Airline Affairs

The Great Airports Sell Off?:

Proposals put forward by the Commonwealth Government in the jobs White Paper could see several Australian airports up for sale and the disbanding of the Federal Airports Corporation. Transport Minister Laurie Brereton wants to dismantle the FAC (which he describes as “the Commonwealth’s last great monopoly”), which would involve seeling off all of the FAC’s airports individually, even though only Melbourne, Sydney and Brisbane are recognised as good earners. A joint Dept of Finance/Transport scoping study will assess the viability of selling off individual FAC airports and will report to Cabinet by September. Tullamarine is estimated to be worth $378m and the British Airports Authority has already shown an interest in managing and/or acquiring a stake in it. Another government minister, Finance’s Kim Beazley, has also stated he’s looking at selling Avalon and its long term tenant, Aerospace Technologies of Australia (ASTA) as a package deal. ASTA has a 99 year lease on Avalon and it is claimed interest is being shown by as yet unnamed parties and that the deal could be finalised by the end of the year. Although it is generally agreed the Avalon/ASTA idea is basically sound, Mr Brereton’s plans have come in for criticism from many quarters including the Victorian government and of course the FAC, but are supported by organisations such as the ACTU. One point in favour of retaining the FAC as an institution is that it makes a profit and is therefore not a drain on the taxpayer. For further commentary refer Reece, page four.

Qantas Plans Massive Sydney Domestic Terminal Expansion:

Qantas has announcedplans for a three stage expansion programme for its domestic terminal atSydney airport, worth $120m. The final stage of the programme will be completed in 1988 resulting in an increase in gates from the current 10 to 18. The first phase involves adding four new gates through the addition of a five gate satellite rotunda style terminal finger, which should be operational in October 1996. Included in this development also will be new Flight Deck and Chairman’s lounges over the new concourse extension. A further two new gates will be completed in September 1997. When ultimately completed the terminal’s capacity will be boosted from the current 4.2m Skywest has taken delivery of Saab 340B SE-KXA to cover heavy maintenance of its Jetstream 31 fleet. The former Gotia Shuttle Express aircraft will initially fly under its Swedish registration on routes from Perth to Albany, Esperance and Kalgoorlie. (Les Bushell) passengers per year to 7m. While the terminal will continue to handle domestic travel only, except when the Tasman finally opens up, Qantas has announced a new seamless airside transfer system for its passengers switching between international and domestic flights. For passengers flying domestically to connect with an international flight, their baggage would be checked through to their ultimate destination, while their details would be entered into the Customs and Immigration computer. In Sydney the passengers would transit through a special lounge at the domestic terminal, boarding an airside bus that would use the airports internal access road linking the two terminals, before passing through another dedicated lounge in the international terminal for a final Customs check From here they would bypass the main Customs line and enter straight into the departures area. The new system is in response to continuing negative feedback on the existing tedious system of having to leave one terminal, and bus it or take a taxi to the other, and recheck in.

America West Well On Theroad To Recovery:

Phoenixbased America West has again postedan impressive quarter financial return,taking the airline to a record net income of $US37m on revenues of$1.32bn for 1993 reports Julian Green. While reorganisation and administrative costs accounted for $16.9m, the overall result is a dramatic turnaround from the $17.6m loss for the same period in 1992. W A Frank, Chairman and CEO of America West, said, “The Company has put together four consecutive quarters of profitability with each quarter showing an improvement in operating income over the previous one.” The results will lend weight to applications for America West’s release from Chapter 11 which is anticipated in the third quarter of this year. It willalso bode well for would be investors, including the Amwest Partners Group comprising Continental Airlines, Mesa Airlines and Fidelity Investments.” Amwest’s bid contemplates a strategic alliance which would result in an independent America West Airlines, headquartered in Phoenix, and affiliated with a global partnership. Under this proposal America West will emerge from bankruptcy with a strong balance sheet and healthy cash reserves”, Franke said. The investment by Amwest Partners would provide $US100m of long term unsecured debt and $120m of new equity in exchange for a minority ownership in the airline. “The companies’ route structures were strategically complementary, strengthening America West’s system in the west and southwest, Continental’s system in the east, and Mesa’s existing role as an America West Express operator.”

Polluter Pays Plan Forksa:

Airlines operating into Sydneyairport could face a “polluter pays” taxif plans developed by the Federal Airports Corporation come to fruition. The scheme results from the FAC’s plan to acquire allegedly noise affected residential properties near the airport and to provide noise insulation for others, something which could cost as much as $238m over the next 15-20 years. Airlines flying into Sydney would be expected to pay for this via a levy which could range from $300 to $1000 per landing for a Boeing 747, depending on whether it’s an early, noisier model or a later, quiet one. The airlines have warned that such a tax could force them to close or scale down their operations into Australia. The Board of Airlines Representatives of Australia (BARA), which represents Qantas, Ansett and 4 7 foreign airlines has said: “Should the proposals be adopted, government would be imposing additional costs on the airlines at a time when the viability of their operations to Australia are at risk”. The BARA has said it will challenge the proposals head on by launching a legal challenge. The airlines have already invested billions of dollars in current generation of quiet airliners. United Airlines’ Australian general manager, Anne Keating, summed it up by saying “We see our responsibility in this issue as providing aircraft that are as quiet as possible. The aircraft we use to Australia are all Boeing 7 47-400s and they are the quietest aircraft available. That’s where I see our social responsibility ends. It’s not in double glazing people’s windows”. Hear hear!

Clarification:

AA would liketo clarify a point made in our December issue Regional Airline Directoryregarding Southern Pacific RegionalAirlines. The airline did not lose its Ansett Sydney/Tamworth rights following the failure of a propeller blade on its Mohawk. The airline had also won route authorities in its own right on the Sydney/Dubbo and Sydney/ Grafton routes.

Virgin And Delta Get Together:

Virgin Atlantic Airways hasannounced a trans Atlantic codesharingdeal with Delta Airlines, the USA’s thirdlargest carrier. Under the terms of the arrangement (which at time of writing still needed US and UK government approval) Delta will buy 15-200/4 of seats on Virgin flights to London from Los Angeles, New York JFK, New York Newark, Miami, Orlando, Boston and San Francisco. Delta will price and market the seats on these flights, which will use joint flight codes. The arrangement will not only generate substantial new income for Virgin but also gives it the opportunity to18 Australian Aviation June 1994 offer its passengers the convenience of Delta’s US domestic network. For its part, Delta benefits from the extra traffic generated by this.

Lufthansa To Train Chinese Pilots:

Lufthansa is to train76 Chinese student pilots at its training centre in Phoenix, Arizona. The new pilots, who will ultimately fly with Air China, have been taken off military flying training duties to retrain as airline pilots. Lufthansa has developed a special programme for the cadets which covers 60 hours flying, 30 in a navigation trainer and 200 classroom hours over the 19 week course. At the completion of the course, the pilots will begin type rating to qualify on the Boeing 737. Lufthansa is also hoping to secure this contract, which would be performed at the airline’s pilot school headquarters at Bremen.

Five Airlines Take On Ba:

Hot on the heels of its troubles with Virgin Atlantic Airways, British Airways now faces a complaint jointly filed by five British airlines: Air UK, British Midland, Jersey European, Loganair and Manx. The five have made a submission to the European Commission calling for a full investigation into the relationship between BA and the Galileo computer reservations system. They claim that Galileo’s operations should be more ‘transparent’ to its customers and are questioning whether the fees charged to the airlines bear any reasonable relationship to the cost to Galileo of the service being provided. The airlines also claim that BA’s position as Galileo’s sole national distribution company in the UK, through a wholly owned subsidiary, provides it with an unfair competitive advantage. A full European Commission investigation into the costs of the Galileo service has been called for, the five airlines wanting to see more transparency in the way fees are charged and how they are made up, and the role played by BA as a Galileo national distributor, including its remuneration.

United Set For Employee Takeover:

United Airlines is set to become the largest employee owned company in the world following agreement over the sale of majority control among its major unions. A deal has been arranged between United’s management, the Air Line Pilots Association and the International Association of Machinists and Aerospace Unions which will see the labour groups acquire 53% of the airline’s equity. In exchange, about $US5bn worth of wage and work rule concessions will be in place by the end of the decade. Approval of the deal by the Securities and Exchange Commission and. the shareholders are the final steps in the plan’s execution. United’s financial restructuring will allow it to establish a new low cost, short haul operation (a kind of ‘mini airline’ within the main one) initially in the intensely competitive US west coast market. The new operation will fly entirely within the USA between non stop. city pairs up to 650nm (1200km) apart.

More Indonesians Visitingaustralia:

Indonesians are coming to Australia in ever increasing numbers, with China now the only touristdestination attracting more of them. Figures released by the Australian Tourism Commission show that in 1993, 72,000 short stay Indonesians came to Australia, a massive 57% increase over the previous year. A healthy rate of growth should continue, with more than 100,000 Indonesian visitors expected in 1994. In addition, Australia is attracting large numbers of Indonesian students with some 8000 here at the moment, while business travel is also increasing spectacularly. The growth is put down to a greater general awareness of Australia, expanding business and investment links between the two countries and Indonesia’s rapidly growing middle class, which has money to spend on travel. In relative ,numerical terms, Asia’s rapidly growing middle class is now considered larger than that of North America, a situation that augers well for Australia’s future tourism aspirations.

China Boom Predicted:

The Chase Manhattan Bank has predicted that China will spend morethan $US100bn on 1250 new airlinersover the next 15 years, double the esti mates issued by Airbus and Boeing. The bank expects China’s civil jet fleet to grow from 340 aircraft in 1992 to 1590 by 2010 and the predictions are based on the assumption that passenger traffic will grow by 20% per annum between now and 1998, 15% per annum between then and 2004 and 10% per annum after that. However, the bank warns that this growth may be inhibited by Chinese government threats to deliberately slow things down until the country.’s poor air safety record is improved and its industry’s infrastructure is sufficiently developed to cope with massive growth.

Business Fares Become Adutch Auction:

An interestingprice war in reverse has developed between Qantas and Ansett as each airline tries to woo the business travelleron domestic routes while at the sametime increasing fares. Normally, a price war results in lower fares, but in this case it’s a matter of the airlines keeping an eye on each others’ increases. Qantas started the ball rolling with an up to 5% hike in business class fares on 12 major business routes (including the Melbourne/Sydney/Brisbane corridor), Ansett responded by increasing its price from 20 to 25% above full economy fare on all routes. This was later matched by Qantas. Your move, AnseW

Compass Recovery Fallsshort:

Although the final wind-upof Compass II is not likely to be completed until early 1997, it appears theairline’s creditors will recover considerably less than they are owed. According to a report to the Australian Securities Commission by the liquidator, Mr Richard Barbor of Price Waterhouse, just $12.6m is expected to be raised against creditors’ claimsof $43.2m. Shareholders who invested $62.9m in the airline will be left with nothing and unsecured creditors might – with a lot of luck – walk away with a few cents in the dollar. Meanwhile, Compass II deputy chairman Doug Reid was charged with 27 offences under the Corporations Law and the Victorian Crimes Act in the Melbourne Magistrates Court on April 27. The action was brought down by the Australian Securities Commission. The ASC stated that the charges alleged that Mr Reid used public funds for his personal use and created false documents and made false statements to a number of parties whilst in his time with Southern Cross Airlines.

Willing Applicants:

Ansetthas received an overwhelming response from advertisements it hasplaced for new flight attendants. The airline needs 200 new flight attendants for its international services to Asia and has been swamped with 6000 applicants, many of them from other airlines. The airline says that most applicants have the necessary language skills and interviews are under way. Interestingly, only a few applications were received from within Ansett’s domestic operations.

Qantas Training Schoolproblems:

Qantas is investigatingsome serious irregularities at its aircraft engineer training school in Sydney, including the leaking of exampapers and the completing of some papers in pencil. The airline has also had the approval of 34 of its 50 maintenance courses withdrawn following discoveries that changes were made to the curricula without approval. The problems were uncovered after investigation by senior Civil Aviation Authority Travelmarvel, a wholesale travel company, is marketing a series of ski trip charter flights between Australia and New Zealand through to October this year. The company will use a 124 seat one class configured Polynesian 737-300 for the flights, which will mainly be between Sydney, Melbourne and Brisbane to lnvercargill, and between Brisbane and Townsville to Auckland. 20 Australian Aviation June 1994officers, and although they are unlikely to compromise safety, a full investigation has been ordered by Qantas’ chief executive, James Strong.

Compass Failure Hitstownsville:

The failure of Compass II and resulting withdrawal of itsdaily services to Townsville has contributed to a large reduction in passenger traffic to the Queensland city. Figures released by the Department of Transport show that passenger numbers at Townsville fell from 131,380 in the December 1992 quarter to just 94,083 in the same period of 1993, a 38% reduction. In another disappointment for Townsville, Garuda has announced it is cutting its Jakarta/Denpasar/ Townsville/Cairns service from two to one per week. The airline says the move is necessary due to fleet changes but it remains committed to Townsville.

Qantas Selects Collinsatcom:

Qantas has selected theCollins Satcom 906, the world’s firstsix channel voice and data satellitecommunications system, for its longrange fleet of aircraft. Satcom 906 will be integral to the joint programme for CNS/ATM (communication, navigation, surveillance and air traffic management) between the US FAA and Australian and other Pacific region civil aviation authorities. The programme uses a flight management system update from Boeing along with Satcom 906 to provide automatic dependent surveillance (ADS) reporting and a digital two way datalink to air traffic control. It will eventually replace traditional HF radio links. ADS reporting capability allows for optimum route flexibility, which in turn means time and fuel savings. This was demonstrated by Qantas and United Airlines in 1992 trials, using Satcom 906 equipment. Over 300 Satcom 906 systems have been ordered worldwide and it is certificated for use on the Boeing 747-400, 767-300 and Airbus A300/310 aircraft.

Asian Airports Bonanza:

There is a motza to be made in themaintenance, upgrading and construction of airports in the Asian region,according to the Australian TradesCommission. The Commission estimates the more than 100 large scale projects currently proposed for Asian airports will be worth up to $200bn, including 76 projects in China alone and a $5.6bn five year airport development plan in Indonesia. Needless to say, the involvement of Australian companies in these projects would be a good thing, and this is what Austrade is trying to encourage by running Airports Asia seminars in Sydney, Melbourne, Adelaide and Perth in late May. The aim is raise awareness of Airport Industries Australia, a new association which brings interested parties together so between them they can offer a package of services when bidding for contracts. Speakers at the seminars include the Hong Kong and Malaysian trade commissioners and the chairman of Airport Industries Australia, Hans Roser.

You Are What You E At:

Bitof a worry, these Kiwis, if this storyfrom our spies in New Zealand is anyindication: An aircraft passenger at Wellington airport was so hungry he wandered across the runway – giving way to a departing jet – to eat at one of the domestic terminals. It was reported by the CAA that the light aircraft in which the man was travelling as a passenger had taxied to the western side of the airport and when he saw the domestic terminals across the way he promptly set his course and walked off – directly across the taxiways and runway. On reaching the runway the obviously observant ‘chep’ noted an Ansett BAe 146 about to takeoff. Displaying what is described by the CAA as “a commendable sense of responsibility”, he backed off a few metres and allowed the aircraft right of way. He then continued on his way. The errant gentleman was then jumped on by two security officers and a policeman, but not arrested. He was given a formal written warning and his pilot a severe talking to about his own responsibilities!

Australi A Air Up Dat E :

Would-be international airline Australia Air has launched its public float but is now seeking an initial $32m from the public rather than the $55m needed to start planned services to China. (refer p20 May 94 AA). 22 Australian Aviation June 1994Underwriters County NatWest and Turnbull & Partners initially claimed to have been “overwhelmed” with inquiries from potential investors but it now appears Malcolm Turnbull’s investment bank will buy a strategic stake in the airline, according to industry sources. Mr Turnbull will also take a seat on the board and estimates of his interest range from 5 to 10%. Australia Air planned starting the equivalent of one Boeing 7 4 7 service per week to China in late March, but failed to raise the necessary capital. The International Air Services Commission gave the airline a 90 day extension to sort out its finances.

All In The Family:

Qantascaptain Graham Kendall-Hawk and hiswife, first officer Victoria, have created a bit of company history by producing the first baby born to a servingQantas husband and wife pilot team. Young Mistral’s parents are no strangers to making history. In 1991 they became the first married couple to crew a scheduled airline flight (an Australian Airlines Boeing 727) while Victoria joined the then TAA in July 1986 (the day before it became Australian Airlines) as its first female pilot. What odds on Victoria and Mistral become the first mother and daughter airliner crew in twenty-odd years time?

P Anic In The Cockpit:

Thecockpit voice recorder of the ChinaAirlines Airbus A300 which crashed atNagoya in late April indicates a highlevel of panic and confusion in thecockpit of the doomed airliner. A transcript of the cockpit tape was released by the Japanese Transport Ministry and this clearly shows a lack of proper cockpit resources management and a reluctance by the first officer (who was flying the aircraft) to initiate a go-around when he was too high on the approach. A go-around was finally attempted when the aircraft was close to the runway but the aircraft apparently stalled when the stick was pulled back. The result was the loss of 263 lives. The tape reveals the captain called for a go-around a full two minutes before the aircraft crashed but to no avail. The crash was Taiwan based China Airlines’ fifth since 1986. The head of the Taiwan Civil Aeronautics Commission tendered his resignation after the crash but at the same time denied his office was derelict in monitoring China Airlines’ safety record. AA readers might recall the photograph in the May 1994 issue (page 21) of a Chinese 7 4 7 almost out of control on Hong Kong’s runway and the revelation that Chinese pilots rarely perform go-arounds as it means a significant loss of face. Rather a significant loss of face than a significant loss of life….

Air Chin A Ren Ews Ansettsimulator Training Contract:

Air China has resigned a 12month contract with Ansett Australia’sFlight Simulator Centre. The contract covers transition and recurrency training on Ansett’s 737- 300, 767-200 and BAe 146-300 flight simulators through to February 1995. This renewal caps of a successful inaugural year for training Air China crews during which 42 of the airline’s flightcrews trained with Ansett, and follows aggressive targeting of Air China’s simulation contracts from a number of simulation centres world wide. Other international airlines to utilise Ansett’s pilot training resources include China Hainan Airlines, Shenzen Airlines, China United, China Southern, Asiana, Vietnam Airlines, Thai, Jet Airways International (of India), Oman Aviation Services, SilkAir, Air Pacific, Pacific East Asia Air Cargo, Royal Brunei Executive, Garuda and Air 2000.

Qantas Sets On Wing Jt9d-7r4 Record:

A Qantas Pratt &Whitney JT9D-7r4 turbofan has set anon wing industry record. The JT9D-7r4 powered one of the airline’s Boeing 767-200ERs, and remained on wing for five years following a rebuild in the Qantas Engine Maintenance Facility on February 7 1989. During this time the engine clocked up 17,801 running hours and 4687 engine cycles (takeoffs and landings), the equivalent of over 1000 round trips between Sydney and Singapore, and the longest continuous time on wing for any JT9D-7R4 turbofan. It also marks an engine cycle record for any Qantas engine type. The engine was removed on February 28 for routine replacement of a time limited part.