TAA And The Airbus

What Mr Warner had learned from his Trident experience was that if there was to be a British or European airliner it had to be designed to please American and worldwide markets. (It is a historical fact that the launch customer for the Trident, BEA, killed the aeroplane for anybody else for forcing its specialised requirements on de Havilland’s.)

It would be wrong to say that TAA had any direct influence on the development of the Airbus, as it had on the Friendship and the 200 version of the Boeing 727. TAA was one of the airlines contacted by the British and French in the mid-1960s when the lessons of the Trident were apparent. Europe had learned that airlines must be invited to suggest what was needed.

The Airbus was actually born in two countries if not three. Over in the USA, Mr Frank Kolk of American Airlines was certain the world needed a big twin only to see his own and other US domestic airlines force Lockheed and Douglas to add an engine, largely because of hot-and-high needs and for high payload/range. Mr Warner and others discussed the twin idea with Mr Kolk and other US airlines. In France, almost all the French industry leaders were for the big twin, including, to my own personal knowledge, Mr George Hereil, who had got the Galion project going. France had the twin message loud and clear.

The trouble was the British. In Government, airlines and manufacturing industry, commercial aviation was in a mess in the 1960s, a mess that still exists. Projects were abandoned all over the country. In the event, the British Government opted out of the project for a big twin, which had already got underway with the French and the Germans by the late 1960s. De Havilland’s might also have got out, or rather Hawker Siddeley might well have, but for the fact that its design staff were well on the way with the wing design. While Britain officially left the three-nation group formed to develop the Airbus, Hatfield remained in on a commercial level. When one considers how much the British industry lost by the official decision in the 1970s until Britain returned rather more than a year ago, one can only be staggered by the insouciance of official attitudes.

One of the casualties of the 1968 situation was that Mr Warner quit England and has been Ansett’s Director of Engineering ever since. He has not been an enemy of the Airbus within that organisation over these past 12 years. He says it was a bad mistake for the British industry to allow complete leadership in the Airbus project to move across the Channel.

Within TAA, Mr Watkins was twin-minded, not seeing the sense of having three engines to perform a task for which two engines would suffice, other things being equal. The capacity of 200 seats-and-up seemed right, as the airline industry here was showing good growth and the general economy prospering, with good prospects. He was hoping that once again TAA could take the lead in equipment selection, as it had in the early days.

It may be hard for a new generation to realise the degree to which TAA (considerably due to the quality of its Director of Engineering) had in its first years led the industry. Mr Watkins was widely known here and abroad for his almost unique capacity to see an airliner in terms of engineering and commercial qualities. Not many top airline engineers have had or have this ability.

It was, admittedly, easier in the late 1940s and most of the 1950s for TAS to lead, as there was for many years no TwoAirlines Policy backed by federal legislation which compelled the domestics to buy equipment of similar work capacity and earning power, to introduce them at the same time, even the same day, on the same routes, to the same timetables and at the same fares. (It is often forgotten now that Sir Reginald made his mark after the war by operating cheap fare services with 28-seat DC-3s that hurt ANA).

There were also some government restrictions on the availability of dollars, which did not exist for the government’s own airline in the first stage of TAA’s career. To make it short, TAA took the first step in killing Holyman’s Australian National Airways when it ordered the Convair 240, which was pressurised. ANA took the view that nobody needed pressurisation, then changed its mind to buy DC-6s, and lost a lot of custom. TAA then took the very intelligent step of buying the first jet-powered aircraft to appear on the domestic routes, the prop-jet Vickers Viscount. ANA’s DC-6s and DC-6Bs simply could not compete with the Viscount except on the Perth run, which was beyond the early-mark Viscount’s range. These equipment choices really spelt ANA’s doom, though old ANA men are quick to argue or even den·y this, particularly the DC-6/DC-6B thesis.

The Watkins’s capacity to view airliners from technical and commercial viewpoints played a major role in this TAA equipment leadership story. And this is not the whole story, for back in the late 1940s TAA did take a long look at that forgotten jet aircraft, the Avro Jetliner. This Canadian twin-jet actually flew a week before the Comet and if the Canadian government had not decided to drop it to allow all Canada’s resources to be put behind the new RCAF jet fighter of the day, this could well have been operated here in the early 1950s – a decade ahead of the pioneering Boeing 727. This was not just a crackpot aircraft: when I saw it in Toronto in August 1949 it was an impressive aeroplane and a serious pioneer design. The Canadians may well have made a big mistake dropping it. It seated 40, cruised around 440mph, and was just right range-wise for the Melbourne/Sydney run. We could have had deliveries around 195213 as a launch customer. What that would have done to ANA is anybody’s guess: presumably ANA would have gone for the Comet. There probably would not have been a Viscount order from either airline.

TAA’s Friendship deal has been described already in this journal: suffice to say John Watkins and his staff were vital to the F27 as we now know it. TAA’s technical quality in those days was recognised worldwide.

Then came the constricting Policy, the result of the ANA collapse after Sir Ivan Holyman’s death. TAA had selected the French Caravelle as its new frontline aircraft for the 1960s. Now, Sir Reginald Ansett in 1976 is on record that he believed the Caravelle was unsuited for the continental route to Perth and economically inferior to the Electra. There is little question the Department of Civil Aviation did not cherish the prospect of having to find funds for airport improvement. The responsible Minister at the time, Sir Shane Paltridge, was against any big and potent aeroplane for the two airlines and practically ordered them to buy Viscounts as their major frontline equipment for the 1960s.

Sir Reginald was sold on the Electra for its economics and versatility, he said in 1976. This is probably right, but as I recall the time he was also worried about other aspects. The small Ansett airline organisation which took over ANA had no experience with prop-jet engines, let alone jet engines. It frankly did not want to make the leap from pistons (Convair 340s) to jets in one gulp. In fact, Sir Reginald told me at the time that if the government did allow TAA to proceed with the Caravelle order (and TAA was actually at Toulouse acting as if the order was achieved) he would buy some such jet as the Convair 880.

In the event, the Minister saw the Ansett point that TAA already had the advantage over Ansett-ANA in its prop-jet fleet (Ansett-ANA having pistons) and TAA was forced to buy the Electras, too. Qantas also bought Electras, which had its effect on the situation, while poor old New Zealand was forced to follow suit, an event which caused the old TEAL people to fly a flag half-mast in honour of the Comets they wanted. (Literally, they flew the flag half-mast at the Auckland HQs. ) Electras went into service in 1959.

After that Electra situation, TAA morale sagged, there is no question about that, and it never again reached the peak of superiority to its rivals until a few months ago. In the late 1940s and through the 1950s TAA staff really did regard their airline as the best in Australia, and considerably based this view on equipment. In the 1960s and 1970s this attitude was not quite the same, also due to the equipment situation. This is not to say that TAA, as some people believe, was forced by Ansett to order aircraft it did not want. TAA assessed the same problems and after- some long differences of view finally came to the same conclusions as Ansett, taking into account the availability of the right version of the aircraft concerned.

What has irritated all TAA people for many years now has been Ansett’s ability to announce its intentions officially – subject to Government approval for the loan guarantees – well ahead of TAA. Ansett had a short gestation period, so to speak, because of its structure. TAA is a government instrumentality and choices must go to the General Manager, the Commission, the Minister and Cabinet, before any public official announcement can be made. Sir Reginald’s system, so the industry has it, is that he would choose the aircraft and then tell his people to prove him wrong if they could.

The Ansett situation was very clear where the Boeing 727 was concerned. No British aircraft then stood a chance and the opposition being the Trident, Boeing had its way without trouble. But TAA really did regard the Trident as a serious competitor: Mr Watkins told his General Manager, the late John Ryland, that either the Boeing 727 or the Trident 1E would do, though the Trident’s performance on hot days was in question and delivery could not match the Boeing date. Everybody seemed to know Ansett would buy the 727 long before the Commission made its decision.

The DC-9 selection was also quite clear where Ansett was concerned. Sir Reginald liked the aeroplane before it was known as the DC-9. He has always had a flair, instinct, intuition, sixth sense or what-have-you, based on his long experience. I understand he told Douglas he wanted places on the line months before it first flew in February 1965, and even told them TAA should have places reserved. (He knew he could not introduce the aircraft ahead of TAA. ) TAA came to the same conclusion in due course and was able to hint this in the media, but in the event Ansett announced his decision well ahead of them. This did not help TAA morale or its public prestige. The idea got around that TAA always followed Ansett’s idea in the Two-Airline Policy framework. The idea stayed until 1979.

The DC-9 was hardly introduced before the Airbus swam into view. Ansett and TAA introduced the DC-9 into service in the same year as the first Airbus discussions were underway – 1967. This was also the year when Boeing came here to try and coax our airlines into trading in their DC-9s against Boeing 737s. They were shocked to find the DC-9s had better performance than their figures allowed and better than the 737 at the time. The DC-9 in fact proved to be the most trouble-free new aircraft ever introduced into our domestic service.

TAA’s very fine technical know-how was given worldwide nods when Boeing and TAA discussed the airline’s experience with the 727-100. TAA and Ansett criticised the operating drawbacks which included restrictions on operations out of Brisbane in hot weather with full loads and fuel. Put briefly, TAA coaxed Boeing into making certain changes to the basic 727 design which led to the more impressive Series 200, which of course the two domestics ordered. I doubt whether TAA’s achievement in this regard was properly appreciated within its own organisation, let alone among the public. It might have been used to offset the blows to morale suffered in previous years. The 200s were put into operation here in 1971.

To take up the Airbus story again, it should be made clear that Mr Watkins was certain that a large twin was the need and he maintained his interest in this after he retired in 1970. His influence at TAA in the first half of the 1970s might well be underestimated, for he kept in touch and was a consultant for some years.

The Airbus first took shape as a proposal here when the first presentation was made in January 1968 by a party led by M. George Barthas, the first Airbus sales manager, who had been a Caravelle executive. That version of the aeroplane was 21ft wide, as it was then a general idea that wide-bodied aircraft should be as wide as the 747. Eighteen inches were cut off the cabin width in the definitive version. Range was immediately recognised here as a problem. Barthas proposed 1000-1200 miles, which of course could not cope with the Perth requirement. Australian reaction was one of several airline demands which forced extra range and made the aircraft the very flexible instrument it is today.

In 1969 Airbus lndustrie, which was created by the French and the Germans, launched the B1, of which one prototype was built and which is still carrying paying passengers in Europe. Air France was the launch customer for the amended version known as the B2. There was also a B3 but the system settled down to the B2 and the B4, the latter having the real range and capability which the Australian operators required, or rather which TAA required. TAA was always more interested in this aircraft than Ansett.

A big public and industry fillip was given the Airbus here when the very impressive M. Roger Beteille, Airbus’ chief executive, came here to present one of the Lawrence Hargrave Memorial Lectures to The Royal Aeronautical Society on the subject of International Co-operation.

This was one of the Airbus’ problems, at least for TAA and Ansett. Our people found it hard to believe that there could be such an animal as an aeroplane developed successfully by a team of nations, particularly by governments. The Concorde and the Tornado were then only in progress and there was no existing success to judge by. At Ansett, their idea of an aeroplane was one made by Lockheed, Boeing or Douglas, no doubt about that, perhaps Fokker. The Australian attitude existed right into the late 1970s.

The 81 prototype of the Airbus came here for a demonstration in May 1974, to produce quite an impact. The industry at last realised there was such an aeroplane in fact rather than in publicity. Not the right version, but an aeroplane. Air France started operating the 82 in the same year which allowed TAA to see the aircraft actually operating.

But the Airbus 81 tour brought a quick American reaction. Lockheed chartered a standard TriStar from a Japanese customer for a demonstration tour, entirely furnished for routine airline operation. This had a very great impact indeed, as the Airbus 81 was not so furnished. It frankly wiped the Airbus from the immediate thinking.

What was TAA management thinking at the time? The 1969/70 annual report says, “Intensive studies are being carried out to determine the optimum time to introduce into service a larger aircraft type, such as the wide-bodied Lockheed 1011 TriStar, Douglas DC-10 or European Airbus A3008.”

Back of this thinking were economics. In 1948/55 piston aircraft averaged a TAA growth rate of 5½ per cent, while the prop-jet period 1955/64 brought 7½ per cent a year and the jet era 1964/75 11. 3 per cent. For some years TAA thought it was getting near the time to introduce something big. Ansett was always more conservative about this, which is a fascinating thing for the private enterprise airline to do. Right up until 1980 Ansett was always more pessimistic about the potential growth in domestic operation than TAA. Ansett thought in terms of several years further ahead than TAA when it spoke of time to introduce wide-bodieds or in fact spoke of non-wide-bodied aircraft which would seat more than the Boeing 727-200.

In 1975/6 TAA did come to the point of seriously considering an order for a wide-bodied aircraft – that is official and historical. TAA was prepared to ask the Government to allow it to go alone if Ansett refused. But not with the Airbus. Its choice was the TriStar, believe me or believe me not.

At the time, the fantastic growth factor led TAA to believe it could justify the 350 seats and the extra engine. TAA had been tremendously impressed by the demonstration tour and by what it heard from the first overseas operators of the type. It also had a great regard for Lockheed from Electra experience. The Electra had proved what Ansett claimed: it turned out to be the most economic airliner operated in Australia until the jets arrived.

But – the bottom dropped out of the market just as TAA was serious about the TriStar. For nearly two years the Ansett and TAA executives were scared to look at their weekly reports on traffic. They went in daily fear of negative growth, as the term was, for the year. And they got it one per cent loss of traffic in 1975/6 and a 0. 1 per cent growth in the following FY. And this was not entirely due to the situation of the general economy of the nation.

The Federal government had introduced a policy of deliberate penalties on air transport, partly due to the recommendations of the Coombs Committee, which had the notion that people who could afford to fly should pay for the privilege. The 1972/5 Labor Government, particularly. its Minister for Transport, Mr Jones, had the mistaken notion that only the rich flew. This and the following anti-Labor Governments pursued the same policy: recover from the airline industry all the cost of providing government-owned facilities. It was in other terms a deliberate policy of stopping people using the airlines. As they had no railroad seats to use to the same extent, this was curious. The policy was so ruthlessly imposed that on the trunk (competitive) routes TAA and Ansett were paying 150 per cent of the costs of using Government facilities. Oil costs rocketed also because of the aviation fuel tax, a unique Australian charge, well before the Arabs took to their policy. Airlines were frightened that if they raised fares too much they would keep even more passengers away.

In the last years of the decade the growth factor revived to the five and six per cents, TAA securing 16. 8 per cent in the last quarter of the FY 1978/9 (Ansett Airlines 3. 4 per cent) and 5. 1 per cent for the year (Ansett 3. 4 per cent) in passengers. Nevertheless, both TAA and Ansett defended themselves hotly against public criticism that they could have placed an order for something like the Airbus in 1976 or 1977 – as Mr Watkins publicly stated they should.

Hard as it is to generalise, the feeling in TAA in the later 1970s was that wide-bodieds should be introduced in the early 1980s, with the optimists for late 1981-early 1982, others (higher up, generally) for 1982/3. Over at Ansett majority opinion was for 1983 and later and not too keen on wide-bodieds anyway. The Ansett thinking was around the DC-9-Super 80 and Boeing 757 area, if anything had to be bought before 1983 and perhaps even then.

There was a group in each airline which thought in terms of the Super 80 as an interim aeroplane (the coward’s way, others called it) which would fend off a real wide-bodied decision even longer. That meant there would be little hope for the Airbus at all and that something big would be introduced in around 1985/6, bigger than the Airbus.

As late as May 8, 1979, Mr A. B. Dignam, one of TAA’s two Assistant General Managers, told the Canberra Institute of Transport: “It may take a long time to convince our critics who favour us buying wide-bodied jets that they have been misled, and it may also take some time for the manufacturer to re-establish its credibility with its prospective customers in Australia. ” May 8, 1979!

That last comment followed strenuous efforts by the local Airbus people, particularly on the PR side, to get public opinion and political authority behind the Airbus, to push the management into a decision, There is no doubt that both TAA and Ansett reacted angrily, whatever the truth of their allegation that they were being pressurised by the manufacturer. There was real bitterness.

If this was so, then how on earth did TAA make such an amazing change of policy and opinion, all within a few months? One might ask the same question of the airlines about their parallel scheduling which, until a few months ago, was as unalterable as the sun but which both airlines are now happy to change and indeed actively changing as fast as they can.

Well let’s go back, again.

TAA has a unique internal idea, a General Specification. Since the late 1960s this has laid down principles about new equipment, such as documentation, product support, interiors, electronics, performance, computers. This is all divorced from size and time. It is really a declaration of standards and can be used in buying aircraft as small as a Nomad or as big as a Boeing 747. It is basic, like the Ten Commandments.

I was intrigued to find that there are no people assigned to the year-by-year task of assessing new aircraft for TAA, at least on a higher level. The airline watches the production industry year by year to see if any of the new proposals could be of interest, working within the limitations of the airlines’ need to keep the multiplicity of types to a minimum. And not only aircraft – the fact that the DC-9 and the 727 had the same engine helped to sell the DC-9 here, for the savings are very great.

There is a standing committee comprising General Manager and his two Assistant GMs, the Secretary of the Commission, and Directors of Marketing, Engineering, Operations, Personnel and Commercial Services Development. But this is not of course a committee which spends a great deal of its time on the subject except when something gels.

The fact is that selection of a new aircraft is the result of a very wide-scale assessment of_ generalities and specifics wide mass of experts spread right through the HQ organisation in Franklin Street, and Essendon.

The fact also is that the Airbus order suddenly developed in TAA without any real prior notice. The airline had been looking at the range of aircraft available, which included the TriStar, DC-10, Super 80, 767 and 757. In 1979 the Super 80 and 757 were not really on for TAA and the TriStar and DC-10 were too big. By spring it was apparent that if the airline bought anything it would be the Airbus. This was:

• The right size, up to 271 seats.

• Available in the early 1980s.

• Fully experienced from years of overseas operation.

• Of proven economics.

• Rid of any bugs.

• Had two engines.

• Did not have any wiring in the seats: it was all up above. (This is quite an important factor, I was surprised to hear.). • Had a very low noise level, better than DC-10-Tri Stareven Super 80.

• Was one of a family.

• Was a relatively simple aeroplane, compared with the 767/757.

The big strike against it recently had been its multination background. The airline had been convinced by 1979 that this did not matter. Also, the airline was now convinced by contact with airlines and with the Hamburg centre that aftersales service and backup was to American standards, if not better in some cases.

What gelled the whole business, perhaps, was the Qantas situation. Last July/August Qantas very nearly bought Airbuses. The technical people were really sold on it. This had a very great effect on TAA thinking, and the very acute Mr George Warde, now International Sales Manager for Airbus Industrie realised this. (Qantas finally went against the two-engine concept for trans-ocean operations and decided to get the SP version of the Boeing 747 for other reasons. ) Mr Warde had been Chief Executive of American Airlines in his day and is highly regarded here as a man who knows what aeroplanes are all about from the operator’s point of view.

At this time, the game was on in Iran and two Airbus aircraft came on the market from lranair. These were offered to TAA and Ansett and TAA did a full project on them, the main things against them being that they had to be considerably altered to our specs and also that they would have had to be introduced into service early this year. They actually went to Eastern.

Mr Warde then did a real pressure project at Toulouse and came up with places on the line for TAA if an immediate decision could be taken, more or less. TAA had been psyched up, as the modern phrase is, by the Iranian exercise and by the flow-on from Qantas. There was also a very great interest in the whole situation from the top, from the new Chairman, Sir Robert Law-Smith, who had seen the Qantas evaluation because he is Vice-Chairman of Qantas.

The whole TAA/Toulouse situation was now in an optimum area that never happened before and perhaps could never occur again. Everybody was all of a sudden mentally right and things came together. It was a transformation. TAA was offered and accepted two for October 1981, one for May 1982 and one for June 1983, all B4s. A refundable deposit of $1 million was paid on November 9, the Minister (Mr Nixon) said it would take a month to get through Cabinet, which it did, and on December 10 the signatures were written. There are 1984/5 options on which no money has been paid and which are on 30 days notice. Talk about a miracle!

From No. 4 it will be possible to install a dozen more seats, as the tapering tail section can be replaced by the A310 wider type. This will almost certainly be standard from No. 4. The airline, as usual, would like more zero-fuel empty weight! But the Airbus has a remarkably low average gross weight per seat – 75016, compared with the Tri-Star/DC-10 850 and the Super 80 600.

TAA is interested in the possibilities of the family: in the mid-80s it might buy the A310 as the second frontline aircraft (in effect, a DC-9 replacement), though it is keeping the Boeing 757 well in mind for this niche. However, the Fokker F29 is a possibility, in its 160-seat configuration, while the possibility of a 150-160 seat design from Airbus for the later 1980s has to be kept in mind as the finer solution is 200-odd seats are not needed.

The 320-seat extension of the Airbus, the B9, may well fit into TAA’s futures, should the growth factor increase in the later 1980s – give 1989 as the year, perhaps 1988. TAA executives told me this and the other family members are part of their present thinking, when they have time!

So there it is. TAA has at last beaten Ansett to the punch by not only announcing its decision well ahead but even signing the contract. To give it credit, the Ansett organisation was inhibited by its ownership situation during the very period of later 1979 when TAA was coming to a decision and it may have been too much to expect ATI to have taken such a vital decision at such an unfortunate time.

Behind all this TAA movement is a very big human story. The man who signed the order for Airbus Industrie, Mr Hugh Tansley, has given most of his life over the past few years to the Australian-New Zealand market. He was a Hatfield man who moved to Toulouse when sales got well underway in the -mid-1970s. But he had been here with the 1968 sales presentation team when the Airbus was not a definitive aeroplane.

Since then he has made 50 or 60 flights to and from Australia, working most of his time on the Australian market. When you total the cost and the fares and hotel bills for the men who often came with him on the technical side, and add to that the cost of the demonstration tour and other costs, Airbus Industrie has spent the best part of $1 million over a decade of effort to get this far. Big rewards but big losses.

There is no doubt in anybody’s mind that Mr Tansley played a major role in the final result – he is a quiet, scholarly man who people trust.

But there has been a permanent, continuing Australian content to this sales drive. Airbus Industrie is represented here by two organisations, Hawker Pacific Pty Ltd in Sydney and OFEMA, which represents the French aircraft industry in Canberra. Hawker Pacific is concerned because before the British Aerospace organisation was formed Hawker de Havilland was part of the mother company in England. Then came the Hawker Siddeley Group interlude and finally BAe. HdeH retained the British interest in the Airbus.

In practice, Hawker Pacific’s Mr David Price has led the local Airbus sales, his and his firm’s contribution being a continued presence for the aircraft here with TAA. OFEMA’s Wing Commander Roy Roberts and his people have maintained contact largely with the Ansett people. Airbus lndustrie has all along realised the value of the contribution these two local firms could make and has in fact told me that it regards them as being very able indeed.

And there was General Electric. About five years ago, the US firm decided it was time to put the Australian representation on a firm basis and opened an aviation office in Sydney, headed by a man who knew the local industry very well indeed – Mr Thomas F. Bergmann. He had to be a patient man, for all he sold in the five years was the CF6 marine version to the RAN for the new frigates. His hopes for Qantas were dashed when they went RB211, GE’s competitive engine, the Dash 80, not being available at the same time. But he was there at TAA and Ansett all along, selling the CF6-50 for the Airbus, and a few weeks after TAA signed for the Airbus they followed with his engine rather than Pratt & Whitney.

Selling an aeroplane these days is not a one-man job.

The most surprised man? Well, it wasn’t Hugh Tansley, who is the phlegmatic type. It was probably a member of the Airbus lndustrie team who had been concerned 20 years ago with the almost-sold TAA Caravelles. He kept on telling his mates that you never had TAA in until the Government approved. And wasn’t he right?