The Jet Set

Trans Australian Airlines was the trend setter in the 1950s, ordering Convair 340s and Vickers Viscounts, and when in May 1954 TAA director of engineering John Watkins visited Toulouse to see the Caravelle under construction he was impressed with what he saw. So too was TAA’s general manager John Ryland. Their plan was to operate the Caravelle Sydney-Adelaide- Perth with a feeder service from Melbourne to Adelaide.

In a 1987 interview with the author, Australia’s legendry aviation doyen Stanley Brogden said that “two Caravelle 1s were ordered, subject to government approval for delivery in mid 1959. ” But that approval was derailed by the turbulent events of the day with upstart Ansett Airways buying Australian National Airlines in October 1957 to prevent the latter’s collapse after the death of Sir Ivan Hollyman in January of that year.

The Menzies government had introduced the Airline Agreement Act of 1952 to bring stability to the industry after the introduction of the government airline in 1946 had threatened to send ANA out of business. The policy dictated that only two airlines could serve capital city routes and major regional centres and it also legislated that new aircraft be comparable. At the time Ansett Airways was considered too small to be part of the agreement. While the death of an airline chief should not have been the reason for an airline’s demise, in this case, ANA itself was in trouble.

Reginald Ansett, owner of Ansett Airways, a small low-cost airline, sensing the opportunity announced on the June 19 1957 that he had orders for the Lockheed Electras, and just five days later made an opening bid of £3 million for ANA. That was rejected by ANA, but not to be denied Ansett with more backing bid £3. 3 million, which was accepted on 23rd August 1957.

In September Ansett-ANA confirmed its order for four Lockheed Electras for delivery from October 1958.

But all of this did not sit well with the government’s “buy British policy” nor with the spirit of the Airlines Agreement Act to which Ansett was now party after the merger with ANA.

Ansett did not want to go for pure jets such as the Caravelle as it had no turbine experience at all. Years later Ansett would tell Brogdan that he would have never purchased the Caravelle if forced to go all jet and would have opted for the Convair 880.

The mood at the two airlines in 1962 was one of “let’s wait awhile”.

But regardless, the government was having none of this and rejected both Ansett and TAA’s orders for Electras and Caravelles in March 1958 but allowed them to buy more Viscounts, the 800 series, which they both did.

But in another twist, Qantas wanted Electras to replace its DC-4s and used its considerable influence through the Australian government’s 50 per cent stake in Tasman Empire Airways Limited to ensure TEAL also purchased Electras instead of the Comet 4 that it wanted.

Thus on May 22 1958, the Australian government announced that the airlines would buy 11 new aircraft being four Electras for Qantas, three for TEAL, and two each for TAA and Ansett.

The reaction in New Zealand was dismay and TEAL became known as Take the Electra And Like it. That decision was in fact the catalyst for New Zealand to buy Australia out of its 50 per cent stake – that occurred in 1961.

And as part of the 1958 agreement Ansett-ANA leased three 700 series Viscounts from TAA and in turn leased the government airline two DC-6Bs.

Jet orders

With millions flocking to and extolling the many virtues of Qantas’s Boeing 707s, pressure mounted for pure jet travel on domestic routes. On the radar was the Caravelle, de Havilland Trident, Boeing 727, Douglas 2086, which became the DC-9 and BAC 1-11.

The government’s regulator, the then Department of Civil Aviation, preferred the smaller designs because of the fragile state of the economy and industry at the time, according to Brogden in 1987.

In fact according to Brogden the mood at the two airlines in 1962 was one of “let’s wait awhile”. However in October Ansett, who had just been knighted, shocked everyone, as he liked to do, and committed to the Boeing 727. At that time TAA favoured the Trident, which could have been ordered under what was now known as the Two Airline Policy.

However, according to Brogden the decision by de Havilland to agree to reduce the engine power to suit BEA’s requirements killed off the Trident for Australia – and in fact globally.

So the die was cast and both airlines ordered the 727-100 in February 1963 for delivery in October 1964. Ansett and TAA were the sixth and seventh airlines to order the new jet.

The 727 was a quantum leap forward over the Electras, DC- 6Bs and Viscounts then in service and boasted a host of firsts. Itsmost distinguishing feature was its extraordinary wing with triple slotted Fowler flaps that almost disassembled for landing into what was termed a “parasol”. This feature along with the leading edge slats gave the 727 its amazing short field performance.

Other firsts included an APU, a tailor-made engine in the JT8D, built-in airstairs and it was the first Boeing aircraft to be subjected to its fatigue and static airframe testing before first flight.

The Boeing 727 was the first of the family concept touted by Maynard Pennell, former Douglas Aircraft Company engineer who was the main force in the creation of the 707 and the 727. Pennell, who joined Boeing in 1940, was also a key designer of the B-29 and B-52.

From an economics aspect the 727 was nirvana. It slashed cost per seat by 60 per cent compared to the Viscount and DC-6B. And compared to its immediate competition, in the four-engine Boeing 720B, it had 18 per cent fewer seats but had direct operating costs 25 per cent less.

Interestingly, jet noise was already a major factor for airport communities and the 727 presentation of the day touted that the 727 would be quieter than DC‑6B on takeoff and almost as quiet on landing.

When the 727 entered service in October 1964 the average weekly earnings in Australia was $37 and the return airfare from Sydney to Perth was $210.

The 727 was an instant hit with the public. Ansett had its “System of the Golden Jets” and TAA the “Whispering T-Jets” and evocative advertising campaigns on new television sets lured the public into the air. In the ten years prior to 1965 passenger numbers had climbed over 95 per cent to 3. 76 million but in the period from 1965 to 1975 that number soared almost 150 per cent to 9. 39 million.

By 1975 air travel was more affordable. The Sydney to Perth return fare had increased by only 23. 8 per cent but the average weekly earnings had leapt 140 per cent.

Smaller jets

To replace the DC-6B and Vickers Viscounts, TAA and Ansett focused on the DC-9 and BAC 1-11 twin-jets.

Sporting the same Pratt & Whitney engine as the Boeing 727, the 95‑seat DC-9-10 was always in front at Ansett despite the airline having to pay import duty that did not impact the British BAC 1-11. In March 1964 Ansett took options on six DC-9s and took a bet with industry journal Flight International that TAA would do the same. However, once again things were not as clear cut for the American product at government owned TAA. There was strong preference at the Commission level for the BAC 1-11 but two sticking points were Douglas’s commitment to a larger Series 30 model and the delivery date.

Traffic in Australia was surging and larger jets were desperately needed. At the last minute Ansett switched his order to the stretched DC-9-30 – dubbed the DC-9B at the time. On March 24 1965 Ansett ordered 2 DC‑9‑30s with four options and reportedly told Douglas officials to keep a similar number aside for TAA.

TAA and Ansett were promised the larger DC-9s for late 1966 delivery whereas a larger version of the BAC 1-11, the series 500, would not be available until March 1967. Complicating matters the Two Airline Policy dictated that the two airlines must have comparable equipment and BAC had not committed to the larger -500 model.

Thus Flight International, which at the time was steadfastly pro-British, reported “once again TAA has followed the pace-setting Ansett, and once again Australia has rejected the British product. ” Compared to the DC-6B, Viscount and Caravelle the DC-9 was slightly wider. Manufacturer presentations of the day – a carbon copy of today’s seat and cabin width debate – touted the wider seats and wider aisles of the DC-9 with a claim that an 80 per cent load factor was needed before the unpopular centre seat was required.

As history would show the DC‑9s did not arrive in November 1966 for the Christmas holiday peak as promised, but in early 1967 because of major production snarls at Douglas which led to its merger with McDonnell in April 1967.

However, when they did arrive, they were, like the 727, popularwith passengers, although the DC-9 did have an issue with engine noise at the rear of the cabin.

Dubbed the “Woolworths Boeing” by engineers the plane gained favour because of its reliability. One senior TAA engineer, John Maskiell, once told the author that Boeing was always at the airline to swap to the 737 but the answer was “make the 727 as reliable as the DC-9 and we will listen”.

Jumbo jets and new owners

With jets replacing virtually all of the DC-6Bs and Viscounts and traffic increasing, the focus moved to the next generation of aircraft – the widebody trijets. Both McDonnell Douglas and Lockheed pushed hard with their respective DC-10 and L-1011 TriStar designs and one futuristic TAA advert of the day featured a L-1011.

But the big trijets were a step too far and Boeing was pitching its Advanced 727-200 – which compared to the basic stretched 727-200 featured a more powerful engine, increased weights and a “widebody” look interior – to combat the DC-10 and L-1011.

Boeing won the day and bothairlines placed orders for four 727‑200s in December 1970.

By 1972 both airline fleets had been dramatically streamlined.

Ansett’s roster was six 727-100s, 12 DC-9s, 18 F27s, five F28s, three Electras, one DC-4 with four 727-200s on order. TAA’s fleet was of course very similar with six 727-100s, 12 DC‑9s, 16 F-27s, 11 Twin Otters, 10 DC-3s and four 727-200s on order.

But that sameness was about to change with the government relaxing the equipment provisions of the Two Airline Policy in the late 1970s and Ansett being taken over by TNT and News Corporation in 1979.

TAA seized upon the relaxation of the equipment provision and ordered five Airbus A300s that were destined for Iran Air but lapsed after that country’s revolution and the subsequent embargo on technology transfer.

TAA’s engineering director Frank Austin told the author in 1981 that the “DOCs were half the airline’s costs and the A300’s DOCs would be 25 per cent less per seat than the 727-200. ” And importantly the A300’s noise footprint was a dramatic reduction of that of the 727, only impacting 3. 5 square miles at 90dB.

For TAA – as for many airlines – it was a no-brainer. The big twin was the future of air travel.

While TAA opted for the larger 269-seat A300, Ansett’s new owners Sir Peter Abeles and Rupert Murdoch were swayed by Boeing’s “frequency rules” pitch, and under the banner of “The New World of Ansett” placed the largest order at the time in Australian aviation history for 21 jets.

The $400 million buy included 12 737-200s, five 767-200s and four Boeing 727-200LRs that could operate from Sydney to Perth nonstop in virtually all weather. Surprising today, but at the time 50 per cent of all Sydney-Perth flights had to stop for extra fuel.

To mark the order, in a special edition of Ansett’s staff magazine Outlook the airline also talked extensively about an additional order for the Boeing 757. It said “the airline has advised the manufacturer of its very definite interest in the new-generation Boeing 757. ” Suddenly the landscape of Australian’s airlines had changed and far more was to come. For TAA – as for many airlines – it was a no-brainer. The big twin was the future of air travel. The build-up was rapid with TAA’s A300s arriving in July 1981 along with Ansett’s first 727-200LRs and 737‑200s. Ansett received four 727-200LRs and seven 737-200s by year’s end. And with those jets and TAA’s A300s came a revolution in inflight service with hot meals and inflight entertainment becoming the norm, replacing boxed cold meals for economy passengers.

With its new fleet of 737s Ansett launched extensive advertising campaigns touting the virtues of being on cosier high-frequency jets rather than large jumbo jets. It was effective. The cosy theme continued with the 767 which seated 201. The first three Ansett machines arrived in June 1983 – two years after TAA’s A300.

More planes, lower fares and deregulation

After a dip in the early ’80s air travel was booming again, which was all Sir Peter needed to order more aircraft – a decision that would sow the seeds of the demise of Ansett. It started at the June 1985Paris Airshow where he ordered without consultation 8 150-seat A320s at a cost of $380 million. According to one News Corp executive the first Murdoch knew of the purchase was reading about it in The Australian. He reportedly stormed into a board meeting and slammed the paper on the table saying “look what bloody Abeles has just ordered”.

Whatever transpired behind closed doors did not impact Sir Peter’s buying spree for he added 12 110-seat 737-300s costing $500 million to the shopping list just three weeks later.

TAA also ordered 12 737s and A320s but cancelled the latter.

The 737-300 purchase was sensible and a big step forward. Both airlines had extensive experience with Boeing and Ansett had the 737-200 in service. The new Boeing with CFM56 engines promised major savings over the types it would replace.

In an all-economy 140-seat configuration it would burn 50 per cent less fuel per seat than the 167-seat 727‑200, 27 per cent less than the 120‑seat 737-200 and 41 per cent less than the 109-seat DC-9-30.

There was of course no doubt that the A320 is an outstanding aircraft but buying both it and the 737 was inefficient and the inefficiency did not end there with Sir Peter, in a Howard Hughes touch, wanting gold-plated ash trays in the A320 which he dubbed the Skystar. Airbus pointed out that the gold plate would tarnish and a “gold effect finish” was substituted.

By 1990 when these types were well established the cost of a return flight from Sydney to Perth at $581 was almost the same as the average weekly earnings of $575. Whereas in 1964 the average earnings would buy you nine return flights across the country, now that number was 51 and deregulation had not started.

But when it did in December 1990 the aviation landscape changed rapidly.

At the time the Department of Transport and Communications assistant secretary domestic aviationRob Elder boldly predicted that he “did not believe that there will be in any way destructive competition following deregulation”. This statement was all the more brave considering the carnage in the US since deregulation in 1979.

All told seven potential operators with 47 aircraft applied for licences, with some of the proposals bizarre. One called Transcontinental Airlines using three class 737-500s was to operate within WA and touted one-way first class fares between Perth and Newman of $300 and business class just $25 less. It did not take off.

First out of the blocks was Compass Airlines operating four A300-600s and a single A310 under the slogan “Stretch your wings Australia”. But unfortunately the airline was also stretched financially as a fare bloodbath erupted. Fares plummeted as low as $198 return between Sydney and Perth. Passengers loved it and traffic surged 25 per cent. On routes to WA the traffic leaped 45 per cent according to then Ansett PR chief Peter Young. Young admitted to the author that Ansett itself was only weeks away from collapse, when Compass ceased flying on December 20 1991.

With Compass Mark II the MD-82 and MD-83 took to the skies but the adventure with five jets lasted less than 12 months.

As a result of the failures the federal government moved to consolidate the industry, with Qantas to buy Australian Airlines which had been re-branded from TAA and itself be floated. Ansett was to gain international access and Air New Zealand was to fly on Australian domestic routes – a concession later revoked.

By 1995 domestic passenger traffic had leapt to 23. 4 million – a 106 per cent increase over the previous ten years. That was a dramatic lift from the 20 per cent growth on the prior ten years to 1985. And more was to come.

By the close of the decade Ansett, whose ownership structure changed dramatically with first TNT and then News Corp selling

The reduction in airfares will slow as the airlines will not always have the most fuel-efficient models.

out to Air New Zealand, found itself labouring under the burden of a mixed and ageing fleet and was totally ill-equipped to match it with new low-cost entrants Virgin Blue with 737-800s or Impulse with Boeing 717s.

The 162-seat 737-800 was to quickly become the backbone of the Australian domestic airline fleets – nearly 150 are today in service with the Qantas and Virgin Australia groups.

Ansett’s collapse and Qantas woes

With the demise of Ansett, Qantas quickly ordered 65 737-800s, taking over an American Airlines order which lapsed after 9/11, and Virgin ordered more.

To combat Virgin Blue, Qantas launched Jetstar initially with 100‑seat 717s it had picked up from the takeover of Impulse Airlines in 2001. Airbus A320s were selected to be the backbone of the Jetstar fleet, with the 717s finally finding a permanent home with QantasLink.

Through the last decade Qantas started deploying A330s to replace both 767-300s and 747s on domestic routes and that aircraft has become the mainstay of the major trunk routes, particularly the transcontinental services.

The A330, while based on the A300 sported an all-new wing, glass cockpit, and more powerful fuel-efficient engines. According to Airbus the A330’s wing is 40 per cent more efficient than that on the A300.

However, the A330 was initially ordered as an interim type to give Qantas pilots experience ahead of the delivery of the A380. In 2005 Qantas ordered and optioned 115 787s to replace its 767s, A330s and even 747s. But delays and production problems with the program and Qantas’s financial difficulties forced the airline to first defer and then cancel many of those aircraft.

By 2013 the best typical return airfare between Sydney to Perth had sunk to just $418, while the average weekly earnings topped out at $1,557 and last year 60 million passengers were carried on domestic services.

However, both major airline groups are losing money as they battle for marketshare and they can no longer afford the very best aircraft. For the first time since WW2 Australian airlines are not among those setting the pace in aircraft technology.

Qantas has cancelled most of its 787s and has not ordered the 737 MAX, although subsidiary Jetstar does have the A320neo on order for delivery from 2016. Virgin Australia, while ordering the 737 MAX with deliveries planned from 2018, walked away from the 787 last year and is now talking 2020 for the replacement of its A330s.

So for the first time in 60 years the pace of reduction in airfares will inevitably slow as the airlines will not always have the most fuel-efficient models to counter the increasing fuel prices.

Still, the impact of jet travel on the Australian economy has been staggering. From a modest 2. 24 billion RPKs in the first year of domestic jet travel that number has soared to 67 billion RPKs last year.

Commercial jets have served Australia well. Not one fatality in 50 years and today almost all the population can afford to fly and often – a remarkable achievement by any standard.

Sir Reginald Ansett, Ivan Hollyman, John Watkins and John Ryland would be very impressed.