Absolutely no argument from me, the difference being the Qantas Group is making money.......... where as the Virgin group! And by the way I don't think that pilot costs are the make and break of a profit but I would think QF management would argue that ALL virgin costs are too high and Qantas can't or won't match them. I think it only becomes the 'market rate' when the business is viable or QF is forced to raise Jetstars terms and conditions to retain pilots as they are all leaving for Virgin.

Jetstar could face Christmas disruptions over pilot dispute

Budget airline Jetstar could face disruptions over the busy Christmas period after pay negotiations with its pilots broke down.

The Australian Federation of Air Pilots said on Wednesday it had applied to the Fair Work Commission to hold a vote among Jetstar pilots on taking protected industrial action.

The proposed actions range from general work-to-rule (pilots not working outside of their rostered hours) to work stoppages of up to 24 hours, AFAP said. Jetstar is able to object to some forms of action with Fair Work today, before pilots vote on them.

Jetstar and the union are at loggerheads over pay, with the airline saying it has proposed a 3 per cent annual wage rise but that the union wants a deal that would increase "pilot costs" by 15 per cent.

AFAP executive director Simon Lutton said the union was taking the step because its members were disappointed negotiations with Jetstar over a new enterprise agreement had stalled.

“As negotiating with the company in good faith has got them nowhere, they have been left with no choice," Mr Lutton said.

A Jetstar spokeswoman said it had been in constructive discussions about the new wage deal since January and remained committed to reaching an agreement, "but not at any cost".

"There are many complex areas to discuss and working through the AFAP’s numerous claims and their many modifications takes time," she said.

Mr Lutton said AFAP members, who make up the majority of Jetstar's pilots, were unhappy with salary and conditions, and concerned about how the airline's rostering practices affected pilot fatigue.

Jetstar said captains on its fleet of narrow body jets earned $304,576 on average and first officers earned $184,260 last year, including superannuation and allowances. On larger aircraft which fly international routes, that went up to $323,274 and $234,516.

The wage dispute comes at a time when Jetstar and its owner Qantas are coming under pressure from falling demand, particularly among holidaymakers, who are choosing not to travel amid softening economic conditions.

Jetstar's unit revenue - an industry figure used to measure passenger traffic - fell 2.6 per cent in the first quarter of the year.

More to come

Well, it does follow a well worn tradition from at least 1971: , an interpretive dance...

What an unwelcome development.
Resplendent in wedded bliss, the region's most highly remunerated airline executive nearly choked on a sausage, at breakfast time.

Options on the table include:

• Jetstar too in "terminal decline" (not sure how to write the necessary "transformation" options against a wholly owned subsidiary)
• Have "Stream Lead" Now lead QF IR negotiator Safe intervene? Like a modern Rudolf Hess. (unfortunately his flying is usually at the expense of colleagues, ten bits of silver and all)
• Call Jetstar pilots "kamikaze" claim they need first class massages and such
• Ground them and lock them out?
• Farm out flying to Network?
• Link new aircraft types to "productivity" improvement?

What to do, what to do.

It is actually a little from column A and a little from column B.
Low Fare Airlines whilst a real alternative (like SWA) actually didn't, despite the lack of grandfathering, government ownership or even protectionism actually push Low Wages.
The low wage phenomena was driven by consulting firms with a spreadsheet approach to running airlines.

They included:

• $50(or so) million of seed capital
• Multi user terminals
• Leased fleet
• Terms and conditions whereby more of the salary/wage was at risk.

The idea was have a go and see how it works. That there have been scores of start ups and failures in Europe is testament to :

1. The limitation of unit cost control
2. Response of established carriers.

Key in this was the oversupply of pilots, usually self funded such that an "airline" had minimal investment in and as such was low risk strategy.The externality borne by the "applicant" who probably paid for testing and attendance. In the case of Ryanair uniforms too.
Perhaps the saddest irony of the Jetstar model is that instead of complimenting the full service offering, myopic management focused on IR and setting work groups against each other. Convicted criminal former CFO Gregg said precisely that at a Parliamentary enquiry: "Jetstar would add competitive tension to labour unit cost" (paraphrase)

Not content, myopic management driven by spreadsheets saw JQ the answer to everything. Doing so they neglected the Achilles heel of low fare airlines: yield.
Jumping the shark is a Qantas specialty so they took JQ International. They hide it in the accounts but it bleeds cash just like the franchises.
For an airline the size of JQ it exhibits classic overscale tendencies: Too much capacity for the revenue it generates.

Mr Evans has his work cut out for him.

The stellar expansion enjoyed by JQ pilots at the expense of Qantas pilots is well documented. Pilots quickly gained promotions while Qantas languished.
The business is now over scale. That means JQ pilots have a fight on their hands.
As JQ was deployed against Qantas, it is probable Qantas will be deployed against JQ as will Network aviation or others in a conga line of acquisitions.....
If Mr Evans and JQ surrender any ground then the revenue margin, already narrow, may well invert!

Pipe down mate. The vast majority of QF pilots wholeheartedly support JQ pilots in this endeavour, but don't try and **** can us for the 787 deal. The baseline had already been set inside "The Group" with the JQ 787 contract which is a little underwhelming!