PAUL PHELAN / CAIRNS
Leisure carrier will take over routes that parent Qantas has failed to make profits on
Qantas' new wholly owned low- cost leisure carrier Australian Airlines will launch operations in September 2002, with Cairns in north Queensland as its first base and international hub.
Start-up services will provide direct return flights connecting Cairns with Nagoya and Osaka daily, and Fukuoka, Hong Kong, Singapore and Taipei three-times weekly. At launch the carrier will offer connecting flights between Cairns and Queensland's Gold Coast, and will eventually fly to all Australian mainland state capitals.
The chief executive of the new airline, Denis Adams, says it will "establish a national presence as quickly as possible". The airline will not compete with Qantas. Instead Qantas will provide, through its Cairns hub, connecting services.
Operations will be launched with four or five Boeing 767-300s, increasing to 12 over about two years. Australian intends to operate the type in a single-class 269-seat configuration and is considering several sources for the aircraft. It may take over Qantas 767s as they are replaced by Airbus A330-200s.
Adams says Australian Airlines will be a full service leisure carrier: "Our job will be to create profitable flying on routes Qantas has withdrawn from, or where it is unable to extract a satisfactory return."
Australian is negotiating labour agreements with the goal of achieving cost savings of 20-25%: "Provided these are concluded satisfactorily, we will be in a position to commence flying around September next year. Fares will be similar to current levels." Adams says he is confident of gaining Qantas' approval of his cost structure plans early next year.
Source: Flight International
