Australian regulator announces special investigation into Qantas

SYDNEY (AFP) — Australian civil aviation officials on Sunday announced an unprecedented special review of Qantas after three mid-air dramas in the space of two weeks threatened to tarnish its safety record.

The investigation by the Civil Aviation Safety Authority (CASA) came as flight attendants asked top company officials for a special meeting and assurances that Qantas planes were safe.

Qantas prides itself on its extremely good safety record, having never lost a plane to an accident, but recent incidents including a mid-air blast that ripped a large hole in the fuselage have dented its image.

CASA spokesman Peter Gibson said to his knowledge the review was unprecedented. A senior authority official, Mick Quinn, would head the inquiry, which would take about two weeks, Gibson said.

“We want to look at their safety systems to make sure that the systems are operating the way they should,” Gibson told AFP. “All these things are stated in manuals. We want to make sure that what is in the manuals is being done.”

Gibson said recent audits of Qantas procedures had not shown up any problems, but following the latest incident on Saturday, the authority felt it was “prudent” to make extra checks.

On Saturday a Qantas Boeing 767 bound for Manila was forced to turn back to Sydney after developing a leak of hydraulic fluid while in the air. It followed two other safety scares.

On July 25, a Qantas Boeing 747-400 en route to Melbourne from Hong Kong made an emergency landing in Manila after a blast believed to have been caused by an exploding oxygen cylinder ripped a large hole in its fuselage.

And last Monday, a Qantas 737-800 was forced to return to Adelaide after a landing gear door failed to retract.

Qantas banks heavily on its image as the world’s safest airline. In the movie “Rain Man”, it was famously cited by the autistic central character played by Dustin Hoffman as the only airline he was prepared to travel on.

However, the latest incidents have left even Qantas’ own staff concerned about its record. Flight attendants made a special request at the weekend to meet senior management to discuss the problems.

“We want some assurances from the company that these are isolated incidents,” said Steven Reed, president of the Flight Attendants’ Association of Australia. “Or are they something we should be concerned about?

“We need to meet with the company at a senior level to have these assurances.”

A Qantas spokesman said he expected a meeting would be held within the next week.

In recent years, Qantas has gone through major changes with the launch of a low-cost subsidiary, Jetstar, which is in the process of expanding into Asia. Jetstar’s chief executive Alan Joyce was recently named as the new chief executive of Qantas, to replace Geoff Dixon.

One of the changes has been increased outsourcing of maintenance by the airline to centres overseas, including in Hong Kong, Malaysia and the Philippines, which engineers have loudly criticised.

Recent incidents involving outsourcing included one where flight attendants were receiving electric shocks in a galley due to faulty wiring and another where emergency lighting failed to work properly, an engineering union official told AFP.

While it would be wrong to blame outsourcing for every problem, Wayne Vasta said, there had been a “change in culture” within the company over the last five years.

Demands from management for cost-cutting were the driving factor, said Vasta, assistant federal secretary of the Australian Licensed Aircraft Engineers’ Association.

Qantas engineers in the past had simply been driven by the need to do the best job they possibly could, Vasta said.

“Now it appears we have got to do the best job we can possibly do, within a budget,” he said, welcoming the CASA’s investigation.

Probe into Jetstar near-miss claim

Australia’s air safety watchdog is investigating a report that a US Learjet came within 60 seconds of a possible collision with a Jetstar Airbus because of confusion about uncontrolled airspace.

The incident reportedly occurred last Saturday after a section of airspace on the Melbourne to Sydney route suddenly became unmonitored at 7.30am (AEST) due to an air traffic control staff shortage.

News Ltd today reports it has obtained the incident report that was lodged by the air traffic controller on duty, which states the Learjet pilot was “briefly uncontactable” because he was on a different frequency.

The incident report also states the controller was “concerned” about the risk to northbound air traffic, particularly Jetstar flight JS720.

The Civil Aviation Safety Authority has confirmed it is investigating while the air traffic controllers’ union says it shows the current safety regime has unacceptable safety levels.

“Aeroplanes passing 15 miles apart may seem like a lot,” Robert Mason, from the union Civil Air, said.

“But they are travelling so fast that in some scenarios there can be less than 60 seconds to react and avoid an incident.”

Government body Airservices Australia says the 15 nautical mile separation was three times the required limit in that sector.

There was “no safety occurrence and no breakdown of air traffic control safety standards,” a spokesman said.

Tiger exits Darwin while Jetstar moves in

Singapore Airlines-controlled low-cost-carrier Tiger Airways is to exit Darwin, in Australia’s north, citing excessive airport fees.

The last Tiger flight will leave Darwin on October 26, discontinuing flights to and from Singapore and Melbourne.

“The cost of operating to Darwin is the highest of any airport on the entire Tiger Airways’ network,” said Tiger Airways COO Steve Burns. “Combined airport and fuel costs in
Darwin cost more than any of the 27 airports that the airline serves across Australia and Asia.

“It is just incompatible for a true low-fare airline to operate to such a high-cost destination,”he said.

Tiger Airways is four years old and after establishing a solid Singapore base, established a jointly owned subsidiary in Australia in March to expand into the local market. It is seeking rights to fly from Australia to Malaysia.

Curiously, while delivering a public broadside to the airport’s owner Northern Territory Airports, rival LCC Jetstar, a subsidiary of Qantas, announced it would establish a northern hub in Darwin.

And an Asia-based aviation consultant, Prithpal Singh, told Singapore’s News Today that he believed Tiger Airways had “overextended themselves” in their Australian expansion plan and had struggled to compete with local rivals Jetstar, Virgin Blue and Qantas.

Singh said Tiger should concentrate on Asia, where the aviation market was growing.

“Besides point-to-point and leisure travel, Tiger could look at areas where there is heavy labour traffic, including domestic maids, who are more price sensitive,” he told News Today.

Tiger will continue flying between Perth and Singapore and offering domestic services between Melbourne and Adelaide, Canberra, Hobart, Launceston, Gold Coast, Sunshine Coast, Mackay, Rockhampton, Alice Springs and Perth.

Jetstar’s Joyce boasts record of keeping lid on costs

Geoff Dixon is unlikely to go down as Qantas’s most popular chief executive but he forced the Australian carrier to meet its challenges head-on and to take its medicine early and often.

His tough dealings with unions and staff are legendary within Qantas and, although he blotted his copy book by agreeing to work with the buy-out team that failed to take the airline private last year, Mr Dixon is a man credited with getting results.

As his chairman, Leigh Clifford, and successor, Alan Joyce, fielded questions about the management shake-up, under which Mr Joyce will take the helm in November, it was left to the outgoing chief executive to tackle thorny questions about QF30, the aircraft that made an emergency landing in Manila after a large hole was punched in its fuselage, possibly as a result of an exploding oxygen cylinder.

As investigators pored over the aircraft, Qantas was preparing to open a new chapter in its history – one that comes as the global aviation sector has been hard hit by the oil price surge and weaker economic growth in the developed world.

In a memo to staff this month, Mr Dixon said Qantas and the sector were in the midst of the greatest crisis in aviation history.

Mr Joyce said fuel prices were the big challenge facing the business. “We are in a crisis period with fuel,” he said.

“The aviation industry is under the toughest period that it’s ever faced, and we have to be conscious of all our costs and making sure the business is strong going forward, and I see a continuation of where Geoff has left off in this.”

Although Qantas is expected to report bumper profits for the year ended June, profits in the current year are forecast by some analysts to decline by as much as 70 per cent, down from an estimated A$1.2bn ($1.15bn) to as low as A$377m.

With external factors including the oil price and the outlook for global growth largely outside Qantas’s control, it will be Mr Joyce’s ability to keep a lid on costs to protect the bottom line that will be watched most closely by investors.

“The current environment is certainly not the easiest,” said Mark Williams, analyst at ABN Amro in Sydney. “But he has been running Jetstar for quite a while and working within strategic issues. He has not been dumped in at the deep end.”

It is Mr Joyce’s success at Jetstar – in addition perhaps to rumours that in 2005 he turned down an offer to run Aer Lingus, where he began his career in the sector 20 years ago – that helped him beat internal rivals to clinch the top job at Qantas.

Although Jetstar only represents about a tenth of Qantas’s group sales, it has grown strongly, with profits quadrupling in the first half. As a budget carrier, Jetstar needed relentless focus on costs to succeed.

With a difficult period ahead, Mr Joyce, who was born in Dublin, may be hoping the luck of the Irish is with him as he prepares to step into the big shoes vacated by Geoff Dixon.

Jetstar boss beats off rival insiders

Alan Joyce, age 42, will become chief executive of Qantas Airways upon the retirement of Geoff Dixon after the airline’s annual general meeting on November 28.

He beat rival internal candidates at Qantas including Peter Gregg, the chief financial officer, and John Borghetti, the general manager, to win the top job.

Mr Joyce was born and educated in Dublin, Ireland, and has some 20 years of experience in the aviation industry.

He moved to Australia in 1996, joining Qantas in 2000 and was appointed Jetstar chief executive in 2003 – the position he currently holds.

He has previously worked at Ansett, the now defunct Australia airline, and Aer Lingus, the Irish carrier.

He is a fellow of the Royal Aeronautical Society.

He will join the Qantas board immediately.

SA closure to hit 80 Jetstar staff

Jetstar says 80 Adelaide-based cabin staff and pilots will face redundancy or relocation when it closes the airline’s Adelaide base.

Jetstar says its 37 Adelaide flights a week will continue but be serviced by staff and aircraft based elsewhere.

The changes will take effect from the end of next month, involving some scheduling changes.

Jetstar chief executive Alan Joyce says the Adelaide base is the only one which will close.

He says the airline made its decision after a thorough review of its operations.

“We had a look at the best ways that we could manage the reduction in aircraft numbers and we felt that the most efficient way was to close the Adelaide base and to do the flying out of other bases,” he said.

“It meant that we could keep the full schedule going out of Adelaide with some timing changes.”

Jetstar wings in for Darwin hub

NICK CALACOURAS

August 2nd, 2008

BUDGET airline Jetstar will set up an international hub at Darwin airport.

Less than 24 hours after Tiger Airways cancelled all flights to Darwin, Jetstar announced its plan to base seven planes in the Top End.

The agreement with the Territory Government will require Jetstar to base three aircraft at Darwin International Airport by June 2009 and a further four by June 2012.

The Government will provide $5million to help set up the hub and $3million to promote the new routes and destinations.

The agreement was signed off by Cabinet before the election was called, it was revealed last night.

Jetstar’s Unni Menon said the hub would allow Darwin to become a “pivot point”, a place to organise Jetstar’s business, for flights going to near-Asian destinations.

Chief Minister Paul Henderson said the $8million contribution had a “clawback clause” allowing the Government to withdraw the money if the airline does not deliver.

The Territory Government has given $2.2million since 2005 for a joint marketing campaign with Tiger Airways.

The Government also gave a $4million subsidy to Virgin Blue in 2001 to encourage the airline to fly to the Territory.

Both airlines have since pulled out of the Territory.

Darwin Airport chief executive Ian Kew said the planned $60million expansion of the airport would need to be “reassessed” to take into consideration Jetstar’s hub.