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1,750 jobs to go at Qantas

Old 16th Apr 2009, 00:11
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Arrow

I just keep on hearing those words that were muttered from GD's mouth the day Jestar was born. "Jetstar will NOT cannibalise Qantas at all".

What a joke Jester was on all!

Perhaps QFLink pilot salaries should be the benchmark for the group? FO start pay at 51K and Captains round 80K?

Bo!
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Old 16th Apr 2009, 00:22
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Operationally the business is relatively lean.

There is hardly any fat at all.
The astute will notice that all of the cuts will fall again in operational areas, with the exception of 500 managers.

Strangely enough the administrative side of a business remains roughly constant in lean times and bloats when times are good. It is in part due to the fact the information flow is controlled through these "counting" areas. With Dixon lite floundering, he naturally will cut where he is advised, hence the penchant to cut the operational side of the business(the revenue generating side) and leave the floors of staff counting the beans untouched...

Which begs the question how many little empires will remain untouched, working the same hours, counting, graphing and analysing whilst those at the customer interface or involved in revenue generation will become fewer on the ground...
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Old 16th Apr 2009, 00:43
  #183 (permalink)  
 
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Qantas could last only six months, expert warnsArticle from Daily Telegraph By Andrew Carswell

April 16, 2009 12:00am

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He also told The Daily Telegraph yesterday that the 3300 jobs already axed at the airline would be easily superceded in the coming months if conditions did not improve.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 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.
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Old 16th Apr 2009, 00:57
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Harbison was one of dickson's main sympathizers and was so for years.

Interesting that this out of line CYCLICAL downturn is now [according to him] threatening the very survival of Qantas.

This, only a year after QF was boasting record profits.

The market is down but will recover and perhaps some see this as the perfect storm that is NEEDED to engineer the dickson dream. The end of Qantas as we know it.

What does Harbison think or more importantly?

What does Clifton think.............?

Last edited by ditch handle; 16th Apr 2009 at 02:25.
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Old 16th Apr 2009, 01:12
  #185 (permalink)  
 
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Arrow

He probably keeps thinking back to this...

I just keep on hearing those words that were muttered from GD's mouth the day Jestar was born. "Jetstar will NOT cannibalise Qantas at all".

What a joke Jester was on all!

Perhaps QFLink pilot salaries should be the benchmark for the group? FO start pay at 51K and Captains round 80K?

... and that Jetstar will probably have some of it's tails painted with the rat on it.

Bo!
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Old 16th Apr 2009, 03:00
  #186 (permalink)  
 
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Posted by FGD135
Dixon was, in my opinion, a brilliant CEO and I'm sure time will come to show that. But, to bring about any kind of reductions to employee's terms and conditions (especially the spoon fed) is incredibly, incredibly difficult, but you can rest assured that he would have been working on it.
If Dixon was that brilliant, why is Joyce systematically reversing the QF organisational structure that Dixon put in place? The changes that have been made so far make the structure look very similar to what Strong set up during his tenure. Personally, I believe that Dixon was never in the same "intellect category" as Strong and Joyce.

QF O, your post contains some very good points, and the majority of QF employees do feel a strong bond with fellow staff members and the history of the company. The anger vented on this forum is a hangover from the very confrontationalist and divisive tactics that were employed by Dixon (read Oldmeadow (who is still lurking around)) during his period as CEO. A minority fail to see that their anger means that they have succumbed to these divisive tactics.
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Old 16th Apr 2009, 03:20
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Without doubt, this " commentator " harbison is on a payroll and the campiagn has begun. Get in, Sit down, Buckle up and STFU because Qantas has just begun morphing and that was ALWAYS the plan since Jstar, day 1

Last edited by SeldomFixit; 16th Apr 2009 at 03:22. Reason: spellographical errors
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Old 16th Apr 2009, 03:44
  #188 (permalink)  
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GB, I think you fail to understand the reasons behind some of Dixon's structural choices. Remember, he learnt a lot while talking with Allco and Mac Bank, and one of the great ambitions was to release some of the value in the support services and other businesses Qantas has by virtue of its operations. If market conditions had remained as they were during mid 2007, the business world would now be congratulating QF for spinning off catering, fleet, freight, Frequent Flyer and other businesses and now sitting on a pile of cash. To have those runnning as discrete businesses means having to employ the right staff and different numbers to make it happen.

Of course, things have changed dramatically, and in this climate it makes more sense to slim down the businesses (which is possible via some reintegration, as AJ appears to be doing now). Some time in the future once things are better, there will probably be a change back toward the former manner. It's probably best to say that GD did well to steer through SARS, 9/11 and also made good hay while the sun shone, but AJ will have to prove his ability to make the big decisions to push the company through and preserve cash (especially when revenues are falling) to keep it well positioned for the clearer skies which are ahead at some point.
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Old 16th Apr 2009, 04:49
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Wasn't all that long ago, that all these threads regarding DJ's struggle to survive this financial downturn...everyone had an opinion ...... but now look whos probably going to come out smelling like roses (in populatiry, morale, sustaining their current buisness model)? QF may have the current finances, but I see that depleting rather quickly if it proceeds the way its going......

EBT I agree GD did do some good, however I think alot of it was just in the short term...

I conquer with many of the posts here... JQ will become the flagship...... with or without public demand....

Qantas
Part of the Jetstar Group


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Old 16th Apr 2009, 04:53
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Considering VB have been going broke for the last 6-12 months,and this is the first rumour of Qantas going under, I guess this means have a good many years left in them. It is funny how all these people "in the know",know something, yet no one is able to produce black and white evidence of the airlines financial woes. Yet to see anyone show VB paying cash for fuel. As far as Qantas goes, $100 million profit is hardly going broke.
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Old 16th Apr 2009, 10:59
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Some perspective is needed in this.

If QF are being painted with this picture I think we need to realise that ALL airlines are heading the same direction. Their ability to survive is based on their ability to burn cash.

If QF are copping a hiding on the pacific, what is happening to the other airlines on this route?

QF are hurting, but so is every other airline! CX, SQ are swinging a mighty big axe at the moment.

Don't for a minute think one airline is immune because of the press going silent.

I would really like to know how VB and TT are traveling in all of this?
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Old 16th Apr 2009, 11:19
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I have never read such utter crap in all my life, it is understandable by this garbage why Qantas is in fact under pressure. Its frontline employees have no idea how to run a business and post personal attacks to, in some weird way make themselves feel better, rather than band together in the true time of need for the betterment of the organisation than themselves, but still have the nerve to accuse the CEO of being selfish. MMMM double standards.
QFO, if we were not sacking so many managers you would stand a good chance of getting a job with us with an attitude such as this.

Not a QF employee? I have my doubts.......
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Old 16th Apr 2009, 11:20
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Harbison and others still fail to realise that there remains a large line entry on the QF balance sheet amortising JQ's start up losses. Added to that the fact is the survival / health of any airline is underpinned by the NAV of the business.

100m is a dissapointing ROI but still it's real revenue - as for the highly acclaimed two brand strategy, I still can't see the coco pops on the shelf next to the home brand version and therefore remain skeptical at AJ's 'leggo' airline model (any crew, any type, anywhere at the lowest cost) which certainly is not something to be embraced, desired or wanted.

Structural change - esp the inefective middle m'ment tiers however might just be a silver lining by default
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Old 16th Apr 2009, 11:32
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100m is a dissapointing ROI but still it's real revenue
The main problem is that QF management were expecting maybe 500mil a few months ago, which means that we are now actually burning cash at a pretty quick rate. How long this can last depends upon how much cash Qantas has at hand, and how much money they can borrow or raise when they eventually run out. (I doubt market conditions will improve quickly as the global recession is only starting to hit our shores). With our credit rating likely to take a hit, borrowing money will become more expensive for us. With our market cap declining, a capital raising becomes less attractive, and the amount we can borrow decreases.
I doubt AJ would be sleepin too well at the moment, nor would he be letting on just how dire the situation may be. He really has his job cut out for him.
How quick things can change in the aviation industry.

PS, for those putting sh!t on the Jetstar brand, it is a very neccessary evil and saving our a$$ at the moment, big time.

Last edited by Ngineer; 16th Apr 2009 at 11:49.
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Old 16th Apr 2009, 11:57
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Geez Jim I dunno. Apart from the economies of scale QF get, just about everything else works against them in comparison to V Oz. The ER saves about 28 tonnes one way across the Pacific compared to a -400, let alone a 380. The staff are payed peanuts in comparison, the business is not modeled on high priced premium cabins, they are so lean in management that if you sacked a manager there'd be none left and they only have to support 3 aeroplanes at the moment. Not only that they are new, the staff smile and the aircraft has a great interior and entertainment system.
No doubt QF's pockets are deeper and V Aus will also be hurting but the Q just lost around $400mill in two months.
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Old 16th Apr 2009, 12:07
  #196 (permalink)  
 
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they are so lean in management that if you sacked a manager there'd be none left
But even sacking managers and operational staff is a long term solution to a short term problem. By the time redundancy payments are factored in, it will take at least 12-18 months before savings are realised. And by that time we will probably need to employ operational staff again as the situation returns to normal. (if we are still in the game). The Jetstar model is helping out the Qantas brand with it's lower cost base on the less profitable routes. But what is hurting us now is the loss of income from both paying passengers, and other operators that relied on our services until we forced a termination of our customer contracts.
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Old 16th Apr 2009, 12:08
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Why should VB or TT be in terrible shape just because Q is now struggling? The arrogance just keeps on coming. It has already been stated many times that Qs exposure to international travel is primarily putting it in the red now and last time I looked VB is a domestic airline with minor exposure to international travel through Vaus. I believe it is the other way around at Q. These statements don't surprise the rest of us though after reading some of the rumors surrounding VB that were coming from people on this site who now appear to have gone silent. Not so nice now that it's you in the hot seat hey? Don't worry though, we won't be stooping to your level and creating useless rumors like trying to pick the date of your demise or suggesting that you're paying cash for fuel or that VB has cancelled leave and ramped up training to prepare for Q going under. That would only make us as petty as you. Good luck to all those in the spotlight. Rest assured the company will pull every trick in the book to make this work to their advantage. Depending on how strong your union is, your EBA won't be worth the paper it's written on.

On another note, you may be aware that Jetstar is currently hiring. Despite everything going on at Q the Jetstar recruitment department has been ringing applicants to offer May interviews. This is not a rumor, this is fact as I personally know two pilots who have recieved phone calls in the last week. As they said at VB, it is the "position" not the person who is being made redundant and it seems that a great many positions at Q could be going to Jetstar as Joyce looks to lower the group cost basing. Good luck boys
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Old 16th Apr 2009, 12:46
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The ER saves about 28 tonnes one way across the Pacific compared to a -400
LOL! Biggest piece of crock I have heard! Maybe 2 tonnes?? lol!
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Old 16th Apr 2009, 12:53
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Overpayment

It is true that long haul flight attendants are in todays terms overpaid and sre enjoying conditions thsat belong in the last century, It will only be evifdent to them if and when they leave Qantas and work in the real world. This is not to blame them and it is always hard totake away what seems normal for them. But realistically Qantas needs to lower its cost base and Original Long Haul Crew are hugely expensive when people of all ages and experience who have been made redundant in other areas would gladly do their job f0or half the amount of money. Many Long Haul CSMs bost of earning $120,000 per year, stay in 5 star hotels, are provided free dry cleaning transport to and from work, fantastic conditions staff travel sick leave annual leave
If the general public had any idea how well renumerated these people were they would be more than happy to work for half of this.
My point is the labour costs of this group is out of touch with similar roles in the workforce.
I also believe the middle managers are the ones who really need to be made redundant.
If you calculate the hours that most of these managers actually do any work, rather than having cakes, meetings wasting time on the internet ect ect and zI am sure this is endemic in all large organisations.
I have a lot of respect for flight attendsants and all n that they do however they m ust realise that they are indeed priveliged to be earning what they do and they are out of touch with the real world.
If Qantas was serious it would play hard ball and bring the wage level of flight attendants in line with similar roles on the ground.
If you were to slash flight attendant wages by 50%, they still would be on a good wicket, I wonder how many would leave.
I respect their role and what a flight attendant does, jet lag etc etc etc however they must face reality and seriously have some dialogue with Qantas to bring their wages in to a more realistic and cost efficient manner
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Old 16th Apr 2009, 13:03
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LH CC Remuneration

Lets make something clear LH CC are not overpaid.Superannuable base income for a CSS of 20 years seniority is $53K.This is considered to be the average wage in Australia.
How do I know that?
Its my wage.
I do not fly to the states and I do not do trips longer than 5 days.
There are many who post here that have an agenda of misinformation/disinformation.An individuals remuneration is the business of no one but the person and the persons employer.
These buffoons who strut around claiming that they are valuable employees because they are cheap obviously have no children and have not yet taken on a mortgage.
Any one who earns more than me I say good on you.You are to be commended for your ability to negotiate a wage commensurate with your abilities.
I am happy with my lot but I bristle when some fool tells me I am overpaid
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