Some big ?Mayday? calls are coming April 25, 2011 ? 1:05 pm, by Ben Sandilands
In terms of action rather than emergencies, there are some big May Day calls coming from Australian airlines next month.
On May 4, the Senate inquiry into pilot training and airline safety standards is due to report, possibly on the same day that Virgin Australia confirms that it will be Virgin Australia (while keeping V Australia as its integrated international brand).
To a similar timetable REX or Regional Express will most likely carry through its foreshadowed intention to reduce its services, perhaps by as much as 30 per cent in terms of flights. Most likely the ATSB will choose that same day to issue its final report into the scandalous ditching near Norfolk Island on November 19, 2009, of an air ambulance flown by Pel-Air, owned by REX?s owners.
In May there should be no doubt that Tiger will have to shape up or ship out.
And unless Qantas changes its constant posturing about how it is all the fault of labor not management that it can?t turn a decent dollar in this country, it is clearly highly likely to suffer a self fulfilling damaging dispute with the pilots and other parts of its work force.
The only thing not highly likely to occur next month will be further details about where a totally independent panel recommends Sydney put its second airport.
Of course, leaks do happen. It might even do the blindingly obvious, and recommend that Sydney?s second airport actually be in Sydney, but, we?ll see. It is about time a truly independent committee decided to remedy rather than justify a government policy disaster.
The Senate inquiry
Given the non-partisan unanimity of intense engagement between the members of the committee with the issues raised in this inquiry, it is reasonable to expect it will deliver a very well argued set of recommendations that will tighten up the slack in pilot training programs and some deficiencies in how safety issues are reported and investigated.
This was the first major Senate inquiry of any description where the press was scooped repeatedly by the members, in particular the chairman Senator Bill Heffernan and the inquiry instigator, Senator Nick Xenophon, who broke stories about stick shaker incidents on Qantaslink turbo-props, and a Jetstar A330 that nearly landed wheels up at Singapore Airport, and whose scrutiny of the Jetstar NZ Cadet Pilot scheme lead to a U-turn by Jetstar that would have filled the chunder bags on any of its services in an instant had it occurred on a regular flight.
Virgin calls Australia home
Comments already made by Virgin Blue CEO John Borghetti make it clear that every time Qantas bleats about how it can?t make money out of being Australian he is going to emphasise that Virgin is Australian.
The contrast is already painful. Qantas sees its future as being less Australian, to wit, the faux-Qantas Jetconnect nonsense and the basing of Australian registered A330s and eventually Boeing 787s in Singapore under Singaporean labor laws, and less full service, to wit the Jetstar play. In return it is up against an operation which says it can be higher in quality and lower in cost than Qantas, and be more Australian.
The emphasis by Qantas on how it will be harmed by a future industrial settlement doesn?t really address the issue as to why it is failing to pay its shareholders, satisfy its customers, or participate in the post GFC recoveries enjoyed by major competitors. Could it just be that it is being poorly managed, or that the plot, whatever it is, has been lost?
REX and regional realities
No-one should be in any doubt that REX has been ultra successful in making small SAAB 340 services work effectively to country towns including some where it has survived and prospered against the larger turbo props of Qantaslink and even A320 and E-70 services. It is very vulnerable however to even a small loss in passenger numbers as it tries to recover rising fuel costs, and other carriers are prepared to put a much higher value on its pilots than it does, or can, which is also its problem in the good times.
The clear signals it has sent that it will respond to these realities by cutting routes is very painful for everyone, except perhaps Sydney Airport, which sees access by slower and smaller aircraft as taking up slots that can be used by far larger jets bringing in much more revenue. In fact Sydney Airport sees no future for airliners of less than 72 seats capacity in the next 10-15 years.
REX?s SAABs are no longer in production. There is no 34 seat replacement for the design currently realistically available now or in the foreseeable future. How and where REX sees itself as going is thus an important issue, unless it is to go into history.
Tiger trapped
Even if the reasonable assumption is made that Tiger completely satisfies all of the concerns that leads to CASA issuing a show cause to the carrier late last month, a management that allowed such a situation to arise is unlikely to survive.
It is inconceivable that a well run airline can accumulate so much by way of problems over a period of months without taking the correct action that would have prevented CASA from going to the step immediately below actually grounding the airline.
This means there will either be significant changes in Tiger, or it will suffer an even more damaging encounter with the safety regulator.
Its unreliability of service is also an issue in a sophisticated market. Australian are used to flying. It doesn?t matter how cheap the fare being offered may be if the perception is that passengers can?t assume they will even takeoff on the day they intended to fly.
Without pricing power in the domestic market, one has to ask what continuing purpose Tiger has in Australia.
