Joyce talks up big changes in wind for Qantas
When Qantas announces details of major changes to its international division on 24 August next month, nobody can say they weren’t warned.
Qantas chief executive Alan Joyce made yet more reference yesterday to the coming changes when he addressed the Australia Pacific Aviation Outlook Summit at Sydney’s Shangri-La Hotel – though he gave away nothing new.
Globalisation is the key to the carrier’s survival, he said.
“On 24 August I will announce the details of the strategic renewal of Qantas International,” he told delegates. “Our review process is based upon four pillars: continuing to be Australia’s leading premium international airline; a strengthened focus on alliances; a review of non-performing parts of the business; and participation in the Asian opportunity.
“This announcement will signal the beginning of the phased transformation of Qantas over the coming years.
“Change is always tough. But the competitive challenges we face make major change essential and our commitment to the change process is absolute.
“I have ever confidence in the outcomes we will achieve.
“I believe we have a major opportunity to go beyond the natural limitations of our market size and geography, to become a champion Australian company in a globalised region and world.”
Speculation continues that Joyce on 24 August will announce the establishment of a full-service offshoot in Asia. He said yesterday that the Qantas group saw continuing opportunities for the Jetstar model and he mentioned “lessons to be learned for Qantas”.
Joyce mentioned expansion of the airline’s frequent flyer scheme, saying its business model could be “replicated in other markets”.
He used his speech, predictably, to have a go at unions. Qantas faces problems from its long-haul pilots and its maintenance staff. Both groups are disconcerted about what may be in the wind for them, and its potential for moving their jobs offshore to Asia. The The Australian and International Pilots Association (AIPA) will begin a soft form of industrial action against Qantas tomorrow: See our earlier story: Qantas pilots industrial action starts with PR rather than disruption
Joyce views such misgivings as rejecting change and being out of touch. He reiterated that Jetstar would become “unviable” if its pilots were paid the same rate as Qantas pilots – and removing Jetstar from the Qantas codeshare system would “weaken the Qantas Group network and destroy jobs”.
Joyce referred to a new airworthiness control system called Project Marlin, which he said was the largest and most complex IT project ever undertaken by Qantas engineering.
It will allow engineers to check maintenance records and updates anywhere in the world from a central database using their iPads.
“Project Marlin cost more than we wanted and took longer than we’d like,” Joyce said.
“Marlin represents the biggest improvement in our maintenance systems since record-keeping began. It is all about work that is safer, smarter and simpler – and compliant with global standards of excellence.”
Joyce said Qantas maintenance and repair costs were currently among the world’s least efficient and most expensive. ABC News quoted him as saying the days of highly specialised engineers checking aircraft between landing and takeoff had been made redundant by new generation planes.
In his Plane Talking blog on Crikey.com.au, aviation writer Ben Sandilands picked up on Joyce’s use of the phrase “compliant with global standards of excellence” in relation to Project Marlin.
Qantas had always striven to exceed the minimum ‘tick the box’ standard required to be deemed compliant, Sandilands pointed out. Historically, Qantas has always considered that merely complying is not sufficient.
As Sandilands noted: “Qantas does exceed minimum standards in many respects. But for Joyce to make a virtue out of compliance, rather than something higher than compliance, is either an unfortunate choice of words, or an insight into the cost savings that might follow when compliance replaces a legacy of excellence.”
Written by Peter Needham
