Preflight

Normalised earnings before tax, which excludes one-off items and was regarded as the best indicator of financial performance, came in at NZ$496 million, an increase of 49 per cent from the prior year, Air NZ said on August 26.

Revenue rose six per cent to NZ$4. 925 billion.

The Star Alliance member is forecasting further profit growth in the year ahead despite the jitters in global markets from the slowdown in China and shifting exchange rates.

Air NZ chief executive Christopher Luxon said there were lots of opportunities for the airline across all the markets it operates in, even with some of those macroeconomic challenges.

“We adapt to changing circumstances, I would argue, better than any airline in the world,” Luxon told reporters during Air NZ’s full year results presentation in Auckland.

“We have a very strong business across Asia, Australasia and the Americas and I would say there is still lots of gold to extract.

“Our experience in the US, European and even Asian slowdowns has been there are still big segments of customers that are largely unaffected by the macroeconomics. ” Air NZ has forecast capacity growth of 11 per cent across its domestic and international network for the full 2015/16 financial year.

The trans-Tasman and Pacific Islands market was expected to grow by four per cent, while the number of domestic NZ seats was tipped to increase by eight per cent.

Luxon said Air NZ’s new Auckland-Houston and Auckland- Buenos Aires services, whichkick off in December, were selling “incredibly well”, particularly in Australia.

“We are already starting to talk about how we would get increased capacity into those routes,” Luxon said.

“We think Australia is underserved and we think there is a huge opportunity to haul Australians through Auckland, which is a great geographic hub into Latin America.

“Already we are seeing our mix of Australian customers more than meeting our original assumptions. ” Further, he said Qantas had “in some way become more focused around Sydney and as a result that’s leaving opportunities”.

Air NZ has been promoting onestop connections from Australia to the Americas via its Auckland hub and earlier this year launched extra Perth-Auckland flights timed to connect with its longhaul trans-Pacific services.

In terms of the local NZ market, Luxon said he was confident Air NZ would be able to stimulate demand to absorb the eight per cent seat growth on its domestic network even with the upcoming entry of Jetstar, as well as other smaller carriers, on regional routes.

Luxon said the arrival of Jetstar with its five Q300 turboprops “isn’t something we should get too freaked out about”.

“I really feel very comfortable in our ability to compete there,” Luxon said.

“We just need to keep it in perspective. I think it has been a bit overblown to be really honest.

“From a cost advantage point of view we have a huge advantage over Jetstar coming into that market.

“We don’t lose at home to Australia. ” One negative note in Air NZ’s 2014/15 results was the NZ$26 million loss from its 26 per cent shareholding in Virgin Australia.

However, Virgin has guided the market to a year of profitability in 2015/16 and Luxon praised his counterpart at Virgin John Borghetti for taking the fight up to Qantas.

The Air NZ boss was also “very pleased with the momentum and the direction of where that business is going”.

“I think John Borghetti and his team have done an outstanding job and the improvement in the results over the past year has been really fantastic,” Luxon said.

“I think they have done a lot of great work that they should be incredibly proud about in terms of being able take on an 800-pound gorilla in their home market. ” Luxon, who sits on the Australian carrier’s board, also described Jetstar’s move to launch regional routes with Dash 8 turboprops in New Zealand as a “macro strategic play” linked to Virgin’s competitive efforts against Qantas in Australia.

“Qantas has been quite bruised by Virgin in domestic Australia, in part by the downturn in mining, but also by a much more vigorous competitor in Virgin,” Luxon said.

“A little of this is payback for the investment in Virgin Australia challenging the heart of their home market.

“Essentially they have got spare aircraft sitting on the ground that are better flying doing something rather than sitting on the ground doing nothing. ” And although Air NZ’s alliance with Virgin covered only trans- Tasman routes and did not include any services to the Americas, Luxon said the Australian airline would benefit given any extra marketshare in Australia would be carried via trans-Tasman routes that were part of the partnership.

“The reality for us is with Virgin we compartmentalise our relationship with them,” Luxon said.

Virgin has a tie-up with Delta Air Lines on trans-Pacific services.

In terms of the outlook, Air NZ chairman Tony Carter said the airline was expecting an improved financial result in the current year.

“Our investment in new efficient aircraft, the continued development of our alliance partner relationships, world class sales and marketing execution, great customer service and strong focus on cost management have enabled Air New Zealand to achieve revenue growth against a stable cost base,” Carter said in a statement.

“Given the current known operating environment, along with our increased capacity and improved operating efficiencies, we expect to achieve significant earnings growth in the coming year. ” Meanwhile, the Star Alliance member received two pieces of welcome news from the NZ government, which approved separate alliances with Cathay Pacific and Air China.

On August 25, NZ Transport Minister Simon Bridges approved the extension of the Air NZ-Cathay partnership on the NZ-Hong Kong market until October 2019.

And approval of the Air NZ-Air China alliance on September 1 has cleared the way for Air China to launch a new daily nonstop service between Beijing and Auckland from December 10. Air NZ will place its NZ code on the new flights, which will be operated by Airbus A330-200s.

According to schedules on the Air China website, CA 783 will depart Beijing at 0040 local time, arriving in Auckland at 1810 the same day.

The reciprocal CA874 is scheduled to take off from Auckland at 2000 and touch down in the Chinese capital at 0430 the next day. It will be Air China’s first destination in NZ.

The Kiwi flag carrier will maintain its daily Boeing 787‑9 service between Auckland and Shanghai as part of the alliance.

Lockheed’s ‘Team 21’ finally confirmed as AIR 5428 winning bidder

Lockheed Martin-led teaming will provide the RAAF’s new Pilot Training System operating 49 Pilatus PC-21 training aircraft from RAAF Base East Sale in Victoria and Pearce in Western Australia.

Defence Minister Kevin Andrews made the long-anticipated announcement that the ‘Team 21’ consortium of Lockheed Martin, Pilatus and Hawker Pacific had been selected as preferred tenderer for the RAAF’s Air 5428 Pilot Training System project during a visit to East Sale on September 6.

The new pilot training system will see ADF basic flying training currently undertaken at the Basic Flying Training School (BFTS) with BAE Systems at Tamworth in NSW relocate to East Sale, already home to the RAAF’s Central Flying School (CFS), while advanced training will continue to be conducted from RAAF Base Pearce, home to the RAAF’s 2 Flying Training School (2FTS).

“The new pilot training system will enable us to use the latest in simulator technology that can be adapted to student needs and different learning styles to allow students to progress through training faster,” Chief of Air Force Air Marshal Leo Davies said in a statement.

“This will create efficiencies for pilot training and allow more flexibility for our student pilots. ” Efficiencies will also mean the new contractor-supported Pilot Training System will see an increase in ADF pilot training throughput despite operating fewer aircraft than the current system.

According to Minister Andrews’ statement the new pilot training system will, from 2019, graduate 105 pilots a year, up from 77 currently, with an annual intake at RAAF Base East Sale of up to 165 trainee pilots. Of the 49 PC-21s to be supplied under AIR 5428, 22 will be based at Sale.

Sale’s gain is Tamworth’s pain under the AIR 5428 decision.

Team 21 was selected ahead of a competing bid from BAE Systems, which together with CAE Australia and Beechcraft had offered a solution based around the Beech T-6C aircraft. BAE had proposed to continue conducting basic training at Tamworth, but, as required under the tender, had offered West Sale as an alternative option for basic training.

The decision will be a blow to BAE Systems’ extensive flying training operation at Tamworth.

BAE will continue to provide ADF pilot training there until the end of 2019, and also provides military flying training for Singapore, Brunei and Papua New Guinea, but the decision seems likely to see a major rationalisation of the Tamworth operation.

The loss of BFTS from Tamworth Airport will also likely see the regional NSW city’s air traffic control tower closed.

But for East Sale: “The training system will also support approximately 162 jobs as part of the ongoing training of students at RAAF Base East Sale,” the Minister said.

Tigerair launches Melbourne-Coffs Harbour, takes 14th A320

Tigerair Australia will operate three times weekly flights between Melbourne and Coffs Harbour from December 9, adding about 1,000 seats a week to the NSW north coast.

The new service is on top of Tigerair’s existing Sydney-Coffs Harbour flights which have been operating since February 2013.

Meanwhile, the Virgin Australia-owned low-cost carrier has also taken delivery of its 14th Airbus A320, with VH-XUH arriving in Melbourne on August 25. Tigerair said the 180-seat narrowbody would join its Sydney-based fleet.

China Southern heading to Christchurch

China Southern says it will be the first Chinese carrier to offer nonstop service to New Zealand’s south island when it begins year-round scheduled services to Christchurch from its Guangzhou hub from December 16 2015.

The Skyteam member’s three times weekly service would be operated with Boeing 787-8 aircraft, a China Southern spokesperson said.

Christchurch will be the second NZ port for China Southern, which currently flies to Auckland.

United to serve all Australian routes with the Dreamliner from October

United will replace Boeing 777-200ERs used on its Sydney-Los Angeles and Sydney-San Francisco services with the 787‑9 from March 25 2016.

The change means all of United’s Australian services will be operated by the Dreamliner. The Star Alliance member’s first international destination with the 787-9 was Melbourne, which is served daily from Los Angeles.

The move will result in a slight capacity reduction, given United’s 777-200ERs have either 269 or 266 seats comprising eight in first, 40 in business and 110 or 113 in economy plus and 108 in standard economy, compared with the 787-9’s 252 seats (48 BusinessFirst, 88 economy plus and 116 standard economy).

The change to the 787-9 in March also means United will end first class services to Australia.

Truss confirms Badgerys Creek design will include rail access

Space for rail links will be included in the design plans for the second Sydney airport to be built at Badgerys Creek in western Sydney, Deputy Prime Minister Warren Truss has confirmed.

Although buses are expected to be the only form of public transit on offer when the airport opens some time in the mid-2020s, the design plans will include provisions for a station within the terminal facilities, as well as tunnels linking that station to the Sydney rail network.

Truss, who is also the Minister for Infrastructure and Regional Development, said the federal government was in discussions with the NSW state government about rail access to the site.

“Clearly at the very least we need to have the planning in place so that we know where the railway line will go,” Truss told reporters at the official declaration of Badgerys Creek as the site for the second Sydney Airport on August 26.

“With the initial expectations of the number of passengers in early years, we don’t anticipate that a railway line just servicing the airport would be commercially viable but as time goes by, passenger numbers will grow and clearly then that access would be required. ” Truss said the cost of the rail tunnels and cavity for the railway station would be about $500 million and that cost was being included in the design plans.

The declaration of Badgerys Creek as the site for the second Sydney airport ensured further planning work on the airport could proceed and airspace around the proposed facility was protected from potential highrise buildings.

Truss said the environmental impact statement for the project, which will look at how the airport may affect air and water quality, local vegetation and wildlife as well as the noise exposure for the surrounding area, was due to be released for public comment in late October.

Also, some 30 residents yet to vacate the Badgerys Creek airport site were being dealt with in Federal Court.

“We are going through the process as outlined in the law,” Truss said.

“We naturally would have been happy to have a negotiated settlement with everyone but that doesn’tvery often happen in circumstances like these. We will certainly treat the people who have lived here over a long period of time with compassion. We are helping them on a one-to-one basis as best we can. ” The government planned to start construction at Badgerys Creek before the end of 2016.

The federal member for Macarthur Russell Matheson, whose electorate covers Badgerys Creek and who was alongside Truss at the official declaration, said the airport was a once-in-a-generation project for the region, noting the opportunities for new jobs and new industries in western Sydney.

“My community is looking forward to having Western Sydney Airport up and running in the next 10 years,” said Matheson.

“This project prepares the way for western Sydney’s growing population and sets the foundation for a strong economy for generations to come. ” Meanwhile, the Commonwealth recently concluded the nine-month formal consultation period with the owners of Sydney Airport and was preparing to release its Notice of Intention (effectively a sales contract) in late 2015.

The Department of Infrastructure and Regional Development is currently preparing its advice to government about the commercial and contractual structure of the proposal, including the detailed first stage requirements of the airport.

When the Commonwealth sold Sydney Airport in 2002 it included a 30-year first right of refusal to build and operate any airport within 100km of the existing terminals at Mascot.

Tigerair opens doors on new Melbourne terminal

Tigerair Australia has left the tin shed for a new home at Melbourne Airport.

The low-cost carrier has moved into the newly opened Terminal 4 at Melbourne Tullamarine, which features new technology automated check-in kiosks and bag drop facilities, as well as an expanded departure lounge and more shopping and food choices.

Tigerair chief executive Rob Sharp was at the airport to greet the first passengers through the new terminal when it opened for business just before 0500 on August 18.

Sharp said Terminal 4 would provide a vastly improved customer experience in Melbourne, Tigerair’s largest and busiest base.

“The move to our new home here in Melbourne is another significant milestone for Tigerair Australia as our transformation strategy continues to gather momentum,” Sharp said in a statement.

“The new terminal is symbolic of the new Tigerair reflecting a step change from the old terminal with which our customers are familiar.

“With the combination of the new-look Terminal 4 facilities and our roaming check-in staff using the Max iPad app, our passengers will be able to check in more efficiently than ever before at Melbourne Airport. ” Meanwhile, Jetstar has confirmed it will be moving into Terminal 4 from November 10.

Currently, Jetstar and Qantas’s domestic flights operate out of Terminal 1, which is at the opposite end of Melbourne Airport. Co-locating with Qantas meant eligible members of Qantas’s frequent flyer program were able to access the Qantas lounges prior to boarding their Jetstar flight.

Jetstar said passengers would still be eligible to use the Qantas Club and Business Lounge in Terminal 3 prior to their flight after the airline moved to Terminal 4. However, it cautioned passengers that “there will be no boarding announcements or flight information screens at the lounge to alert you of any updates or changes to your flight”.

“If you wish to use the lounge, please ensure you check in, drop any bags and get to the gate in time for your flight,” Jetstar said.

“It’s approximately a 15-minute walk between terminals 1 and 4, and check-in and bag drop close 30 minutes before departure. ” Melbourne Airport said in a fact sheet Terminal 4 was designed to handle up to 10 million passengers a year.

“Passengers will experience a seamless journey through Terminal 4, which is the first terminal in the Asia Pacific region to open as a complete self-service operation,” Melbourne Airport said.

Regional Express is also due to move into the terminal in coming months.

Nelson and Napier first to receive ‘Propstar’ Jetstar turboprop services

New Zealand’s regional aviation market will receive a shakeup in December when Jetstar commences turboprop service from Auckland to Napier and Nelson.

Jetstar’s inaugural two routes with its Q300 fleet kick off on December 1 and will be followed by New Plymouth-Auckland, Palmerston North-Auckland and Nelson- Wellington from February 1 2016.

Jetstar Australia and New Zealand chief executive David Hall unveiled the new routes on August 31.

“We believe the routes we’ve announced today offer the strongest opportunities to grow the market and make a real difference to local economies and locals’ wallets, encouraging more travel and saving people money when they fly,” Hall said in a statement.

Jetstar launched plans to expand into regional NZ with Dash 8-Q300 turboprops in June. The five aircraft will be operated by QantasLink’s Eastern Australia Airlines for Jetstar.

In terms of schedule, Jetstar said aircraft and crew would be positioned overnight at each of its new destinations, meaning the first flight each day would take off from those regional ports.

The airline planned to operate 27 flights a week on the Nelson- Auckland, Napier-Auckland, New Plymouth-Auckland and Palmerston North-Auckland routes, and 21 flights a week between Nelson and Wellington.

Jetstar said its expansion into regional NZ would add about 670,000 extra seats into the local market, on top of its 2. 6 million seats flown by its fleet of nine Airbus A320 jets.

Jetgo to Melbourne

Regional carrier Jetgo is expanding its regular public transport (RPT) network to Victoria with nonstop service between Dubbo and Melbourne to begin in late October.

It will be the only nonstop flight from Dubbo to Melbourne, with the new thrice-weekly offering scheduled to run on Tuesdays, Thursdays and Sundays with 36-seat Embraer ERJ-135 regional jets, Jetgo said on September 8. Specific start dates were not available when the magazine went to print.

Rex reports falling profits, shuts Aviex maintenance subsidiary

Regional Express (Rex) has reported a double-digit drop in full year net profit and says the future is uncertain amid ongoing weakness in Australia’s resources sector and declining passenger numbers.

The company said on August 28 net profit for the 12 months to June 30 2015 tumbled 13. 6 per cent to $6. 67 million, compared with $7. 73 million in the prior corresponding period. It was the third straight year of declining profits at the airline.

Revenue rose 1. 1 per cent to $256. 2 million.

Rex deputy chairman John Sharp said “regional headwinds”, comprising not just the downturn in mining investment and weaker commodities prices, but also drought and bushfires, meant it was “tough going in the bush at the moment”.

“All of the serious calamities that regional Australia has been faced with have all made it a very difficult economic environment for a company like Rex to operate in,” Sharp said at Rex’s full year results presentation in Sydney.

Rex said passenger numbers dipped 1. 9 per cent in 2014/15 to 1. 025 million, 19,500 lower than the prior year. That represented a $3. 1 million fall in passenger revenue from Rex’s non-subsidised RPT network.

Meanwhile, capacity measured by available seat kilometres (ASK) fell 2. 2 per cent, while load factors were stable at 54. 7 per cent. The figures did not include Rex’s five Queensland government route contracts that began on January 1 2015.

The carrier’s 2014/15 results said trading conditions deteriorated “drastically in the last quarter of the financial year”, while the weaker Australian dollar had also increased US-dollar denominated costs.

Sharp said although passenger numbers on mining-linked routes had been weaker, load factors on some leisure destinations in Rex’s network such as Merimbula had been quite stable.

“It’s quite clear from our analysis of the way the passenger numbers are changing that the mining slowdown has had quite an impact on our passenger numbers overall and we are not the only airline to experience such a thing,” Sharp said.

On a more positive note (or tailwinds as the company described it), Rex said it expected the first full year of operating Queensland government regulated routes in 2015/16 would help boost profits, while it expected to book a $4. 5 million benefit from lower global oil prices in the current year.

Rex said fuel costs fell $1. 85 million in 2014/15, while the end of the carbon tax yielded a $2. 5 million boost to the bottom line.

The company declined to offer profit guidance for the current year due to the uncertain operating environment.

“We are certainly not confident to predict the net outcome of headwinds and tailwinds,” Sharp said.

The company also deferred a decision on whether to pay a dividend to November’s annual general meeting.

Rex also flagged interest in bidding for some government regulated routes in Western Australia that were open for tender.

Sharp noted WA and the Northern Territory were the only two states where Rex did not have operations.

“Rex is now giving serious consideration to tendering for some of these licensed routes in Western Australia and to establish a beachhead if you like for further growth and development of the company in that particular state,” Sharp said.

“That’s another thing we think, if we decide to proceed with it, will be a boost to the company’s financial performance over the course of the next four months. ” In other Rex news, the company shut down its Townsville-based aircraft maintenance, repair and overhaul (MRO) company Aviex on August 25, resulting in 15 people losing their jobs.

The shutdown forced clients such as the Royal Flying Doctor Service (RFDS), Curtain Brothers and others to source other maintenance providers.

An RFDS Queensland spokesperson told Australian Aviation the organisation had managed to transition its maintenance work at Townsville from Aviex to Hawker Pacific without any disruption to services. The Royal Flying Doctor Service (Queensland Section) have two Beechcraft King Air B200s based in Townsville to provide aeromedical assistance to rural and remote Queensland,” RFDS Queensland Section general manager for integrated operations Jaya Ganasan said in a statement on September 2.

“Aviex were performing our scheduled maintenance and line maintenance of these two Townsville-based aircraft. When Aviex announced their impending closure, RFDS (Queensland Section) contacted Hawker Pacific in Cairns which agreed to provide an engineer on the ground in Townsville to meet the maintenance needs of these two aircraft. ” Across the runway at RAAF Base Townsville Hawker Pacific alreadyprovides support for eight King Air 350s operated by the RAAF’s 38 Squadron, while the RFDS already had an existing relationship with Hawker Pacific in Cairns.

It was understood Hawker Pacific had also sent an engineer to another Aviex customer, Curtain Brothers, to assist following the Aviex closure.

The closure ended an unsuccessful turnaround effort from Rex, which announced the purchase of Aviex from Townsville Airport operator Queensland Airports Ltd in March.

Aviex leased a 5,500sqm hangar from Townsville Airport and specialised in maintenance of turboprop airliners such as the Saab 340, ATR, Dash 8, Metroliner and King Air.

However, Aviex suffered a blow in July when its largest clientVirgin Australia Regional Airlines (VARA) chose to move ATR 72 line maintenance work to its own Virgin Tech facility in Brisbane, a Rex spokesperson told Australian Aviation.

The Rex spokesperson said the loss of the VARA contract meant there was not enough work to keep the facility going. The 15 Aviex employees were made redundant and their entitlements paid out on August 25.

Rex aircraft that previously had their maintenance checks done at Aviex will be sent to Townsville for line maintenance and be routed through the airline’s southern network for heavy maintenance, the spokesperson added.

Qantas says slot congestion at HKG limiting growth

Lack of slots, not bilateral capacity, limits Qantas growth to Hong Kong

Qantas chief executive Alan Joyce says slot restrictions at the busy Chek Lap Kok Airport make it difficult to grow the airline’s service to Hong Kong.

The Flying Kangaroo has managed to secure slots to add four additional flights a week between Sydney and Hong Kong from October on top of the airline’s existing daily service.

While Qantas had been hoping to add a second daily service, it had to settle for just four flights due to a lack of available slots at Hong Kong that suited the Australian carrier’s schedule.

Joyce said it was the slot situation rather than the bilateral air services agreement between Hong Kong and Australia that was hindering Qantas’s efforts to grow its operations in the territory.

“You might have open access or more access in the bilateral but if you don’t have the slots it is academic,” Joyce told reporters after a Royal Aeronautical Society Virgin Australia Regional Airlines (VARA) chose to move ATR 72 line maintenance work to its own Virgin Tech facility in Brisbane, a Rex spokesperson told Australian Aviation.

The Rex spokesperson said the loss of the VARA contract meant there was not enough work to keep the facility going. The 15 Aviex employees were made redundant and their entitlements paid out on August 25.

Rex aircraft that previously had their maintenance checks done at Aviex will be sent to Townsville for line maintenance and be routed through the airline’s southern network for heavy maintenance, the spokesperson added.

Qantas says slot congestion at HKG limiting growth Lack of slots, not bilateral capacity, limits Qantas growth to Hong Kong Australian Division lunch in Sydney on September 9.

“Unfortunately until the third runway is built in Hong Kong it means there are limited growth opportunities for Australian carriers compared to Hong Kongbased carriers and that needs to be recognised in any bilateral discussions.

“We’ve got plenty of room to grow in the current bilateral, the trouble is we can’t get the slots to grow. ” Joyce said Qantas had filed for a second daily out of Sydney but managed to only secure four slots after some airlines relinquished their landing and takeoff slots.

“We would love for the slots position to improve because then we would be growing Hong Kong more than we are today,” Joyce said.

The first of the four additional flights a week, to be operated with Airbus A330s, begin on October 26.

Qantas schedules show QF117 departing Sydney at lunchtime on Monday, Tuesday, Wednesday and

Then we would be growing Hong Kong more than we are today. alan joyce

Thursday for an evening arrival in Hong Kong, with the reciprocal QF118 an overnight flight.

Cathay Pacific flies four times a day between Sydney and Hong Kong.

Qantas International chief executive Gareth Evans said the new flights would give passengers more choice, adding that there was strong demand on its Hong Kong services.

“Customers travelling from Sydney will have the choice of double-daily flights to Hong Kong on peak days of the week for business travel and we’ll look at expanding beyond that if the opportunity is available,” Evans said in a statement.

Qantas also flies daily to Hong Kong from Melbourne and Brisbane.

Meanwhile, Qantas is also adding a fifth weekly flight between Sydney and Manila that will run between December and March 2016. Currently it flies four times a week to the Philippines capital.

Virgin Australia’s new business class takes off

“It’s the business” says Virgin boss

Virgin Australia’s first commercial service with what chief executive John Borghetti describes as the best domestic business class seat in the world has taken off.

Virgin flight VA559, operated by Airbus A330-200 VH-XFH, departed Sydney Airport a little after 1300 local time on Monday August 17 bound for Perth fitted with the new cabin featuring 20 B/E Aerospace-designed herringbone business class seats with direct aisle access laid out 1-2-1 across the cabin.

Ahead of that flight, Borghetti said during a media tour of the first reconfigured aircraft the new seats were longer and wider than any other business class seat flown domestically by any other airline anywhere in the world.

“There is not another domestic business class that operates out of a domestic terminal anywhere in the world that would be as good as this business class. Full stop,” Borghetti told reporters.

“It’s the business. ” Virgin’s six A330-200s currently fly between Perth and Australia’s east coast capitals, as well as between Sydney and Nadi, Fiji on a seasonal basis.

And although the resources boom that fuelled the Western Australian economy in recent years is now a thing of the past, Borghetti said Virgin’s performance on the Perth route was still holding up well as the airline secured more corporate accounts and a greater share of governmenttravel spending.

Moreover, there were no plans to follow Qantas’s recent move to reduce A330 services on trans-continental flights.

“We are very happy with the level of improvement on that route,” Borghetti said.

“We have no intention of withdrawing any services. They are performing very well and we are happy with that. ” Virgin is reducing the number of business class seats on board its A330-200s from 24 under the old configuration to 20 with the B/E Aerospace seats installed.

However, Borghetti said the airline would be “competitive” for both pricing and the ability to redeem flights via Virgin’s frequent flyer program, Velocity.

“When you get to pricing or redemptions, it is a question of competitiveness and I can assure you we will still be as competitive as we were and are and will always be,” Borghetti said.

“If you are competitive still in your pricing and you have got a better product, then you’ll get that marketshare shift and that’s where the profits are. When you have got competitive fares and a superior product, that’s where the money comes. ” Separately, Borghetti expects the airline’s new terminal at Perth Airport to be ready by the end of November.

The new Virgin terminal was due to open in June 2014. However, delays and building issues have forced Perth Airport to push back Virgin’s move-in date on several occasions.

As a result, Virgin has continued to operate from three separate terminals while waiting for its new facility to be completed.

“End of November I’m told that we will be able to move into the new terminal,” Borghetti told reporters.

“I was there about a month or so ago and I went for a tour of the building site,” he said.

“We are ready when the terminal gets handed over. That will be an outstanding terminal. ” Currently, Virgin’s operates from both sides of the Perth Airport precinct, which has added a layer of complexity for those passengers connecting between fights.

On the international side, Virgin’s international flights depart and arrive at Terminal 1, while services operatedby Virgin Australia Regional Airlines are at Terminal 2. On the domestic side, Virgin’s mainline services are located at Terminal 3.

The new terminal, called the Virgin Australia pier, is located on the international side at Terminal 1 and is expected to feature new check-in and bag drop technology as well as new Virgin lounges.

Borghetti said in September 2014 the delays were costing Virgin tens of millions of dollars.

Townsville Airport welcomes arrival of Jetstar’s Bali service

Townsville Airport’s ARFF service has greeted the arrival of Jetstar flight JQ101 with a traditional ‘monitor cross’ salute.

The Jetstar flight, operated by Airbus A320 VH-XSJ, arrived at Townsville Airport from Bali a little before 0930 local time on September 3.

The arrival was Jetstar’s inaugural international service from Bali to the north Queensland city.

The inaugural Townsville-Bali flight, JQ102, departed Townsville a little before 2300 local time on September 2 and arrived in Bali at 0130 the following day.

The reciprocal JQ101 took off from Bali at about 0245 local time.

More than 10,000 tickets have been sold for the three times weekly flights that were launched in April.

Townsville Airport received the go-ahead to again offer international flights in February after an “in-principle agreement of the National Passenger Processing Committee to facilitate international services” at the airport.

The airport has had international flights in the past, most recently with the now defunct Strategic Airlines flying to Bali.

Sydney Airport takes steps towards integrated terminals with buyback of Qantas Terminal 3 lease

Terminal 3 would be a common user terminal from mid-2019Sydney Airport’s plans to create two integrated terminal precincts each capable of handling both international and domestic services has taken a step forward with the buyback of Qantas’s lease over Terminal 3.

Although there will be no change to the existing arrangements – with international flights at the western side of the airport at Terminal 1 and domestic services operating out of Terminals 2 and 3 on the eastern side – for at least the next five years, Sydney Airport chief executive Kerrie Mather said the $535 million transaction announced on August 19 was one of the necessary steps towards eventually having domestic and international flights operating out of the same facility.

“The integration of terminals is a key plank actually in our long-term master plan and acquiring T3 was key in terms of being able to achieve that,” Mather said.

“In the long term it will help us deliver the master plan which provides for the ability to have integrated operations across all of our terminals. We don’t have any plans in the next five years, which is the period we have actually given capex guidance for the market. ” The airport’s most recent master plan, which the federal government approved in 2014, proposed having two integrated terminal precincts capable of handling regional, domestic and international flights.

This would reduce the number of passengers that currently had to transfer between the domestic T2/ T3 precinct and the international T1 precinct. That would provide a single terminal experience for 97 per cent of passengers, the 2033 master plan said.

“One of the key benefits of the development plan is the ability to service aircraft demand through the use of swing gates that can accommodate both international and domestic/regional aircraft in each of the two terminal precincts,” the Sydney Airport master plan said.

“This provides the airport the ability to easily respond to fluctuations in actual demand between its international, domestic and regional operations. ” Qantas chief executive Alan Joyce said he was committed to the concept of co-location for the airline’s domestic and international flights.

Joyce said having integrated terminals capable of handing both overseas and local services would enhance the “whole desirability of Sydney Airport”.

“It is one of the elements that we continue to believe is very important for the airport,” he said.

“We will be working through how those details work. As Kerrie said it won’t be here in the next five years, but it will be something that’s there in the medium to long term. ” Both parties described the $535 million Sydney Airport will pay Qantas to buy back the airline’s lease over Terminal 3 as a “win‑win”.

The deal was reached four years before Qantas’s 30-year lease over Terminal 3 was due to expire.

Sydney Airport said the transaction was “strategically important for future airport flexibility”.

From September 1, Terminal 3 reverted from Qantas to Sydney Airport under a new 10-year deal.

Sydney Airport said the fixed property rental it previously received for Terminal 3 would cease and new variable aeronautical, retail and property revenue streams, as well as operating expenses, would commence on completion of the transaction on September 1.

Qantas said it would continue to manage the terminal on behalf of Sydney Airport between September 1 2015 and June 30 2019.

“After that time, Qantas will retain priority usage to Terminal 3 through to 30 June 2025. Priority usage includes a majority of the terminal’s gates, check-in and baggage facilities,” Qantas said in a statement.

“Use of the terminal by Qantas from 1 September will incur a perpassenger charge at an agreed rate through to 2025. ” Joyce said the agreement was strategically and financially positive for both parties, and for Qantas customers it would be business as usual.

“This deal secures Qantas’s long-term position in our largest hub, ensuring priority usage as the primary airline customer of Sydney’s Terminal 3,” Joyce said.

Sydney Airport said Terminal 3 would be a common user terminal from mid-2019.

Meanwhile, Sydney Airport reported net profit of $134. 6 million for the six months to June 30 2015, up from $53. 9 million in the prior corresponding period.

Jetstar chief pilot encourages more women to become pilots

Jetstar chief pilot Georgina Sutton says demystifying the rostering system is a key plank in boosting the number of women in Australian pilot ranks.

While rosters at airlines such as Jetstar, which are busiest during periods such as Christmas, Easter and school holidays, can sometimes be unfriendly for women, Sutton says there are ways around this issue.

“That is a struggle that all businesses find challenging,” Captain Sutton told delegates at the Women in Aviation/Aerospace Australia summit in Melbourne on August 27.

“People want to fly at Christmas and Easter and it’s not seen potentially as family-friendly but there are ways in rostering and allocation of duties of getting through that and even flexible parttime work arrangements. ” Captain Sutton noted women accounted for 5. 4 per cent of commercial airline pilots globally, with the four major airlines in Australia at similar levels to the international figure – Jetstar (3. 6 per cent), Qantas (4. 5 per cent), Virgin Australia (4. 9 per cent) and Tigerair Australia (7. 7 per cent) “This figure is obviously not where it needs to be so we are very, very committed at Jetstar in relation to diversity and within the Qantas group,” Captain Sutton said.

“There is a long way to go to improve gender diversity in many parts of aviation but we are seeing more and more females applying for roles as pilots and engineers. ” “We are working closely with schools, universities and career advisers to help encourage more females into these types of roles. ” Sutton said one factor that has limited the growth in the number of female pilots at Australia’s commercial airlines has been the lack of new recruitment, given Qantas “haven’t recruited in probably six years”, while pilot recruitment at Jetstar had “slowed”.

However, the Jetstar chief pilot flagged more opportunities in the period ahead.

“We are looking towards recruiting again shortly and I think Qantas will potentially be looking at doing so in another 18 months with the 787 coming,” Sutton said.

Also, Sutton said a career in the military, which was “not available to me” while coming through the ranks, was a good option, adding she would have “loved to have flown for the military”.

The former Qantas 767 fleet captain, who switched across to Jetstar in February, urged companies to support mentoring programs which she said were pivotal to helping her progress during her career.

“Those of us in those roles need formal time off to do mentoring properly,” Sutton said.

“I was obviously a product of this process and I just could not believe how important it was for me to be able to succeed in senior roles. ” “If we are taking talented potential women into roles it is incumbent on organisations to set them up for success with such programs. ” Meanwhile, Boeing Research and Technology Australia general manager Michael Edwards told the conference a key part of improving the diversity of the workforce was management understanding the need to change its current approach.

“What’s the saying, the first sign of madness is if you keep doing the same thing and expect a different result,” Edwards said.

“We actually have to start changing and be courageous about the types of activity and the way we structure our management to do things differently. ” Royal Australian Air Force Director General Aerospace, Maritime, Training and Surveillance, AIRCDRE Adam Brown, said the Air Force’s organisation design was based on “centuries of bureaucratic, government-style processes and military traditions”, which had “fairly strict bounds about how we actually construct our work and how we allow people to work in our organisation”.

Former senior Qantas executive named new Melbourne Airport CEO

Lyell Strambi moves from the airlines to the airports

Former senior Qantas executive Lyell Strambi has been named chief executive of Asia Pacific Airports Corporation (APAC), the owner and operator of Melbourne and Launceston airports.

Strambi, who was previously chief executive of Qantas’s domestic operations, started his new job on September 21.

Prior to joining Qantas, Strambi was chief operating officer at Virgin Atlantic and also worked at Ansett in finance and strategic planning roles. “I am excited by this opportunity and look forward to working with the APAC board and the talented leadership team in the next phase of its growth and investment,” Strambi said in a statement announcing his appointment on August 19.

“The transformation of Melbourne and Launceston airports is well underway and we will work closely with our client airlines, retail and service partners to ensure the experience passengers enjoy matches the wonderful facilities we are building.

“My goal is to build on the excellent foundations built bythe APAC team under previous leadership as we continue our journey to make our airports the best in the region. ” APAC chairman David Crawford said Strambi had a successful track record of planning and execution in complex regulatory environments.

“The board was impressed with Lyell’s corporate and team leadership credentials and strong customer focus,” Crawford said.

Strambi’s appointment ends an eight-month search for APAC’s new chief executive after Chris Woodruff announced his resignation in December 2014.

Airservices managing conflicts of interest: Houston

Senate committee probes probity of OneSky deal

Airservices says an external review of its procedures for dealing with conflicts of interest relating to the OneSky project found they were “adequate, robust, sound and consistent with market process”, its chairman Sir Angus Houston has told a federal parliamentary committee.

Houston told the Senate Rural and Regional Affairs and Transport Legislation Committee the board asked law firm Allens to conduct the review after evidence given at a previous committee hearing in August had raised some concerns about “some of the perceptions that were out there”.

While the review is ongoing, Houston said the initial findings showed these potential conflicts were being adequately managed.

“The probity framework for theOneSky procurement process was adequate, robust, sound and consistent with market process,” Houston told the committee during testimony in Canberra on September 9.

“Secondly, they agreed there is a possible perception of conflict which requires additional management, but this possible perception did not have any actual effect on the actual tender process including the evaluation of tenders and selection of a preferred tenderer.

“Thirdly, there is no evidence that the issues raised by the Senate resulted in any improper influence, bias, favour or breach of confidence or any incompatibility between duties to the program and the personal and financial interests of those involved.

“We provide governance and oversight by making sure that the frameworks, the processes are inplace to deliver the system but it is up to management to deliver the OneSky system. ” The appointment of external lawyers Allens to look into how Airservices managed potential conflict of interest situations came after the committee raised questions surrounding the OneSky tender process during an August 18 hearing.

In February 2015, Thales was named as the successful supplier to commence work on the OneSky project, which aims to combine and replace the civil and military air traffic management systems with one single program. Airservices said in July it had signed contracts to design and build the software system.

Houston told the committee that since the decision was made to go with Thales, Airservices had been working on a “whole heap or risk reduction

There is no evidence that the issues raised by the Senate resulted in any improper influence.sir angus houston

activities” around the OneSky project to ensure that “when we do go into contract we fully understand what we are signing up to”.

Parts of the OneSky system were expected to be operating by 2018, with the full rollout due to be completed in 2021.

It emerged during the August 18 hearing that Airservices had contracted the International Centre for Complex Project Management (ICCPM) in 2012 to establish the request for tender for the OneSky program.

“We contracted with ICCPM and became a partner of ICCPM,” Airservices acting chief executive Jason Harfield told the committee on August 18.

Harfield said the ICCPM contract has cost $4. 6 million since 2012, comprising payments from Airservices of $740,000 in 2012/13, $1. 8 million in 2013-14 and $2 million in 2014-15, which was “during the height of the tender evaluation process and leading into the negotiations”.

The committee heard Steve Hein, who was for a period of time Airservices’ executive general manager of future service delivery, worked previously at ICCPM. His wife Deborah Hein is chief executive of ICCPM. In one instance, the Senate committee heard Steve Hein signed a quotation from DeborahHein for the cost of contracting two people from ICCPM that was being forwarded to the Airservices chief executive officer for consideration.

And adding to what Senator Joe Bullock described on August 17 as a “vast web of very close interconnections”, the chairman of ICCPM is Chris Jenkins, who is also managing director of the company that won the tender, Thales.

“We have a chap who used to work for ICCPM who now works for Airservices Australia and who plays a role in giving ICCPM the work, where they are involved in the appointment of Thales, and the chairman of ICCPM, which was asked to assist in this work, is the managing director of Thales,” Senator Bullock said on August 17.

Committee chair Senator Bill Heffernan added: “It is a bit messy. ” Further, an ICCPM director, Harry Bradford, is currently assisting Airservices to negotiate the contract to build OneSky with Thales because Airservices did not have the in-house capability to negotiate the contract.

“He is under guidance from Airservices and Defence on what the parameters are for him to negotiate through with contract negotiation directives,” Harfield said on August 17.

“It is not about him just doing something for his mates. He is doing it under instruction from Airservices for the negotiation of the contract. ” Harfield also noted the ICCPM board also included representatives from companies unsuccessful in the tender.

Houston said the board was not aware of the relationship issues regarding Steve and Deborah Hein, and described the situation as “unfortunate”.

“Immediately after the last Senate hearing the board was very concerned,” Houston told the Senate Committee during testimony in Canberra on September 9.

“So we put some terms of reference together and we employed Allens to do some work for us.

“They will leave no stone unturned and they will go through the whole probity subject, they will speak to everybody, they will look at every single document and they will make sure there are no further problems, no further issues.

“They will make recommendations and I promise you the recommendations they come up with will be implemented by the board. ” Houston said the initial report from Allens showed there was “no activity where people have made money”.

Meanwhile, the committee agreed with Houston’s request that testimony concerning the resignation of Andrew Clark as Airservices chief financial officer be taken in camera.

ACCC OKs Qantas-China Eastern partnership

Qantas’s proposed alliance with China Eastern is set for takeoff, with Australia’s competition regulator approving the partnership with conditions attached and reversing an earlier draft ruling to reject the tie-up.

The Australian Competition and Consumer Commission (ACCC) said the two airlines would have to report their average fares, month by month, on each route that they operate between Australia and China as part of their partnership.

Moreover, the ACCC’s authorisation also required Qantas and China Eastern to increase their combined capacity on routes between Shanghai and Australia by a compound annual growth rate of four per cent. This represented a 21. 67 per cent increase in capacity across these routes over the next five years.

ACCC chairman Rod Sims said the two carriers had provided significant commitments to add extra flights and launch new routes since it handed down a draft determination in March that proposed denying authorisation.

This included more flights from Shanghai to Melbourne, Sydney and Cairns during peak periods, as well as a new year-round service that has not been made public. There were also more destinations that would be covered by the two carriers’ existing codeshare agreement.

As part of the alliance, Qantas would move into Terminal One at Shanghai Pudong Airport, facilitating quicker transfers as part of making Shanghai the gateway into greater China.

“The ACCC considers that theaddition of a significant number of new services, and expanded range of destinations, reflecting this gateway strategy, would constitute a significant public benefit,” Sims said in a statement on August 21.

Sims said the capacity conditions imposed on Qantas and China Eastern as part of the five-year authorisation ensured coordination between the two carriers would not result in a reduction in the frequency of services provided below that which could be expected if the alliance was not in place and they continued to compete strongly with each other for passengers.

However, Sims said the ACCC believed the alliance would encourage additional new capacity above what was required under the five-year authorisation.

“The ACCC does not consider that capacity additions that simply keep pace with historical levels of growth are sufficient to demonstrate that the alliance will result in significant public benefits,” he said.

“The ACCC accepts that Qantas and China Eastern do not want to commit to additional capacity expansion until closer to the time that capacity will be added.

However, the ACCC expects that successful implementation of the gateway strategy underpinning their public benefit arguments should result in significant additional growth in capacity above that required by the conditions the ACCC has imposed over the term of the authorisation.

“If this were to prove not to be the case, it may be difficult for the ACCC to accept that the alliance facilitates the addition of new frequencies and destinations, and the development of Shanghai as a gateway to greater China for Qantas and China Eastern, in any application for re-authorisation. ” The ACCC noted that competition between Qantas and China Eastern for passengers on the Sydney- Shanghai route would be greatly reduced under the alliance and “may provide them with the opportunity to increase prices for passengers traveling directly between Sydney and Shanghai”.

“It is not uncommon for airlines to charge higher fares for passengers on a point-to-point route, where competition is limited, than for passengers travelling on the same flight who have an onward connection to a destination that is serviced by a variety of carriers,” Sims said.

“The ACCC considers that Qantas and China Eastern would have an incentive to adopt this strategy on the Sydney-Shanghai route if the alliance proceeds.

“To enable the ACCC to monitor such behaviour conditions have been imposed requiring Qantas and China Eastern to report to the ACCC their average fares, month by month, on each route between Australia and China on which they offer services. ” Meanwhile, the ACCC also gave final approval for Virgin’s alliance with Delta Air Lines for a further five years.

Although Virgin and Delta had asked for a 10-year extension to their alliance, the ACCC said it decided to grant only a five-year extension due to the “ongoing evolution of services on the trans-Pacific and the dynamic nature of the aviation industry”.

CASA boss announces change program

CASA director of aviation safety Mark Skidmore is embarking on a “significant change program” as part of efforts to improve service delivery.

The nation’s aviation safety regulator needed to “do better at delivering regulatory services to the aviation community”, Skidmore said in the August CASA Briefing.

“As part of our efforts to strengthen the contribution CASA makes to the Australian aviation safety system I have embarked on an internal change program,” he said.

“It is clear to me from both internal and external feedback, as well as my evaluation of the Federal Government’s response to the Aviation Safety Regulation Review, that a range of changes are required. From talking with many people I understand our service delivery can be inconsistent and applications can sometimes get passed unnecessarily between different areas of CASA, slowing down our response times. ” Skidmore said he was committed to the significant change program, adding reforms to the organisation would be undertaken progressively to minimise disruption to CASA’s operations.

All CASA’s processes would be under review in efforts to determine where and how the most effective improvements could be made to “deliver consistent, effective, efficient and timely regulatory services to the aviation community”.

“The plan is to have key changes in place by the middle of 2016, with a number of steps being taken between now and then,” Skidmore said.

“This approach allows us to build on the positive things CASA does and to ensure important safety outcomes continue to be delivered.

The overarching aim of the change program will be to develop a more constructive engagement between CASA and all sectors of the aviation community. ” Skidmore said CASA would soon set out its regulatory philosophy, outlining how the organisation would be a “strong, fair and responsive safety regulator that works with the aviation community to achieve optimal safety results”.

CASA announced a new directive in June which said that aviation safety regulations must be shown to be necessary and developed with a view to addressing known or likely safety risks that cannot be addressed effectively by non-regulatory means alone.

Further, the directive said: “If a regulation can be justified on safetyrisk grounds, it must be made in a form that provides for the most efficient allocation of industry and CASA resources. Regulations must not impose unnecessary costs or unnecessarily hinder levels of participation in aviation and its capacity for growth. ”

Hercules firefighting tanker begins contract with NSW Rural Fire Service

A Lockheed Hercules firefighting air tanker has arrived at RAAF Base Richmond as part of the NSW Rural Fire Service’s (RFS) two-year trial of a large air tanker during the upcoming bushfire season.

The stretched L-100-30 (model 382G) Hercules, registered N405LC to Lynden Air Cargo and on contract from Coulson Flying Tankers of Portland, Oregon, was put through its paces on a demonstration flight at RAAF Base Richmond on September 1. In a note to media at the event, the NSW Rural Fire Service said the L-100-30 Hercules Large Air Tanker (LAT), which can carry up to 15,450 litres and takes just 10 minutes to refuel, was chosen due to its successful operational history in fire fighting.

“It is able to reach remote fires rapidly with a large load of fire retardant, suppressants or water and drop, and they quickly return to the base to reload,” the NSW RFS said.

The aircraft will be based at RAAF Base Richmond from September 1 until early December, the NSW RFS said, with secondary regional bases such as RAAF Base Williamtown, Dubbo, Tamworth and Canberra also able to accommodate the aircraft to increase coverage of key risk areas and improve operational efficiency.

“This will allow the LAT to operate on fires anywhere in the state,” it said.

N405LC, named Thor, is the larger sistership to C-130Q Herculesair tanker N130FF which operated in Australia during last summer’s bushfire season under contract with the Victorian Department of Environment and Primary Industries.

Thor is due to joined by a McDonnell Douglas DC-10 Very Large Air Tanker (VLAT) which the NSW RFS said would join its firefighting air fleet at the end of September and be available for deployment in the state between October and the end of January 2016.

The RFS said it would have 35 aircraft supporting the firefighting effort over the coming bushfire season, which would be “supported by over 100 tactical aircraft from operators that have net standards to carry out aerial firefighting activities”.

“The aircraft will be strategically located across the state in accordance with the predicted fire risk to facilitate rapid initial attack in support of ground fire fighters,” the RFS said.