My guess is that VB are gonna shaft their current workers, all within three years of starting, so much for "our staff are our greatest asset" . I am sure Godfrey will use his spin docters on his staff................................... make them feel all cuddley and warm before he bends them over and gives it to them.
Yawn, you covered some very important issues, a very thoughtful post. Not only will they take the VB guys and gals international work but also some domestic sectors as well.
When are companies going to start looking after their staff, instead of constantly raping their work force. Tell me Mr Dixon and Mr Godfrey how do you sleep at night? Oh that's right your mattress and pillows are full of money that you bled from your hard working staff.
The bean counters know it, Dixon, Godfrey et al know it and will use it to increase profits, undermine their current work group and get fatter off their bigger bonuses.
Tell me this, if the kiwi's wanted exactly the same pay and conditions as well as operating the exact same number of flight attendants then "where is the significant advantages"?
My guess is that VB are gonna shaft their current workers, all within three years of starting, so much for "our staff are our greatest asset" . I am sure Godfrey will use his spin docters on his staff................................... make them feel all cuddley and warm before he bends them over and gives it to them.
Yawn, you covered some very important issues, a very thoughtful post. Not only will they take the VB guys and gals international work but also some domestic sectors as well.
When are companies going to start looking after their staff, instead of constantly raping their work force. Tell me Mr Dixon and Mr Godfrey how do you sleep at night? Oh that's right your mattress and pillows are full of money that you bled from your hard working staff.
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My Prediction
NZ Based companies using lower paid NZ crews taking up the majority of Australian domestic and regional pacific jet operations.
Xenophobic? No?
Corporate mistrust? Definitely!!
The big question: What will an Australian government do to help protect Australian jobs?
The answer: Sweet FA
And when the companies can get cheaper 3rd world labour to do the same job, well then NZ will lose out too.
Hey, at the end of the day, it's the shareholders that really count, don't they??
Xenophobic? No?
Corporate mistrust? Definitely!!
The big question: What will an Australian government do to help protect Australian jobs?
The answer: Sweet FA
And when the companies can get cheaper 3rd world labour to do the same job, well then NZ will lose out too.
Hey, at the end of the day, it's the shareholders that really count, don't they??
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Colonel Blink:
According to IBISworld.com.au the forecast growth and industry size forecasts of the passenger market is (frieght has a lot more growth):
2003 4.6b +11%
2004 4.8b +8.4%
2005 4.9b +5.5%
2006 5.0b +5.5%
As much as it displeases me, I cannot see a difference between the ATOs view of Cathay pilots who are paid in Hong Kong dollars and their treatment of the tax differential between 15 and 48.5 percent. If they dont stay away for 180 days Same argument different scale.
As for ANZ, if they dont make money going to LA well theyre really stuffed.
According to IBISworld.com.au the forecast growth and industry size forecasts of the passenger market is (frieght has a lot more growth):
2003 4.6b +11%
2004 4.8b +8.4%
2005 4.9b +5.5%
2006 5.0b +5.5%
As much as it displeases me, I cannot see a difference between the ATOs view of Cathay pilots who are paid in Hong Kong dollars and their treatment of the tax differential between 15 and 48.5 percent. If they dont stay away for 180 days Same argument different scale.
As for ANZ, if they dont make money going to LA well theyre really stuffed.
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Eh??
Kiwi's will do anything to get the job including screwing everyone around them on the price, just look at the building industry, scab bastards.
It is true that salaries in NZ are dire (and I am NOT a Kiwi), but likewise they are commensurate with the cost of living. That is why there are so many POM's moving from the UK to both Aussie and NZ - not interested in the money, but happier with the quality of life.
Yawn said
According to IBISworld.com.au the forecast growth and industry size forecasts of the passenger market is (frieght has a lot more growth)
Col Kurtz
The big question: What will an Australian government do to help protect Australian jobs?
The answer: Sweet FA
And when the companies can get cheaper 3rd world labour to do the same job, well then NZ will lose out too.
The answer: Sweet FA
And when the companies can get cheaper 3rd world labour to do the same job, well then NZ will lose out too.
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Guys/Gals
You are now experiencing 25 years of modernisation in a few months just as those in Godzone learnt 10 years ago.
Learn to go with the flow or be like a dinosaur and die.
1 bastion in a worldwide field of change will not survive. Remember the Alamo!!!
You are now experiencing 25 years of modernisation in a few months just as those in Godzone learnt 10 years ago.
Learn to go with the flow or be like a dinosaur and die.
1 bastion in a worldwide field of change will not survive. Remember the Alamo!!!
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Saw this quote in the paper today - Robert muldoon, former NZ PM many moons ago. (something like this, can't remember the exact words)
Migration from NZ to Australia improves the average brain pool of both countries at the same time.
Migration from NZ to Australia improves the average brain pool of both countries at the same time.
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Trans Tasman rivals
It seems a bit of the old trans tasman rivalry is sneeking into the threeds
NZ dosen't have as good of a set up as the oz lads/ladies do, and this shows in the wage differences and the way pilots are treated in the two countries. However we don't screw everybody around us (servo), like anti skid pointed out cost of living has a lot to do with it (much like other countries in the world).
So how about we all get over the fact that NZ pilots are paid **** and and continue living our lives not giving a rats what the grass is like on the other side
As far as Robert Muldon goes if he was the PM now we would probably be the richer of these two countries
NZ dosen't have as good of a set up as the oz lads/ladies do, and this shows in the wage differences and the way pilots are treated in the two countries. However we don't screw everybody around us (servo), like anti skid pointed out cost of living has a lot to do with it (much like other countries in the world).
So how about we all get over the fact that NZ pilots are paid **** and and continue living our lives not giving a rats what the grass is like on the other side
As far as Robert Muldon goes if he was the PM now we would probably be the richer of these two countries
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....lower cost of living in NZ?
.........Ha, good one!...try living in Auckland!
you wont survive on that predicted wage, unless the missus has a pretty good job too. (oh....that's assuming 'sneeky' at 'Rish-thingys' is up to his usual form)
Rent will kill you, food is way overpriced, electricity, gas, fuel, beer!....hope you aren't planning on going out much, or using a heater.
.....example...try living in Sydney on that wage ....get the idea?
No idea about Wellington tho' ....may be better, but who knows...no one goes there .......Fiji is a nice place to visit as well, but you wouldn't work there for local wages, now would you?!
....as for 'lifestyle'....Aussies are not the flavor of the month (...year or decade for that matter)
Best leave this dog sleeping!
.........Ha, good one!...try living in Auckland!
you wont survive on that predicted wage, unless the missus has a pretty good job too. (oh....that's assuming 'sneeky' at 'Rish-thingys' is up to his usual form)
Rent will kill you, food is way overpriced, electricity, gas, fuel, beer!....hope you aren't planning on going out much, or using a heater.
.....example...try living in Sydney on that wage ....get the idea?
No idea about Wellington tho' ....may be better, but who knows...no one goes there .......Fiji is a nice place to visit as well, but you wouldn't work there for local wages, now would you?!
....as for 'lifestyle'....Aussies are not the flavor of the month (...year or decade for that matter)
Best leave this dog sleeping!
Just pondering, and I'm afraid I cannot come up with any REAL benefits to Australians wrt an 'Open Skies' agreement. NZ's population base doesn't justify lots of internal operators. Profitabilty comes from the trans-Tasman and oncarriage. IMHO only Kiwis will benefit. Therefore why is the OZ govt even considering this. Lower cost labour will displace Australian jobs, and therfore taxation revenue to boot. Result, net loss to the Australian economy. Whether you work for QF, DJ or any other Australian operator, the threat is to ALL current and aspiring career aviators in Australia. Only those in high level management of the respective Airlines will benefit(as usual). However, we do outnumber them considerably, and this is still a democracy, albeit with no viable political opposition party. What (if anything) are AIPA and AFAP doing about this? If there is any lobbying to protect their members intersts they are keeping it VERY quiet. I believe we should all start contacting our local Members and informing them that anyone who supports this legislation in Parliament will lose votes. After all, that is the only language a Pollie understands. Whilst you are thinking about this it would probably be a good idea to educate your family, friends and aquaintances bout the realities of this situation, and request them to start lobbying too. If we do nothing we have only ourselves to blame for negative outcomes. Sermon over!!
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If you have strong feelings and wish to lobby try these email addresses (In public domain)
John Anderson MP
Deputy Prime Minister & Minister for Transport & Regional Services
[email protected]
Senator Ron Boswell
Parliamentary Secretary to Minister for Transport & Regional Services
[email protected]
John Anderson MP
Deputy Prime Minister & Minister for Transport & Regional Services
[email protected]
Senator Ron Boswell
Parliamentary Secretary to Minister for Transport & Regional Services
[email protected]
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The majority of us living/flying NZ are quite content - albeit for a segment of any population the sand/grass on the other side will be an attraction - so since those of you in Aust who keep going on about NZ'z "3 rd world pay and conditions" aren't as yet forced to live/work in NZ - give it a rest !!
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I think this high risk on both sides.
If ANZ falls the market will be saturation with high time jet jocks who MUST (through no fault of there own) take anything they can get is every bodies concern. Some for family reasons will want to stay in NZ. Other will be forced away from there families and kids by commuting to places like EVA and only returning once a month. Having just gone through it (I would so like to make an anti-Helen Clark comment...big restraint) I think it is the height of uncompassionate feeling that you show towards your fellow Kiwis.
I think this is very much an issue affecting pilots on both sides.
What will ANZ pilots do when faced with a bail out...accept the lowest going rate. It's called arbitrage. Ask Qantas pilots how they feel by being they only ones in Oz on high money. From an industrial point of view their head is on the chopping block.
They only people that will benefit is people (Ozzie and Kiwis) with low time who think its worth the punt.
I think there's a safety case for crewing an aircraft with low time pilots (I presume they will primarily accept this), who are backed up with 2 or 3 girls. These girls must be very young to accept the conditions...$25,000 PA Kiwi.
I think that everybody should think long and hard about this.
We should send petitions to the Australian and New Zealand Aviation Ministers outlining the UNINTENDED consequences of there decisions.
I now believe I'm up to 6 cents worth...
If ANZ falls the market will be saturation with high time jet jocks who MUST (through no fault of there own) take anything they can get is every bodies concern. Some for family reasons will want to stay in NZ. Other will be forced away from there families and kids by commuting to places like EVA and only returning once a month. Having just gone through it (I would so like to make an anti-Helen Clark comment...big restraint) I think it is the height of uncompassionate feeling that you show towards your fellow Kiwis.
I think this is very much an issue affecting pilots on both sides.
What will ANZ pilots do when faced with a bail out...accept the lowest going rate. It's called arbitrage. Ask Qantas pilots how they feel by being they only ones in Oz on high money. From an industrial point of view their head is on the chopping block.
They only people that will benefit is people (Ozzie and Kiwis) with low time who think its worth the punt.
I think there's a safety case for crewing an aircraft with low time pilots (I presume they will primarily accept this), who are backed up with 2 or 3 girls. These girls must be very young to accept the conditions...$25,000 PA Kiwi.
I think that everybody should think long and hard about this.
We should send petitions to the Australian and New Zealand Aviation Ministers outlining the UNINTENDED consequences of there decisions.
I now believe I'm up to 6 cents worth...
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Mon "West Australian"
Government grounded on airline policy
By Geoffrey Thomas
COMMENT
THE latest rejection by the competition regulator of the alliance between Qantas Airways and Air New Zealand is an indictment of the Federal Government's airline policy, which has crashed and burned on the runway.
On the one hand the Government allows a wholly foreign owned airline to operate on domestic routes, something the US does not.
But on the other, through the Australian Competition and Consumer Commission legislation, it refuses to allow market forces to prevail and declines Qantas' pleas for a lift in foreign ownership caps to give it access to much needed foreign capital.
The Government's policy and ACCC laws simply ignore the globalisation and liberalisation of the airline industry - the world's least profitable sector.
At the same time, the ACCC's arguments that such an alliance will cause airfares to rise is flawed.
The fact is airfares have declined in relationship to average weekly earnings every year since the first fare-paying passenger took to the air in 1912.
There are some who say ACCC chairman Graeme Samuel had no choice but to follow Professor Allan Fels' draft determination handed down in April. That argument is similarly flawed. When Professor Fels, Mr Samuel's predecessor, handed down his determination, Virgin Blue was playing hard ball and claiming it would not fly the Tasman route if the alliance went ahead. Emirates had also not entered the market.
Since then Virgin Blue has confirmed its entry to the market and Emirates has started flying between Australia and NZ.
Mr Samuel had a very different set of competitive circumstances and Qantas and Air NZ had also agreed to price and capacity restrictions over three years to aid any new entrant.
The reality is that it's hard to find any market with as many well-established airlines competing.
And Virgin Blue has proved it can take on Qantas and has substantial backing in Sir Richard Branson and its partner Patrick Corporation.
Qantas chief executive Geoff Dixon's warnings after Ansett's collapse two years ago that Qantas' future was also not guaranteed were greeted with disbelief and ridicule among unions, staff and in government circles - but the reality is he's right.
As the Government approaches an agreement on open skies with Singapore, it must revisit its airline policy to ensure a more even playing field.
© 2003 West Australian Newspapers Limited
All Rights Reserved.
============================================
Government grounded on airline policy
By Geoffrey Thomas
COMMENT
THE latest rejection by the competition regulator of the alliance between Qantas Airways and Air New Zealand is an indictment of the Federal Government's airline policy, which has crashed and burned on the runway.
On the one hand the Government allows a wholly foreign owned airline to operate on domestic routes, something the US does not.
But on the other, through the Australian Competition and Consumer Commission legislation, it refuses to allow market forces to prevail and declines Qantas' pleas for a lift in foreign ownership caps to give it access to much needed foreign capital.
The Government's policy and ACCC laws simply ignore the globalisation and liberalisation of the airline industry - the world's least profitable sector.
At the same time, the ACCC's arguments that such an alliance will cause airfares to rise is flawed.
The fact is airfares have declined in relationship to average weekly earnings every year since the first fare-paying passenger took to the air in 1912.
There are some who say ACCC chairman Graeme Samuel had no choice but to follow Professor Allan Fels' draft determination handed down in April. That argument is similarly flawed. When Professor Fels, Mr Samuel's predecessor, handed down his determination, Virgin Blue was playing hard ball and claiming it would not fly the Tasman route if the alliance went ahead. Emirates had also not entered the market.
Since then Virgin Blue has confirmed its entry to the market and Emirates has started flying between Australia and NZ.
Mr Samuel had a very different set of competitive circumstances and Qantas and Air NZ had also agreed to price and capacity restrictions over three years to aid any new entrant.
The reality is that it's hard to find any market with as many well-established airlines competing.
And Virgin Blue has proved it can take on Qantas and has substantial backing in Sir Richard Branson and its partner Patrick Corporation.
Qantas chief executive Geoff Dixon's warnings after Ansett's collapse two years ago that Qantas' future was also not guaranteed were greeted with disbelief and ridicule among unions, staff and in government circles - but the reality is he's right.
As the Government approaches an agreement on open skies with Singapore, it must revisit its airline policy to ensure a more even playing field.
© 2003 West Australian Newspapers Limited
All Rights Reserved.
============================================
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Yawn said:
________________________________________________
This is a particularly pleasant thought: $800 to fly to NZ for interview, 21,000 AUD for 737 endorsement, $4,000 to live in Melbourne whilst getting endorsement, a few grand to move to NZ all to get 55,000 NZ dollars on which the differential goes to the ATO. It better be a very quick transition to command.
__________________________________________________
Does the NZ CAA recognise 0 hours type ratings issued in Australia? I am not sure but there is a requirement for one hour of base training. Air NZ offers a 737-300 type rating course for about 45,000-50,000NZD including 6 t/o and ldgs.
________________________________________________
This is a particularly pleasant thought: $800 to fly to NZ for interview, 21,000 AUD for 737 endorsement, $4,000 to live in Melbourne whilst getting endorsement, a few grand to move to NZ all to get 55,000 NZ dollars on which the differential goes to the ATO. It better be a very quick transition to command.
__________________________________________________
Does the NZ CAA recognise 0 hours type ratings issued in Australia? I am not sure but there is a requirement for one hour of base training. Air NZ offers a 737-300 type rating course for about 45,000-50,000NZD including 6 t/o and ldgs.
