Qantas in management shake-up ahead of job cuts
Qantas is splitting its domestic airline business from its loss-making international operations, but says customer benefits such as its popular frequent flyer scheme won’t be put at risk.
QANTAS is splitting its domestic airline business from its loss-making international operations, but says customer benefits such as its popular frequent flyer scheme won’t be put at risk.
The flying kangaroo announced the massive senior management shake-up on Tuesday, a day after revealing it was axing 500 heavy maintenance jobs.
Under the management changes, Qantas’s domestic and international operations will be headed by separate chief executives and independently managed from July 1.
But for passengers, it will be business as usual.
“We treat customers on the Qantas brands exactly the same across them,” chief executive Alan Joyce said.
“It is still one group, it is one corporation and we will have no intention of separating out how customers are treated across the Qantas-branded airlines.”
The management changes were made in recognition of the different challenges facing the airline’s domestic and international arms.
Qantas domestic is a dominant force but facing a fresh assault from Virgin Australia, while Qantas international lost $216 million in 2010/11 amid fierce competition from foreign carriers and a high cost base.
Qantas International will be headed by Simon Hickey, formerly the boss of Qantas frequent flyer, while Lyell Strambi moves from group executive of operations to head up Qantas Domestic.
The Australian and International Pilots Association (AIPA), which represents Qantas pilots, welcomed Mr Hickey’s appointment.
“Mr Hickey seems to enjoy a reputation as a pragmatist and that is certainly the change in approach Qantas International needs right now,” AIPA treasurer and Qantas pilot Adam Susz said in a statement.
Separately, Jayne Hrdlicka will replace Bruce Buchanan as Jetstar chief executive.
Mr Buchanan, who has been Jetstar chief executive since October 2008, will leaving in six months to work at an organic skincare business, Vanessa Megan, in which he holds a 50 per cent stake with his wife Elizabeth.
Thought of in some circles as a potential successor to Mr Joyce, Mr Buchanan will stay at Qantas for a further 18 months after stepping down as a consultant.
As well as the management shake-up, Qantas intends to report financial results for its international operations as a separate division.
CBA Institutional Equities transport analyst Matt Crowe said the move would offer greater transparency on that part of the business.
“I think there has been a bit of skepticism about Qantas management, that somehow they were exaggerating the poor performance of Qantas international,” he said.
“Having audited accounts should put a stop to those sorts of comments.”
Meanwhile, Mr Joyce refused to comment on reports Qantas was in talks with Dubai-headquartered Emirates on a possible codeshare agreement, saying it would lead to unnecessary speculation.
Qantas closed four cents higher at $1.47. – AAP