Reece

What occurs during 1988 to a large extent depends upon the December/January period that we are now transmitting. If the world’s markets stabilise and complete their long-tipped shakeouts, then it is odds on that international economic growth will not be greatly affected by the startling events of October 19, 1987.

If on the other hand the crash has affected medium-term confidence to the point where we all put off buying that new TV, taking that trip or repainting the house, then look out, we will all pay the piper.

It would indeed be tragic if this occurred as most of the nations of the world were fostering reasonably buoyant economies. Albeit in debt though essentially sound and looking to modest though sustained growth. A downturn, even of only two or three percent, would send inevitable shockwaves through the world airline structures that could ultimately create major problems for some of the largest of US carriers. As big as they are, many of these mega carriers live in a world of extremely high debt. Texas Air for instance has accumulated debt of nearly $A1bn and operates from month to month largely because of its vast cashflow capability. Slash this, as would happen in a US economic downturn, and the biggest US carriers could suddenly become the most helpless as they would gradually slip into a mire of greater debt. To many in the industry, Texas Air is merely a gathering of already defunct carriers that have been able to continue only through the mass of energy that their sheer size provides in the marketplace. Similarly TWA and PanAm are also highly vulnerable, as is United. The major US carriers are growth-orientated, their yields are paper thin and so a downturn could create massive problems that would rapidly flow over to the airframe manufacturers on both sides of the Atlantic.

On the question of airframes, it was another boom year with Boeing, Airbus and MDC all scoring more sales than they probably bargained for. When not busy throwing stones at Airbus, Boeing was occupied in more productive pursuits with preparing for their 1988 rollout of the 747-400 and the 737-400. Boeing also launched the smallest of the baby Boeings, the 737-500, an aircraft that should sell well and eventually replace many 737-200s in worldwide airline service in the decades ahead. The wisdom of experience also reigns at Seattle and accordingly Boeing prudently stalled the promising 7J7 propfan airliner for at least fifteen months while it further refined the precise requirements of its potential airline customers. In view of the 7J7 delay, it is anticipated (providing the economy remains strong) that the fuel-frugal 757 and the new 737-400 will gain additional sales that may have gone to the 7J7.

Across the Atlantic, Airbus flew their advanced technology A320 with a first flight order book that set new records. Airbus also launched the long-awaited A330 big twin and its ultra longrange sister, the four engine A340. International Aero Engines consequently canned their much talked about IAE Superfan and continued to refine the ailing V2500, which is selling about as well as ham sandwiches at a bar Mizvah! Meanwhile, CFM. took up the A340 void with yet another variant of their CFM56 to ensure hat this engine will in time probably become the most successful engine programme of this century.

Internationally, the new generation of super commuters continued to boom while America’s General Aviation industry took yet another nose dive with expected sales of light aircraft for 1987 not expected to even reach 1000 units. Helicopters were also in recession as exploration projects, both at home and abroad, waned.

At home it was one very momentous year. In one fell swoop, the new aviation minister, Senator Gareth Evans, displayed his abilities as a fast mover and ushered in an era of deregulation to Australia’s future air transport environment. After a third of a century, the ghost of the dying Two Airline Policy was finally put to death though the funeral won’t occur till October, 1990.

As a prelude to deregulation, Ansett moved to acquire everything in sight including controlling interests in Kendells, Lloyds and of course, East-West. The Trade Practices Commission then promptly overturned much of this buying frenzy and gave Australian Airlines a unique opportunity to regain some of its lost on carriage in addition to handing Ansett a much refined and streamlined East-West that looks even more viable than before.

Government decisions also came in for much flak with the Coastwatch fiasco taking centre stage in a comedy of errors that should never have occurred in the first place. We hope somebody somewhere has learnt from this ridiculous episode though we honestly doubt it!

Similarly, the Defence Department also worked overtime to make members of the GA community question the value of pursuing government contracts. The RAN Fleet Support contract, potentially the largest contract to ever be offered GA, was again scuttled without even a care for the many firms that had invested dearly in meeting the requirements of the DoD. The Defence Department hierarchy must surely now realise that it must get its own house in order if it wants commercial Australia to take it seriously.

Also not taking it seriously were nearly 10,000 highly trained men and women of the Australian Defence Forces who voted with their feet during 1987 to seek employment elsewhere. We, and other news mediums, have been harking on the accelerating attrition rate now for more than two years and yet still nothing concrete comes from Defence Central in the form of credible remedial action. Trained aircrew musterings are now in dire straits as our frontline F-18, P-3 and F-111 squadrons can barely call upon parity crewing in their efforts to remain effective on a day to day basis.

If an emergency occurred (and that could happen overnight as history continually records) then we would have a critical problem. Some of the world “finest hardware but not enough trained manpower to ensure its prescribed application is in its simplest form a false economy; in its most critical form though, it could well be the cause of losing the battle: Defence must address this problem before it’s too late.

Nineteen· Eighty-Eight offers largely unchartered waters, like the song says, it could be heaven or it could be hell. It could be a boom year for Australia and its airline environment, or it could be a thundering anti-climax – we like to think it will be the former.

Regardless of what the Gods have in store, thanks for being with us in ’87 and we look forward to serving you again through Australia’s 200th year.