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Alan Joyce’s decision to shut down Qantas mainline services over the weekend could result in a win on the industrial relations front, but it seems that the damage done to the brand will see it suffer for some time.
The shock decision to ground all flights from Saturday afternoon indefinitely before a formal lockout commences at 8pm on October 31 has over 70,000 passengers around the world in limbo. Many have turned to Twitter and Facebook to vent their spleens about the inconvenience, while the 24 hour news channels are helping to fuel that discontent further.
Reading through some of those comments, it seems that most of the public are not buying the idea that Qantas was forced into a corner by the three unions who have been involved in industrial action over the past few weeks. Reports are that bookings over the next few weeks had plummeted, particularly after TWU head (and possible future Labor Party president!) Tony Sheldon warned passengers not to book on Qantas to avoid being inconvenienced.
Then there are the simple dollars and cents. Joyce told media recently that the industrial action thus far had cost nearly $15 million a week, but that pales into insignificance over the $25 million per day that the grounding of the airline is having. That is one expensive exercise, particularly if it drags on into the next week.
Even if it is resolved soon, a number of major Qantas customers (notably the high tier Frequent Flyer members) have been inconvenienced already, and given that many are now heading to Virgin Australia, Singapore Airlines and other competing airlines, many will be happy to leave behind Qantas at least in the short term. Virgin Australia in particular has been given the opportunity to show off its wares to very valuable business clients, and you can bet that some of those clients are now being impressed with the Virgin product.
Then there is the consideration for the alliance partners such as British Airways who have also been massively inconvenienced by the disruption. Joyce had earlier highlighted this as a key part of its international strategy going forward. Partner airlines will not be taking this lightly, and there is no doubt that execs of other Oneworld carriers s will be questioning this move, particularly where they are being left to pick up the pieces. Joyce’s phone will no doubt be running hot over the next few days, and it will take some time to explain to the partner carriers’ CEOs. It won’t be enough to force termination of these agreements, but it will definitely strain them.
With past disruptions, Qantas management have boasted how resilient the brand is. My fear is that this one will stretch that resilience too far, and no matter the outcome it will be a long road back for the Flying Kangaroo.
Ellis Taylor
John in Melbourne
says:Short term pain for long term gain. Either ground the airline for a week or two now and deal with the unionists once and for all now or allow them to have their way and watch Qantas slowly but surely fall to pieces over the next 10 years, finally collapsing completely as Ansett did, only 10 short years ago.
Qantas, with 16 different unions, is one of the last bastions for the “bad old days” of militant unionism. As the unions become less relevant and their membership numbers continue to fall, they’ve become more and more militant in their attempts to hold onto what little membership they have left.
I work for Qantas engineering in Melbourne and what amazes me most is that there are LAMEs there who were working for Ansett when it collapsed and yet they still either fail to see or refuse to see that the unions are now forcing Qantas down the same path as they forced Ansett in the 80’s and 90’s. I predict that within 10 years the majority of Qantas engineers, pilots and ground staff will be non-union members, who haven’t spent their whole working lives in the cosy, comfortable confines of a unionized workplace and who will, as a result, be proud to work for Qantas and be aware of just how fortunate they are to do so.
Both unionists, the government and the executives of Qantas need to stop treating Qantas like a cash-cow and recognize that it is a business, first and foremost. Its purpose is to make a profit and deliver dividends to its shareholders. It is NOT here to deliver huge executive bonuses to its executives, hugely inflated salaries to its engineers, pilots and ground staff, nor is it here to act as a political drawcard in parliament. It’s time for all parties to stop the grandstanding, to stop playing the victim and to start acting like the mature adults that they supposedly are.
reverend
says:it is rediculous that joyce can get a massive pay rise but the employees not. mr joyce should be sacked
KERRY BESWICK
says:I fly Qantas because it is Australian., paying a little extra is cool because you get a meal and you know the standards of safety are high as well as feelings ( perhaps misplaced) of patriotism. Last time I flew I paid over $300 from Sydney to Brisbane and I received a cookie. The feel of the airline is one that is going downhill. If Qantas needs to have their workfoce out of Australia and pay them peanuts then they need to be upfront and admit the following ‘QANTAS is nominally Australian, so get over your nostalgic love with the flying Kangaroo; because whilst you may feel loyal to our brand we have none to your country.’
Chris
says:That’s what worries me!!
Mark
says:If Qantas goes under so too will Joyce, Dixon and Clifford’s little baby “Jet Star”, after all that “airline” passes a lot of its costs onto Qantas and relies on a great deal ot of Qantas infrustructure to operate. Sadly histrory will show how badly the Qantas board and management have been over the past 10 years. These misguided and poor decisions are now becoming reality. Its seems like a classic case of whereby any twit can show a profit in an organisation by slowly ripping out the guts of a company. Over time the organisation will begin to fall apart. Joyce, Dixon and Clifford’s actions seem to borded on criminal behaviour, when will the media begin to accurately report the behaviour of these incompetent people. One last thing, with Qantas in such a mess (and hopefully the current board and management gone) do you ever think that John Borghetti would return to Qantas to save our national icon?
Ron
says:Mark, I think Borghetti’s having more fun already building a NEW national icon.
gary
says:I wonder if Joyce will be dipping into his 2 mill payrise to help stranded travellers……I think NOT…..who does he think he is.To disrupt the travel and cause stress and upset to relatives is simply not on.Take a flight out Alan,we can find an Aussie to run Qantas!
Pepita Andrew
says:Gave up on Qantas some time ago. Go Air NZ every time, it’s the best for service and reliability. Remember the Ash.
Hannes
says:I have worked on a recent LNG project where the union’s actions have been disgusting while the Labour government refused to step in. Union actions had cost the project $100 millions while the very well paid and greedy unions kept the project to ransom.
Qantas are competing with airlines that do not have the constraints the union wants to impose on Qantas. The unions wanted a prolonged drawn out disrupted campaign and Qantas management’s action was to force the issue to negotiation. I am sure that Qantas’ management had tried to forced the Gillard government to act but as this government are prisoners of the unions they cannot act. Gillard’s argument that she could not envoke the specific powers in the Fair Work Act because of legal concerns are pathetic. Whe wrote the Act, her speciality was IR law and she should be well seasoned professional in this area. Was she then totally incompetent when drafting the act?
australianaviation.com.au
says:Hannes
Have youconsidered the possibility that, since Ms Gillard wrote the Fair Work Act, then maybe her legal concerns were well founded? It’s a big call to call them pathetic.
I don’t think any of us has enough information to criticise the government on this issue at the moment. It’ll be a ‘he said, she said’ back and forth for weeks.
Cheers
Andrew
David
says:I don’t buy it that Alan JOYCE had to do what he did. Then the government made an even bigger mess of it.
When an airline treats it’s staff as an asset, not an expense. They the staff perform better, with trust in management better communication. The airline makes a profit.
Craig
says:Putting aside Qantas for a moment, I am concerned with how the world now perceives Australian work place relations. If an airline like Qantas has to shut down to overcome its employees and unions, why would an overseas company want to invest, start or have part of its company or just deal with Australia?
I think that Qantas (Joyce) has not only defaced the reputation of Qantas, but also Australia. This is not how we normally do business in Australia! (Maybe it is in Ireland). We have fair work place rules and generally cooperative unions who work with employers for the benefit of all.
I have already had people, from the U.S., comment or ask how about Australian workplace relations because of the Qantas issue. Australia really looks like a pack of hicks in the eyes of the business world!