Qantas chaos casts shadow on Gold Coast bid for 2018 CW Games?

The chaos caused to global passenger travel over the weekend following the unprecedented grounding of its entire fleet by Qantas Airways could be a blow for Australian Gold Coast’s bid for 2018 Commonwealth Games.

On Saturday Qantas took the drastic step to ground its fleet cancelling over 450 flights affecting 70,000 passengers.

              



The unprecedented move was amidst Australia holding the 22nd Commonwealth Heads of Government Meeting (CHOGM).

Sources said that the Qantas action inconvenienced several delegations apart from disrupting travel of its passengers worldwide.

Australia’s Gold Coast along with Sri Lanka’s Hambantota is bidding to host the 2018 Commonwealth Games and some participants at CHOGM had raised a few eyebrows over the chaos caused by Qantas.

A Reuters report on the chaos said Qantas’s move had investors worried about longer-term damage to the brand from the grounding, which disrupted the travel plans of some leaders at the end of a summit of Commonwealth nations in the western city of Perth.

“I will never ever even think of flying Qantas in the future,” said Robert Moore, on the airline’s Facebook page.

The weekend was one of Australia’s busiest for travel, with tens of thousands travelling to the hugely popular Melbourne Cup horse race on Tuesday.

However, Australia’s airline returned to the air on Monday after grounding its entire global fleet over the weekend in a bold tactic to force the Government to intervene in the nation’s worst labour dispute in a decade.

At the Government’s instigation, Australia’s labour tribunal ordered Qantas to resume flights and banned trade unions, which have waged a damaging campaign of industrial action, from staging more strikes while negotiations continued.

“That was the only way we could bring that to a head,” a bleary-eyed Qantas CEO Alan Joyce told reporters after 36 hours of round-the-clock brinkmanship.

The Government welcomed the tribunal’s ruling, saying it had saved the tourism industry and the wider economy from serious harm, but it turned its anger on the Qantas CEO.

Prime Minister Julia Gillard said the grounding was an extreme step and criticised Joyce for giving the Government only three hours notice before grounding the airline, which carries about a fifth of Australia’s international passengers.

Later, after being given the all-clear from aviation regulators, Qantas resumed flights from Sydney with an Airbus A330 bound for Jakarta. Around the country and overseas, airport departure lounges filled up with Qantas passengers keen to resume their journeys after a frustrating weekend of waiting.

“I understand strikes happen, but to stop all flights without thinking about the passengers – I don’t agree with that,” said Mary Keers, a 50-year-old Irishwoman waiting at Singapore’s Changi Airport to catch a flight to Perth.

Joyce, dubbed a “kamikaze” by one newspaper for effectively staging his own strike against the unions, came under fire from Canberra and also credit rating agencies for the grounding.

The tribunal ruling, handed down in the early hours of the morning, gives both sides 21 days to settle the dispute or submit to binding arbitration – an expedited process likely to favour Qantas in its battle with unions to cut costs and base more operations in Asia, a labour-law expert said.

Qantas says it has lost about A$ 70 million ($ 75 million) since September from industrial action in its dispute with three trade unions over pay, working conditions and its Asian plan. Joyce had described the union campaign as “death by a thousand cuts” for the 90-year-old airline.

In Australia, Qantas departure lounges were crammed with passengers hoping to board the first flights. Qantas is not expected to be back to full operation until Wednesday.

The grounding also stirred media speculation of Qantas as a potential takeover target, with a Sydney Morning Herald columnist accusing Joyce of driving “Qantas’s share price into the ground, making it a sitting duck for a takeover”.

Qantas was the target of an aborted private-equity bid four years ago and has continued to draw takeover rumours from time to time, despite a 49 per cent limit on foreign ownership.

Assistant Treasurer Bill Shorten said Joyce had lit a fire beneath Qantas. “It really shouldn’t have needed this bushfire, industrial bushfire, to take place,” he said.

The Qantas dispute has dragged on for months but escalated recently when the airline announced plans to cut 1,000 jobs and order $ 9 billion worth of new aircraft as part of a makeover to salvage its loss-making international business.

Union representatives said they would work with Qantas to resume flights as soon as possible but some sought to cast Joyce as a reckless manager prepared to risk the airline.

“The board should immediately sack their out-of-control CEO,” said Captain Richard Woodward, Vice President of the Australian and International Pilots Association.