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Justice Brooking, in a six hour summation, found that the AFAP had deliberately sought to financially damage the airline companies as a result of their directive to work only nine to five. In his summary Justice Brooking stated, “I have no doubt that the AFAP selected the nine to five directive as a means to achieve this result because they knew the directive would bring pressure to bear on the airlines by causing them great loss. I am satisfied the AFAP gave the directive with the intention of injuring the airlines as a means to an industrial end,” he said. The actual amount of damages to be paid will be decided at a Supreme Court hearing scheduled to commence on January 16.

Meanwhile at presstime, the AFAP and the airlines had met on a face to face basis for the first time in 18 weeks. The meetings were as a result of the Industrial Relations Commission decree that the AFAP must accept the IRC’s decisions in future, to abide by the rulings of the National Wage Case and to lift its ban on pilots joining the airlines under the new indi- vidual contracts. Whether or not the AFAP abandon their campaign and accept the above is tantamount to their future, as a decision to not accept the rulings of the IRC will legally place them outside the jurisdiction of the industrial relations system and render them technically irrelevant within the air transport industry.

 Qantas Us Expansion:

Qantas has added three more US cities to its network following implementation of a new code sharing arrangement with American Airlines.

Services to Washington DC, Boston and Chicago began late last year, adding to the flights operated to New York’s John F Kennedy Airport since April 1988 under a similar cooperative deal with American Airlines. Under the agreement (named ‘Partnership Service), Australian passengers going to any of the four cities fly with Qantas to Los Angeles where they connect with an appropriate AA flight.

Ballooning Report on Way:

Following the spate of accidents involving hot air balloons last year and the industry/govt. discussions which followed, an offcial report on the industry is due to be released in March.

Vastly experienced balloonist Phil Hanson (who was responsible for the drafting of the current Australian Ballooning Federation operations manual) has been appointed as a consultant to the CAA on balloon operations and will prepare the report. His terms of reference include providing the CAA with information on the effectiveness of any changes to the flight crew, operational or airworthiness standards recommended by the discussions; assessing current standards; surveying a number of commercial balloon operators to see if they are complying with standards; reporting deficiencies and recommending changes.

Fairchild’s New Projects:

Following the dropping of a variant of the Metro commuter liner with a stand up cabin, Fairchild has come up with two further developments of the basic 19 passenger aircraft.

The first is a 25 seat version (dubbed Metro 25) which is basically a Metro III with the passenger cabin extended aft into what was the baggage area (allowing three extra seat rows), moving the baggage into a pan- nier under the fuselage, fitting more powerful Garrett TPE331-12 engines and incorporating minor structural changes to cope with the 25’s greater operating weights.

A prototype Metro 25 flew last September and if the project goes ahead (a decision was imminent at time of writing) first deliveries will be made in late 1991 or early 1992. The second new model is called the Metro 25J, which combines the fuselage, wings, tail and landing gear of the turboprop version with a pair of Garrett TFE731 turbofans mounted in overwing nacelles.

This arrangement is similar to what Embraer is doing to the Brasilia to create the Amazon small regional jet. The 25J is at the preliminary design stage and if the go-ahead is given, it could be in service by the end of the decade.

Aeroflot to Australia:

The world’s largest airline, Russia’s Aeroflot, is to operate two exploratory charters to Australia during December as an operational prelude to scheduled services commencing this April.

Aeroflot will use their long-range 11-62 aircraft on the Sydney/Singapore/Dubai/Moscow route in a three class 168 pax configuration with the anticipation of being able to serve Melbourne, Adelaide and Brisbane at a later date. With the thawing in relations between east and west, it is expected that if Russia, and eastern Europe, can rapidly upgrade their tourism infrastructure (as China did in the mid eighties), then they could be in for a windfall of foreign tourism and much needed foreign exchange in the years ahead. Already Lufthansa and Interflug are looking at joint domestic services within the two Germany’s while Aeroflot itself is preparing to order Airbus aircraft and a breakaway long-haul Russian challenger to Aeroflot is planning to commence services with leased Boeing 7478.

Glasnost could well prove to be a considerable boost to international commercial aviation as an entirely new market is opened up in the traditionally closed Eastern bloc. • QANTAS LOOKS AT FREIGHTER: Qantas is considering acquiring a Boeing 747 freighter following a review of the company’s cargo operations under former DHL executive Tim Edwards.

The company is looking at a general expansion of its cargo business in the areas of both traditional freight and high yield services like courier express and door to door on both retail and wholesale levels. Qantas currently leases a World Airways DC-10 freighter and has joint cargo flights with Lufthansa, Japan Airlines and Cathay Pacific. 1991 is the year it is planned to put a 747F into the Qantas fleet, although the fact that the earliest available delivery position for a new aircraft is 1993/94 may ultimately force the airline to purchase second-hand or even convert one of its existing 747-200s to freighter configuration.

 Lockerbie Lingers On:

The fallout from late 1988’s Lockerbie air disaster, in which a PanAm Boeing 747 was destroyed by a terrorist bomb over Scotland is still having a marked effect on the airline’s reputation and financial performance.

Figures show that the incident has cost PanAm some $US250m in lost ticket sales and security costs by the end of 1989, serving to exaggerate an already dicey financial situation. The airline has not made a profit since 1985 and its performance for the first nine months of 1989 resulted in a loss of $US158m.

Ticket sales are substantially down, particularly in first and business classes where American corporations are sending their executives with ‘safer airlines. Those who have stuck with PanAm have made more complaints against the airline than ever before, while attempts to find a partner air- regarded as essential to its survival- have so far failed.

Aeroflot and Jetset Team Up:

Russia’s Aeroflot and Australia’s Jetset Tours have formed a joint venture company to promote worldwide tourism into the USSR. The new joint venture company would have branches throughout the world and would establish tourist programmes and ground handling facilities in the USSR and Australasia. Jetset will lend its not inconsiderable experience to helping Aeroflot develop first class facilities for tourism within the USSR, in addition to eventually marketing holidays abroad for Soviet citizens.

 Amann Ceases Cocos/Christmas Islands Service:

Amann Transport Industries, an operating division of unsuccessful Coastwatch tenderer, Amann Aviation, has been forced to withdraw from its short-term, contract to supply air services linking Perth with the Cocos and Christmas Islands.

Amann had leased a Boeing 737-200 and failed to obtain a CAA Air Operators Certificate for the aircraft following the inability of the company to supply adequate and updated documentation for the aircraft. Island residents were also reported to have been concerned at the amount of engine oil the aircraft apparently required following each service. An Amann spokesman though stated that the reason for this was largely that the aircraft had been standing idle for several months before commencing service with Amann, something that could affect the engine seals due to lack of regular use. Amann had also contracted Michel Asseline as chief pilot. Capt Asseline was in command of the Airbus A320 which crashed while performing at a regional French airshow during 1988. While his French pilot’s licence was withdrawn, he still holds US and various international credentials.

Amann was given the contract to fly the route, basing out of Singapore, by the Dept of Arts, Sport, Environment, Tourism and Territories in lieu of Australian Airlines who withdrew from the route as a result of the pilots’ dispute. Australian was expected to resume services as capacity became available.

Defence Orientated Companies Likely to Be Hit Hard by Events in Eastern Europe:

The recent pledge by President George Bush that the US would slash defence spending by $US180bn over the coming six years has sent shivers through every defence manufacturer from Bethpage to Bath.

The US will not only have to trim present programmes but will be forced to axe a num- ber of proposed systems that it intended to field during the latter nineties. Similarly. Europe will now have to reassess its own defence spending levels in light of a significantly reduced perceived threat from Eastern Europe. If the Warsaw Pact nations, and Russia also, reduce their military budgets by the amounts being publicly stated, then NATO will in time also be forced to follow suit. One programme in particular that has been fighting for survival for a number of years now is the European Fighter Aircraft (EFA) which will now find it increasingly difficult to survive. It has long been noted that a much cheaper alterative would be for Europe to upgrade an existing US fighter such as the Hornet 2000 or Agile Falcon. France’s Rafale might also be in for turbulence, particularly for the naval version which has constantly been under threat from the F-18 lobby.

On Wall Street, major US defence stocks have lost more than 10% of their value since September, when the first signs emerged that a new order was headed Eastern Europe’s way. The unprecedented events of recent weeks though have taken everybody by surprise, with the end result that only a direct and tangible threat would now reins- tate programmes to their former status.

The move also holds long-term implications for Australia’s aerospace manufacturing capability as most US and European manufacturers will now seek to place more work within their own group to maintain their own financial viability. It is thus expected that offsets, which the US is already beginning to restrict, and designated work packages will be harder to come by unless the recipient is actually a financial risk sharing partner in the specific project.

 Air New Zealand Wins Major Raaf Contract:

Air New Zealand has won a $20m maintenance contract from the RAAF for the maintenance of the force’s 24 C-130 Hercules aircraft.

ANZ’s Christchurch heavy maintenance base will undertake the work which will be similar to that performed for the US National Science Foundation. ANZ also overhaul and support the RAAF and RAN’s Dart turbo-props for the HS 748 aircraft. Qantas did not bid for the contract, which it formerly held, due to its continuing lack of in house maintenance capability while Hawker de Havilland offered to build a dedicated support facility at Townsville if it won the contract.

Meanwhile ANZ’s first 747-400 has gone to Cathay Pacific on a six month operating lease with an option to renew for a further six months. ANZ opted out of taking delivery of the aircraft when it failed to reach agreement with its pilots’ union as to terms and conditions affecting operation of the aircraft. A threat of strike action by the pilots was aver- ted when they decided not to proceed with strikes which had been set down for early December. ANZ is scheduled to receive its second 747-400 in August 1990 and the third in mid ’91. It is expected though that a resolution to ANZ’s aircrew problems is in sight and that the airline will be operating both its -400s by year end.

In another move, speculation that the airline would trade its existing 737-200 fleet in on five new 737-500s grew as we closed for press. In the face of mounting sensitivities against noisy Stage 2 aircraft, particularly at Wellington and Christchurch, and the recent importation of ultra quiet BAe 146 aircraft by Ansett NZ, the airline is expected to move for an entry to service by 1992 of new generation 7378.

The Federal Government Abandons Privatisation:

The Federal Government has disbanded its ALP Airline Funding Committee even before it had reported on ways and means of injecting funds into Qantas and Australian Airlines.

The body was set up in May in an attempt to avoid the politically sensitive issue of direct free market privatisation. Qantas requires something in the region of $1bn over the next three years, while Australian will need about half this amount if they are to be able to move from their present positions of being commercially disadvantaged by very high debt to equity ratios.

Meanwhile, the Coalition has verified that in its first year in office it will sell federal assets to the value of at least $1. 6bn, including Australian Airlines. Qantas will follow in the second year, a move the Coalition believes will greatly increase productivity and enable the airlines to be more competitive without the shackles of government ownership.

Qantas, Australian Face Delays on New Jets:

As a result of the 48 day Boeing machinist strike, both Qantas and Australian Airlines are now looking at late delivery of their respective 747 and 737 jets. Qantas was to have received its fourth and fifth 747-400s in late November to inaugurate daily non stop services on the prestigious Sydney/LA route prior to Christmas. These will now not be operational till late January and possibly early February, causing Qantas further revenue losses due to not being able to commercially exploit the many benefits of the latest generation 747.

Australian Airlines will also now receive their first 737-400s in February/March rather than January as originally intended. The airline plans to generally replace its 727-200 fleet with the largest member of the 737 family over the coming year and a half.

 Lock Haven Rebirth:

Piper is to commence production again at the site of its very beginnings at Lock Haven, Pennsylvania.

The company took the decision following the approval of a State development loan of $US10m to upgrade the plant. Piper built some 77,000 aircraft at Lock Haven between 1937 and 1984 and will now place back into production the popular Navajo and Chieftain models and also possibly the ‘new’ Swift- Fury high performance two seater.

New CEO at Australian:

Mr John Schaap has been appointed the new Chief Executive of Australian Airlines. Mr Schaap replaces James Strong who left the airline on September 22 to take up the position as head of Australia’s largest law firm, Corrs.

Mr Schaap has been a senior executive with Qantas for many years and was largely responsible for the stunning turnaround made by Fiji’s Air Pacific whilst in command of that carrier during the mid eighties under secondment from Qantas. His last position at Qantas was as manager of the passenger services division. Mr Schaap will take up his position at Australian on January 16th, ironically the same day as the Victorian Supreme Court is due to hand down its decision on the extent of damages that the AFAP will have to pay the airlines as a result of their directives during the pilots nine to five campaign.

 Kal DC-10 Crash Through Pilot Error:

The South Korean Transportation Ministry has announced that the cause of the KAL DC-10 crash at Tripoli on July 27 was as a result of pilot error.

The pilot attempted to land despite thick fog and reported control tower warnings. Following months of protracted negotiations, the black box flight recorders have now been sent to the US for examination by McDonnell Douglas and the NTSB.

 Charter Entering a New Era:

About the only winner in the pilots’ dispute, GA and, in particular, charter is looking forward to a new era as companies are now realising the benefits of using “personal” aircraft rather than the scheduled airlines for many of their more remote operations.

Across the board increases of 300% in hours flown during the Sept/Dec period were common with many operators now looking at adding upgraded equipment that six months ago would have been beyond their expectations. The general feeling is also that even when scheduled services return to normal that charter will be able to retain between 10 and 20% of the new business generated. In many cases, firms that had looked at charter but had not actually used it were now converted to the benefits of having an aircraft on call for a particular mission. It was also hoped that many more firms would now look to operating their own corporate aircraft with that aircraft also being on line for cross charter activities.