Australia's Qantas says unions 'out of touch'

15:25 | 20/07/2011
Qantas chief Alan Joyce on Wednesday accused labour unions of standing in the way of change at the airline, as he signalled greater industry consolidation, with a focus on Asia, was the way forward.

The Australian carrier, which is engaged in prolonged talks with pilots and engineers on contracts, will next month announce a strategic plan designed to revive its loss-making international business and expand its Asia markets.

"We are now in negotiations with a number of unions," Joyce said. "But some union leaders are simply out of touch and trying to block our use of new business models."

The chief executive said the Australian Licensed Aircraft Engineers? Association (ALAEA) needed to understand that new technologies required changed work practices.

"But our maintenance and repair costs are among the least efficient and most expensive in the world," he said in a speech to the Australian Pacific Aviation Outlook Summit.

"So it's time to catch up. We don't repair our cars the same way we did 40 years ago. We can't repair our planes the same way either. We can -- and we will -- be safer, smarter and more efficient."

The ALAEA, whose members are due to stop work for 60 seconds on Friday as part of an ongoing dispute over wages and conditions, reacted furiously to Joyce's comments.

"Right now I would like to direct all members to walk straight off the job and walk into Alan Joyce's office," union secretary Steve Purvinas said in an open letter on the union's website.

"To tell him to stop destroying the business that was founded 90 years ago by two pilots and an engineer. To remind him that without Qantas International, he will not have any other associated businesses."

But Purvinas called on engineers not to walk off the job, saying Joyce's comments were "clearly trying to incite us into doing something stupid".

Qantas is also facing its first industrial action by pilots in 45 years as they demand a new clause in their contracts to stop the airline from potentially outsourcing pilots to cheaper bases in Asia.

Joyce said the competitive challenges airlines faced made major change essential, including greater engagement in Asia, particularly China.

Qantas' budget subsidiary Jetstar was already Asia's largest and fastest growing low-fare network and Joyce said management saw "continuing opportunities for the Jetstar model".

Joyce said while Qantas was one of the world's top aviation companies, its success was "far from guaranteed".

"We come from a relatively small home market, that is not a major global destination. We have no global hub ports. And we're not backed by government," Joyce said.

"To secure our future, we must face up to the new global realities, seize new opportunities, and make the external and internal changes that will enable us to compete effectively."


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