The Qantas Monday announcement of the closure of the air carrier's Tullamarine Airport maintenance facility was just the tip of the iceberg. On Wednesday, Qantas Chief Executive Alan Joyce made an even bigger announcement of more revamps in the company.
Australia's competition watchdog, Australian Competition and Consumer Commission (ACCC), has on Thursday awarded a conditional approval to the partnership of Qantas Airways with Emirates as the former reclaims its fading glory in the global airline industry.
Mr Joyce split the air carrier's operations into four business units made up of international and domestic operations, Jetstar and the frequent flyer programme.
Part of the change includes the appointment of chief executives for each unit. Tapped to head international operations is Simon Hickey who used to be the head for strategy and oversaw the growth of the frequent flyer business.
In his place, Lesley Grant will take over the frequent flyer to provide Mr Hickey time to bring back the international operations to profitability. Ms Grant will take over the frequent flyer programme which contributed in 2011 $342 million to Qantas earnings and counts 8.5 million members.
Named to be the chief executive for domestic operations is Lyell Strambi, while Jayne Hrdlicka will replace Bruce Buchanan as Jetstar group chief executive.
Mr Buchanan will remain chief executive for six months and then become consultant for 18 more months before he leaves Jetstar permanently to pursue business interests in Asia. He had been with the budget air carrier for nine years.
Mr Joyce said the restructuring will build a clear path for a better and more competitive Qantas.
"Qantas Domestic and Qantas International face very different situations.... Qantas Domestic is strong and profitable. We are seeing the most sustained levels of high customer satisfaction on domestic services since 2004, and we are the airline of choice for corporate Australia," The Australian quoted Mr Joyce.
"Qantas International, a great airline with a rich history, is loss-making and does not deliver sustainable returns. However, we are committed to turning it around through the five-year strategy we announced last year, based on flying to global gateways, deeper alliances, smart investment in product and disciplined capital management," he added.
Mr Hickey hinted he would drop unprofitable routes to save Qantas $120 million.
Despite the changes, Mr Joyce said it would be business as usual for Qantas as the air carrier, which is battling restive unions, work out the details of splitting operations in the next few months.
While Qantas pilots welcomed the changes, the Transport Workers Union said the revamp made little sense, but warned it could be a red flag that management could break up the flag carrier.
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