New Airline to Concentrate On Trunk Route Shuttle

AAA is headed by ex-Qantas pilot and GA identity Ron Bartsch who’s major ambition with the airline is to provide a high value service via a company with a maximum of employee participation. The name AAA does not specifically stand for anything other than a suggested ‘triple A rating’ and is not Australia America Airlines as has been rumoured in some quarters. This writer also notes that in the pecking order of international CRS systems an airline abbreviated as AAA is hardly carrying a liability as it technically lists you amongst the top rankers on the first or second page of the agent’s computer screen. This was a major reason why the then TAA changed its name to Australian in 1986.

The innovative employee ownership scheme will extend to all employees, and in particular pilots, are asked to contribute to purchasing an equity in the venture. This is seen as the best way of getting the maximum amount of productivity and enthusiasm from AAJ),(,s workforce.

Of the airline’s anticipated 200 employees, 95 will be pilots who will fly an average of just 550hrs per annum. Though this is now significantly less than the industry norm, it is envisaged that pilot incomes will be buoyed somewhat by their participation in the pilot equity contribution scheme and consequent profit sharing. Pilots will even rotate as flight attendants and baggage handlers, a far cry from the pampered conditions they flew under prior to the 1989 AFAP dispute.

Owing to their generally large superannuation payout it is envisaged that technical crew will own around two thirds of AAA with senior management and the Moran Health Care Group owning the remainder. It is envisaged at this stage that the full financial requirement for the company will be met from Australian sources with no overseas involvement required.

Operationally the airline is looking at a 50% breakeven load factor using just two aircraft to provide high frequency shuttle services between Sydney and Melbourne. Brisbane is expected to be added at a later date while the aircraft will also be used extensively to fly specialist tourist oriented routings not currently being catered for by either of the four existing operators. Such routings might encompass Sydney/Coolangatta/Cairns/Yulara/ Perth and vice versa or Launceston/Coolangatta/Cairns/Darwin/ YuIara/Sydney, etc. Either way, AAA management feel that there are still plenty of niche opportunities for providing better linking within the primary tourist destinations on what is essentially an ‘aircruise’ operation.

The DC-9s will be configured in a 98 seat economy, 8 business class arrangement. Economy is standard 32in pitch five abreast with standard DC-9/MD-80 economy seats which are actually an inch wider than that typically found on the Boeing narrow bodies. Business will be four abreast using MD-80 first class seats, pitch will be either 34 or 36 inches. Catering will be geared to what the airline feels passengers want rather than what they are given by established carriers and then charged for whether they want such a high standard of inflight service or not. While disdaining the catch phrase of no-frills,AAA marketing Manager, David McNamee, feels that the majority of the market on a typical one hour flight does not need or want a full hot meal service that only inflates the cost of a ticket for a small carrier.

Fares will be budget priced with no conditions with the majority being handled by the carrier’s own yet to be established reservation system. Whilst this does eliminate the theagent’scommission (6-12%) it will be interesting to see how this fares in the real world though with only a handful of relatively small aircraft it would be more viable than it would be for instance, with Compass and a broad based network.

At presstime it was envisaged that a typical Sydney/Melbourne one way fare of $110 would be charged though a launch fare of $99 is being considered. Whilst there are presently fares as low as $95 one way on this sector it is felt that these won’t last into next year and are also available often with special conditions. AAJ),(,s fares will be a straight no condition fare with sufficient frequency being provided that a virtual walk in and fly service will be available.

AAA are already moving to acquire the present Flight Facilities FBO at the eastern (GA) end of Sydney airport. Operations into Melbourne will be either into Essendon, where improved ground links with Melbourne CBD will be established, or the Melbourne Jet Base at Tullamarine. The airline also will acquire the Flight Facilities maintenance hangar at Sydney which is large enough to doA and B checks on their DC-9s. Heavy maintenance will be undertaken either by ASTA at Avalon or lpec at Essendon.

The basic concept of AAA is for the establishment of a budget fare jet operation using low cost but high productivity aircraft to link Australia’s most populous centres by way of a deep discount high frequency service. Buoyed by its employee participation scheme, the airline might well become an Australanised People Express.

The eventual demise of that famous carrier was its insatiable appetite for growth and inevitable head on confrontations with its far larger adversaries. If AAA, and small niche airlines like it, can heed that lesson and avoid such follies then their future could be interesting indeed.