no punches pulled on regional routes fight, page-4

The court case is bit complex but this is the gist of it. The case was heard on 25th February and we are now waiting on the decision.

1. Both Rex and Qantas fly in to a regional centre 11 times a day, in sub 20 ton aircraft, which, according to CASA rules, does not require security equipment to be installed..

2. Qantas elected to very occasionally fly in a bigger aircraft over 20 tons, which means that to accommodate that, the local Council has to install security equipment costing $1m. Plus $800,000 a year to run.

3. The Council decides to charge all passengers, $9 per head to pay for the security.

4. Rex says, hey, wait a minute, that's not fair, we still fly sub 20 ton aircraft that CASA says don't need security. Rex already flys to many centres that have security but don't require Rex to pay because it is not legally required to.

5. Council digs in and says we will make Rex pay. Rex takes Council to Court.

6. The court case is not about security per se, but is a test case to see which jurisdiction has final say, Commonwealth CASA law, or local Council.

My money is on CASA, but we will soon know.

It is hard to understand Qantas' reasoning for flying in the bigger aircraft, only a few times a week. They simply increased capacity to the regional airport that already enjoys the most flight frequency in the country, with a yield of about 65%. The margins are slim, about equal to the security charge, and a cycnic might think that it was deliberate action on Qantas' part de-stablise its rival. Qantas' published reasoning was that the bigger 76 seat aircraft was better. It probably is, marginally, but we're not talking a fifteen hour flight here, and cost is the main consideration. Qantas cleverly got the Council on side, with the mayor making a grand inaugural flight, it was all quite nauseating. Making a big fuss about a noisy Bombardier Q400 is a bit over the top.

Its seems a bit ironic that Qantas announced extra flights from Auckland to Perth, just a few days after Air New Zealand announced it would be flying the route with its new Dreamliner. Qantas would do well to focus less on intimidating its rivals, and more on improving its business.

The court case will have far-reaching ramifications.