Why don't we put Australia first ?
 

With QF struggling to maintain a presence on the Kangaroo Route, I ask one simple question
Why does the vast majority of Australian passengers heading to and from Europe end up on the ME3 and Asian carriers ?

Ancient 3rd and 4th freedom rights permit this, but we are now in 2017 folks
What gives the right for Asian and Middle East carriers to profit from people flying from (eg) Australia to UK or Australia to NZ

In the case of Australia to Europe, these flights are sold as direct, with a refueling stop or change of aircraft at a hub
As these are just hub and spoke flights the likes of the ME3 and Asian Carriers will always be able to do the flight at a cheaper price
It is not a level playing field....

There is however, a simple solution
1) A minimum stopover of 3 days required for any foreign carrier selling seats from Australia to Europe
2) Selling tickets from Australia to NZ only permitted for non Australian residents on foreign airlines

Point 1 allows genuine passengers who would like to visit multi destinations on a trip, the freedom to do so and legitimize the stop over, all be it at a cost
Point 2 stops foreign carriers utilizing aircraft that would otherwise sit in Australia waiting for a time schedule window for the return flight, to compete on a route they have no investment in and plundering Australian and New Zealand carriers passengers

Would this inhibit free trade and open skies ? YES, but so what....

It would however, give our airlines a fair go and create more jobs for Australia and New Zealand in the aviation industry

Though I appreciate your cander, you want to drive down the industry? At the end of the day it's supply and demand. If one were to impose your vision, we would drive down local demand and drive down local supply which in tern will costs jobs.

However, I agree with the sentiment. We should limit foreign carriers access and allow local carriers to pick up the slack. Open skies agreements are as stupid as they sound. The world is not a financially equal flying ground. But if we do that, expect the same in return.

Were the lucky country right....???

Because they give passengers what they have been asking for, new aircraft, frequent schedules and some fantastic innovation in product development. Our main carrier is still flying antique 747s built in the early 90's! Qantas has not updated their A380s since incepted, have you seen the Etihad A380?

As Virgin has very limited scope Internationally, leaving one main carrier being Qantas, the simple reason is they have an absolute rubbish network and offering. Have a look at national carriers networks out of Adelaide and Perth, in fact don't bother because there is none.

A lot of reasons why Australians are flying the elites is due to poor management from current and previous executives of Qantas and Virgin Australia.

I would argue all these carriers landing on our shores are providing many more jobs locals compared to what Qantas and Virgin would ever offer.

It would be great for Qantas and AirNew Zealand but not for the vast majority of Australian and NZ citizens in that less people would travel to NZ and Aus resulting in more job losses than job creations.
Basically it would not be as good for the economy as the current set-up.

If only we had access to cheap labour from the 3rd world, a president who was also the CEO of QANTAS, CEO of Sydney Airport and head of CASA, then we might be able to get somewhere...

:hmm:

Qantas who still call Australia 51% home and who wanted foreign ownership restrictions lifted.

Virgin - Owned by Etihad, Hainan group & Singapore Airlines

How are they OUR airlines?

Qantas is a peculiar beast.

Privatised to release 'efficiency', the idiots in Canberra belatedly realised 'national interest' and created the Qantas Sale Act 1992.

• Qantas has to compete with third world airlines, 'open skies' privatised airports, seek capital and chase return whilst simultaneously keeping the 'majority of their facilities in aggregate in Australia'

• As the QSA was something that QF rightly detest from a pure commercial perspective I remember former general Counsel Johnson, arguing vigorously that the JQ 'Asian pivot' was not in breach of the QSA as it applied ONLY to QF.
• The control of various offshore entities, the huge capital QF must pay to step around the QSA is substantial, their onshore partners provide Principal Place of Business cover that is all, Qantas picks up the tab. Think Singapore, Vietnam, Japan and most definitely HK.
• JQ was the way to step around IR, FWA, the QSA Penny wise and pound foolish, the role of JQ grew far further than originally envisaged, from providing leverage against Australian terms and conditions, managers got carried away conducting an IR war....Neither shareholders, employees or the nation won, but certain insiders and legal firms made substantial profit..

Politicians of all persuasions have sold out this country, globalisation destroying not only bottom end jobs, but gutting the middle class, we the populace exchanging a stable economy for cheap Chinese crap, TV's and cars. The politicians made sure that by importing 457 visa holders and lots of immigration that real wages fell for many years...


The irony for Qantas is that the jig is up, in trying to offshore the business, save a dollar they lost far more. They are not alone every corporate tried it. In a time where populist politics and 'national interest' raising its head, as the tide recedes we may just find out the emperor (Elaine) never had any clothes...

Have you flown Qantas long-haul down the back recently? I did it a couple of years ago; hours in an old and cramped 747 with an entertainment system that didn't work and a crew that didn't care.

Contrast that with any of the Asian and ME carriers and it is easy to see why "never again" was the main thought going through my mind afterwards.

I do, however, fly Air NZ long-haul if the price is right (or near right) - it is a great airline, with decent planes and fantastic crew. A shining example of how you can get it right.

The game was given away in 1999 when John Howard stated "Australian Airlines do not need protection because they are so efficient" and opened the floodgates and the ME carriers(highly subsidised, but will never admit it who also operate from airports that they own) grew and continue to grow. John Anderson was the Aviation Minister at the time and both him and Mark Vaile spent a lot of time with the Sheikhs on Dubai and Abu Dhabi Golf Courses. The ME carriers along with the Chinese will continue to dump capacity into Australia and the only protection we have across the Pacific is the US and Canadian Governments. In fact the Canadians use Australia as and example of how NOT to run their Aviation market.

The Terms the Australian Airservices Commission operate to is cheap airfares first and a sustainable industry last. Sydney Airport is the most expensive in the Asia/Pacific with charges 4 times more than Jakarta and 3 times more expensive than Singapore and double Hong Kong. Sydney is Qantas' home base! Qantas has offshored it's maintenance jobs to LA, London and Manila so again we see the dumbing down of the airline and the hiring of Mexicans! Sydney's Padstow TAFE has all but shut down as instead of training Engineers it trains Hortoculturists and Florists! No Large engines are maintained on shore any more so should the Korean rheteric turn into something serious we must rely on someone else to look after our Jet Engines. We have only two oil refineries so we need to bring our oil in from Asia. What a mess!

Just as Australia has done with manufacturing they have privatised the energy providers and priced our own manufacturers out of the market. For each Manufacturing job there are 5 for the economy and IATA tells us that for every aviation job there is 3 for the economy. You will never see Emirates or Etihad offshore their airline because they already employ slave labour imported from India and Bangladesh and the aviation industry keeps their own economy ticking along with Building and Retail etc. Maybe we need a Trump style revolution but I fear it is too late for the Australian Aviation industry. Politicians need to make sure they stand for "National Interest" instead as most of them at the moment and make sure to ensure "Personal Interest" as their number one priority.

The only solution would be to freeze all bilateral approvals for a period to allow Australian airlines to catch up and also provide incentives to invest is new and fuel efficient aircraft. That would require vision and a foresight that does not exist in our current crop of leaders.

OZ is bankrupt. We need all the tourists we can get.

don't understand why anyone going to North America who go via NZ. Fly south to head north ?

When your competitors fly into your major ports up to 4 times a day with superior product, and you try to compete with ONE A330 or 737, the choice is simple. Add to the mix grumpy old and tired girls being paid top dollar to give me attitude, I know where I'd rather spend my money.

Does a company have to be 100% Australian owned to be "ours"? Or does it just have to employ say 10,000 Australians?

Is a company "Australian" if owned by an Australian who sends all money overseas or in offshore accounts, contributing nothing to the economy.

Not pointing at anyone in particular but its an interesting question..

Lamborghini no longer owned by Italians, is it still Italian?

To make the suggestion a bit "real".
What would happen to the bottom line of "Sydney Seaplanes" if the OP's suggestion was implemented?
Serious question.

It would be nice if it were Australian owned
However
Based here
Employing local workforce for all facets of the business
Pays taxes here
No objection to profits going off shore as airlines don't make an awful lot anyhow
Government owned would be the ultimate....

There is no such thing as cheap labor
There is exchange rate though
A Philippino earns $100.00-$150.00au per week, but on this pay can
Buy a house, a car, send kids to private school and still afford to holiday overseas
$1au buys about 36php, but the dollar for dollar is about 10-1

On that basis, if QF were to out source engineering work to the Philippines, the government could legislate a currency differential tax on the labor
For that matter, they could levy a similar tax on foreign carriers into and out of Australia to cover the labor differential
Then we would have a level playing field (and slightly higher air fares)
Net result, bring jobs back home....

A government acting in the interest of the populace necessitates a change to the current political order. Status quo protection at all odds, a greater divide between rich and poor is the blueprint of both sides of parliament...Driven by ideological crap, captured by vested interest and in the case of Iranian Sam $1650 from a Chinese 'friend' it costs very little to capture parliament and most of them never saw a mirror they didn't instantly love...

Then again if elections ever really changed anything people would not be allowed to vote.:suspect:

There's just one thing wrong with what you say... Australia has galloped full speed down the 'globalisation' path, privatising things like airlines and making them beholden to the market.

Meanwhile, the similarly 'globalisation' chanting competition continue to maintain control of and let's face it, substantially fund through either direct cash or discounted everything, their national carriers... Gulf, Etihad, Emirates, Singapore Airlines (Temasek Holdings is a Govt. owned corporation that owns the majority, i.e. 90+% of SQ so issuing a few shares and saying it's private is BS), Malaysian, Garuda, Air NZ are ALL owned substatially or totally and benefit from sovereign interest rates like QF used to and in the case of the ME carriers, they have access to piddling fuel prices ex their main hubs.

The answer is that Qantas should have been merged with TN but NEVER should have been floated or not totally anyway. Similar concessions could have been extended to AN as well... everyone else is doing it is the problem and we're the only dick heads that lap up the BS mantra and then sit back and watch our OWN carriers get screwed.

Admittedly, the US carriers are all privately owned but they are coming off a base of 330,000,000 using their domestic networks, that's equivalent to every country in Europe nearly in market size.

There needs to be some sort of restrictions as we are going to end up with no carriers... and if anyone thinks for a nano-second that EK, EY, et al will keep flying here when the mood changes, they've got rocks in their head.

It's a concept Australia has never cottoned on to... we treat the ANZUS Alliance like it's some temple of god or something when the US are only in it for themselves and come up in a competition with somewhere else that is of value to them and watch them not live up to the agreement.

One would think we would have learned our lesson in the 80s when the US talked us down the free trade route and we dropped all our tariffs then what did the US do??? Subsidized their primary producers to the point that it was impossible for our farmers to compete.

It's all a crock. We look after ourselves, we engage with the world but on our rules... there has to be a fair exchange. Just like in the 80s... Australia let SQ have more frequencies and MH and CX, in return QF got access to fly the golden triangle without restrictions on local vs through load. Now we just give everything away and hope for the best. No wonder QF haven't invested in product, they actually HAVE to make a profit and don't get the concessions all these other carriers do.

Couldn't agree more... how about when you fly to DXB you get handled by DNATA or not at all. Can you imagine the screams if it was made law that carriers could only be self-handled or handled by QF or VA.

We just let everyone walk all over us. It makes me sick. For goodness sake let's become a republic as quick as possible, maybe that will change the mindset to Australia first instead of living our entire existence dependent or subservient to others.

In agreement Mr. perspective...

National interest means in the interest of nationals. Unfortunately ideology got in the way..
Gas from Australia, costing Australians more than foreigners, surrendering fifth freedoms to Arab ME carriers, for nothing,

Qantas being privatised, yet retaining its own act of parliament shows that somewhere there is national interest, but perhaps a residual veto stake was a smarter move. A bit like Air NZ, in the national interest..

As General Counsel Johnson stated fiercely when amendments to the QSA were considered, JQ is not Qantas as defined in the Act so Qantas management spent every waking hour trying to get around the QSA, setting up shop in any Asian country that would have them...(for a big fee of course!)

Spot on Mr Mach. The QSA was put there to supposedly protect Qantas but we all know the lazy, indolent Treasurer we had in the mid 2000s was happy to see a consortium nearly take over QF in what would have been completely against the national interest. We all know now that there would be no QF now had that happened or at the very least, a substantial government re-nationalisation to pick up the pieces.

That Treasurer is still lauded today for his work, which was actually the work of his predecessors and where is the guy now??? Can't get a job in the private sector.

National 'interest' depends on who's in government.

Australian airlines have the right to fly local passengers between the UAE/Qatar and other countries, they just choose not to, except QF that flies DXB-LHR twice a day.

Also Australian airlines have exactly the same rights to traffic on routes to the ME3, they could fly 21 flights a week out of SYD/MEL/BNE/PER out of each port and an unlimited number from DRW/ADL/CNS etc.

The biggest problem with these sorts of arguments is that they invariably ignore the elephant in the room the customer.
It's no bad thing imho to look after your own first, that should be the default position and in a way Australia actually does do that for its airline passengers already.
If you subscribe to the view that artificial restrictions are beneficial to the country as it protects industries and companies on the basis of a locals first policy then you have to accept the trade off that those same industries and companies have no real incentive to remain as competitive or to compete as vigorously. If modern industrial history has taught us anything it's that governments and their various ministries and quango's are utterly hopeless when it comes to operating efficiently along side the private sector, moreover the natural progression tends to lead to bloated high cost "businesses" that tend to drift out of touch with reality.
The trick if there is such a thing is to find the right balance of regulation v free market practises whilst ensuring that competition is healthy rather than one sided.
The reality as it stands right now is that in terms of airlines and international travel both QF and VA have been less than enthusiastic about risk and strategy and have instead focused far more on their domestic operations.
The customer in turn has far more choice than they ever have had and at a price that in real terms is far more affordable today than at any previous time.
If some think that it's in the national interest to restrict and block outside competition then that's an argument for the political arena, it's a concept that works in some regards in the US due to the numbers who live there, however in a country of less than 25 million at the arse end of the world that relies on significant amounts of external trade and inbound tourism it's a mindset that will lower standards of living and merely benefit a small fraction of the local population.
The other question I'd ask would be to those who feel that things should be restricted etc is, how many Pax do QF and VA now carry verses when there was less competition? and how does that compare to the numbers in terms of revenue now versus back then? (Time period to look at of your own choosing)

If you put Australia first, other countries will mostly likely do the same. Everything will get more expensive, thus less consumption. I'm sure that you can see the snowball effect coming. Free trade is the policy that took more people out of poverty, over 2 billion. If you want to go back in time, it is a valid option. Yet, you will have to pay the price.

There is already a call for New Zealand to retaliate against some of the things that Australia is doing to New Zealanders who call Australia home.

This is not aviation related but it illustrates what New Zealanders feel: Dear New Zealand: What did Australia ever do to you? | Stuff.co.nz

Are we paying less for electricity since the governments sold out
How about CTP insurance post GIO insurance only
Are banks doing the right thing by customers since State Bank and CBA were privatized
Or how is the price and service of Australia Post doing under private ownership (kinda)

Back in the 70s and 80s QF did not have the protection of the 2 airline agreement and competed with international carriers well and had around 50% of the market

What changed is that it was privatized meaning
It now has to not only break even, but give a return to shareholders and pay huge amounts to management

If QF international were returned to government ownership (in the national interest) profits could be rolled into
Fleet renewal
New routes
Returning maintenance to Australia

If QF international under government ownership went down this path, the net return to the government (assuming profits were rolled back into the airline) would still be positive
Extra income tax from re-created jobs in maintenance, extra flight crews, ground staff and admin
Less welfare paid for those who take up these positions

For every 1000 people employed there is a net gain to the government of around $22 million per year

Sorry Deano but your argument is flawed and simplistic

Back in the 70's and 80's there was also no internet, no social media, the tourism industry was a mere pup compared to what it is today and the average standard of living when comparing most metrics was inferior.
Economy's of the time were more centrally controlled Which led to the rise of incredibly wasteful policy making. It also meant there was very little choice, very little in the way of travel for ordinary people and perhaps worst of all a great lack of opportunity in comparison to today.

Wrong for half a hundred different reasons, put simply if QF was re-nationalised there would be no incentive to make a profit, the Govt of NZ when it bailed out Air NZ did so as a majority shareholder with the key difference to what you are suggesting being it compelled Air NZ to operate on a profitable commercial basis to return the sum invested in it..e.g like any other investor.
Making the assumption that profits would return to the airline also shows a considerable amount of naivety, politics would invariably get in the way of good business, and as the political winds ebb and flow so does the prevailing will of a government that might decide that it's better to invest any profit in a new school in Karatha or a computer system for ministerial expenses etc etc.
Quite simply Govt has shown it can't be trusted nor can it be genuinely held to account when it comes to running organisations for profit..except of course at the ballot box, where in all likelihood the running of the airline might be viewed as small potatos compared to other issues of the day....and you are essentially now back where you started with no money for anything, sound familiar?

Exactly
With so many now looking on Webjet etc, people are buying on price more than ever
Regular travelers will tend to look at comfort above price if there is not much difference
Other things factor in, like Manila locals will fly PAL to avoid the old terminal even if QF had a better service

A corporatised QF with a GM answering to a government instead of a board made up of bankers and investment fund reps would be little different
Other than profit would not be the primary objective

A larger QF breaking even or even losing $200 million a year would be more than offset by the income tax revenue from thousands of new or re-hired employees
Pilots, cabin attendants, engineers, admin etc

Legacy government owned airlines still offer great service at reasonable prices
Its the ones that are privately owned that struggle and fail

With tourism so important to our economy with the mining boom over, we need to ensure that this industry is strong and resilient
An inbound tourist that has a poor experience on a foreign airline starts and ends on a downer and is unlikely to talk up their holiday as much

Right now, if a QF international route fails to make money, its dropped
Just look at the farce with the 787 Mel-Per-Lhr and return which is downgraded from an A380
Passengers will now just fly Emirates with a mid way stop in a more comfortable aircraft rather than a cramped 787 stopping a mere 3 hours into the flight

Qantas was an icon under government ownership, now it is no better than Jetstar, actually you even have more personal space on a Jetstar a320 than a Qantas 737
Speaking of Jetstar, what a great joke that turned out to be
You often pay more on Jetstar than Qantas for the same journey

If things don't change Qantas will have no international network within 10 years

They were probably saying the exact same thing 10 years ago!

Or,
With tourism so important to our economy with the mining boom over , we can't afford to reduce the number of tourists travelling to our shores.

Well for one thing the people now running this country really don't mind dropping their strides, bending over, and taking it in. Seems like instant gratification has replaced long term vision.

And so what if you buy Australian, your boss will probably by anything but Australian from the profits you helped he/she create.

With middle and upper Australians now driving European luxury cars there aint many mugs left willing to stick with the local brand if they can avoid it.

Not me, I don't want to be seated next to a pedophile.

If you replaced CEOs that are just interested in growing bonuses, with CEOs who want to grow their business, the rest should take care of itself.

The only way to do that is allow them a long term view by changing how often they report to the market.

Apart from being completely wrong and ignoring history, your post says at first if Qantas were re-nationalize there would be no incentive to make a profit, then you claim that Air NZ was re-nationalized but makes a profit... make up your mind would be the first point. Secondly, you ignore history. All of the shares in Qantas Ltd. were purchased by the Commonwealth in 1947. The company continued to operate as an unlisted public company. I suggest you look through actual FACTS and you will find that in all those years of government ownership the total capital injected into Qantas was $164m - the company grew to be worth $2bn in that time - AND $80m of that was within the previous decade prior to the public float to provide capital base to raise loans to purchase the 747-300 and 767s. That means the government only contributed $84m in 37 years of ownership, then the $80m then nothing until it was fully floated. During that time Qantas managed to retain $967m in 'retained profits', ALWAYS paid the Commonwealth a dividend and the only assistance it received (we'll leave Bi-Laterals aside because that was the system at the time a quid-pro-quo exchange of rights) was that it was able to have it's loans for aircraft guaranteed by the government in exchange for making a substantial amount of the fleet available to operate on behalf of the Commonwealth at cost only in times of national need... which was often... cyclone Tracey, ferrying troops to/from SE Asia, etc.
During the 45 or so years of government 'ownership' as the single shareholder, the company I don't think EVER made a loss... maybe one or two years when the entire industry was in downturn but still made some sort of profit as it coincided with asset sales.
There is some evidence to suggest it's financial performance was more stable and better managed over the long term during those years than it ever has been during the second period of being a public company, from 1995 onward... profits increased after that float ONLY because the Keating Government put $1.1bn of the sale proceeds back into Qantas as a capital injection following the float (part of the deal with BA to pay a higher share price and have the company properly capitalized).
There is ample evidence to suggest that as a majority Commonwealth owned asset, Qantas would possibly do better than it is now - yes, it didn't make profits in the billions back in those days but it also didn't have a fleet of nearly 300 aircraft - and it's KPIs could be part based on serving the national interest. The UAE doesn't gauge EK's performance entirely on profit but also on it's contribution to the national economy and to tourism and foreign exchange.
There may not have been an internet and social media 'back in those days' but in the 20s, there were no aeroplanes that could carry more than one passenger and in the 40s there were no jet aircraft and in the 60s there were no widebodies and during the 60s mostly, there were no computerized reservations systems either... point is things change and you can't use social media and the internet as examples of paradigm shifts because there were equally significant shifts back then as well driven by technology... such as it taking 30+ hours to get to London from Sydney and not 3 days.

You've misinterpreted my intent and the example...perhaps I should have said that the Air NZ bailout was effectively done on commercial terms, i.e. Much like a hostile takeover where the business case is sound but requires restructuring to ensure a return, where the investor took a hands off approach and allowed the business to recover, rather than running it from a parliamentary office and taking decisions based on politics rather than business.

With respect to the OP, his contention was that Oz jobs/companies should be put first..that implies to me a re-nationalisation process which is what I was alluding too.
I frankly couldn't care less about the history of QF nor it's past performances, we are discussing things moving forward in a modern context. If you want to debate the basis of my assertions that's fine...but let's lay out the context and parameters of the operating environment first, otherwise it's merely apples and oranges.

I am suprised the case of Air New Zealand has not featured more prominently to illustrate that the purported paradigm of government inefficiency in SOE enterprises was simply ideology and politics mixed together...

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11508152

It is a shame, Australian politicians are content to allow Qantas to be simultaneously hamstrung by the provisions of the QSA whilst somehow maintaining that the market ought control it. With nominee companies (foreign) and errant management fighting an IR war no matter what the cost am not quite sure how any 'national interest' or indeed employment would have been preserved...

Maybe PM Trumble could buy 15% of QAN?

Correct, and I totally agree, I suppose you could say it's the idea of traditional nationalisation v a Govt owned company run on a commercial basis. For the sake of accuracy the Govt of the day in NZ had the issue land in their lap so to speak...it wasn't some genius or political brilliance at play, they are still the same old self interested politicians.

You have also misinterpreted my post. You referred to Air NZ being re-nationalised, that IS history too. Everything before yesterday is history.
My point is valid as you used the expression 'no incentive to make a profit' and I was offering 45 years of QF history and 16 years of Air NZ history to counter the argument that something being owned by government is inefficient. Qantas was not used as a political football or run from a parliamentary office in the past and Air NZ isn't today, both were allowed to operate independently. Your later post responding to Tuck Mach I agree with and was what I was getting at, offering historical figures only to support what I was saying.

Indeed the 'reputation' of government owned but independently run organisations being inefficient is puerile ideology and not supported by facts. Singapore Airlines and Emirates are both government owned.

The CSIRO is a largely independent organisation that has done groundbreaking work until the current government started destroying it for petty and totally ideological rather than logical reasons so that is an example of government being destructive and/or inefficient but the examples of Qantas and Air NZ prove the opposite is true in a hands off environment.