Qantas~ A Business in Decline
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T-Vasis, You may or may not be correct, however you make statements as fact without providing supporting evidence to back up your arguments, for example:
Can you support this assertion? Are the ME carrier's "on-costs" of supporting a pilots entire family with company supplied accommodation & medical care included in this comparison, for example, or is it just a straight wage comparison. Another factor is the exchange rate, which has a massive effect on the cost of labour between two countries. Are your comparisons at some static point in time or averaged out? There are just so many subtle details that can distort the picture.
I cannot let these arguments go unchallenged. Without solid factual evidence, many of your arguments appear weak. Please show us the evidence - links, documents. You obviously have them as you are able to make highly specific claims.
Qantas has the second highest labour costs of any airline in the world - the exception being Japan Airlines which was higher - and look at what has happened to them. I am only pointing out labour costs here to make a point
I cannot let these arguments go unchallenged. Without solid factual evidence, many of your arguments appear weak. Please show us the evidence - links, documents. You obviously have them as you are able to make highly specific claims.
Last edited by breakfastburrito; 6th Feb 2011 at 02:04.
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Breakfastburrito - Sure no problem. The labour claim was taken from IACO data "Fleet and Personnel" 2006. I don't have links as this data is hard copy.
One component as an example since this board is made up mainly of "drivers":
Average annual renumeration for pilots in 2006 US$000s:
- Japan Airlines 189.2;
- Thai Airways 105.4; and
- Malaysian Airlines 46.6.
Another source of information that supports costs are the unit operating costs of airlines taken from IACAO data (2009).
A comparison of airlines (US cents per available tonne-kilometre):
- Japan Airlines 90.1;
- Singapore Airlines 30.6; and
- Cathay 33.6 etc
Quite a difference between Japan Airlines and Singapore Airlines...
Other information or claims I make are taken from financial data (annual reports) from airlines as well as comments made from speeches | published commentary by airline personnel and organisations (IATA | ICAO) as well as my own study in this field and a representation of my opinions and | or information sourced via the aforementioned channels..
One component as an example since this board is made up mainly of "drivers":
Average annual renumeration for pilots in 2006 US$000s:
- Japan Airlines 189.2;
- Thai Airways 105.4; and
- Malaysian Airlines 46.6.
Another source of information that supports costs are the unit operating costs of airlines taken from IACAO data (2009).
A comparison of airlines (US cents per available tonne-kilometre):
- Japan Airlines 90.1;
- Singapore Airlines 30.6; and
- Cathay 33.6 etc
Quite a difference between Japan Airlines and Singapore Airlines...
Other information or claims I make are taken from financial data (annual reports) from airlines as well as comments made from speeches | published commentary by airline personnel and organisations (IATA | ICAO) as well as my own study in this field and a representation of my opinions and | or information sourced via the aforementioned channels..
Last edited by PPRuNeUser0198; 6th Feb 2011 at 02:45.
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Update your Data Old Sun
2006 is an eternity ago.In many cases two EBA s ago
QF wage bill has dropped by some 20 % since then.
You sound like middle management....plenty of assertions,little data and totally disconnected from reality.
Competing means exactly that ...competing.Grow your network spread your fixed costs and be innovative.......innovative!!!!
Travellers are prepared to pay a little extra for a better product.Qantas is not a better product than its peer aiilines.
Costs are only one part of the jigsaw but for QF its the only part of the puzzle.
When comparing wages start comparing executive remuneration.Qantas is around the 10 th largest airline in the world and many execs are paid more than the number three airline.
Find some data to make that comparison.....not from 1976!!!
QF wage bill has dropped by some 20 % since then.
You sound like middle management....plenty of assertions,little data and totally disconnected from reality.
Competing means exactly that ...competing.Grow your network spread your fixed costs and be innovative.......innovative!!!!
Travellers are prepared to pay a little extra for a better product.Qantas is not a better product than its peer aiilines.
Costs are only one part of the jigsaw but for QF its the only part of the puzzle.
When comparing wages start comparing executive remuneration.Qantas is around the 10 th largest airline in the world and many execs are paid more than the number three airline.
Find some data to make that comparison.....not from 1976!!!
Last edited by DEFCON4; 6th Feb 2011 at 03:16.
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Defcon - what kind of "drop" did the unions agree with the last two EBA's? I am not sure there was any "reduction" in pay. I thought it was a capped 3% increase each year? Was it not? Isn't that above CPI?
If you compare the differences between JAL and let's say SIA - that amounts to a significant difference between the two...
And were not talking just pilots. The labour cost data detailed in the ICAO report represents all labour costs. That's the data - I am not making it up. Yes, it was based on five years ago - however that change is unlikely to be material considering the gaps. Qantas will never have lower or as low labour costs as SIA or CX etc.
You cannot grow your network if states are going to "constrict" you're ability to do so (refer Paris argument).
"Travellers prepared to pay a little extra for a better product" - that's subjective. The consumer is majority price driven. Then network and frequency | convenience. Product rates further down the line if you read customer advocacy data. Qantas has a comparable product to many other airlines.
Executive wages? Australian CEO's are paid well below their US counterparts.
And no - I am not "middle management" or employed by Qantas.
If you compare the differences between JAL and let's say SIA - that amounts to a significant difference between the two...
And were not talking just pilots. The labour cost data detailed in the ICAO report represents all labour costs. That's the data - I am not making it up. Yes, it was based on five years ago - however that change is unlikely to be material considering the gaps. Qantas will never have lower or as low labour costs as SIA or CX etc.
You cannot grow your network if states are going to "constrict" you're ability to do so (refer Paris argument).
"Travellers prepared to pay a little extra for a better product" - that's subjective. The consumer is majority price driven. Then network and frequency | convenience. Product rates further down the line if you read customer advocacy data. Qantas has a comparable product to many other airlines.
Executive wages? Australian CEO's are paid well below their US counterparts.
And no - I am not "middle management" or employed by Qantas.
Last edited by PPRuNeUser0198; 6th Feb 2011 at 03:19.
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Inflation
To receive a wage increase in real terms it needs to be seen in terms of CPI/ inflation.Inflation in this country has historicaly been running at between 3 to 4 %.So if you increase your productivty by 8 % and receive 3 % as a wage increase you are going backwards.Ergo anything less than 6% is actually a wage decrease.
Re read my post..I said you "sound" like middle management
You like using "old" data.At one stage Dixon was earning more than the CEO of Delta.Dixon also had his superannuation pay out backdated so as not to be disadvantaged by downward corrections in the market
You dont appear to understand the relationship between costs revenue and profit
Re read my post..I said you "sound" like middle management
You like using "old" data.At one stage Dixon was earning more than the CEO of Delta.Dixon also had his superannuation pay out backdated so as not to be disadvantaged by downward corrections in the market
You dont appear to understand the relationship between costs revenue and profit
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Everybody has a price Scamsniffer, and Borghetti is in the position to tell them his. He has the ability to turn the airline around, he knows it better than he probably knows his own backyard. I would for one hopes he takes up the offer when it comes, as it will.
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TG,
There are a few reasons why that is unlikely.
Firstly, there would be an employment contract involved and there is no way DJ would let him out of that in the circumstances you suggest without a very long period of garden leave or a fierce legal battle.Sir Richard would ensure he is tied up a long time ahead of any expiry although it could be a rolling contract.
Secondly and most relevantly, he is different from the others from where he came. He seems to have personal integrity.
Thirdly, he would have to replace the whole Rat executive on principle, not that they made the decision but many would be tainted by the process.
Let me suggest another scenario, he is quite happy to see it decline and he just sits and waits and says told you so very quietly. In the meantime he gets to pick and choose who he wants when he wants.
Suggest this is a good time for him and as it goes on it will get better provided he has support re capital.
Who knows where this game will end up and it could change dramatically at any moment with any screw up by any party.
We live in both sad and interesting times.
There are a few reasons why that is unlikely.
Firstly, there would be an employment contract involved and there is no way DJ would let him out of that in the circumstances you suggest without a very long period of garden leave or a fierce legal battle.Sir Richard would ensure he is tied up a long time ahead of any expiry although it could be a rolling contract.
Secondly and most relevantly, he is different from the others from where he came. He seems to have personal integrity.
Thirdly, he would have to replace the whole Rat executive on principle, not that they made the decision but many would be tainted by the process.
Let me suggest another scenario, he is quite happy to see it decline and he just sits and waits and says told you so very quietly. In the meantime he gets to pick and choose who he wants when he wants.
Suggest this is a good time for him and as it goes on it will get better provided he has support re capital.
Who knows where this game will end up and it could change dramatically at any moment with any screw up by any party.
We live in both sad and interesting times.
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QF Share in FJ
What's the story with the Qantas share in Air Pacific? If I remember correctly it is around 48%. With the rapid losses occurring at FJ, I would think Qantas would want to get rid of the burden asap...
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Rodchucker, I don't believe he would like to see it die. I don't think he is that bigger bastard. He will simply sit and wait, he will come back on HIS terms, but he will come back. What ever any of us think of QF we recognise its importance in this country. We cannot have a national carrier going belly up. Its not good for the country or our reputation OS. Whatever the public perceive QF to be, or what they think of it, they will not tolerate its demise, and the Govt. know that. QF will fly on.
Yeah Qantas still own a significant portion of Air Pacific. They are still actively trying to sell it, but as they are a massive loss making venture, no one really wants to buy it. The Fijian Government have been looking into it, but don't have the cash themselves to buy into it.
I guess its upto Qantas whether they right it off as a loss or just give them away on the street.
I guess its upto Qantas whether they right it off as a loss or just give them away on the street.
Just to reinforce the case that the punters are "perceiving" that there's something rotten in QANTAS, I was just reading a post on an international non-aviation forum ... where a guy was complaining about engineering and malfunction delays on his flights with a major international carrier.
He finished his post with: " .. at least I don't have to fly on QANTAS"
Once upon a time that used to be the likes of Garuda or Air India etc
He finished his post with: " .. at least I don't have to fly on QANTAS"
Once upon a time that used to be the likes of Garuda or Air India etc
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THIS SORT OF JOURNALISM MAKE ME 
Jetstar, not Qantas, as our national airline? Stay tuned
James Kirby
February 6, 2011
IT'S SHOCKING really … but who was surprised that Qantas, having promised to get stranded Australians out of Egypt, left them waiting another 13 hours in the hell of Cairo airport due to ''technical problems''.
I don't doubt the endless mechanical failures and depressurisation incidents we hear every other day are overblown.
No doubt they have always occurred routinely: it's just that passengers armed with Facebook, Twitter and video cameras didn't act as vigilante reporters in days gone by.
Advertisement: Story continues below
Still, the dismal diary of ''incidents'' reported at Qantas is surely filling to the point where the brand - once the best in Australia - is a shadow of its former self.
Moreover, beyond such intangibles as brand decay, there are verifiable facts surrounding Qantas Airways - the ASX-listed holding company that covers all the subsidiaries - which are simply inescapable.
In the case of Qantas International, the company is stuck with archaically old planes and the attempts to refresh the fleet have been delayed, significantly with the dramatic problems in the A380s.
The ''super jumbos'' were shaping up as a potential favourite among travellers until one of them had to make an emergency landing in Asia before Christmas.
The other plain truth about Qantas Airways is that strategically it is being sandwiched - rival global carriers such as Etihad are coming down hard, while its offshoot, Jetstar, is a better business on almost every measure and is moving upmarket.
No surprise then to hear that Alan Joyce, the former Ryanair and Jetstar executive who is head of Qantas Airways, is to run a strategic review of the airline.
There is talk of joint ventures, of a renewed thrust into China and other initiatives.
Yet while Joyce hints at these changes, he also comes out with very negative comments about Qantas International - last week he said the division was falling ''significantly short of expectations''.
Meanwhile, Qantas stock is steady … in fact in recent days, despite a new fuel surcharge, the share price has started to lift.
Why? Well, virtually every stockbroker in the market reckons Qantas Airways is a buy - the stock closed for the weekend at $2.41 yet the 12-month price targets from brokers range between $3 and $3.70.
The optimistic forecasts follow suggestions from analysts that Jetstar is now so strong - especially in Asia - it can deal with the drag imposed by Qantas International.
But you'd have to think that Joyce, himself a product of the low-budget Jetstar (and earlier of the ultra low-budget Ryanair), would have to consider closing down Qantas International as a potential way out of the conundrum he faces as boss of the whole show.
Joyce is highly regarded by many in the industry - crucially he has shown the ability to respond in a decisive manner to every issue thrown at him, including the unprecedented spectacle of European airports closed en masse due to clouds of Icelandic volcanic ash.
But would he move to close Qantas International, leaving us with a national airline called Jetstar? … I wouldn't rule it out; Jetstar now has the potential to be a better brand than Qantas.
So who is the Clown writing this dribble today in the SMH?
Is this the new agenda......position JQ as the Flag Carrier.
Yeah right
Get a few Star Class tix to DPS did we buddy for writing this. Nice one.
Jetstar, not Qantas, as our national airline? Stay tuned
James Kirby
February 6, 2011
IT'S SHOCKING really … but who was surprised that Qantas, having promised to get stranded Australians out of Egypt, left them waiting another 13 hours in the hell of Cairo airport due to ''technical problems''.
I don't doubt the endless mechanical failures and depressurisation incidents we hear every other day are overblown.
No doubt they have always occurred routinely: it's just that passengers armed with Facebook, Twitter and video cameras didn't act as vigilante reporters in days gone by.
Advertisement: Story continues below
Still, the dismal diary of ''incidents'' reported at Qantas is surely filling to the point where the brand - once the best in Australia - is a shadow of its former self.
Moreover, beyond such intangibles as brand decay, there are verifiable facts surrounding Qantas Airways - the ASX-listed holding company that covers all the subsidiaries - which are simply inescapable.
In the case of Qantas International, the company is stuck with archaically old planes and the attempts to refresh the fleet have been delayed, significantly with the dramatic problems in the A380s.
The ''super jumbos'' were shaping up as a potential favourite among travellers until one of them had to make an emergency landing in Asia before Christmas.
The other plain truth about Qantas Airways is that strategically it is being sandwiched - rival global carriers such as Etihad are coming down hard, while its offshoot, Jetstar, is a better business on almost every measure and is moving upmarket.
No surprise then to hear that Alan Joyce, the former Ryanair and Jetstar executive who is head of Qantas Airways, is to run a strategic review of the airline.
There is talk of joint ventures, of a renewed thrust into China and other initiatives.
Yet while Joyce hints at these changes, he also comes out with very negative comments about Qantas International - last week he said the division was falling ''significantly short of expectations''.
Meanwhile, Qantas stock is steady … in fact in recent days, despite a new fuel surcharge, the share price has started to lift.
Why? Well, virtually every stockbroker in the market reckons Qantas Airways is a buy - the stock closed for the weekend at $2.41 yet the 12-month price targets from brokers range between $3 and $3.70.
The optimistic forecasts follow suggestions from analysts that Jetstar is now so strong - especially in Asia - it can deal with the drag imposed by Qantas International.
But you'd have to think that Joyce, himself a product of the low-budget Jetstar (and earlier of the ultra low-budget Ryanair), would have to consider closing down Qantas International as a potential way out of the conundrum he faces as boss of the whole show.
Joyce is highly regarded by many in the industry - crucially he has shown the ability to respond in a decisive manner to every issue thrown at him, including the unprecedented spectacle of European airports closed en masse due to clouds of Icelandic volcanic ash.
But would he move to close Qantas International, leaving us with a national airline called Jetstar? … I wouldn't rule it out; Jetstar now has the potential to be a better brand than Qantas.
So who is the Clown writing this dribble today in the SMH?
Is this the new agenda......position JQ
as the Flag Carrier.Yeah right
Get a few Star Class tix to DPS did we buddy for writing this. Nice one.
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He finished his post with: " .. at least I don't have to fly on QANTAS"
Once upon a time that used to be the likes of Garuda or Air India etc
Once upon a time that used to be the likes of Garuda or Air India etc
Joyce set the bar for engagement at 60% with a two year time frame.
The last survey was 20%.There is less than six months left of the time frame.
The last survey was 20%.There is less than six months left of the time frame.
Has anyone even noticed a difference since the previous person left?
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Them's fighting words
Joyce is highly regarded by many in the industry - crucially he has shown the ability to respond in a decisive manner to every issue thrown at him, including the unprecedented spectacle of European airports closed en masse due to clouds of Icelandic volcanic ash.
But would he move to close Qantas International, leaving us with a national airline called Jetstar?
But would he move to close Qantas International, leaving us with a national airline called Jetstar?
As if Joyce was the only airline CEO to suffer through the Icelandic volcanic ash cloud situation. Suggest that there may be a few volcanic eruptions here in Australia if AJ really tried to swap QF for JQ as our International carrier! words fail me.
Average annual renumeration for pilots in 2006 US$000s:
- Japan Airlines 189.2;
- Thai Airways 105.4; and
- Malaysian Airlines 46.6.
- Japan Airlines 189.2;
- Thai Airways 105.4; and
- Malaysian Airlines 46.6.
JAL - 211 aircraft. 77% widebody (A300(18), B767(42), B747(65), B777(37)). 23% Narrow body (B737(13) and MD80/90 etc(36))
Thai - 82 aircraft. 85% widebody (A300(19), A330(12), A340(9), B747(20), B777(10)). 15% Narrow body (B737(10), ATR72(2))
Malaysian - 106 aircraft. 49% widebody (A330(16), B747(19), B777(17)). 51% Narrow body (B737(39), F50(10), DHC-6(5))
So don't you think this might just skew the statistics for starters? Just a bit perhaps? Or is a Twin Otter on par with a B777 for a wage comparison? Averages can be very simplistic and often very misleading, if not completely stupid.
Did you know the average fruit at my local market is a Japanese Pumpkin and costs $2.99 a punnet?
I don't know why some ICAO boffin would even bother coming up with such a ridiculously flawed attempt at some kind of "average" wage comparison. (Unless they want to "sell" it to similarly stupid airline managers). Though I guess the decimal points make it look like quite a piece of statistical analysis.
Last edited by The The; 6th Feb 2011 at 10:34.
Run QF into the ground, whilst growing Jetstar quietly, make QF look so bad that they have no choice but to close it down, retrench everyone at QF, transfer all the flying over to Jetstar and their payrates, wait 6 months and say that the public still prefers the QF name and after all jetstar is a qf group company, and wala you have your low cost Jetstar model wearing the QF logo. It's almost like this latest press release is his grooming of this.
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ACCOR and Qantas
Dixon was always on about the ACCOR Group and how it covered all levels of the market.It was his desire to emulate them.
The people at ACCOR are very astute and knew how to market themselves.
Dixon and his cohorts didnt have a clue.Aspirations yes but absolutely no clue.
What puff has just said has a lot of merit.Its about the only thing long term Qantas done in a decade.Offshore and outsource everything.Pour everything you've got into Jetstar.Use it as a vehicle to drive down wages and conditions at mainline.When mainline is a basket case merge the two and become all things to each segment of the market.A very clever devious idea.Only one problem ...Dixon wasnt that smart.
Ian Oldmeadow on the other hand.........?
The people at ACCOR are very astute and knew how to market themselves.
Dixon and his cohorts didnt have a clue.Aspirations yes but absolutely no clue.
What puff has just said has a lot of merit.Its about the only thing long term Qantas done in a decade.Offshore and outsource everything.Pour everything you've got into Jetstar.Use it as a vehicle to drive down wages and conditions at mainline.When mainline is a basket case merge the two and become all things to each segment of the market.A very clever devious idea.Only one problem ...Dixon wasnt that smart.
Ian Oldmeadow on the other hand.........?
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A Timely Reminder
Joyce ready for great leap at Qantas
October 10, 2009
The new boss of Qantas has survived his first year but challenges lie ahead, writes Matt O'Sullivan.
It is one of the most exclusive clubs in the land. Its doors are hidden from view and its members, who gain entry by invitation only, number politicians, corporate chieftains and celebrities. The superbly appointed Qantas Chairman's Lounge at airports in Australian capital cities is more than just a venue for sipping Penfolds Bin 389 and nibbling hors d'oeuvres. It is a place to network and initiate deals far from the public glare.
So exclusive is the club that Qantas sends its state sales managers to deliver to new members in person a pack containing the location of the lounges, preferred dialling numbers entitling them to preferential treatment and the membership cards that welcome them in.
Yet not even these inner sanctums of quality are immune from the woes facing the aviation industry in its biggest downturn of the jet age - or the frantic attempts by the new Qantas management to slash costs.
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''The Chairman's Lounge is all about networking, ego stroking and recognition,'' says a member, who recently took a call from a Qantas staffer politely inquiring about the extent of his recent travel. ''But they are now looking to cull the membership … because it's too expensive.''
The troubles highlight the huge job still ahead for Alan Joseph Joyce, the number-cruncher from Dublin who will have officially served a year as Qantas's chief executive next month.
Although sharemarkets have surged and talk of ''economic green shoots'' has risen in recent months, Qantas has yet to see a revenue rise despite offering its lowest fares in real terms. This fact ensures that Joyce's top priority will continue to be chipping away at costs. He has already pulled almost every lever possible: grounded aircraft, laid off up to 1750 workers, deferred delivery of new aircraft and tapped investors for $500 million.
The diminutive Irishman has to tread carefully to avoid alienating customers. In the case of the Chairman's Lounge his predecessor, Geoff Dixon, was well aware of the sway members held over large corporate and government travel accounts.
Like many newbies, Joyce has distanced the new management from the old. Dixon's coterie of executives - including strategy king Peter Gregg, operations boss John Borghetti, industrial relations chief Kevin Brown and one-time wunderkind Grant Fenn - are becoming distant memories at Qantas headquarters in Mascot, Sydney.
''Alan didn't have to do a lot to be better than those who went before,'' says the Nationals senator Barnaby Joyce, one of the fiercest critics of Dixon and his management team for their involvement in the botched $11 billion takeover bid for Qantas in 2007. ''With that as the base line, Alan Joyce is looking pretty good. What he is doing now is the reality of business - it's just the hard churn of the day-to-day management of the business.''
Joyce has installed almost a wholly new management team. One of the notable recruits is Lyell Strambi, a former Virgin Atlantic and Ansett executive who is now operations boss at Qantas. The two go way back: Strambi hired Joyce in the late 1990s from the Irish carrier Aer Lingus to work on route planning at Ansett.
Some industry insiders say Strambi's imprimatur on Qantas is already plain to see: an improvement in its on-time flight performance (although it follows a disastrous period last year when Qantas was embroiled in a stand-off with its engineers).
Joyce is also understood to rely heavily on David Epstein, a former chief of staff to Kevin Rudd, who was appointed to the new position of government and corporate affairs chief in November. Dixon was regularly seen in the halls of Parliament, but Joyce prefers to let the likes of Epstein manage the politicians. And retaining a healthy relationship with Canberra will be crucial.
The real test will come as Qantas fights over the coming months to keep its stranglehold on the Federal Government's $500 million annual travel budget - the biggest single account in Australia.
Then there's the wider market. Airlines have been pointing to a recent rise in passenger numbers as a sign of a tentative upturn. But the key figure is passenger revenue, which shows little sign of a substantive increase despite super-low fares. Steep discounts also mean passengers are bringing forward their trips, raising questions about demand next year.
''What is clear is that the market is a long way from getting back to where it was. Airlines are on a revenue diet at the moment,'' a former airline executive says.
''The fact Qantas has identified what needs to be done is different from doing it. The challenge has always been, 'How do you attack your costs without undermining your product?' Otherwise consumers will take their business elsewhere.''
The favoured child in the Qantas family remains Jetstar. The oft-raised argument is that Joyce, the former boss of Qantas's low-cost offshoot, is slowly ''Jetstarising'' the entire company.
Qantas's latest accounts may record Jetstar as the second-best contributor to the group's earnings, but many argue that the low-cost subsidiary is heavily subsidised by its parent.
Insiders also note that Joyce's underlings from Jetstar are quickly moving up the ladder at Qantas - John Gissing, for example, was Jetstar's former general manager of safety before he became the parent's executive manager of safety.
''Qantas is destroying its brand name,'' a former Qantas executive says. ''They are cross-subsidising Jetstar like you won't believe.''
The former executive argues that low-cost airlines are not feasible on routes of more than five hours because international travellers prefer full-service airlines for the long haul. He is also critical of such strategies as replacing Qantas flights with Jetstar on most flights between Australia and Japan.
''The low-fare market is the blue-singlet boys - the fellas going up [to Asia] for the buck's party and the silver hairs. It's the newly-weds and the nearly-deads,'' the former executive says. ''It's just a flying bus service, making its money from ancillary services.''
But Joyce refutes suggestions he is focused on ''Jetstarising'' Qantas and points to the investment in double-deck A380s, airport lounges, customer service and training.
'The business market will return, and when it does return you could easily see in a couple of years' time the bulk of our profitability being made through the Qantas brands again,'' Joyce says from his office on the top floor of Mascot HQ.
The international share of the Qantas mainline - the red-tailed aircraft - has fallen from about 42 per cent to less than 23 per cent since the airline was floated in 1993. And like all other airlines, Qantas is bleeding on the overseas routes. Low fares show no sign of ending soon because competition is ferocious, particularly on the key routes to Europe and the US.
Back home, it's a better story. But the Singapore Airlines-backed Tiger Airways is an irritant to Qantas and Virgin Blue and business traffic remains weak.
The worry for Qantas is that much of the business and first-class traffic will not return - at least not any time soon. Business people are not travelling anything like they did before the financial crisis, and if they fly at all they prefer economy class.
First- and business-class flyers comprise less than 10 per cent of a Qantas plane's total occupancy yet they contribute about 40 per cent of revenue.
However, Joyce is unperturbed. To doomsayers he responds: ''I think [the business market] does have a life, and after the end of every recession people have called the market as being dead and it's never been the case.''
The loss of market share on international routes means that Qantas must allocate its fixed costs over less flying, which forces up unit costs.
''It's making Qantas dearer and dearer relative to their competition,'' the former executive says.
''They are effectively saying to the unions, 'If you guys don't come up with a radical plan to lower unit costs, we will just melt Qantas on the vine and do it all on Jetstar'.
''Joyce has run out of options on the revenue side, so now what he is doing is cutting costs. There isn't anything else that can be done.''
Enter Conor McCarthy, a former chief operations officer for the no-frills Irish airline Ryanair, who is regarded as a genius at cutting allowances for technical and cabin crews. He helped turn Aer Lingus into a low-cost carrier by reducing wages.
Joyce is using McCarthy as a consultant on a range of matters. The Irishmen crossed paths at Aer Lingus, where McCarthy put Joyce to work on setting up a low-cost offshoot before they both departed in the same month of 1996 (Joyce to Ansett and McCarthy to Ryanair). McCarthy, now boss of PlaneConsult, also played a key role in helping Qantas draw up the blueprint for Jetstar in 2003.
''I know Conor very well,'' Joyce says. ''He is a great source of knowledge for us, so we use him occasionally for some consultancy activity … procurement strategy, development in the low-cost arena - very specialised activity.''
Insiders say one of the key targets for McCarthy will be Qantas mainline's cabin crew - the so-called ''Last of the Mohicans'' who have hung onto their penalty rates and other awards while new recruits have been hired on less lucrative awards.
Qantas also continues to have on its payroll Ian Oldmeadow, the former ACTU heavyweight whose firm Oldmeadow Consulting advises the airline on its industrial relations matters.
Yet some industry officials believe Joyce has lost a rare opportunity to tackle a massive restructure on the coat-tails of the worst of the global financial crisis. They argue the months immediately after the meltdown provided a rare chance to push for allowance cuts.
Making it harder to push for such change has been the largesse heaped on Qantas's former management team, notably the $3 million paid this year to Dixon as compensation for tax changes - it boosted his total payout to almost $11 million.
The largesse is especially galling for the airline staff who have faced successive management teams intent on suppressing wage rises and retrenching workers.
''There is a significant amount of unhappiness out there among staff,'' says the Australian Services Union's assistant national secretary, Linda White.
''Next time they start crying poor we won't get the Kleenex out. Qantas has had a history of rewarding the executives extremely generously.''
The dilemma is that further cost-cutting of any magnitude could spark damaging industrial action. Joyce has worked hard over the least year to improve relations with union officials, many of whom have breathed a sigh of relief after a testy relationship with Dixon. He has brought some aircraft maintenance work back to Australia and recently hired engineering apprentices.
Union officials say it is too early to cast judgment on Joyce. The first test of the relationship will come when a three-year enterprise bargaining agreement covering up to 10,000 workers - almost a third of Qantas's workforce - expires in the middle of next year.
''Joyce has never made it quite clear, but I dare say that like many of the low-cost people they don't want to deal with unions,'' says the secretary of the Pilots Association, Barry Jackson.
''Unless you put forward a business plan, I think he would rather ignore us. As a person he is more amenable, and he is certainly talking to staff. But as I say, actions speak louder than words. He will tolerate us.''
Keeping a firm hand on proceedings is Qantas's commanding chairman, Leigh Clifford, a former chief executive of Rio Tinto. The relationship between Clifford and Joyce is regarded as the inverse of that between Dixon and the former chairwoman Margaret Jackson.
''The more you look at it, you realise Joyce is under the chairman's thumb,'' an insider says.
Clifford's tough approach on industrial relations is well known - and he is believed to have given Joyce the all-clear to tackle the unions. ''Leigh is a miner and is typical of who runs airlines these days. He is very aware of the safety implications of any accident but he has a union-busting background,'' says Barry Jackson.
Qantas shareholders have become accustomed to turbulence since the $11 billion, Macquarie Group-backed bid failed in 2007, and following record high fuel prices, mid-air emergencies, damaging disputes with its heavily unionised workforce, and swine flu.
But those events have been dwarfed by the severe impact of the global financial crisis, which almost coincided with Joyce taking the reins at Qantas.
So far, institutional shareholders have given him credit for the way he has handled his first year.
''We have been reasonably positive about his term so far. It's been a very tough period for him and the company,'' says Rob Patterson, managing director of Argo Investments, which is one of Qantas's top 20 shareholders. ''It's a tough industry, and I guess in a relative sense they are one of the better players.''
Patterson will not be drawn on comparing Joyce to Dixon, but points out the latter was focused on operations, too, despite his reputation as a deal maker.
Joyce has repeatedly pointed to his focus on the operational side of Qantas. Deal-making can waste time that the management might otherwise spend on running the airline, he has said.
But he is not mute on the subject of pursuing acquisitions and closer tie-ups. ''We have the strength to do it,'' says Joyce.
''Our issue is that these are a lot harder to do than in any other industry. There is nothing on the radar screen for us. After going through it a few times you begin to realise you need all the planets to align to make it happen and it's a very difficult task for us to complete.''
The chief executive of Balanced Equity Management, Andrew Sisson, says Joyce has shown an ability to make tough calls in a difficult operating environment.
Sisson, whose firm is Qantas's second-biggest shareholder, says Joyce made the right decision to jettison the merger talks late last year with British Airways, which would have exposed the Australian airline to large pension liabilities. The planned $9 billion tie-up has been Qantas's biggest proposal since the botched private-equity raid two years ago.
Sisson likewise agrees with Joyce on the decision to dump plans for a partial float of Qantas's Frequent Flyer scheme, which was responsible for the airline staying in the black last financial year.
''When it comes to the big issues he has made calls which I think are right,'' Sisson says. ''My feeling is that they are better to try and get savings from alliance and code shares. Takeovers do increase the complexity.
''The BA deal would have made life a lot more complicated.''
Sisson rates Joyce very highly for his job over the past year, particularly given that Qantas has faced some of the toughest trading conditions in its history.
''The strategic decisions are right. He hasn't done anything startling but they have worked extremely hard on the operations. They are working on cutting costs meticulously and carefully, and saving the balance sheet - doing it at the right pace.''
Joyce's detractors at the start of his tenure were critical of him for a perceived lack of experience, especially given he was picked over old hands such as Peter Gregg and John Borghetti. He is still only 43.
''I never thought that was a legitimate criticism,'' says a former chief of British Airways, Sir Rod Eddington, who points to Joyce's time at Aer Lingus, Ansett and Jetstar.
''He is a very experienced aviation executive and he understands the industry extremely well … he has devoted his life to the industry.''
Eddington believes that Joyce has done a good job in very trying circumstances.
''It's been the most difficult 12 months in the history of the industry that has seen a significant number of airlines going to the wall,'' he says. ''Alan has had a real trial by fire given that he did take over at this very difficult time. The revenue position is not going to recover quickly. The top line for the airline is going to remain really challenging.''
Critics will argue that Eddington has always been a big supporter of the Irishman from Tallaght, an outer Dublin suburb. After all, Joyce worked under Eddington at Ansett and he recommended the Irishman to Dixon in the early noughties. At Ansett, Joyce had responsibility for the airline's route network and what aircraft the airline would use.
But even some of his competitors have a good word. John Sharp, deputy chairman of Regional Express and a former federal transport minister, says Joyce has taken the right approach considering the trying circumstances.
''My only concern with Alan is that he has got rid of the entire management team that was there under Geoff Dixon and there is no one with long-standing corporate experience at the company,'' Sharp says. ''The value of that shines through when you get difficult times like now.''
However concerning Qantas's performance might be, it needs to be considered alongside the dire state of many of the world's airlines. If anything, some argue the Australian carrier could emerge from this crisis as a stronger and larger airline.
''Alan will be in a good position versus Virgin Blue, which will not be able to take up the opportunities like Qantas will be able to,'' says Sharp. ''Qantas's debt is low and they still have cash in the bank … [while] Virgin Blue is losing tonnes of money and have locked themselves into routes that are going to take a long time to come good on them.''
Joyce is typically hesitant about calling any sustained upturn in the market.
''Certainly we think we have hit bottom and it looks like it is improving, but we are obviously making sure we are planning for a range of scenarios,'' he says.
''It was certainly a challenging year … but I think we've come through it better than any other airline in the world.''
And at least industry veterans can all agree on one thing: in the airline business you can always be guaranteed of another crisis around the corner.
October 10, 2009
The new boss of Qantas has survived his first year but challenges lie ahead, writes Matt O'Sullivan.
It is one of the most exclusive clubs in the land. Its doors are hidden from view and its members, who gain entry by invitation only, number politicians, corporate chieftains and celebrities. The superbly appointed Qantas Chairman's Lounge at airports in Australian capital cities is more than just a venue for sipping Penfolds Bin 389 and nibbling hors d'oeuvres. It is a place to network and initiate deals far from the public glare.
So exclusive is the club that Qantas sends its state sales managers to deliver to new members in person a pack containing the location of the lounges, preferred dialling numbers entitling them to preferential treatment and the membership cards that welcome them in.
Yet not even these inner sanctums of quality are immune from the woes facing the aviation industry in its biggest downturn of the jet age - or the frantic attempts by the new Qantas management to slash costs.
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''The Chairman's Lounge is all about networking, ego stroking and recognition,'' says a member, who recently took a call from a Qantas staffer politely inquiring about the extent of his recent travel. ''But they are now looking to cull the membership … because it's too expensive.''
The troubles highlight the huge job still ahead for Alan Joseph Joyce, the number-cruncher from Dublin who will have officially served a year as Qantas's chief executive next month.
Although sharemarkets have surged and talk of ''economic green shoots'' has risen in recent months, Qantas has yet to see a revenue rise despite offering its lowest fares in real terms. This fact ensures that Joyce's top priority will continue to be chipping away at costs. He has already pulled almost every lever possible: grounded aircraft, laid off up to 1750 workers, deferred delivery of new aircraft and tapped investors for $500 million.
The diminutive Irishman has to tread carefully to avoid alienating customers. In the case of the Chairman's Lounge his predecessor, Geoff Dixon, was well aware of the sway members held over large corporate and government travel accounts.
Like many newbies, Joyce has distanced the new management from the old. Dixon's coterie of executives - including strategy king Peter Gregg, operations boss John Borghetti, industrial relations chief Kevin Brown and one-time wunderkind Grant Fenn - are becoming distant memories at Qantas headquarters in Mascot, Sydney.
''Alan didn't have to do a lot to be better than those who went before,'' says the Nationals senator Barnaby Joyce, one of the fiercest critics of Dixon and his management team for their involvement in the botched $11 billion takeover bid for Qantas in 2007. ''With that as the base line, Alan Joyce is looking pretty good. What he is doing now is the reality of business - it's just the hard churn of the day-to-day management of the business.''
Joyce has installed almost a wholly new management team. One of the notable recruits is Lyell Strambi, a former Virgin Atlantic and Ansett executive who is now operations boss at Qantas. The two go way back: Strambi hired Joyce in the late 1990s from the Irish carrier Aer Lingus to work on route planning at Ansett.
Some industry insiders say Strambi's imprimatur on Qantas is already plain to see: an improvement in its on-time flight performance (although it follows a disastrous period last year when Qantas was embroiled in a stand-off with its engineers).
Joyce is also understood to rely heavily on David Epstein, a former chief of staff to Kevin Rudd, who was appointed to the new position of government and corporate affairs chief in November. Dixon was regularly seen in the halls of Parliament, but Joyce prefers to let the likes of Epstein manage the politicians. And retaining a healthy relationship with Canberra will be crucial.
The real test will come as Qantas fights over the coming months to keep its stranglehold on the Federal Government's $500 million annual travel budget - the biggest single account in Australia.
Then there's the wider market. Airlines have been pointing to a recent rise in passenger numbers as a sign of a tentative upturn. But the key figure is passenger revenue, which shows little sign of a substantive increase despite super-low fares. Steep discounts also mean passengers are bringing forward their trips, raising questions about demand next year.
''What is clear is that the market is a long way from getting back to where it was. Airlines are on a revenue diet at the moment,'' a former airline executive says.
''The fact Qantas has identified what needs to be done is different from doing it. The challenge has always been, 'How do you attack your costs without undermining your product?' Otherwise consumers will take their business elsewhere.''
The favoured child in the Qantas family remains Jetstar. The oft-raised argument is that Joyce, the former boss of Qantas's low-cost offshoot, is slowly ''Jetstarising'' the entire company.
Qantas's latest accounts may record Jetstar as the second-best contributor to the group's earnings, but many argue that the low-cost subsidiary is heavily subsidised by its parent.
Insiders also note that Joyce's underlings from Jetstar are quickly moving up the ladder at Qantas - John Gissing, for example, was Jetstar's former general manager of safety before he became the parent's executive manager of safety.
''Qantas is destroying its brand name,'' a former Qantas executive says. ''They are cross-subsidising Jetstar like you won't believe.''
The former executive argues that low-cost airlines are not feasible on routes of more than five hours because international travellers prefer full-service airlines for the long haul. He is also critical of such strategies as replacing Qantas flights with Jetstar on most flights between Australia and Japan.
''The low-fare market is the blue-singlet boys - the fellas going up [to Asia] for the buck's party and the silver hairs. It's the newly-weds and the nearly-deads,'' the former executive says. ''It's just a flying bus service, making its money from ancillary services.''
But Joyce refutes suggestions he is focused on ''Jetstarising'' Qantas and points to the investment in double-deck A380s, airport lounges, customer service and training.
'The business market will return, and when it does return you could easily see in a couple of years' time the bulk of our profitability being made through the Qantas brands again,'' Joyce says from his office on the top floor of Mascot HQ.
The international share of the Qantas mainline - the red-tailed aircraft - has fallen from about 42 per cent to less than 23 per cent since the airline was floated in 1993. And like all other airlines, Qantas is bleeding on the overseas routes. Low fares show no sign of ending soon because competition is ferocious, particularly on the key routes to Europe and the US.
Back home, it's a better story. But the Singapore Airlines-backed Tiger Airways is an irritant to Qantas and Virgin Blue and business traffic remains weak.
The worry for Qantas is that much of the business and first-class traffic will not return - at least not any time soon. Business people are not travelling anything like they did before the financial crisis, and if they fly at all they prefer economy class.
First- and business-class flyers comprise less than 10 per cent of a Qantas plane's total occupancy yet they contribute about 40 per cent of revenue.
However, Joyce is unperturbed. To doomsayers he responds: ''I think [the business market] does have a life, and after the end of every recession people have called the market as being dead and it's never been the case.''
The loss of market share on international routes means that Qantas must allocate its fixed costs over less flying, which forces up unit costs.
''It's making Qantas dearer and dearer relative to their competition,'' the former executive says.
''They are effectively saying to the unions, 'If you guys don't come up with a radical plan to lower unit costs, we will just melt Qantas on the vine and do it all on Jetstar'.
''Joyce has run out of options on the revenue side, so now what he is doing is cutting costs. There isn't anything else that can be done.''
Enter Conor McCarthy, a former chief operations officer for the no-frills Irish airline Ryanair, who is regarded as a genius at cutting allowances for technical and cabin crews. He helped turn Aer Lingus into a low-cost carrier by reducing wages.
Joyce is using McCarthy as a consultant on a range of matters. The Irishmen crossed paths at Aer Lingus, where McCarthy put Joyce to work on setting up a low-cost offshoot before they both departed in the same month of 1996 (Joyce to Ansett and McCarthy to Ryanair). McCarthy, now boss of PlaneConsult, also played a key role in helping Qantas draw up the blueprint for Jetstar in 2003.
''I know Conor very well,'' Joyce says. ''He is a great source of knowledge for us, so we use him occasionally for some consultancy activity … procurement strategy, development in the low-cost arena - very specialised activity.''
Insiders say one of the key targets for McCarthy will be Qantas mainline's cabin crew - the so-called ''Last of the Mohicans'' who have hung onto their penalty rates and other awards while new recruits have been hired on less lucrative awards.
Qantas also continues to have on its payroll Ian Oldmeadow, the former ACTU heavyweight whose firm Oldmeadow Consulting advises the airline on its industrial relations matters.
Yet some industry officials believe Joyce has lost a rare opportunity to tackle a massive restructure on the coat-tails of the worst of the global financial crisis. They argue the months immediately after the meltdown provided a rare chance to push for allowance cuts.
Making it harder to push for such change has been the largesse heaped on Qantas's former management team, notably the $3 million paid this year to Dixon as compensation for tax changes - it boosted his total payout to almost $11 million.
The largesse is especially galling for the airline staff who have faced successive management teams intent on suppressing wage rises and retrenching workers.
''There is a significant amount of unhappiness out there among staff,'' says the Australian Services Union's assistant national secretary, Linda White.
''Next time they start crying poor we won't get the Kleenex out. Qantas has had a history of rewarding the executives extremely generously.''
The dilemma is that further cost-cutting of any magnitude could spark damaging industrial action. Joyce has worked hard over the least year to improve relations with union officials, many of whom have breathed a sigh of relief after a testy relationship with Dixon. He has brought some aircraft maintenance work back to Australia and recently hired engineering apprentices.
Union officials say it is too early to cast judgment on Joyce. The first test of the relationship will come when a three-year enterprise bargaining agreement covering up to 10,000 workers - almost a third of Qantas's workforce - expires in the middle of next year.
''Joyce has never made it quite clear, but I dare say that like many of the low-cost people they don't want to deal with unions,'' says the secretary of the Pilots Association, Barry Jackson.
''Unless you put forward a business plan, I think he would rather ignore us. As a person he is more amenable, and he is certainly talking to staff. But as I say, actions speak louder than words. He will tolerate us.''
Keeping a firm hand on proceedings is Qantas's commanding chairman, Leigh Clifford, a former chief executive of Rio Tinto. The relationship between Clifford and Joyce is regarded as the inverse of that between Dixon and the former chairwoman Margaret Jackson.
''The more you look at it, you realise Joyce is under the chairman's thumb,'' an insider says.
Clifford's tough approach on industrial relations is well known - and he is believed to have given Joyce the all-clear to tackle the unions. ''Leigh is a miner and is typical of who runs airlines these days. He is very aware of the safety implications of any accident but he has a union-busting background,'' says Barry Jackson.
Qantas shareholders have become accustomed to turbulence since the $11 billion, Macquarie Group-backed bid failed in 2007, and following record high fuel prices, mid-air emergencies, damaging disputes with its heavily unionised workforce, and swine flu.
But those events have been dwarfed by the severe impact of the global financial crisis, which almost coincided with Joyce taking the reins at Qantas.
So far, institutional shareholders have given him credit for the way he has handled his first year.
''We have been reasonably positive about his term so far. It's been a very tough period for him and the company,'' says Rob Patterson, managing director of Argo Investments, which is one of Qantas's top 20 shareholders. ''It's a tough industry, and I guess in a relative sense they are one of the better players.''
Patterson will not be drawn on comparing Joyce to Dixon, but points out the latter was focused on operations, too, despite his reputation as a deal maker.
Joyce has repeatedly pointed to his focus on the operational side of Qantas. Deal-making can waste time that the management might otherwise spend on running the airline, he has said.
But he is not mute on the subject of pursuing acquisitions and closer tie-ups. ''We have the strength to do it,'' says Joyce.
''Our issue is that these are a lot harder to do than in any other industry. There is nothing on the radar screen for us. After going through it a few times you begin to realise you need all the planets to align to make it happen and it's a very difficult task for us to complete.''
The chief executive of Balanced Equity Management, Andrew Sisson, says Joyce has shown an ability to make tough calls in a difficult operating environment.
Sisson, whose firm is Qantas's second-biggest shareholder, says Joyce made the right decision to jettison the merger talks late last year with British Airways, which would have exposed the Australian airline to large pension liabilities. The planned $9 billion tie-up has been Qantas's biggest proposal since the botched private-equity raid two years ago.
Sisson likewise agrees with Joyce on the decision to dump plans for a partial float of Qantas's Frequent Flyer scheme, which was responsible for the airline staying in the black last financial year.
''When it comes to the big issues he has made calls which I think are right,'' Sisson says. ''My feeling is that they are better to try and get savings from alliance and code shares. Takeovers do increase the complexity.
''The BA deal would have made life a lot more complicated.''
Sisson rates Joyce very highly for his job over the past year, particularly given that Qantas has faced some of the toughest trading conditions in its history.
''The strategic decisions are right. He hasn't done anything startling but they have worked extremely hard on the operations. They are working on cutting costs meticulously and carefully, and saving the balance sheet - doing it at the right pace.''
Joyce's detractors at the start of his tenure were critical of him for a perceived lack of experience, especially given he was picked over old hands such as Peter Gregg and John Borghetti. He is still only 43.
''I never thought that was a legitimate criticism,'' says a former chief of British Airways, Sir Rod Eddington, who points to Joyce's time at Aer Lingus, Ansett and Jetstar.
''He is a very experienced aviation executive and he understands the industry extremely well … he has devoted his life to the industry.''
Eddington believes that Joyce has done a good job in very trying circumstances.
''It's been the most difficult 12 months in the history of the industry that has seen a significant number of airlines going to the wall,'' he says. ''Alan has had a real trial by fire given that he did take over at this very difficult time. The revenue position is not going to recover quickly. The top line for the airline is going to remain really challenging.''
Critics will argue that Eddington has always been a big supporter of the Irishman from Tallaght, an outer Dublin suburb. After all, Joyce worked under Eddington at Ansett and he recommended the Irishman to Dixon in the early noughties. At Ansett, Joyce had responsibility for the airline's route network and what aircraft the airline would use.
But even some of his competitors have a good word. John Sharp, deputy chairman of Regional Express and a former federal transport minister, says Joyce has taken the right approach considering the trying circumstances.
''My only concern with Alan is that he has got rid of the entire management team that was there under Geoff Dixon and there is no one with long-standing corporate experience at the company,'' Sharp says. ''The value of that shines through when you get difficult times like now.''
However concerning Qantas's performance might be, it needs to be considered alongside the dire state of many of the world's airlines. If anything, some argue the Australian carrier could emerge from this crisis as a stronger and larger airline.
''Alan will be in a good position versus Virgin Blue, which will not be able to take up the opportunities like Qantas will be able to,'' says Sharp. ''Qantas's debt is low and they still have cash in the bank … [while] Virgin Blue is losing tonnes of money and have locked themselves into routes that are going to take a long time to come good on them.''
Joyce is typically hesitant about calling any sustained upturn in the market.
''Certainly we think we have hit bottom and it looks like it is improving, but we are obviously making sure we are planning for a range of scenarios,'' he says.
''It was certainly a challenging year … but I think we've come through it better than any other airline in the world.''
And at least industry veterans can all agree on one thing: in the airline business you can always be guaranteed of another crisis around the corner.
Last edited by watch your 6; 6th Feb 2011 at 21:04.
Join Date: Apr 2009
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reinvigorate the brand in Singapore?
by puff - whilst growing Jetstar quietly, make QF look so bad that they have no choice but to close it down,
Budget airline reverses losses
Interesting timing for this story considering yesterdays story in the smh & the age....
post 99 by TEAL and again by SJ considering the contents.
THE Qantas-backed Singaporean budget airline Jetstar Asia has made a small profit in its first full year since Australia's largest airline boosted its stake.
Jetstar Asia has struggled to turn a profit since it began services in 2004. Its latest accounts show it posted income of $S268 million for the year to June, including $S20 million in sub-lease revenue.
The previous loss was blamed on high fuel costs and a rise in marketing expenditure to reinvigorate the brand in Singapore.
The previous loss was blamed on high fuel costs and a rise in marketing expenditure to reinvigorate the brand in Singapore.
'Joyce has run out of options on the revenue side, so now what he is doing is cutting costs. There isn't anything else that can be done.''
Enter Conor McCarthy, a former chief operations officer for the no-frills Irish airline Ryanair, who is regarded as a genius at cutting allowances for technical and cabin crews. He helped turn Aer Lingus into a low-cost carrier by reducing wages.
Enter Conor McCarthy, a former chief operations officer for the no-frills Irish airline Ryanair, who is regarded as a genius at cutting allowances for technical and cabin crews. He helped turn Aer Lingus into a low-cost carrier by reducing wages.
Last edited by TIMA9X; 6th Feb 2011 at 13:17.