Consolidation may be inevitable for Qantas, Australia's national airline, if it wants to continue to compete efficiently in a rapidly changing global aviation industry, says the carrier's outgoing chief executive.
"The future of aviation will not and cannot look like the past. For years now, I have been saying that airline consolidation is an inevitable part of the aviation industry's necessary transition to stability. Well, consolidation is now underway in earnest," Geoff Dixon said in a speech to the American Chamber of Commerce in Australia.
"We believe there is a compelling case for Qantas, if the right opportunity arose, to be allowed to participate freely in the new global aviation order. This would provide further opportunities for growth in jobs and benefits for shareholders and the nation as a whole."
Mergers and tie-ups between airlines have increased in recent months as they struggle to cope with rising costs and slowing economies. Dixon, who hands over the reins at the Oneworld alliance member to Jetstar CEO Alan Joyce next month, says: "This will be the way to preserve valuable brands, provide expanded networks, deliver new avenues for revenue growth, and create increased scale and sources of efficiency."
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Making the case for Qantas, he added. "We are at the end of the world. We have no hub advantage so we cannot connect many point-to-point routes to easily build networks. Our home population is comparatively small. And while we are private and commercially run, some of our strongest competitors are government owned and supported airlines."
Acknowledging worries about a loss of Qantas' status as a national icon that provides essential air transport services in the country, Dixon says that any proposal for a consolidation would "be very mindful of all our responsibilities" and "commitments".
Looking ahead, he says that Qantas must focus on succeeding in a new global marketplace for the aviation industry that seeks to move away from the old international structures.
"The aviation world - a much as the world around aviation - is changing rapidly. The current turmoil will no doubt speed up the change process. There will be no let-up for Alan and his management team, as Qantas confronts intense competition at home and abroad, this challenging global economic environment and volatile fuel prices," he added.
Source: Air Transport Intelligence news
