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China Route Again Open To Review:
In a draft decision on August 8, the International Air Services Commission stated that it was not allowing a time extension for new entrant Australia Air to raise the capital required to allow commencement of air services to China. Prior to the IASC draft decision, Australia Air founder Colin Hendrick mooted that he would be reviewing the possibility of launching a Federal Court challenge against the IASC’s decision if it should prove detrimental. The IASC has consistently required Australia Air to have proven reserves of $55m while Hendrick has always considered that $15m would be sufficient. The IASC’s major concern is the long term damage that failing new entrant Australian international carriers would do to Australia’s overseas image in addition to the damage that such losses would cause to those involved with the airline in question. Confirmation of the draft IASC decision will mean that other Australian carriers will now have the opportunity of applying for capacity on the route that Australia Air had held provisional rights for since March last year. Whilst Australia Air would also be able to bid again it must come up with proof of the required $55m in backing and would this time be up agamst Qantas which has recently made it clear that it wishes to return to the Australia/ China route that it abandoned in 1987. The closing date for final submissions is August 25.
Saatchi & Saatchi For Qantas:
Advertising agency Saatch1 &Saatch1 has been appointed to handleall overseas advertising for Qantas,working in conjunction with the airline’s principal agency, Mojo. MoJo will handle all Qantas business in Australia and New Zealand, directing branding and positioning, while Saatchi & Saatchi will provide Qantas with a single overseas agency, a much more efficient situation than before where eight different agencies looked after that aspect of the business. Qantas shareholder British Airways has been a Saatchi & Saatchi customer for ten years.
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Skyrace Future Assured:
The future of Skyrace Tasmania hasbeen assured following the announcement that the event will be sponsoredby Tasmania’s Country Club Casinofor the next five years. The $500,000 deal will see the eventdesignated as the Country Club Casino Skyrace and will continue to be held at Valleyfield. Next year’s Skyrace will begin on February 11 with an around Tasmania navigation event and will climax with the pylon racing at Valleyfield on February 16, 17, 18 and 19.
Airports Selloff Opposition Increases:
The Federal Government’s plan to privatise the nation’s airports is being subject to increased opposition from many sections of the community, business and from within the government itself. Ansett Australia has said that if the selloff goes ahead it wants legal safeguards put in place to stop it being “raped” by overcharging. The airline is concerned about dealing with private monopolies. According to Ansett’s general operations manager, Ron Entsch: “If a private enterprise was not constrained in some way by legislation, it could put prices onto the user that could be very adverse and detrimental to our business. We would seek ‘:o have some legislation or constraints put on board so that we weren’t raped”. The University of NSW has also entered the debate, via Dr Peter Kriesler from the School of Economics. Dr Kriesler questions some of the basic philosophies of the privatisation idea, including that of increased competition between airports, something which will not happen.
Clive Caldwell1910-1994
Australia’s top scoring fighter ace of WWII, Group Captain Clive Caldwell DSO, DFC and Bar and Polish Cross of Valour, died in Sydney at the age of 84 on August 5. Caldwell made his name with the Desert Air Force, flying with 112 and 250 (RAF) Squadrons. Flying Tomahawks and Kittyhawks, Caldwell scored 20.5 confirmed kills against German and Italian aircraft during his period of service in North Africa. He returned to Australia in late 1942 to command No 1 (Churchill) Wing, formed to provide aerial defence for Darwin and flying Spitfires. Later, Caldwell was involved in the push north as the Japanese were gradually forced back. He increased his tally of kills to 28.5 during his time on Spitfires. Opinionated and often controversial, Caldwell was responsible for developing many of the RMF’s successful fighter tactics during the war. Postwar, Caldwell built up a successful export-import business and did not continue flying. According to Dr Kriesler: “Privatising airports in order to break them up into separate entities to be sold off is a crazy notion. Airports are no more separate entities than one train station can be considered separate to the railway grid. It is in che nature of air travel that you are selling a ‘network’.” To make the point at its most obvious level, aircraft generally take off and land at different airports. The services provided by one airport are used in conjunction with, and are complementary to, i;he services of other airports in the system. Pricing and planning policies need to be considered across the network to be efficient”.
Sydney Airport Rail Linkapproved:
The NSW State Government has approved a $600m underground rail line linking Sydney Airportwith parts of the city. The line will run from Central Station to Waterloo, Beaconsfield, Mascot, underneath the airport (with stations at the international and domestic terminals) before joining the East Hills line. The line is scheduled for completion in 1999, in time for the 2000 Olympics. The project will be a joint venture between the government, Transfield Holdings (builders of the Sydney Harbour tunnel) and construction company CRI which has pioneered many large scale redevelopments around Mascot Airport in recent years. Transfield and CRI will run the railway stations and collect revenue from ticket sales for 30 years, after which the railway will revert to public ownership. Of the total cost, $470m will be provided by the government via the State Rail Authority’s capital works budget ($350m) and $120m from consolidated revenue.
More Cath Ay For Melbourne:
Cathay Pacific is to increase the frequency of its nonstopMelbourne to Hong Kong flights fromfour to six per week and inbound direct flights from three to four, commencing October 30. The result will be a 30% capacity increase on the route. Victorian Premier Jeff Kennett has welcomed the extra flights into and out of Melbourne, saying they would enhance the state’s prospects as a trade, services and investment centre within the Asia-Pacific region. Cathay also operates three weekly cargo flights to Mel
E-Systems To Buy Asta?
US company E-Systems – which has recently been named as the preferredcontractor for the RAAF Orion upgrade programme – is reported to beconsidering purchasing AerospaceTechnologies of Australia (ASTA) and Avalon airport. ASTA is the permanent tenant at Avalon. E-System’s Australian managing director, Mr Brooks Nolan, has already had talks with the Federal Government on the purchase of ASTA at an estimated price of $320m. E-Systems says it will buy ASTA either from its own resources or in partnership with an Australian company if the deal proceeds.
Qantas Float Contenderson Parade:
Tradition has beenbroken by the Federal Government’sasset sale task force by holding the socalled ‘Beauty Parade’ of potentiallead managers to the Qantas float inthe airline’s Sydney offices rather thanin Canberra. Contenders were asked to keep their submissions down to 15 pages or less and the move suggests that Qantas chairman Gary Pemberton and chief executive James Strong want to take an active role in the process. It has been reported that the lead manager roles will be shared between J B Were, Potter Warburg, McIntosh and County Securities.
Ansett Looks At L Ea Sing:
In order to keep pace with marketgrowth and to compete with Qantas’recent increases in capacity, Ansett islooking at leasing additional aircraft. The airline currently claims 56% of the overall Australian market and 52.5% of the markets in which it competes with Qantas. The aircraft to be leased will probably be Boeing 767s. Ansett has meanwhile quietly disposed of two of its operations as part of the ongoing programme to relinquish non core assets. Road transport companies Ansett Freight Express and Wridgeways have been sold to TNT, one of Ansett’s co-owners. It is expected that in time the two companies will become part of the overall TNT conglomerate. Meanwhile, Ansett has been playing down investment house predictions of a $225m pretax profit for the 1993-94 financial year, the company’s executive chairman Ken Cowley saying the figure is “a bit on the high side”. Recent good results have set the scene for a float of an Ansett shareholding inthe not too distant future (refer Airline Affairs item this issue).
Rooftop Protest:
From our colleagues at Australia-New Zealand Aviation Fast Fax, a tale about people living in stone houses not throwing glass, or something…. When Ansett Australia’s new NSW manager, Peter Rowe, moved to Sydney this year from Canberra, he was prepared to defend the third runway and put his money where his mouth is by buying a house under the airport flightpath in the suburb of Annandale. Little did he know that the previous owner of the house was one of the most vocal anti third runway residents of the area. Peter recently discovered just how vocal when he climbed onto the roof to check something and found a message in letters several metres high which was easily readable from any passing aircraft: NO THIRD RUNWAY!
Sweet Deal :
The Australiansugar industry and broken throughEuropean trade barriers and won acontract to supply nine million sachets of sugar to Scandinavian Airlines System (SAS). The contract is reported to be worth about $150,000 and is modest in the overall scheme of things but nevertheless opens up the possibility of further opportunities for Australian suppliers of items such as salt, pepper and herbs. Australian wine is already available on many international flights.
Tafe Technical Trainingfor Ra Af:
The RAAF is to contract out training at its School of Technical Trade Training at Wagga NSW. Negotiations with the NSW TAFE Commission will be held with a view to TAFE conducting post graduate technical training for over 500 personnel each year. Courses will include an Associate Diploma of Engineering in aerospace systems, aircraft and avionics fitter courses and a range of general trade training courses. However, basic training of new recruits will still be undertaken by the RAAF. Four commercial organisations bid for the contract which will substantially reduce training costs.
Pc-12 Certificated:
ThePilatus PC-12 single engined turboprop utility aircraft has received itsUS FAA Type Certificate, with certification in Australia, Japan, France andCanada scheduled for the near future. The nine passenger, 267kt (497kmh) aircraft has so far attracted 44 orders and options, including five for the Royal Flying Doctor Service of Australia (Central Section). Pilatus is planning to deliver 11 PC-12s this year and the first two RFDS aircraft are scheduled to arrive in Australia next January. In Australia, the move towards allowing some single engined turbine aircraft to conduct RPT and charter operations under the IFR category and at night will enhance the PC-12’s sales prospects. There is a good potential market for replacing the now fairly elderly cabin class piston twins such as the Piper Navajo/Chieftain and Cessna 400 series. The Swiss type certificate for the PC-12 was awarded earlier in the year.
727 Twin:
US modification specialist Snow Aviation Internationalhas launched a programme to re-engine the Boeing 727-200 trijet with twoIAE V2500 turbofans. The company hopes to have a launch customer signed up by the end of the year, and if so, the conversion could enter service in June 1996. United Airlines is reported to have requested information on the conversion, which will be powered by a 30,000lb (134.4kN) thrust version of the V2500. United has V2500 powered Airbus A320s entering service. The conversion includes the fitting of a two crew digital cockpit, heavy maintenance, ageing aircraft modification package and a revamped interior. It will cost $US18-20m and comfortably meet Stage 3 noise regulations. Snow estimates that between 200 and 500 suitable 727-200s are currently in service or storage. US majors Delta, American and United all have very large fleets of 727-200s still in service.
Home Sweet Home:
Malaysian Airlines (MAS) is planning toestablish a housing estate for its employees near the forthcoming KualaLumpur International Airport. Called Malaysian Airlines Village, the town will feature schools, parks, hospitals and commercial centres and employees will be able to purchase or rent houses of different levels and price. The idea of providing a complete town for the employees of large companies is not new (19th century England saw several examples and Australia’s mining industry has also produced many) but MAS’s move is probably a first for the airline industry.
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