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Massive overhaul at Qantas

airceo — Wed, 17 Aug 2011 18:58:23 +0000

Two Qantas 747's parked side by side at Heathrow

Qantas has announced an overhaul of its international operations to try to right the ship from the tough position it currently sits in. These changes were announced in a document entitled “Building a Stronger Qantas” released to investors on August 16th. Having read the document (twice) my outsider’s assessment is that there appears to be a bit of a lack of coherent focus.

Qantas services to London Heathrow will be dropped to two daily flights via Singapore. Existing services via Hong Kong and Bangkok will terminate in those cities. Passengers will transfer onto flights operated by British Airways. Not too long ago there was talk of Heathrow becoming an all A380 station for Qantas. The newly released document now states Heathrow will be served by “A380 aircraft or equivalent product.” This, I presume, is in reference to the 9 747s Qantas plan to retrofit to “A380” standard.

Sydney – Buenos Aires flights will be dropped in favour of a Sydney – Santiago service. This makes sense. Santiago is alliance partner, LAN’s biggest hub. This switch makes numerous places in South America accessible with a single stop. Add to this the fact that Aerolineas Argentinas is destined to join Skyteam, SYD-EZE makes less sense than ever.

Delivery deferral of 6 A380s by 5 years (FY’14 to FY’19) This decision was likely based on a simple total cost of operation calculation. There is no doubt that the A380 is the sexier offering but the fact that the 747s are paid off make them more viable at this time.

Qantas will focus on Premium International Travel ex-Australia. Given the lower cost of labour and (perceived?) better service on the numerous Asian carriers that service Australia, is this wise? Qantas is no slouch but topping titans like Singapore Airlines is not going to be easy. I fear that this may be too big a hill for Qantas to climb.

The document also indicates that Qantas will set up a “new premium, full-service airline based in Asia under a new brand.” At the time of writing, no “base” has been chosen. I would imagine any base would have to be chosen with some synergies with Qantas and/or its OneWorld partners in mind. This would suggest that it would have to be Hong Kong, Bangkok, Kuala Lumpur or Singapore. Given the scale back in both Hong Kong and Bangkok, neither of those appears to be the frontrunner. Singapore is already quite a ferocious market and I have a hard time believing Qantas has the stomach for it. This leaves Kuala Lumpur. Geographically speaking it’s well placed to serve most of Asia but given that it’s in a region with an appetite for LCC flying isn’t this too a bloodbath waiting to happen?

In addition, Qantas plans to launch Jetstar Japan in 2012. Japan is not an easy marketplace at the best of times but the current economic climate and the fact that the key partner in this venture is JAL – a carrier with deep problems of its own – really make me wonder if this is ever going to be anything more than a pipe dream.

Good luck Qantas, you’re going to need it!

Qantas to abandon San Francisco in favor of Dallas

airceo — Fri, 14 Jan 2011 15:45:54 +0000

As part of a move to harmonize operations with their Oneworld partner American Airlines, Qantas is set to discontinue operations from Australia to San Francisco on May 14th. The sudden halt of San Francisco is a bit of a surprise, but given the strength of American Airlines at DFW the move is an understandable one. Qantas seems bullish about the potential of switching to Dallas and have indicated that the new route will be inaugurated with 4 weekly A380 services which will turn to a daily service with the arrival of additional A380s.

Qantas abandons San Fransisco in favor of Dallas

The interesting wrinkle in this new route is that while the outbound leg (QF7) will operate SYD-DFW the return leg (QF8) will operate DFW-BNE-SYD due to range restrictions caused by prevailing winds over the pacific. The stop in Brisbane may become a problem. For example, for a passenger flying from Miami to Sydney the thought of MIA-DFW-BNE-SYD seems far less palatable than MIA-LAX-SYD. Though Qantas are taking steps to improve the customs and immigration process for stopover passengers in Brisbane I feel that the perception problem is one that may not be easy to overcome. To their credit Qantas do see this is a problem – if not necessarily the size of the problem – and have indicated that when the 787 enters its ranks it will take DFW-SYD direct in both directions. The only issue with that resolution is that there is still very little clarity into when the 787 will actually enter service and how it will perform. Hopefully the US$3.1 million in rebates from Dallas-Fort Worth airport to Qantas will be enough to keep things ticking along until Boeing gets the 787 rolling in earnest.

The 8 best airline tails in the air today

airceo — Thu, 08 Jul 2010 21:50:22 +0000

Like anything else of an aesthetic slant, the like and dislike of tail designs is largely subjective. I have compiled the following list of tails as my current top ten with a few accompanying words. They are in no particular order.

Air Tahiti Nui – A flower floating in water; hardly a conventional idea for a tail and yet it works. Beautifully. The ripples in the lagoon blue whisper tranquility and beauty. What better representative could their be of a country that bills itself as paradise on earth?

Etihad - Some would say that this tail is far too masculine and imposing – that it’s almost military in appearance. I think it’s super. It’s certainly not conventional. Nor is it a tail you forget quickly. Etihad has used this design since its inception (albeit with the small change of adding seven stars to represent the seven emirates of the UAE) let’s hope nobody talks them into changing it.

Qantas - The Kangaroo may have gained and lost a few kilograms over the years but fundamentally this tail has remained unchanged for a very long time, and with good reason. It’s striking, simple and quintessentially Australian.

There was chatter that QF were going to paint a few tails with the silhouette of other Aussie animals such as the wallaby. That appears to have been nothing more than a rumor.

Egyptair – After many years of that awful bland blue-with-chicken-scratch tail the folks at Egypt Air have pulled up their socks and made a change. The new tail is a winner. All of their new metal is coming online with this new tail. The concentric waves of blue are simply mesmeric!

Gulf Air – Even before it’s rebirth, Gulf Air had a striking tail. Of course, as the various emirs got into a “mine’s bigger than yours” competition leaving Bahrain in the lurch it didn’t really make sense to preserve the red, black and green runners… since Bahrain’s flag sports none of those colors.

The new design (tail and livery) is great. So great in fact that it has been knocked of twice (that I know of) and has set off a wave of imitators. Sure the idea of a bird-only tail is hardly unique but this look easily has the edge over the likes of Singapore Airlines, Garuda Indonesia, Aerolineas Argentinas et al.

Emirates - Long before the billowing sail-inspired Burj al Arab Hotel graced Dubai’s skyline, the billowing flag graced it’s planes. What’s so clever and pleasing about this design is that it does not bastardize the real flag at all, it simply projects it onto the tail.

As far as I can tell the only change between this design and the original is that it’s is ever so slightly less angular.

American Airlines – Simple, timeless, clean, almost arrogant but in a friendly way this tail forces you (well me at least) to look at it. No matter what your allegiance may be this tail is a winner.

Thai - There’s something majestic about this tail’s almost opulent use of powerful colors. Then again I suppose for a carrier that still refers to itself as the “royal orchid service” that opulence should come as no surprise. This new tail was so powerful when it was first rolled out that it had what I call the BMW effect – as soon as you see a new one next to an old one the old one looks like crap, even though it isn’t.

Now if Thai could only bring that external feel to their interiors that would be great; I flew London-Bangkok last year with no on-demand IFE. Less than regal don’t you think?

While I’m on the subject of tails, if anyone knows what that thing Sri Lankan uses on its tails is I would love to know. At least the old bird was intelligible. That new thing is simply awful. Is it a jalapeno?

Short-cycle aircraft leasing

airceo — Thu, 20 May 2010 20:03:21 +0000

Qantas parking lot at LAX by Kim Davies

When planes are on the ground they don’t make money. Why then do numerous carriers the world over allow their precious metal to sit on remote stands gathering dust for hours at a time awaiting their return rotations? Simply put, I think nobody has bothered to challenge the status quo. Look at LAX for instance. It has a hugely impressive offering in terms of trans-Pacific flight possibilities. What’s less impressive is the aircraft utilization of some of the operators. Let’s put Qantas under the microscope for a second. On most days they offer five services into LAX:

Flight Numbers	Origin	Arrives	Departs	Idle Time
QF0011/QF0012	SYD	9:40	22:30	12:50
QF0107/QF0108	SYD	6:45	23:50
QF0015/QF0016	BNE	11:00	23:30	12:30
QF0093/QF0094	MEL	7:20	23:20	16:00
QF0025/QF0026	MEL	6:30	23:40	17:10

Out of the flights listed in the above table QF107 continues on from LAX to JFK. The others sit on the ground doing nothing. What’s stopping Qantas from leasing out one or more of these idle frames to their alliance partners at American Airlines to conduct hub to hub runs out of LAX? The numbers would obviously have to be studied but I would imagine that AA could sustain a 747 or A380 service between LAX and at least one of its hubs. DFW alone sees 15 direct dailies from LAX including a 767 followed in quick succession by a 757 during the morning rush. Surely that pair could be replaced with a QF 388/744 with a return flight back to LAX in time for the late night departure down under? It’s a win-win for QF and AA.

Obviously an idea like this sounds simple on paper but requires a lot more thought to implement. In the example I have given – the QF-AA tie:

AA would need to ready a stable of pilots rated on the 744/388.
QF would need to be satisfied that their equipment and brand was being looked after.
“Operated by” stickers would need to be in place to appease the DOT.
Perhaps a ghastly OneWorld livery too.

These and a whole slew of other items must be addressed but in the end I think the possibility for this to happen is there. Beyond Los Angeles, San Francisco and Vancouver have planes that sit on the ground for long periods. A similar deal could easily be struck up between say Air New Zealand and United who already fly the 744.

In my opinion if this type of short cycle leasing is ever going to happen the biggest possibility will be between the Virgin carriers. Virgin America are stable and expanding and V Australia is making inroads on the US west coast. As both airlines take additional deliveries I think V Australia’s schedule will start to look more and more like Qantas’s which will create the perfect platform for Richard “fair dinkum” Branson’s Aussie carrier to short-cycle lease 777s to Richard “born on the fourth of July’ Branson’s American carrier. Of course such an action would set the “birthers” off and likely cause a ruckus on Capitol Hill, but guess what it would be a perfectly legal arrangement.