Preflight

All its operating segments were expected to be profitable in the first half.

Qantas chief executive Alan Joyce said the projected first-half result would be an improvement of about $500 million from the underlying loss of $252 million in the prior corresponding period, with the airline’s cost-cutting transformation program the “primary driver of the turnaround”.

“Today we confirm that Qantas is set to report its best first half result since 2010,” Joyce said in a statement on December 8.

“This demonstrates that the strategy we have outlined to transform our business is working. ” The airline’s financial guidance was higher than analysts’ expectations and puts the company on track for a full-year profit. It also sent the Qantas share price higher.

“Although the second half of the financial year is typically weaker for Qantas, guidance implies fullyear profit that is significantly above our forecasts and the market’s expectations,” Morningstar analyst Daniel Mueller said in a December 8 research note.

Qantas International posted an underlying earnings before interest

Consumers have it a lot better than they have had in a long time.ALAN JOYCE

and tax loss of $262 million in the first half of 2013/14 and has not posted a profitable half since the company started reporting its performance as a separate operating segment in 2012/13.

Prior to 2012/13, Qantas did not split out the performance of its mainline domestic and international operations. However, the airline said in 2012 its international arm had met its cost of capital three times in the past 15 years.

Qantas is in the middle of a threeyear plan to take out $2 billion of costs from the business through measures such as increasing fleet utilisation, closing down call centres, retiring older aircraft and withdrawing from loss-making routes. The airline has forecast about 5,000 jobs will be cut over that three-year period.

The program was on track to achieve $350 million in cost savings in the six months to December 31 2014, having already achieved $204 million in benefits in the second half of 2013/14, Qantas said.

Qantas said lower fuel prices would have a $30 million benefit in the first half. However, there were no plans to alter the airline’s level of fuel surcharges on international flights until there was a sustained and significant reduction in fuel prices.

“We are long way away from seeing sustainable fuel price reductions that would allow us to start alleviating and pulling back on the surcharges,” Joyce said.

Joyce said the current level of fuel surcharges on its tickets did not cover Qantas’s fuel bill for its international operations. Moreover, an airfare from Australia to London has fallen by 30 per cent over the past 10 years.

“Consumers have it a lot better than they have had in a long time. ” Joyce noted that Qantas’s international fuel bill would be about $2 billion this year, while the fuel surcharges would bring in about $1 billion.

Moody’s senior analyst Matthew Moore said in a research note dated December 8 he expected “more material improvements from lower fuel to flow through in the second half” of 2014/15.

Joyce affirms Qantas 787 order prospects

But reducing debt takes priority

Qantas CEO Alan Joyce says he wants to order the Boeing 787, but only after the airline has paid down debt and strengthened its balance sheet.

“I want to order it, I think everybody at Qantas wants to have them, they’d love those aircraft to come in,” Joyce said in Brisbane onDecember 9, the day after Qantas released guidance forecasting a $300‑350 million underlying profit for the first half of the current financial year.

“But we have to make sure that the business has the balance sheet straight, has the [right] cost base – the transformation [program] is key – and has the appropriate business case to get them, and I think we can achieve all of that, and we’re working with our people to make sure that we get there. ” Qantas holds options and purchase rights on 50 787s, on top of 11 787-8s currently being delivered to low-cost subsidiary Jetstar. Joyce and his management team have repeatedly reiterated in recents years that the Qantas Group won’t order further 787s until Qantas’s international operations have returned to profitability, but said in early December that all its Qantas business segments, including Qantas International, were on track to record a profitable first half for the current financial year.

Joyce further explained that Qantas has flexibility as to when it can confirm 787 options into firm orders and when aircraft deliveries can take place.

“What’s ended up happening is they are very movable … we’ve got the flexibility of moving them out, so we haven’t lost any of theoptions and we talk to Boeing if we say we need more time. So there is not going to be a firm date, that date is always going to be variable.

“We’d like to make [a decision] as soon as we can and as soon as all of our conditions and our outlook is [right] we’ll make that call. But don’t assume that there is a hard date where we will lose an [aircraft] option. It’s very flexible. ” Joyce also confirmed Qantas would look at the Boeing 737 MAX and Airbus A320neo as options to eventually begin replacing Qantas Domestic’s 737 fleet.

“I think what we will do for Qantas mainline is we will have a look at absolutely the MAX or the neo. We have great neo options, we have them at a great price and there is enough aircraft there, with the way that the deal works, to ratchet up the options that are available. But we will also look at the MAX and we will see what is the best economic outcome for the group. ” The Qantas Group already has 99 Airbus A320neo aircraft on order pencilled in for Jetstar, with first deliveries from 2016.

“Again, our focus is ontransformation, it is the same issue with the 787s, we need to make more progress on paying down our debt, we need to make more progress on turning the cost base around and we’re very conscious of the fact that we will not order aircraft until we see the right environment, the right balance sheet, the right business case to enable us to do that, and the 737 replacement is in the same boat,” Joyce said.

“We’d like to get there as fast as we can, [but] we still have a lot of life left in the 737s. ”

Air New Zealand tops up 787 order with two more aircraft, confirms new Buenos Aires route

Qantas executive revamp

Qantas has made sweeping changes to its senior executive ranks with the heads of its Domestic and International operations heading for the departure gate as part of a major restructure.

Lyell Strambi, who runs Qantas Domestic, and the head of Qantas International Simon Hickey will leave the company once the new structure is in place by March 2015, Qantas said in a statement on December 12.

In their place, Andrew David has been promoted to the chief executive of Qantas Domestic from his current position of Qantas chief operating officer, while current Qantas chief financial officer Gareth Evans moves across to run Qantas International.

Current QantasLink chief executive John Gissing gets an expanded role as group executive of associated airlines and services. He will keep responsibility for the regional carrier, as well as New Zealand-based Jetconnect and fly-in/fly-out operator Network Aviation.

Evans’ replacement as chief financial officer will be Tino La Spina, who is currently the deputy chief financial officer.

And Robert Marcolina will have an expanded role as group executive for strategy, transformation and IT.

Qantas said the changes were the first major restructureof the company’s executive committee since May 2012 and would result in a “flatter structure for the broader Qantas Group executive team”, given the deputy chief financial officer, QantasLink chief executive and Qantas chief operating officer positions were not being replaced.

“In the 12 months since we announced our accelerated transformation program, we have made excellent progress,” Qantas chief executive Alan Joyce said in a statement.

“But there is still a lot of work to build the foundation for a stronger, more sustainable and more successful Qantas. This new executive team will lead this work forward to deliver for our customers, shareholders and employees according to the strategy we have laid out. ” Evans has held the role of chief financial officer since 2010, when he replaced Colin Storrie.

A 15-year veteran of the company, Evans had previously worked on flight scheduling, pricing, revenue management and airline operations, as well as preparing the airline for the entry of the Airbus A380 into the fleet.

David – pictured – is a recent arrival at Qantas, having joined the company in 2013. Previously, the 53-year-old has worked at Jetstar, Tiger Australia (where he was chief executive for 18 months), Virgin Australia and Air New Zealand.

Air New Zealand chief executive Christopher Luxon has flagged capacity growth in the order of five to six per cent a year over the next five years as the airline adds a further two Boeing 787-9 aircraft to its existing order book.

The airline announced the order for two more Dreamliners, which are due for delivery in 2017 and 2018 and bring to 12 the number of 787s the airline has on firm order, on December 8.

Air NZ has to date taken delivery of three 787-9s, which were operating from Auckland to Perth, Sydney, Tokyo Narita and Shanghai.

The top-up order for additional 787-9s comes amid improved profits at the airline for a third straight year in 2013/14 and forecast further profit growth in the current year.

“The reason why we have gone from six of those aircraft initially to now 12 is as our results have got better we’re taking those profits and we are ploughing it straight back into the business to make it strong, relevant and competitive for the future,” Luxon told guests at a National Aviation Press Club lunch in Sydney.

“We do have routes in mind for these aircraft. We don’t just buy aircraft and work out where to send them, we have got markets that we think we can develop. ” Air NZ also had a further six options for 787-9s still available.

The airline was expecting to grow its network by five tosix per cent a year over the next half decade as it sought to “unlock and develop” new markets across the Pacific Rim.

Four days later, as part of that strategy, Air NZ announced it would begin services to Buenos Aires in Argentina from December 2015 – the carrier’s 28th international destination – using Boeing 777-200ER aircraft three times a week from Auckland.

Aerolineas Argentinas, which used to serve New Zealand and Australia, will place its AR airline code on the new flights.

The new flights will have a flight time of approximately 12 hours and will go on sale from March next year.

They will be the only direct connections between New Zealand and Argentina after Aerolineas ceased Auckland services, which continued on to Sydney, in June 2012, in favour of direct flights to Sydney (which it subsequently withdrew from earlier in 2014).

LAN, meanwhile, operates daily flights from Santiago, Chile to Auckland and then on to Sydney, and has announced plans to upgrade the service from Airbus A340‑300 to Boeing 787 aircraft from April 18 2015.

The Chile-based airline said in a statement the Dreamliner used to Sydney would be configured with 30 business and 217 economy seats for a total of 247, suggesting LAN planned to use the 787-8 to operate the route.

But LAN has flagged adding extra frequencies to Sydney and Auckland, as well as deploying the larger 787-9, which has 313 seats, on the route from the second half of 2015.

Virgin flags second quarter underlying profit in 2014/15

Benefit from falling fuel prices yet to come

Virgin Australia expects the full benefit of the recent drop in fuel prices to come in the second half of 2014/15, as the airline group points the market to an underlying profit for the three months to December 31 2014.

Office of Transport Security looking at new approach to airport security

Forecast growth in passenger numbers, coupled with the persistent threat of a terrorist attack will place unsustainable pressure on security checkpoints at the nation’s airports unless new techniques are introduced, a conference has heard.

To manage the anticipated 260 million travellers expected to pass through Australia’s airports by 2030, regulators are looking at providing expedited screening for lower-risk passenger groups, increasing the use of Smart Gate technology and matching the security measures required at an airport to its risk profile.

Department of Infrastructure and Regional Development executive director Sachi Wimmer, who heads up the Office of Transport Security (OTS), says the industry needed to balance security outcomes with maintaining a viable transport industry.

To that end, the OTS was refining its approach to risk, Wimmer said.

“We are moving away from addressing all vulnerabilities as it is absolutely impossible and prohibitively expensive toplug every security hole that we can identify,” Wimmer told delegates at the Australian Airports Association national conference on the Gold Coast on November 25.

“Instead we are focusing on where we judge the highest risks to be and that means our judgements are about when the most plausible risks are played out and that’s really important. ” The Office of Transport Security was established in 2004, following the September 11 terrorist attacks in the US in 2001 and the Bali bombings in 2002, and its purpose was to “support Australia’s economic and social prosperity through effective transport security regulation”, Wimmer said.

Wimmer said OTS was looking at matching security requirements at airports so that they were proportionate to their respective risk profiles, along with helping reduce the administrative burden on industry.

Separately, OTS was considering offering expedited security screening for predetermined lower-risk passengers, which would reduce the pressure at screening points and allow border agencies to focus on passengers of unknown or higher risk.

There were also changesplanned to what passengers were allowed to carry on board an aircraft, with small scissors with blades less than 6cm in length, small sharp tools of similar length and metal cutlery including knives with rounded edges to be permitted.

“If we take into account forecast growth of about four per cent in international departing passengers, the 100 per cent screening model that we have in place at the moment is just unsustainable in the long term,” Wimmer said.

“When it comes to regulation one size does not fit all so we need to tailor our regulation to be proportionate to security risk and differentiate between industry sectors and segments. ” Department of Infrastructure and Regional Development Secretary Mike Mrdak said the recent trial of new procedures for the explosives detection tests (EDT) at the security scanning points at Brisbane, Melbourne, Sydney, Coffs Harbour and Rockhampton airports had been a success.

Mrdak said moving the explosives test to before the x-ray machines, and screening people in batches of up to three at a time helped improve queueing times and increased passenger flows by up to 50 per cent.

In an update to shareholders at the company’s annual general meeting in Brisbane on November 19, Virgin chief executive John Borghetti said conditions in the local market were moderating.

Borghetti said yields, an industry measure of average airfares per passenger, in the Australian domestic market were higher during the first four months of 2014/15 compared with the prior corresponding period.

“While the continued uncertain economic environment and subdued consumer sentiment make it difficult for us to give guidance for the 2015 financial year, Virgin Australia expects to achieve an underlying profit in the second quarter of the 2015 financial year,” Borghetti said.

Virgin Australia chairman Neil Chatfield, who was running his last AGM after announcing his intention to step down, said conditions in the Australian domestic market were improving, “with domestic capacity growth beginning to moderate and some improvement in fuel costs”.

“We believe the business is well placed to significantly improve performance in the 2015 financial year,” Chatfield said.

“While the domestic market continues to suffer from overcapacity, there is evidence that this is easing. ” Speaking with reporters after the shareholders meeting, which lasted just over an hour and featured just one question from the floor, Borghetti said demand was catching up with the amount of seats in the local market.

“The moderation in capacity has certainly meant that the demand/ supply equation is getting closer to a more sustainable level,” Borghetti said.

“There’s no question that we are in a position where we are still continuing to win corporate share, which gives us better yields. ” Virgin chief financial officer Sankar Narayan said the airline’s fuel hedging program meant any gains from the lower fuel price would not be immediately felt.

“We expect to see a bigger benefit in the second half as we actually get the benefit of some of the options that we have,” Narayan said.

“We haven’t put a number on it but it could be a meaningful number. ” Meanwhile, Borghetti also flagged an improved performance from Tigerair Australia, with the low-cost unit forecast to halve its underlying loss in the three months to December 31, compared with the prior corresponding period.

The battling budget carrier, which has never made a profit since commencing operations in Australia in 2007, was expected to reach breakeven by the end of 2015/16, six months earlier than previously forecast.

Virgin Australia bought the remaining 40 per cent stake in low-cost carrier Tigerair Australia that it did not already own in late October for $1.

ATSB to reopen Pel-Air ditching investigation

The Australian Transport Safety Bureau (ATSB) will open a fresh investigation into the ditching of a Pel-Air Westwind corporate jet off Norfolk Island in 2009.

The decision to reopen the case was made following a critical review of the original inquiry by the Transportation Safety Board of Canada (TSB).

“A new investigation team will review the original investigation and associated report in the light of any fresh evidence and relevant points raised in the TSB review and other recent aviation reviews,” the ATSB said in a statement on December 8.

“At the same time, the ATSB Commission will continue to methodically and carefully work its way through the broader findings and recommendations of the TSB review, with the aim of ongoing improvements to the future work of the ATSB. ” Deputy Prime Minister and Minister for Infrastructure and Regional Development Warren Truss told Parliament he had asked the ATSB to reopen the case.

The TSB report said ATSB investigators did not follow proper process and had poor oversight during an investigation into the ditching of the Westwind.

The TSB said its review of how the ATSB investigated the crash of the Pel-Air aircraft, registration VH-NGA, “revealed lapses in the application of the ATSB methodology with respect to the collection of factual information, and a lack of an iterative approach to analysis”.

“The review also identified potential shortcomings in ATSB processes, whereby errors and flawed analysis stemming from the poor application of existing processes were not mitigated,” the TSB said. The ATSB requested the TSB conduct the review after the commission was heavily criticised for its report on the accident, where the Westwind conducting an aeromedical flight from Apia, Samoa to Melbourne, ditched after running out of fuel.

All six passengers and crew on board survived the crash and were rescued.

The ATSB report into the incident cited errors by the flightcrew and found the pilot in command of the aircraft, Dominic James, did not plan the flight in accordance with regulatory and operator requirements.

However, the ATSB investigation was the subject of a scathing assessment by a Senate committee which found, among other things, that the Civil Aviation Safety Authority (CASA) withheld a number of documents critical of Pel- Air. A Four Corners investigation also highlighted serious flaws in the way the investigation was conducted.

“The response to the Norfolk Island investigation report clearly demonstrated that the investigation report published by the ATSB did not address key issues in the way that the Australian aviation industry and members of the public expected,” the TSB said.

The TSB review said the ATSB collected “insufficient information from Pel-Air to determine the extent to which the flight planning and monitoring deficiencies observed in the occurrence existed in the company in general. ” “Poor data collection also hampered the analysis of specific safety issues, particularly fuel management, company and regulatory oversight, and fatigue,” the TSB said.

On a positive note, the TSB found the ATSB’s methodologies “met or exceeded the intent and spirit of those prescribed” in the International Civil Aviation Organization (ICAO) convention on international civil aviation.

ATSB chief commissioner Martin Dolan said his office was carefully and methodically working through the review’s findings.

“While I’m pleased to see that the ATSB mostly met or exceeded international investigative standards, there is clearly room for improvement,” Dolan said in a statement.

The ATSB said it would provide a detailed, formal response to the review in early 2015.

RAAF Heron detachment completes Afghan mission

The RAAF’s Heron remotely piloted aircraft (RPA) detachment’s mission to Afghanistan has ended following the final mission being flown on November 30.

The detachment was established at Kandahar in August 2009 following a rapid acquisition program called Project Nankeen which resulted in the IAI Heron being selected through an initial partnership with the Canadian forces, and with contractor support from Canadian firm MacDonald Detwiller & Associates (MDA). Crews initially trained in Canada in July 2009 before posting straight into theatre with the system.

In the five years of the detachment, 15 rotations comprising 490 ADF personnel from all three services have cycled through Kandahar Airfield to operate the Heron and its ground control segment. In that time, the three aircraft have flown a total of more than 27,000 intelligence, surveillance and reconnaissance mission hours in support of Australian and coalition ground operations.

“The Australian Heron capability forged a fine reputation among our American and other Coalition partners here in ISAF as a result of our can-do attitude and the capabilities of this aircraft,” Heron Rotation 15 Commanding Officer, WGCDR Phillip ‘Budgie’ Parsons said in a statement.

“From Heron’s first days supporting the Special Operations Task Group through to the end of Australia’s mission in Uruzgan province last year and support to ISAF units throughout 2014, Heron has provided commanders on the ground with information they needed to fight and keep their people safe. ” The Heron mission was extended for two additional six-month tours late last year after the withdrawal of Australian ground forces from Afghanistan. More recently, it was announced two Herons will be retained for a further six years until 2020, during which concepts of operation will be developed in preparation of the planned arrival of the Northrop Grumman MQ-4C Triton UAS.

It was expected all Heron detachment personnel and equipment would have returned to Australia by the end of December.

Canberra commissioning marks new era in ADF amphibious warfareAustralia’s amphibious warfare

capabilities have taken a 27,000 tonne step forward with the commissioning of HMAS Canberra, the first of two LHD amphibious ships being built for the Royal Australian Navy.

The Canberra was formally commissioned into RAN service in ceremony at the Navy’s Fleet Base East in Sydney on November 28 attended by Governor General Peter Cosgrove, Prime Minister Tony Abbott, Defence Minister Senator David Johnston, Chief of Defence Force Air Chief Marshal Mark Binskin and Chief of Navy Vice Admiral Tim Barrett.

“Through the efforts of many organisations, this outstanding ship is now a reality,” HMAS Canberra’s commanding officer, Captain Jonathan Sadleir, said.

“We know it’s an awesome ship with huge capability, but the next step is to go to sea and test procedures, refine and consolidate, so we can be ready when the nation needs us. ” Sadleir commands a ship’s company of 400 personnel from all three services.

“It was a proud and emotional experience for me to stand with 400 exceptional members of my crew today,” he said.

HMAS Canberra and sistership NUSHIP Adelaide – due to commission in 2016 – are designed to carry 1,000 troops and equipment which can be landed ashore by landing craft or helicopter.

Both LHDs have deck space for six MRH 90 or Black Hawk medium helicopters, but can also support the heavylift CH-47 Chinook and the Tiger Armed Reconnaissance Helicopter.

“This LHD is a true multipurpose warship ideally configured to carry out humanitarian assistance or transport an embarked force complete with their equipment and aviation assets for a peacekeeping mission,” Minister Johnston said.

“These two ships together will be able land a force of more than 2,000 personnel by helicopter and water craft, along with all their weapons, ammunition, vehicles and stores. ” The two ships are based on the Spanish ‘Buque de Proyección Estratégica’ (Strategic Projection Ship) design. Their hulls were built by Navantia in Ferrol, Spain, while their superstructures were built by and final outfitting undertaken at BAE Systems Australia’s Williamstown, Melbourne shipyard.

Australian tech flies on Boeing’s 787 ecoDemonstrator

Two Australian-developed innovations are among 25 new technologies being tested as part of Boeing’s latest ecoDemonstrator flight test program that has seen 787-8 test aircraft ZA004 begin a month-long flight test campaign.

“The 787 is going to have 25 new technologies on it. We have partnerships with JAL, Delta, NASA, the FAA, Rolls‑Royce, Honeywell and other suppliers like Panasonic,” Julie Felgar, managing director of Boeing Commercial Airplanes environmental strategy, told Australian media in Seattle.

The 787 ecoDemonstrator program aims to test and validate a range of technologies that could reduce aircraft fuel-burn and manufacturing costs, ranging from new laminar-flow wing coatings, a ceramic-matrix composite engine nozzle (which could allow engines to run hotter, and thus burn fuel more efficiently) and providing pilots with real-time wind information so they can select optimum cruising altitudes.

The ecoDemonstrator program “is really dedicated to fast-track testing and development of new technologies that are related to environmental efficiency for our new airplanes,” Felgar said.

Australia’s connection to the 787 ecoDemonstrator is outer-wing access doors made from recycled composite scrap and a single-piece composite aft engine pylon fairing.

The new wing access door has been developed by Boeing Aerostructures Australia.

“When we’re building composite structures there is composite scrap that comes off the building of those structures,” explained Felgar.

“What you have to do is you take the scraps, you have to go through a process where you reheat and form the scraps into the composite layup that you need, and then you bake it into a hardened form. ” Felgar estimates that “it is reducing emissions from manufacturing by 30 per cent if you are reusing that [scrap] material. ” The second project ecoDemonstrator project with Australian involvement has seen Boeing Research and Technology Australia work with Boeing Research and Technology Canada to develop a resin-infused engine pylon aft fairing.

“Working with Boeing Research and Technology Australia and our BRT centre in Canada we identified how we could do a one-piece design instead of a two-piece design and we do that through resin infusion. Basically you lay out the composite material, you bag it, you take the resin and you shoot it and then you use atmospheric pressure to cook the part together,” Felgar explained.

“What that has done is reduce the weight by 20 to 30 per cent and it is also a 50 per cent cost saving in manufacturing because it is one step instead of two and it is [using] much less material. ” Under the ecoDemonstrator program Boeing has already flight tested a leased American Airlines 737-800 fitted with an active engine vibration reduction system and a regenerative fuel cell, which could in time be used as an aircraft auxiliary power source.

Then in 2015 Boeing will flight test a Tui 757-200 modified with active flow control technology on the aircraft’s vertical tail, aimed at reducing rudder sideforce and drag, thus allowing future aircraft to be designed with smaller vertical tails.

Virgin receives WA gov’t OK for regional route reductions

Virgin Australia has received approval from the West Australian government to reduce flights on regulated routes to four regional towns in the state’s south.

As part of the changes that have been gradually introduced from December 5, the number of Perth- Albany flights will be cut to 15 per week, from 20 currently, while the Perth-Esperance route will have five fewer flights at 13 per week.

Meanwhile, Virgin said it would serve Busselton with a once-weekly direct service, rather than as part of a Perth-Busselton-Albany route.

And Ravensthorpe would no longer receive its once-a-week direct flight.

Instead, Virgin will serve the town twice-a-week with a Perth-Esperance- Ravensthorpe-Perth routing.

Virgin, which served these communities with Fokker 50 aircraft, proposed reducing services to these regional towns in August, citing unacceptable losses on those routes.

The airline said on November 28 the new timetable was a result of extensive consultation between the airline, the WA government and local communities.

“The new flight timetable is designed to maintain the best possible schedule and help ensure the long-term viability of the services to Albany, Esperance, Busselton and Ravensthorpe,” Virgin Australia Regional Airlines chief executive Merren McArthur said in a statement.

“We appreciate the professional evaluation process, especially the contribution of the Department of Transport and community consultation groups, which ensured the best possible outcome for all involved.

“We look forward to continuing to provide vital air services to Albany, Esperance, Busselton and Ravensthorpe.

The state government was currently conducting a review of WA regulated routes.

Wellcamp welcomes first flight

Brisbane West Wellcamp Airport just outside Toowoomba welcomed its first regular public transport flight on November 17.

Sunny skies greeted QantasLink flight QF2016, which touched down at 0845 local time after a 106-minute trip from Sydney, according to the Qantas website.

QantasLink will offer 11 flights a week between Sydney and Wellcamp, Australia’s first privately-funded airport built by family-run local company Wagners.

Wagners’ chairman John Wagner, as well as brothers Denis, Neill and Joe were on hand to witness the first flight.

“To see our vision of a jetcapable airport come to life and celebrate the first flight with our first customer QantasLink, it’s a moment we are all extremely proud of,” John Wagner said.

The aircraft operating the first flight, a Bombardier Q400, is named Darling Downs in honour of the region.

Regional Express was due to start flights to Brisbane- Wellcamp from January 1 2015 after winning three new Queensland government regulated routes.

In the initial stage, the 8,000 square metre passenger terminal is capable of handling 1. 5 million passengers a year with 10 check-in desks.

QantasLink to use Network Fokker 100s on RPT flights in WA, reduce fleet to cut costs

Qantas plans to use Fokker 100 aircraft from its Network Aviation subsidiary to operate scheduled flights in Western Australia under the QantasLink brand.

The move will result in QantasLink ending all turboprop operations from its Perth hub and is part of a broader change to the network that will result in four Bombardier Q300 aircraft leaving the fleet and schedule changes in a number of markets.

QantasLink head of airports Todd Chapman said Network’s Air Operator’s Certificate had now been amended to allow it to operate regular public transport (RPT) flights with its 12 100-seat Fokker 100s.

“We are starting to use those aircraft as QF-coded flight numbers on formal RPT routes,” Chapman told delegates at the Australian Airports Association national conference on the Gold Coast on November 26.

“It is a real symbol of the diversity that QantasLink now has in order to meet not just right aircraft, right route, but we can also tackle different markets with the different fleet choices that we have depending if they are RPT or charter. ” With the end of turboprop operations at Perth, QantasLinkflights from the West Australian capital would use either Boeing 717s or Network-opeated Fokker 100s.

Qantas acquired Network, which runs charter and fly-in/fly-out services, in February 2011.

Chapman noted QantasLink’s fleet, comprising 49 Bombardier turboprops and 18 Boeing 717s, flew 10 per cent more flights per day than Qantas’s mainline domestic and carried 20 per cent more passengers than Qantas’s international operations.

Moreover, 33 per cent of passengers travelling on QantasLink flights were connecting onto a Qantas domestic or international flight, which Chapman said highlighted the importance of ontime performance (OTP) for the regional carrier.

To help airports with keeping QantasLink’s flights on schedule, the airline publishes weekly charts ranking each airport in terms of aircraft turnaround time in a bid to motivate airports to do better.

“We can actually see a dent in our yield in the subsequent weeks after we have a bad week of on-time performance because the market softens, they lose confidence and they are not prepared to pay as much for their ticket,” Chapman said.

“OTP is critical for us as a business and airports assisting us on that is invaluable.

“We are just wanting good turnaround performance as a core skill from our airports. We don’t want them to rush. We just want them to do it safely within the allotted turn time. ” Of the 18 717s, 13 were in a single-class configuration with 125 seats primarily used in Western Australia and the Northern Territory.

The remaining five were fitted to carry 110 passengers with 12 business and 98 economy class seats and operated out of Hobart, Melbourne, Canberra, Sydney and Adelaide and had onboard streaming inflight entertainment and galleys able to serve hot meals.

Chapman said the use of 717s was the “solution to those routes that are a little bit too thin for a 737 but still demand a high-quality, two-class product”.

“We have been able to really turn those routes around from being frankly loss-making with the 737 to now coming out ahead with the right aircraft on the right route,” Chapman said.

“We are a vibrant dynamic, lean, responsible custodian for regional air services in Australia. ” The network and fleet changes at QantasLink, which will come into affect in March 2015, were part of Qantas’s three-year, $2 billion costreduction program.

While they were expected to impact staff, a Qantas spokesman said job losses were not expected as the airline would “manage the changes through leave burn, leave without pay and natural attrition”.

“We have announced changes to our network which will increase efficiency and better match capacity with demand,” QantasLink chief executive John Gissing said in a statement on November 25.

QantasLink planned to increase utilisation rates on its turboprop fleet to achieve “almost the same amount of flying” with four fewer aircraft through “being smarter with our operations”.

The Australian reported QantasLink was aiming for a three per cent cut in unit costs and a five per cent increase in aircraft utilisation.

Jetgo begins RPT flights but drops Roma

Regional carrier Jetgo operated its first scheduled regular public transport (RPT) flight on December 1. Flight JG70 took off from Sydney Airport at 0610 local time on Monday bound for the Queensland port city of Gladstone, where it landed about 90 minutes later. The aircraft, a 36-seat Embraer ERJ-135 jet, was greeted by an Airservices ARFF water cannon salute as it taxied to the terminal.

Jetgo is offering double-daily services between Sydney and Gladstone, breaking the QantasLink monopoly previously on the route. The airline, which was primarily a charter and fly-in/fly-out operator prior to gaining its high capacity jet RPT Air Operator’s Certificate in October, is adding a second RPT service in January when it commences flights between Brisbane and Tamworth.

Jetgo had planned to also start Sydney-Roma services on December 1, but cancelled the proposed flights less than two weeks from launch citing low demand and economic conditions in the region.

Industry welcomes government response to ASRR

Badly needed reforms to the Civil Aviation Safety Authority (CASA) have taken a “critical first step” with the appointment of three new directors to the board, an aviation industry group says.

Aerial Agricultural Association of Australia (AAAA) chief executive Phil Hurst says the addition of Anita Taylor, Ian Smith and Murray Warfield to what will be a sevenmember CASA board, as well as the government’s response to the Aviation Safety Regulatory Review (ASRR), represents “a very welcome turning of the page for aviation policy”.

Hurst says the government’s commitment to issue a new statement of expectations to CASA as part of its response to the ASRR written by former Airservices chairman David Forsyth, where it will accept 32 of the report’s 37 recommendations, is also a welcome move.

“The announcement today of three new board members – all with aviation experience – is another strong downpayment on improving CASA governance and creating a better relationship with industry,” Hurst said in a statement on December 3.

“The government’s detailed response to the Forsyth review is also a very positive statement of intent to both reset the CASA/ industry relationship and to bring CASA up to speed as a regulator we can be proud of.

“Industry desperately wants meaningful change in its interactions with CASA – including improvements in response to issues such as regulatory reform, AOC issuing and amendment timeframes, licensing and reductions in costs. ” Deputy Prime Minister and Minister for Infrastructure and Regional Development Warren Truss – pictured – handed down the government’s response to the ASRR on December 3.

Truss told parliament it was time to “reset the relationship between industry and agencies and move onwards, recognising our strong aviation safety record and the potential improvements that can be made in line with the report’s recommendations. ” “Successful implementation of these recommendations will need the active and constructive participation of our aviation industry, working openly and positively with our agencies,” Truss said in a statement to parliament.

The federal government accepted all but five of the 37 recommendations from the Aviation Safety Regulatory Review (ASRR) and called for Australia’s aviation regulators to work more closely together and improve their relationship with industry.

As part of its response to the ASRR, the government said it would issue a new Statement of Expectations to the CASA board, with the expanded board to play a critical role in the oversight and monitoring of how the agreed recommendations that directly and indirectly involve CASA would be implemented.

“While the government recognises that there will inevitably be some tension in the relationship between a regulator and industry participants, there is clearly capacity to significantly improve CASA’s engagement and relationships with industry in areas such as regulatory development and implementation,” the report said.

Meanwhile, the government said it was committed to the appointment of an additional ATSB commissioner with aviation experience.

The ATSB and CASA were also expected to update their memorandum of understanding to work better together.

“The government also agrees in-principle to better information sharing between industry and safety agencies which is a wellestablished, international best practice and can assist in preventing future safety occurrences,” the report said.

The government said four recommendations – delegating responsibility for day-to-day operational management of airspace from CASA to Airservices, that CASA change its organisational structure, that CASA establish small offices at specific industry centres, and changes to how Aviation Security Identification Cards are issued – would require further detailed examination by aviation agencies.

Also, the government said it would accept recommendations that called on CASA to fully disclose all findings from audits at audit exit briefings.

The Australian Airports Association (AAA) said this was a positive reform, given it wouldensure airports were immediately alerted to any potential safety issues and were able to respond quickly, rather than having to wait weeks or months for the formal results of the audit.

Also, AAA chief executive Caroline Wilkie said the association supported the government’s request that the Department of Infrastructure and Regional Development provide further policy advice on airspace protection arrangements for Australian airports.

“Airspace protection is a criticalissue for Australian airports, both large and small, and vital for the future growth of Australian aviation,” Wilkie said in a statement.

“Implementation of the government’s response to the recommendations should assist in strengthening the relationship, communications and engagement between the regulator and industry, which will help to deliver even stronger outcomes for aviation safety in Australia. ”

IATA tips ticket prices to fall in 2015

Lower fuel prices bring airlines, passengers cheer

Air travel looks set to be more affordable in 2015 as the recent fall in fuel prices leads to lower ticket prices, the International Air Transport Association (IATA) says.

IATA’s Global Economic Outlook report, released on December 10, says average return air fares, which exclude surcharges and taxes, are tipped to fall by 5. 1 per cent to US$458 in 2015, after adjusting for inflation.

IATA chief economist Brian Pearce says lower fuel prices are “unambiguously good” for the travelling public.

“There is going to be a major benefit for consumers,” Pearce told reporters at IATA’s media day in Geneva on December 10.

However, Pearce cautioned that the recent reduction in the price of fuel may take some time to flow through to airfares given the hedging contracts in place at many carriers.

But history showed that airfares and cargo rates “ultimatelyreflected the cost of providing those services”, Pearce said.

“It is a very competitive market, airlines compete on the total travel cost to passengers so you should expect that total travel cost including surcharges to come down in line with what we are saying here about the underlying fare,” Pearce said.

Oil prices have fallen about 40 per cent since June, and were sitting close to five-year lows at about US$66 per barrel. Despite the recent slide, both Australia’s two major carriers Qantas and Virgin Australia had no plans to reduce their fuel surcharges on ticket prices for certain international destinations.

IATA chief executive Tony Tyler – pictured – said fuel surcharges imposed by airlines often did not cover the full impact of any increases in the cost of fuel.

“The mechanism of the fuel surcharge has been an effective one for the airlines obviously to help cover the increase in fuel cost although it hasn’t by any means

Qantas 767 fleet captain new Jetstar chief pilot

Captain Georgina Sutton will become the first female chief pilot for a major Australian airline when she takes up the post with Jetstar Australia and New Zealand in February.

Sutton is leaving Qantas, where she has been the Boeing 767 fleet captain, and moving to Melbourne for the chief pilot role at the Qantasowned low-cost carrier.

Sutton will replace current Jetstar chief pilot Captain Mark Rindfleish, who announced his intention to resume full-time flying with the airline earlier this year.

Rindfleish has spent the past six years as Jetstar’s head of flight operations and chief pilot.

Corrections

Two corrections and apologies for errors in recent issues.

Our feature ‘New Envoys’ in the December issue said that the RAAF’s BBJ and Challenger SPA fleets were leased through Hawker Pacific. In fact the aircraft are leased through GE Capital.

Further, SPA maintenance contractor Northrop Grumman advises that Challenger availability “exceeds” the contracted dispatch reliability rate. Sorry.

And in our October issue our ‘The Best Job in the World’ feature reported that Airlines of Tasmania entered voluntary administration in 2012. In fact it was Tasair that went into administration and was subsequently wound up. We apologise to Airlines of Tasmania. covered all of it,” Tyler said.

The more benign environment on fuel was also expected to deliver profits of US$25 billion for the world’s airlines in calendar 2015, up 26 per cent from 2014, according to IATA’s latest forecasts.

The 2015 forecast represented a 26 per cent improvement from the US$19. 9 billion profit the global airline industry is tipped to achieve in 2014 and continued growth from US$10. 6 billion profit in 2013 and US$6. 1 billion in 2012.

Tyler said oil prices were projected to average US$85 a barrel in 2015, compared with a price of more than US$100 a barrel from 2011 to 2014.

“There’s no doubt that the recent fall in the oil price is a relief for airlines,” Tyler said.

All regions were expected to report improved net profits in 2015, with airlines in North America leading the way with anticipated profits of US$13. 2 billion.

Strong growth is also projected for Asia Pacific airlines, who collectively were in line to post net profit of US$5 billion in 2015, up from US$3. 5 billion in 2014.

“Some strengthening of cargo markets, particularly in this manufacturing region, plus lower fuel costs, are expected to drive the moderate improvement on 2014,” IATA said.

Tyler cautioned that the US$25 billion profit was distributed over a “very fragmented industry with hundreds of players, hundreds of airlines”.

Moreover, the airlines’ projected 2015 net profit margin of 3. 2 per cent, up only slightly from 3. 1 per cent in 2014, offered little buffer to absorb a significant shock to the system such as economic uncertainty, political instability, public health emergencies and terrorism.

“I have given these caveats for context and perspective, not to downplay the significance of the profit that we expect to see generated next year or the tremendous changes that are behind it,” Tyler said.

IATA said passenger traffic was expected to increase seven per cent in 2015, above the 5. 5 per cent trend growth rate of the past two decades. Meanwhile, capacity was forecast to rise an even higher 7. 3 per cent in 2015.

The rise in air travel was reflected in the number of city-pair connections rising above 16,000 for the first time in 2014, having nearly doubled over the previous 10 years.

IATA, which represents the world’s airlines, has about 250 carriers as members covering about 84 per cent of global air traffic.

Qantas boosts Japan offering with new Brisbane-Narita and Sydney-Haneda flights

Qantas plans to start new four times weekly services between Brisbane and Tokyo Narita from August 1 2015 and shift its daily Sydney-Tokyo flights from Narita to Haneda airport from July 31 2015. The airline also flagged another three times weekly service to Narita, operating on alternate days to the Brisbane flights, from another Australian port to be announced at a future date. The new services, once operational, mean Qantas will offer twice daily services to Japan. The new Narita services from Brisbane and the second Australian city will be operated by Airbus A330s, while the Sydney-Haneda flights will utilise Boeing 747‑400s. Qantas said better aircraft utilisation is providing the capacity to enable the new Tokyo flights.