Issue 10: Qantas SP Implications

Qantas could, and probably will, use the aircraft on long hauls too, say one-stop (Bombay) to Europe or non-stop to the US West Coast. However, they already possess this capability in their current Rolls Royce-powered fleet of 747Bs. Hence our puzzlement at the SP purchase.

Qantas’ primary argument, or defence of the SP purchase, is that crew and equipment commonality will actually make the SP more efficient than the alternative of another type in the fleet. Certainly there is a lot of wisdom in this but, from where we stand, not enough to really hold water.

The SP is roughly 90 per cent common to the 747B in airframe and avionics, etc, while crew conversion takes merely a few circuits (on regular passenger-carrying flights) and some classroom instruction. If Qantas were to introduce either the Tristar 500 or the Airbus, then crew conversion would take time, even months, but there again, with a purchase of more than one aircraft, this would be an insignificant burden in view of the long-term benefit such conversions generate. Does it really cost a fortune to convert 747 crews to the alternatives? According to Qantas aircrew we have questioned, it becomes clear that when an eventual acquisition is up to half a dozen of the alternative type is considered, the crew commonality issue becomes a red herring.

What it really comes down to is economics, and that spells fuel rather than Captains. A major factor of commonality lies in engines, the single most expensive item on any airliner. Qantas has now gone over wholesale to the eventual use of the fuel-efficient Rolls Royce RB211-524-D4 engine of 53,000 lb thrust. This engine could have been installed on any Qantas Tristar 500 purchase and will most probably be available on the Airbus within a few short years. Both Tristar and Airbus would carry around 250 passengers in standard Qantas configuration. We believe the SP will mainly be configured for between 280 and 309 passengers, providing a capacity bonus on one hand but a maintenance/fuel consumption deficit on the other. Boeing 747SP country is New York to Tokyo, Johannesburg to London, Sydney to San Francisco – not Townsville to Wellington, Sydney to Port Moresby or trans-Tasman. A similar comparison, though with tongue in cheek, would be for East-West to use 727s on their rural NSW network or Air Tasmania operating DC-9s!

The real problem lies in not that the use of the ultra-long-haul SP will eventually prove uneconomic to operate on the majority of sectors allocated to it (at the time of writing), but that this inefficiency and consequent loss of revenue and political embarrassment will occur at a time when both domestics are equipping with aircraft types perfect for the sectors that our national carrier will be having migraines about.

Both the TAA Airbus and Ansell’s 767 will fit perfectly into most of the regional international traffic patterns presently served by Qantas 747s. Ansell in particular will be pressing aggressively for regional routes and started last year with the abortive attempt at a Townsville to Singapore route and now with an international foot in the door through a proposed Vanuatu charter. The fact that TAA will most probably lay quiet while Ansell, through Sir Peter Abeles, does most of the cannon firing will reflect merely its parentage. When the dividends come TAA will be just as well served as Ansell; between them, both will carve up the regional routes through the use of more efficient aircraft and thence the promise of increased tourism to Australia.

On this side, Qantas is doing well and pins much hope on attracting large numbers of wealthy Americans to the Barrier Reef via its Townsville route. However, after travelling what to most Americans must seem like a trip to the moon in relative distance to get to Australia, will they not venture south to visit the major cities? Therefore what is the true long-term worth of the Townsville port at all and its exclusive (in Qantas terms) requirement for the short-field SP? Will this ultimately lead to many passengers entering Australia via Townsville only to depart from southern ports with the resultant imbalance of payloads? At present, we can only surmise, but it is an interesting question that does appear to be a little obvious.

The problems that Qantas, as our sole national carrier, will begin to really experience by 1984 could ultimately lead to that horror of horrors – a TAA/Qantas merger with all the resultant in-fighting, inefficiency and loss of personal prestige that goes with a corporate shotgun marriage of mangoes. On the other hand, the government could legislate to allow Qantas something that it has been desperately fighting for for years – the right to carry domestic passengers on internal sectors.

Why Qantas, with seats to spare, cannot offer its international ticket holders the opportunity to travel to Australia at vastly reduced prices is a sad testimony to the bureaucratic inertia that exists within modern-day government departments. In this way, Qantas would be able to offer its international clientele the real Australia, all of it, just like the US carriers offer unbelievable opportunities to discover America by use of their internal routes. With Qantas serving the profitable long-haul routes to North America, Europe, Asia and eventually South Africa and South America, the domestics could operate on a limited basis into Noumea, Bali (from the economically rich north of Australia), Wellington and of course Port Moresby, where the arrival of a 747 creates chaos by any standard.

It is the historic nature of airlines, successful airlines as our three major carriers most definitely are, to spread outwards to new fields. To believe that in 1990 both Ansell and TAA will be happy to be confined to continental Australia may be a very pleasant daydreaming exercise in the Qantas boardroom but it is certainly not reality.