Qantas expected to bounce back

AUSTRALIAN flag carrier Qantas’ decision to ground its entire fleet over the weekend, in response to months of strikes by baggage handlers, engineers and pilots, should not dent its long-term reputation or financial liquidity, said Brendan Sorbie, chief representative South-east Asia, Centre for Asia-Pacific Aviation.

“(Qantas) has bounced back from prior labour disputes and disruptions. Temporarily, their brand may be damaged, but customers will likely soon forget the turmoil of the last couple of days,” said Sorbie, adding that the carrier’s robust brand name and strong frequent flier programme should see it through the crisis.

Even though he acknowledged that the full-scale grounding would likely result in some short-term financial injury, Sorbie was of the opinion that Qantas CEO Alan Joyce’s bold move would eventually offset any losses.

“From a medium and long-term perspective, the financial impact could actually be positive,” he explained.

“The grounding prompted intervention from the Australian government (TTG Asia e-daily, October 31), leading to binding arbitration if the sides cannot come to an agreement over the next 21 days, and removing any threat of a strike during the busier travel periods of later in the year.”

Qantas had already seen forward bookings drop by about 10 per cent for the peak Christmas period due to uncertainty caused by the labour dispute. “With this uncertainty now removed, Qantas faces the prospect of a stronger level of bookings for the peak period,” said Sorbie.

Singapore-based travel agents whom TTG Asia e-Daily spoke to were also unperturbed by Qantas’ actions.

Jenny Loh, marketing manager for Qantas Holidays in Singapore, revealed that the grounding had little impact on her company’s operations.

“Most of the bookings we hold (for Qantas) are for the end of the year, coinciding with the Singapore school holidays. Only a handful of our FITs were affected by Qantas’s sudden action,” she explained.

“The airline made sure affected passengers were well taken care of, and so far we’ve yet to receive any complaints, though we do anticipate a small number of re-bookings.”

A spokesperson for Chan Brothers, one of Singapore’s largest outbound operators, said: “Consumer confidence for Qantas will definitely be affected in the short run.

“However, being one of the trusted airline brands and the national carrier of Australia, Qantas should be able to regain consumers’ confidence in time to come, especially if they have managed passengers affected by the grounding well.”

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