Having just recovered from the amazing revelation that ‘coal mines may close’, now I’m reading this gem:
Centre for Asia-Pacific Aviation director Peter Harbison said that a currently unprofitable Qantas faces being gutted and reconstructed around a more profitable Jetstar model.
Well the language is tabloid-style, where any restructure is labelled as ‘gutted and reconstructed’, but the point is made that seeking bigger margins via lower costs will mean a mix of sharper scheduling, more layoffs, increased outsourcing, fleet sales and further creative reorganisation. Of course the Jetstar model is not the only one, just the most likely – given that it’s one that appears to work. However Qantas may seek to retain some premium services, at premium prices, with a tightly targeted approach, and it may contract its network of routes. It could also re-engage in merger or ‘partnering’ talks with other airlines in the hope that size will help.
So where’s the surprise in all of this? Hasn’t Qantas already telegraphed many of these changes? Given the current global economic situation, drastically falling seat sales and the looming impact of carbon emission schemes, which will surely force fuel costs back up, what else could they reasonably do? Even a return to economic ‘good times’ will only mean rising fuel prices – and restructuring. So they may as well get it over and done with… and bear the pain.
Having just recovered from the amazing revelation that ‘coal mines may close’, now I’m reading this gem:
Centre for Asia-Pacific Aviation director Peter Harbison said that a currently unprofitable Qantas faces being gutted and reconstructed around a more profitable Jetstar model.
Well the language is tabloid-style, where any restructure is labelled as ‘gutted and reconstructed’, but the point is made that seeking bigger margins via lower costs will mean a mix of sharper scheduling, more layoffs, increased outsourcing, fleet sales and further creative reorganisation. Of course the Jetstar model is not the only one, just the most likely – given that it’s one that appears to work. However Qantas may seek to retain some premium services, at premium prices, with a tightly targeted approach, and it may contract its network of routes. It could also re-engage in merger or ‘partnering’ talks with other airlines in the hope that size will help.
So where’s the surprise in all of this? Hasn’t Qantas already telegraphed many of these changes? Given the current global economic situation, drastically falling seat sales and the looming impact of carbon emission schemes, which will surely force fuel costs back up, what else could they reasonably do? Even a return to economic ‘good times’ will only mean rising fuel prices – and restructuring. So they may as well get it over and done with… and bear the pain.
