QANTAS ~ more than a business. The AUSTRALIAN airline.

[The Hammer]

For people around the globe, and especially for Australians, whether at home or overseas, QANTAS has meant employment for Australians within Australia, frequently overseas in offshore QANTAS offices, and supplementary employment for some non-Australian staff.

But the current CEO of QANTAS, Mr Geoff Dixon, and the current chairperson, Ms Margaret Jackson, seem content to let the QANTAS image slowly fade - both domestically, and internationally - as they tighten the screws by outsourcing work done by Australians to overseas, and displace the familiar red QANTAS aircraft with the silver, yellow-starred JetStar.

Was QANTAS really such a financial "basket case", and so hopelessly beyond repair industrially, that it was more economical to set up from scratch a brand new airline, JetStar?

It is as if it is now almost within Mr Dixon's interest to make any experiences with QANTAS unfavourable, thereby further promoting JetStar.
I personally, don't see QANTAS - under Mr Dixon - as being anything more than a "bottom line business", and the way he has it headed, in my opinion, will ultimately end up in that bottom line being red.
At which time any remaining business will be transferred across to the amazing JetStar.
The full text is on PIREP.org:
http://www.pirep.org/forum/viewtopic.php?t=3132

 

[maninblack]

Qantas has been very successful in perpetuating the mythology that it our national carrier or the Australian flag carrier. But Qantas has been a public company with substantial foriegn ownership for 11 years and was in fact 25% foriegn owned even before it was floated.

This mythology I fear carries over into a sentimental view about Qantas, which we should not hold. It is a business subject to the pressures that all international businesses are subject to. Whether it is well run or not is another story and another debate. A large number of Australians will always be employed by Qantas/Jetstar but they will take advantage of lower cost employment where they can, an unfortunate reality. This amongst other things may eventually erode the percieved quality of the Qantas brand.

I first flew Qantas as a young boy in 1969. We flew TAA from Essendon to Perth on a 727 then on a QF 707 to Singapore as the start of a big family world trip. TAA and Qantas were both government owned as was little Essendon airport, which couldn't even handle heavy 707's.

The world has changed a great deal since then, but somehow the Qantas myth remains largely intact.

 

[Dave Noble]

Qantas Airways is a business and needs to operate appropriately and many changes made seem to me to be sound. Hiring local people overseas or relocating staff to work from overseas, such as having a UK base of FAs rather than having to pay regular unnecessary costs in accommodation et al makes perfect sense.

If having maintenance performed in Singapore is better value than having it done in Australia, then it would be poor business approach to not do so.

Although having Jetstar reduces the QF routes , is it better for the poor profit routes to be serviced by JQ rather than be phased out totally by QF and offer no service. It makes little sense to operate routes by QF if the returns do not justify it

It is an Australian company in that it is listed and traded on the Australian stock exchange, but just as relevantly , it is a business , not a government agency or charity and needs to operate as such

Dave

 

[aus_flyer]

While I understand that it would normally make business sense to outsource maintenance, IT, etc to the cheapest provider, I think Qantas does not fit the normal business mould.

For one, Qantas is still the "national carrier" - a title that it does not pay anything for. There comes a bit point where it's a bit rich for Qantas to call itself the national carrier, yet such a huge portion of the workforce are employed overseas. I have no doubt that in years to come, if Virgin Blue (and it's international arm) decided to call itself the national carrier, Qantas wouldn't be too impressed.

Secondly, I think sometimes Qantas forgets about the level of support and protection it receives from the Australian government. If Qantas wants to run the "but we're a business" defence for taking jobs overseas, then I don't think there is any reason the government should be protecting Qantas the way it does. If Qantas wants government protection, it should employ Australians, for the privilege. Otherwise, the government should allow anyone and everyone to operate the routes Qantas does - because afterall, it's just "a business".

In summary, I think Qantas is a bit of an exception to the rule, and needs to have a hard think about the level of support and protection it receives from the Australian government, and perhaps sometimes return the favour.

 

[turtlemichael]

I think they do "return the favour" on occasions. I too hate the thought of our children not being able to get jobs that are going overseas. However, my suspicion, without a shred of evidence to base it on , is that many more jobs would be heading offshore, if the Federal Government had not agreed to continue to protect QF against SQ on the trans-Pacific routes. I suspect a deal was done. Competition from DJ is one thing, but from SQ it would be a completely different jar of vegemite.

 

[Mwenenzi]

Re: QANTAS ~ a business, but not a charity

It is an Australian company in that it is listed and traded on the Australian stock exchange, but just as relevantly , it is a business , not a government agency or charity and needs to operate as such

Many QF employees consider QF a charity of which they are the beneficences. Only have to look at the duty cycles of staff and the high staff levels (QF 38 pax per flight attendants = most other commercial airlines 50 pax). When you start looking at staff levels per flight, per landing, per pax, per miles flown, per tonne of freight, per baggage offloaded, per airrcaft hours in the air and average $$$ income per employee per year it takes less than 1 second to know QF is bloated. Hence Jetstar for QF to survive. If the QF unions did not have there heads in the clouds they would, accept reality of good money for a reasonable time worked (like the rest of us in the real COMMERCIAL world). Unless the unions accept reality QF will become a small airline with a few very large aircaft. Jetstar will become the large airline for the Qantas shareholders.

 

[Dave Noble]

For one, Qantas is still the "national carrier" - a title that it does not pay anything for. There comes a bit point where it's a bit rich for Qantas to call itself the national carrier, yet such a huge portion of the workforce are employed overseas. I have no doubt that in years to come, if Virgin Blue (and it's international arm) decided to call itself the national carrier, Qantas wouldn't be too impressed.

To be honest , I cannot recall Qantas documents claiming Qantas to be the national carrier; I have only heard the media refer to it as such, typically when decrying actions of Qantas

Dave

 

[maninblack]

To be honest , I cannot recall Qantas documents claiming Qantas to be the national carrier; I have only heard the media refer to it as such, typically when decrying actions of Qantas

Dave

I agree with you Dave. Qantas nowhere claim to be the national carrier. This is as I pointed out earlier part of the ongoing mythology about Qantas that the public and perhaps the media continue to propogate. Remember the Sydney Olympics where Ansett was the official airline but Qantas cleverly bought up huge amounts of TV advertising time and constantly played the "Still call Australia home" ad with the kids. BRILLIANT marketing coup and reinforcement of the myth, and a huge stuff-up by Ansett. One of a number of factors in their demise. Most people would have thought that Qantas was the official airline of the games and the nation...both assumptions, false :!:

 

[oz_mark]

Officers of Qantas certainly have

Peter Gregg, CFO, Asia Pacific Aviation Summit Keynote Address, 9 August 2005

http://www.qantas.com.au/infodetail/about/investors/AsiaPacificAviationSummit2005.pdf

But, we’d like to think that we have a pretty good track record.
After all, Qantas was a pioneer of civil aviation. In its 85 year
history, it has mastered many periods of enormous change and
has grown to become a very successful national carrier of which all
Australians can be proud.

Qantas documents tend to refer to Qantas being the "flag carrier"

 

[Dave Noble]

Qantas documents tend to refer to Qantas being the "flag carrier"

In the document you reder to, It doesnt claim to be The National carrier, just "a very successful national carrier" which seems to be a fair statement and would be just as valid if DJ was to make the same statement

I didn't see a reference to Flag Carrier in the document

Dave

 

[oz_mark]

"Flag Carrier" is in documents such as the Corprorate Governance Statement

http://www.qantas.com.au/infodetail/about/corporateGovernance/CorpGov.pdf

 

[thadocta]

Secondly, I think sometimes Qantas forgets about the level of support and protection it receives from the Australian government. If Qantas wants to run the "but we're a business" defence for taking jobs overseas, then I don't think there is any reason the government should be protecting Qantas the way it does. If Qantas wants government protection, it should employ Australians, for the privilege. Otherwise, the government should allow anyone and everyone to operate the routes Qantas does - because afterall, it's just "a business".

In summary, I think Qantas is a bit of an exception to the rule, and needs to have a hard think about the level of support and protection it receives from the Australian government, and perhaps sometimes return the favour.

Don't forget that Qantas - in addition to being protected in some ways by the gummint - is also restricted by the same gummint. Qantas wants to be able to source overseas capital, something it is unable to do under the current rules, and which is having a detrimental effect on the operations of the airline. So it isn't just a one-way street here.

Dave

 

[JohnK]

For one, Qantas is still the "national carrier" - a title that it does not pay anything for. There comes a bit point where it's a bit rich for Qantas to call itself the national carrier, yet such a huge portion of the workforce are employed overseas. I have no doubt that in years to come, if Virgin Blue (and it's international arm) decided to call itself the national carrier, Qantas wouldn't be too impressed.

Agree with most posters that Qantas is a business but right or wrong many people do regard Qantas as the national carrier.

There is a strong possibility that Virgin Blue may one day be regarded as the national carrier but an even stronger possibility that Jetstar never will!

 

[caggs]

Re: QANTAS ~ a business, but not a charity

Many QF employees consider QF a charity of which they are the beneficences. Only have to look at the duty cycles of staff and the high staff levels (QF 38 pax per flight attendants = most other commercial airlines 50 pax).
--------------------------------------------------------------
That makes the QF level of service even worse than I expected. If they have such a great rsatio of FA's to pax, why on earth is their inflight service soooooo bad. Have you ever tried to get an attendants attention during the tray service times - near on impossible.

Caggs

 

[NM]

And don't forget that it our (the passengers) demand to fly on the lowest fares that is forcing Qantas to find new ways to reduce its operating costs to be competative against other airlines, both domestically and internationally. We can't have both low airfares and legacy business pactices.

In order to achieve the lower operating costs required to meet the demainds of low airfares that come from increased competition, they have to make changes that will adversely affect some people.

Who is to blame for the changes? At the top of my list is the passengers demanding more competition and lower fares, which are forcing the Qantas management to make unpopular decisions.

 

[Altair]

Re: QANTAS ~ a business, but not a charity

Only have to look at the duty cycles of staff and the high staff levels (QF 38 pax per flight attendants = most other commercial airlines 50 pax). When you start looking at staff levels per flight, per landing, per pax, per miles flown, per tonne of freight, per baggage offloaded, per airrcaft hours in the air and average $$$ income per employee per year it takes less than 1 second to know QF is bloated. Hence Jetstar for QF to survive. If the QF unions did not have there heads in the clouds they would, accept reality of good money for a reasonable time worked (like the rest of us in the real COMMERCIAL world). Unless the unions accept reality QF will become a small airline with a few very large aircaft. Jetstar will become the large airline for the Qantas shareholders.

From what I can remember the number of FA per passenger is a CAA requirement, Qantas wanted it changed to be in line with the international limit of 50 per passenger. For long haul many airlines have a ratio below 1:50 because due to the nature of the flight.
Flight crews are paid per flying hour, not a salary. This means simulator, training, pre-flight, mandatory rest breaks are not paid for. Although the per hour rate is high there are legal limits per year in which crew can fly, 900-1,000 hours. Pilots average 650-850 per year, which means there is some room for increased productivity but it will require changes to the duty cycle that must comply with maximium flying hours and minimum rest hours. At the moment there is an international shortage for crews but it is the natural reluctance to move home that keeps crews in their country of residence.

 

[Yada Yada]

And don't forget that it our (the passengers) demand to fly on the lowest fares that is forcing Qantas to find new ways to reduce its operating costs to be competative against other airlines, both domestically and internationally. We can't have both low airfares and legacy business pactices.

In order to achieve the lower operating costs required to meet the demainds of low airfares that come from increased competition, they have to make changes that will adversely affect some people.

Who is to blame for the changes? At the top of my list is the passengers demanding more competition and lower fares, which are forcing the Qantas management to make unpopular decisions.

In my opinion, QF (and AN) have themselves to blame for this. They gouged the market for so long (domestically) that they encouraged a string of competitors to enter the market. Now we have one who has survived the pressure applied by the incumbent and who does not gouge the customer but continues to price fairly, and QF find themselves too fat to play after years of largesse.

 

[NM]

In my opinion, QF (and AN) have themselves to blame for this. They gouged the market for so long (domestically) that they encouraged a string of competitors to enter the market. Now we have one who has survived the pressure applied by the incumbent and who does not gouge the customer but continues to price fairly, and QF find themselves too fat to play after years of largesse.

Indeed. And QF's attempts to trim the fat to meet the demands of the "New World" competition are seen by many people as undermining the old status quo. We can't have our cake (low prices driven by increased competition) and eat it too (enjoy the benefits of the old ways).

 

[maninblack]

And don't forget that it our (the passengers) demand to fly on the lowest fares that is forcing Qantas to find new ways to reduce its operating costs to be competative against other airlines, both domestically and internationally. We can't have both low airfares and legacy business pactices.

Who is to blame for the changes? At the top of my list is the passengers demanding more competition and lower fares, which are forcing the Qantas management to make unpopular decisions.

Not me. Happy to pay more and get more. But not happy to pay more and get less as is the current situation. On nearly every major route (except USA) I can fly the equal or some might argue superior competition for less than I pay on Qantas. So why do I keep flying Qantas? Legacy business practices of my own :!:

PS. My friends are flying in J, MEL to YVR via NRT on JAL for less than the QF discounted Business fare just to NRT and way less than the QF YVR fare. And who operates the JAL MEL-NRT-MEL service, you guessed it, QF.