Home' Australian Aviation Magazine : April 2011 Contents 43
APRIL 2011 AUSTRALIAN AVIATION
per cent in the last year, they are expected
to level out this year.
According to an American Express
Business Travel report, rst class fares rose
by between ve and six per cent last year,
while full and discount business class rose
four per cent.
However, in a telling development com-
petition from new airlines such as V Aus-
tralia and Delta on ights to the US limited
the fare increases to just one per cent.
And soon Qantas will face another mar-
ket distortion, with the European ETS due
to start in 2012 with airlines hubbing closer
to Europe, at an advantage says Crowe,
although he also warns that advantage
pales when put alongside the likelihood of
further rising fuel prices. "No cost-cutting
program will dent the impact of soaring
Both the pilots and engineers have lob-
bied strongly for job security and no-one
denies the desirability of the goal, but as Sir
Rod Eddington tellingly said in 1997 when
asked about job security at Ansett, "there is
no such thing in this industry anymore."
In fact there is virtually no job security
in any industry and hasn't been for many
decades, and the airline industry is the
most volatile and the one most exposed to
global labour markets and wage levels and
the tide of liberalisation, which is more like
e conundrum for engineers, who are
increasingly unsettled by their union's
strong stance, is that the more they under-
mine the public's perception of Qantas's
safety and maintenance standards, the more
marketshare it loses, and thus their job
security becomes more and more tenuous.
For the pilots, some of whom earn close
to $500,000, a di erent equation applies,
and that is they are in serious danger of
pricing themselves out of a job. e airline
industry as it is today simply cannot sustain
those salary levels.
Overwhelmingly, the engineers and
pilots know which way the wind is blow-
ing and understand the dynamics of the
industry, but they are in danger of losing
out because of the agendas of a handful of
antagonists whose motives are not those of
the greater good of Qantas.
Long gone are the days when Qantas
could charge a premium for its safety
record, and passengers constantly change
airlines for $10 or less as its competitors lift
their safety image.
During a ight attendant dispute early
last decade the union posted on its website
a comparison which claimed proudly
that Qantas sta were more e cient
than its main competitors on European
routes -- Alitalia, Air France, Lufthansa
and Swissair. It conveniently omitted the
real competitors at the time in Singapore
Airlines, Cathay Paci c, ai International
and Malaysia Airlines.
At press time the ASU had joined the
"summer of discontent", threatening indus-
trial action over its sta being threatened
by allegedly equally discontented passen-
gers at major airports.
All of these actions simply drive pas-
sengers to make alternative -- and possibly
permanent -- travel changes, further eroding
the airline's market position.
When Joyce took over the reins at Qan-
tas he listed sta engagement as the highest
priority, yet the airline's relationship with
sta , at least at a union level, seems no bet-
ter than under Dixon and his predecessor
James Strong, so perhaps the unions should
take a greater share of the blame.
Over the past 40 years, Qantas's and Air
New Zealand's competitors have changed
dramatically as their management and sta
failed to heed the signs of liberalisation.
In the 1970s it was Pan Am with its
eet of 747s, Alitalia, UTA, BOAC,
Air India, and the new kid on the block
Singapore Airlines which snubbed its nose
at IATA and gave away free drinks and
rough the '80s and '90s Pan Am waned
and collapsed, replaced by United which
nearly went the same way in 2001, while
Cathay Paci c, ai and Malaysia Airlines
secured footholds in Australia, and the rst
of the Middle East giants, Emirates, started
ser vices to Melbourne.
In the past 10 years even more change
has occurred as AirAsia X at the bottom
end ravages yields and distorts passen-
ger perceptions on fares, while Emirates,
Etihad and Qatar lure passengers with
innovation and sporty fares.
While some extreme elements in the
unions need to smell the co ee and
understand the rapidly changing market
dynamics and distortions, Qantas manage-
ment's focus ought to be about getting on
the front foot with innovation, something
Joyce has been striving to achieve.
But it can't be the rst to "introduce in-
arm IFE in premium economy", as recently
touted by the airline as a rst. It just doesn't
cut it -- it has to be industry leading!
Following is no longer an option. Qantas
must lead commercially as it does op-
erationally and build on what is the best
reputation for safety in the world, which
according to Crowe is still intact. " ere is
no doubt the brand is in good shape. Very
Instead of yet another cost-cutting
program, the airline ought to launch an
airline-wide "reinvent the travel experience
program" to tap the innovation, passion and
desires of the Qantas and Jetstar sta .
To paraphrase "Build it and he will come",
Qantas management must "Lead with in-
novation and the sta will follow as will the
passengers and then the shareholders!"
Put simply, Qantas needs to nd
reasons to make things happen, not why
BARBARIAN AT THE GATE? Emirates Airline has an eight per cent share of Australian international
passenger numbers. (Seth Jaworski)
e airline's relationship with sta , at least at a
union level, seems no better than under Dixon.
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