Qantas accused of driving away rivals

[NickN]

from smh.com.au

Andrew West
April 16, 2009
QANTAS is dramatically increasing the prices it charges other international airlines for providing baggage handling and ground services in a calculated effort to lose business, an airline union claims.

The Transport Workers Union alleges the inflated quotes are part of a broader strategy to shed jobs and outsource all ground services to contractors that pay lower wages.

In the past six months, the union said, Qantas had effectively driven away Philippine Airlines, Etihad and its own Jetstar subsidiary by increasing prices for ground services by up to 30 per cent.

"Whoever heard of putting up prices, especially this much, in the middle of a recession?" the union's national secretary, Tony Sheldon, said.

"We believe their ultimate strategy is to downgrade training and wages for the ground crew they already employ by actually losing contracts. That allows them to say they cannot compete and the only way they'll be able to compete is by cutting wages."

A Qantas spokesman, Joe Aston, confirmed the company had lost several clients. "Some airlines will move to other providers."

Mr Aston said Qantas had "adjusted our rates to be more in line with commercial prices", having previously provided ground services to other airlines at cost price.

The Herald has confirmed that Philippine Airlines will terminate its contract with Qantas for ground services on May 16. Philippine Airlines's Australian general manager, Arnul Pan, said Toll DNATA would take over all its ground operations, including passenger check-in, baggage handling and cargo.

"The decision was made in head office [in Manila]," Mr Pan said. "They came down here to Sydney and had a meeting with Qantas and just made the decision."

A spokeswoman for Etihad, Anne Tullis, also confirmed the Abu Dhabi carrier had renegotiated its deal for ground operations in Sydney late last year and Qantas had lost the contact.

"In order to be cost-effective and competitive, we put the provision of our ground handling services at Sydney Airport out to tender in the last quarter of 2008," Ms Tullis said in an email.

Three companies took part in the bid, with Menzies Aviation lodging the most competitive price.

It "met our other service delivery criteria as a result of which the company was selected", she said.

"The company now provides ground handling services at Melbourne and Brisbane as well."

Mr Sheldon said the union was attempting to begin talks with Toll DNATA to negotiate a collective agreement for staff taking over the Qantas contracts. But he said that contract staff generally received lower rates than Qantas employees.

Employees at Aero Care, the contractor that now runs ground operations for the Qantas budget subsidiary Jetstar, are paid almost $300 a week less than their Qantas counterparts.

Last month, Qantas baggage handlers staged a wildcat stoppage to protest at the loss of at least 120 jobs through outsourcing.

http://www.smh.com.au/travel/travel-...0415-a7ke.html

The folks at Menzies, Toll and Aero Care will be happy with this, picking up the extra revenue during a recession!

It makes sense to outsource the work if there are others willing to do the same job at a lesser cost, provided operations aren't significantly affected.

[Simon L.]

Probably everyone knows that Qantas ground services isn't competitive in terms of pricing for contracted ground handling operations and we have all witnessed more and more international carriers switching over to other providers.

However, some international carriers still stay with Qantas because from my understanding they do actually get better SPA rates for domestic add-on sectors since not all international carriers are like SQ, CX, MH etc. which serve most capital cities here in Australia.

Nonetheless, I have to say those Qantas ground services personnel processing passengers etc. for other carriers do seem to be less friendly, most of them seem not to be terribly interactive with passengers/airline supervisors/duty or station managers when compared to their counterparts handling QF flights.

Also, it seems that those airlines that are using Qantas ground services as their GHA in Australia really need to provide more training to some of the staff as I have came across quite a number of check-in staff whom lack the basic knowledge/skill to get the work done. eg. very few clues on contracted airlines' FFPs and the relevant benefits for elite members, difficulties to use other DCSs instead of the one used by Qantas, lack of communications to seek the appropriate action from airline supervisors/duty managers etc.

Anyway, the business class check-in desk staff (of course he's from Qantas ground services) for my last international flight (obviously not on Qantas) on Saturday, April 18, had absolutely no clue on how to actually update the FFP details recorded in the system. He had to ask the airline supervisor to come and do it for him etc.

Anyway, let's hope there won't be more job cuts...

[Montague S]

Originally Posted by NickN

from smh.com.au



http://www.smh.com.au/travel/travel-...0415-a7ke.html

The folks at Menzies, Toll and Aero Care will be happy with this, picking up the extra revenue during a recession!

It makes sense to outsource the work if there are others willing to do the same job at a lesser cost, provided operations aren't significantly affected.

hmmm...am I reading you right? it makes sense to shed more Australian jobs.

[Michael Morrison]

Please refrain from quoting the whole previous post in your post, it is not necessary, thank you - mod

Toll, menzies and Aerocare all employ Aussies to do the same jobs - albeit on ower wages.

[Montague S]

Originally Posted by Michael Morrison

Toll, menzies and Aerocare all employ Aussies to do the same jobs - albeit on ower wages.

oh I know that...simple fact of the matter is that they're shedding one work-force for another, I wonder if the author knows where the QF handlers might find another job.

[Michael Morrison]

Apparently the difference between say a Menzies Cust Service officer and QF one is about $300 p/w

[NickN]

I wonder if the author knows where the QF handlers might find another job.

You need to quiz Qantas on that point, they are one hiking prices up to push customers away and give reason to make the positions redundant.

I am happy however that in this case the jobs stay here in Australia. As I said above, given the fact we are facing a recession the other companies will be happy to see an increase in revenue through the new contracts when most other businesses are suffering.

[Ellis Taylor]

From doing a little behind the scenes research into ground handling a while ago, QF had a great little deal going for a number of years where they would charge outrageous amounts for handling foreign carriers in Aussie ports, while the other carriers would do the same at their ports, so in effect it would even up. But now with the extra competition in the market, especially on the international side, it seems like it's more economic to go to the market and seek the cheapest, best quality handler. Nine times out of ten, that's someone other than Qantas

[NickN]

There will be no going back to the good old days for QF, both with ground services and airfares. They will have to put a limit on the prices to meet peoples expectations after the glorious cheap fares people are getting at the moment.

[D Chan]

Originally Posted by Michael Morrison

Apparently the difference between say a Menzies Cust Service officer and QF one is about $300 p/w

and staff travel.