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The prospect of the government banning foreign cabin crew on domestic flights, as reported in some outlets, would be a bold step--but if only it were true.

In reality the private bill Independent Senator for South Australia Nick Xenophon intends to introduce has a narrow remit. Xenophon, who chaired the Senate inquiry into pilot training and aviation safety, wants foreign-based cabin crew employed to work on Australian aircraft to have the same flight and duty time limitations as their Australian counterparts. It is an appropriate measure.

"This is a basic issue of fairness and safety," Xenophon said in a statement. "We shouldn't have an underclass of cabin crews flying around Australia on Australian carriers." Xenophon said foreign crew have no limitations in their contract on how many hours they could be expected to fly.

Jetstar chief executive Bruce Buchanan was asked at a March Senate hearing if foreign crew had different duty limitations than their local counterparts.

"There is a variety of different arrangements in place on the Australian domestic arrangements. Some of the international crew will align with some of the Australian international crew, but the domestic crew have different agreements and different time limitations and how they work in Australia," Buchanan replied.

Xenophon's bill follows a recently-aired local documentary on ABC Lateline that highlighted how Jetstar employs Thai cabin crew from a company Qantas owns 37% of yet gives lower conditions to and, in some (exceptional) instances, has cabin crew work 20-hour shifts. The long shifts raise questions over how safety proficient the crew could be in an emergency.

"In the event of an emergency, I believe passengers have a right to expect that their cabin crews are going to be alert enough to get the door open and the passengers out," Xenophon said.

The proposed bill would also apply to international airlines in which an Australian carrier has a stake of at least 20%, directly affecting Jetstar Asia--which flies Airbus A330s from Singapore to Melbourne--and any possible full-service east Asia-based subsidiary Qantas will announce on 24 August.

While Xenophon said he would "take up" the issue of the lower salaries paid to foreign crews, he stopped short of calling for legislation on the topic. Buchanan told the senate inquiry an "indicative" salary (likely including per diem and flight hours) for Jetstar's Singapore-based crew would range from $36,000-$46,000 while the "indicative" salary for Australian-based cabin crew was $50,000-$69,000.

Buchanan said at the hearing that Thai-based cabin crew have similar salaries as their Singapore colleagues while Vietnam-based salaries "are substantially less" but "commensurate with local market levels".

"At the end of the day, you have to be competitive in each of the local markets to recruit cabin crew and pilots," Buchanan said.

Xenophon's statement said the bill "follows revelations that Jetstar's Bangkok-based foreign crews regularly work on flights that travel from one Australian location to another, and that most passengers would believe are domestic flights."

That statement is in reference to foreign-based crew working "tag" domestic services on their aircraft between international sectors, such as A330 flight JQ35 that routes Sydney-Melbourne-Bali. Foreign crews work the Sydney-Melbourne sector.

However, Xenophon should know that practice is not a "revelation" as it was discussed, with little debate, at a hearing he attended on 31 March.

Before the Civil Aviation Safety Authority grounded Tiger Airways effective 1 July, the carrier was showing signs of operational maturity, although Tiger's two low approaches in June and its subsequent grounding clearly indicate the safety side of the airline was deficient.

The positive operational signs were coming via a series of network changes that were giving critical short- and long-term perspectives about the carrier.

The network changes consisted of Tiger re-scheduling its Avalon-Perth flight to, in its words, "provide better timed...services". It also opted to re-locate one Airbus A320 from Melbourne Avalon to Melbourne Tullamarine. While Avalon was able to better serve Victoria's Geelong region, the bulk of traffic would find Tullamarine more convenient than Avalon.

Tiger also axed four routes: Melbourne to Mackay and Rockhampton, and Sydney to Brisbane and the Sunshine Coast. Then-managing director Crawford Rix said in a statement "These network changes will both streamline and simplify our Australian operations, enabling us to focus on combining our low fares with improved punctuality."

Quietly added after that was that profitability to Mackay and Rockhampton was being affected by high fuel prices, and that a lack of a base in Queensland or New South Wales "has proved more challenging than anticipated".

In the long-term, that period will be seen as when Tiger started to grow up by trading maximum utilization hours for reliability. The carrier was due to axe four routes while only adding one return Melbourne-Sydney service--and no more, a spokeswoman confirmed. "It's about fixing reliability and flying the best routes to get our business on track," she said. Unknown is if Tiger faced any other restrictions from its show cause notice besides not being able to induct more aircraft into service.

That net utilisation decrease would have given Tiger more schedule padding, decreasing delay dominoes and dampening the affects of when an aircraft goes tech. That would have resonated well with a public that has lamented Tiger's reliability.

The move could also have been a prelude to Tiger trying to lure more of the corporate market as easyJet, for a global perspective, has done. While Tiger did have a tiny fraction of the corporate market, there was undoubtedly greater potential. Anecdotal evidence from corporate passengers shows they would fly Tiger more if its reliability was better--never mind the carrier's ultra no-frills approach.

That said, the International Air Transport Association noted at its June AGM that aircraft utilisation was falling globally due to a decrease in demand, suggesting that perhaps Tiger was seeing that demand decrease too and was not just looking to improve reliability.

In the short-term, Tiger acknowledged it was finally feeling the tough Australian market that Virgin first felt in May 2010 with a profit downgrade. The announcement axing some Mackay and Rockhampton services was the first time the carrier mentioned fuel as having an impact.

Going forward it should be watched if Tiger continues to show signs of operational maturity while also satisfying CASA. Tiger is expected to resume operations with a limited service that in addition to complying with safety regulations will help operationally. (The carrier's booking engine, at times, indicates Tiger will only fly to five cities from Melbourne upon service resumption.)

It remains to be seen if once CASA loosens the shackles and Tiger becomes under pressure to make up lost revenue if the carrier will go back to its old high-utilisation and low reliability ways, or if Tiger will embark on a slower path with bigger long-term gains.

The Civil Aviation Safety Authority now believes Tiger Airways Australia is nearing a position to safely resume services.

Yesterday the safety regulator indicated it had concluded its basic investigation of Tiger as it gave the carrier a set of undisclosed conditions, some of which Tiger must comply with before resuming services and some that must be adhered to after resumption. Accepting these conditions will end CASA's application to the Federal Court about extending Tiger's grounding. Yesterday's hearing, adjourned from last week, has been adjourned to next Monday (1 August), the day CASA originally expected to conclude its investigation by.

The adjourned hearing was instigated again at Tiger's request, showing Tiger continues to want to avoid court limelight. Tiger has ruled out flying before 5 August as it has refunded passenger tickets until then. An announcement about ticket booking resumption and scheduled flights on and after 5 August will be made in due course, Tiger said.

There are two views to this. First, as has been suggested in local reports, Tiger could resume services on 1 August but needs lead up time to sell tickets (it has agreed with the competition regulator not to sell tickets while grounded) and prepare crew.

The second view is Tiger may not be able to comply with CASA's conditions by 1 August. A carefully worded statement goes: "Tiger Airways Australia is confident that it can comply with these conditions and expects to resume services in the near future. As a consequence, Tiger Airways Australia will automatically refund all passengers booked to fly between 1 August 2011 and 4 August 2011."

With Tiger's fate no longer a prime consideration, two questions emerge: how quickly will the public go back to Tiger's low fares, and will the carrier continue with the operational (albeit non-safety) maturity it showed prior to its grounding?

Air New Zealand is now toeing Boeing's line about the 787-9 delivery schedule after being put in the docket by the airframer for issuing harsh words about the embattled aircraft programme.

To recap, last week in Sydney Air NZ chief financial officer Rob McDonald said his carrier expected to deploy the 787-9, for which it is the launch customer, in 2014, some 2-3 years later than promised. "It would be an understatement to say we are frustrated and disappointed," McDonald said.

Boeing had last advised ANZ, the launch customer of the stretched 787, that it would receive its first of eight aircraft in late 2013 or early 2014. An Air NZ spokesman said that date slipped to an undetermined period in 2014 that it is still in discussions with Boeing about. The year 2014 "is as specific as it gets", the spokesman said.

McDonald said Air NZ was "in discussion" about delivery dates and compensation. He remarked: "We always seem to be having discussions."

Earlier this week news trickled out of Boeing refuting Air NZ's remarks. Boeing's remarks reached a climax during the company's quarterly earnings call, although according to the call's transcript Boeing chief executive Jim McNerney was from confident about the matter:

I don't know where this 787-9 rumor. I guess there was -- I guess in New Zealand there was a -- just like in maybe the same press that you're looking at, there was a comment that there was a worry that the 787-9 was pushed into 2014. I'm not sure where that came from. But our ramp plans on the 787-9 are in place, it's going well....So the 787-9, just to refresh, the 787-9, our guidance is end of '13, okay? That's a delivery. Air New Zealand is one of the very first customers to get the 787-9. And it takes a while to induct these things in the service, so I don't know if whether there's a disconnect between when we deliver it and the time he [McDonald] takes to get in into the fleet or not. I don't know what he meant by that. But we have not changed our schedule.

Today an Air NZ spokesman dispelled Boeing's suggestion of a "disconnect" between delivery and entry into service dates, saying "Entry into service is normally a few days after delivery."

As for a delivery date, the same spokesman who said 2014 was "as specific as it gets" had a curiously similar message to Boeing's. "We've always been expecting delivery in late 2013 or early 2014. It hasn't changed."
 
But then he adds, "Our expectations are early 2014 for delivery."

So there you go. Air New Zealand will gladly reiterate Boeing's statement about receiving its first 787-9 in 2013 or 2014. But Air NZ does not believe it.

This month Virgin Australia is due to take delivery of its first ATR turboprop aircraft, an ATR 72-500 after previously expecting the aircraft in May. It will be the first of four -500 variants and will be followed next year by four ATR 72-600, which received EASA certification in May.

Virgin ordered up to 18 ATR aircraft in February. "The ATR will form the foundation of our regional network plans, with the first six ATRs replacing our current Embraer E170 fleet and the additional aircraft flying to new regional destinations," chief executive John Borghetti said at the time. The E170 disposal was announced in August 2010.

Borghetti said the ATR72 burns one-third less fuel than the E170 and also burns 20-30% less than its competing aircraft, a statement likely in reference to the Bombardier Dash 8-400 aircraft that QantasLink operates on its regional routes, giving Virgin an advantage on economics and passenger comfort.

The -600 features as standard fit ATR's new Armonia Interior, which it developed with Italian design house Giugiaro Design. As we reported at the time of the partnership:

Armonia's cleanly-styled seats have been ergonomically designed to ensure greater knee clearance. Coupled with the Armonia ceiling; side panels; overhead bins, and LED lighting, the ATR Series 600 cabin will feel more spacious and airy, says ATR, noting that Armonia also uses lightweight materials, reducing its total weight by the equivalent of two passengers.

Although the Armonia interior is available on the -500 and can be retrofitted to it, Virgin's -500s will not feature the cabin design. But its -600s will, and here's an early of peek of what the cabin looks like in real life, as seen on Royal Air Maroc ATR 72-600 on show at last month's Paris Air Show.

Note the interior colours, configuration, and design elements are specific to RAM, the -600's launch customer, but you can get the gist of what Virgin will be pitting against Qantas Q400s on regional and low capacity routes on the east, and later, west coasts. Skywest will operate the Virgin-liveried aircraft.

The main passenger entrance is at the rear as the forward fuselage is used for the baggage hold and access door (more on that later).

The entrance opens to main cabin, which features the "Classic" economy seat in a 2-2 configuration that offers 17" width at 29-31" of pitch. All seats (economy, premium economy, and first class) are manufactured by Italian manufacturer Geven and are lightweight and designed for a long life.

The seats have a natural recline with no additional recline, which reduces wiring and extra material (and thus weight). ATR says each Classic seat weighs only 9kg.

Note the seat pocket storage on top that...
Forward of the first row is an aisle that leads to a compartment with the cargo hold on the right, loading ramp on the left, and cockpit access ahead.
The ATR72-600 also has orders from RAM, Air Nostrum, Azul, Air Tahiti, and leasing firm Air Lease.

The current woes of Tiger Airways Australia are not enough for competing pan-Asian carrier AirAsia to fast-track its evaluation of launching a subsidiary in Australia.

"Regarding AirAsia Australia, it remains a possibility although not in the short term," Azran Osman-Rani said. Osman-Rani is the chief executive of AirAsia's long-haul sister carrier AirAsia X.

Last year Osman-Rani disclosed AirAsia was watching the emerging shift of Virgin Blue, since re-branded as Virgin Australia, forgoing the leisure market for a greater share of the corporate market. That could have reduced competition, paving the way for a new entrant.

"The way it is now, if you've got three players competing aggressively for the mass market segment that's all the industry can take," Osman-Rani said at the time.

"If the market dynamic changed and suddenly there is space and existing players start to rationalise fights and increase fares, it will be very tempting," he said of launching an Australian subsidiary operating Airbus A320 aircraft.

Australia and New Zealand are unique in being the only countries in the world to permit majority foreign-owned domestic airlines. Such carriers, however, are prohibited from operating international services.

The Australian market has yet to see a large swing in capacity as a result of Virgin Australia introducing domestic business class, the first time in ten years there is premium competition to Qantas. But it is still early days for Virgin Australia. The carrier's three-year game change plan, implemented under chief executive John Borghetti, called for the carrier to re-position itself in the 2011 financial year through 30 June. Achieving the rewards of a more balanced revenue mix and improved yields are targeted for the 2012 and 2013 financial years.

The market has, however, seen a short-term capacity reduction as a result of the Civil Aviation Safety Authority grounding Tiger Airways Australia for posing "a serious and imminent risk to air safety." CASA has applied to Australia's Federal Court to extend Tiger's grounding until 1 August. The court is to hear the case next Friday.

CASA's grounding was immediately provoked by two incidents of Tiger breaching minimum safe altitudes while on approach to land after being issued a show cause notice in March.

AirAsia X was involved in two minimum safe altitude incidents last year at Queensland's Gold Coast airport, which the Australian Transport Safety Bureau is still investigating and due to complete this year.

Osman-Rani said CASA audited AirAsia X's operations and renewed the carrier's air operator's certificate.

"They also acknowledged that the approaches into OOL [Gold Coast] are challenging," Osman-Rani said.

AirAsia X also enhanced its operations by including specific modules for Gold Coast approaches in its flight simulator programmes and regularly conducts recurrent training with its pilots, Osman-Rani said.

"It helps when we have our own academy with our own flight simulators and instructors," Osman-Rani said of the AirAsia Academy, which includes full motion simulators, maintenance training devices, as well as cabin trainers.

Although he did not directly contrast AirAsia's operations to Tiger Airways Australia, the grounded carrier uses a shared training facility in Melbourne, according to testimony from Tiger director of operations Tim Berry to a senate inquiry on pilot training and aviation safety.

For some, a recent Hitler parody video explains all that is wrong with Qantas. But for those wanting a more insightful and accurate account, look no further than 13 words chief executive Alan Joyce delivered last week about Qantas International: "It has achieved its required returns only three times in the past 15 years."

And if you think the figures are cooked, Joyce adds that "the good years have not been good enough to offset the bad."

The statement begs the question how Qantas managed that record and did not think it prudent prior to February to announce it would return its international division to profitability.

It also partially exonerates Joyce as Mascot's persona non grata since the problems he face are not ones he exclusively created but rather inherited from predecessors including Geoff Dixon and James Strong, the latter of whom resides on the Qantas board. Perhaps that explains why Joyce chose to reveal such an unflattering record.

Joyce was barely two and half years into his tenure when he announced a turn-around for the international division, details of which will be made public at the carrier's 24 August annual results briefing. While it can be asked why Joyce waited 2.5 years, it should also be asked why Strong and Dixon, let alone the board, never bothered.

Perhaps the answer is complacency. Qantas had a domestic monopoly, and more recently a frequent flyer programme, that could prop up a loss-making international network. Cue the statement, "The Qantas Group has made an annual profit every year since 1995, a claim only two other major full service carriers can match."

The international network was critical as it gave the staple domestic passengers and corporations international flight options, thus creating a seamless single-carrier preference. As Qantas said in its application to the ACCC for a joint business agreement with American Airlines, "the viability of Qantas' entire portfolio of businesses depends on a viable international business."

But the status quo is no more. The trans-Pacific duopoly has ended and Asian and Middle Eastern carriers with lower cost bases have entered. What is not said is the future of Qantas domestic. While it may continue to be profitable, the yields and revenue volume should shrink as a result of Virgin Australia's entry into the corporate market.

Qantas, however, spent years--at least 15--being complacent. That is how a middle seat almost became standard in business class, enhanced benefits are only now being implemented with American Airlines, and, for an anecdotal reference, how flight attendants failed to pick up a dirty spoon.