Business Travel News - December 15, 2008 - (Page 14) AVIATION Qantas Eyes Corp. Demand, U.S. Access, Service Classes Qantas Airways head of sales and distribution Rob Gurney spoke with BTN senior editor Jay Boehmer last month about Australian corporate demand, the impact of premium economy class seating on business travel and the effect of aircraft technology on the carrier’s hope of serving U.S. interior points nonstop. BTN: To what extent has the financial crisis impacted your corporate travel outlook? Rob Gurney: I don’t think it is as grim in Asia/Pacific as it is in North America, particularly in the transatlantic travel market. There’s no doubt that this is an economic crisis of global reach and impact, and clearly the economic situation is dominating news in this country and throughout the region. There’s no doubt that the sentiment in Australia and through the region is one of caution, but the Australian economy and our financial system are in good shape. We haven’t had in this country the sort of fallout you’ve seen in other parts of the world in the banking system. That’s one important difference to flag: The banks are solid, and the federal government moved quickly with deposit guarantees and an economic stimulus package. There’s still a high level of confidence in banking and finance, generally. This is more a story of slowing economic growth. A variety of forecasts say it’s slowing, and most of the official forecasts from the Treasury or Reserve Bank show slowing growth, but not a recessive economy in Australia. Those things put Australia in probably a better position than other parts of the world, but I wouldn’t suggest there isn’t caution. In terms of travel, we haven’t seen as much evidence of specific cutbacks and changes in policy as much as in other parts of the world. There is evidence of some companies temporarily changing policies, downgrading from business to economy. Most business travel out of Australia is long-haul, so a lot of the policy changes capture traffic of, say, five hours or less. That does not apply to many international routes Qantas operates, as most are longer lengths. BTN: Qantas and some other carriers in the Pacific have introduced premium economy cabins. Given the environment, do you run the risk of cannibalizing your business class? Gurney: Through the research we did, we didn’t expect to see ONE-ON-ONE ROB GURNEY, QANTAS HEAD OF SALES AND DISTRIBUTION downtrading from business to premium economy. When we designed this product, we essentially saw the consumer group as leisure customers who were prepared to pay a premium for a more comfortable seat and more personalized service. We also recognized there would be business customers interested, such as medium-sized businesses or those where the business owner is the person traveling and is very mindful of cost. That’s a good product for them as it’s priced between economy and business class. We’re not seeing a lot of corporations trading up at the moment, but if customers decide to trade down and move from international business travel policies to an economy policy, premium economy is something else they can consider, and it does make a considerable difference to the traveler in terms of the comfort level offered. There’s been an ebb and flow around this. There are corporates, regardless of the economic circumstances, that have had policies where travelers progressively adding services on generally do travel in the economy those routes as more A380 aircraft class. It gives them an opportunity come into our fleet. By putting them for them to rethink that travel poli- in airports in Los Angeles, where cy without going to the cost of busi- gate access is becoming more conness class. strained, the A380 provides us with BTN: The United States and Aus- the capability to increase bandwidth tralia enacted a liberalized aviation of capacity. It’s a major part of our agreement this year (BTNonline, growth strategy on the U.S. route. Feb. 15). Does it offer opportunities We also fly to John F. Kennedy Inin the United States? ternational Airport via Los Angeles, Gurney: We were a strong sup- but the aircraft we operate doesn’t porter of the Australian govern- have the range with a decent payment’s efforts to fully liberalize the load to serve that market nonstop. air services agreement with the Unit- As aircraft technology improves, our ed States. We do think it brings new next area of interest in the States is opportunities for growth, and we are to fly nonstop from Australia beyond going to see increased competition the West Coast gateways. There’s a since there will be another airline, variety of points of interest to us, an Australian carrier, starting on the but that’s dependent on aircraft transpacific routes. technology and there’s not an airWe already operate something craft that can do it without signifilike 47 frequencies on the Pacific cantly impacting our payload. route. One of the direct conseBTN: Could nonstop service to quences of opening up the bilater- the East Coast be on the horizon? al is that our codeshare points can Gurney: We’ve done various exbe increased under those arrange- ercises looking at that with existing ments. Previously, the number of aircraft. Is it something we’d like to points we could serve through code- do? Yes, but there’s no aircraft on shares had been capped. Now that the near- or midterm horizon that limitation has been removed. That would be able to do that. provides us with a growth of codeProbably, what would come earsharing opportunities. lier is an aircraft that Access the We’ve been growing get us places 2008 Annual Airline Survey could Dallas,to which rapidly. Over the past like see btnonline.com/airsurvey five or six years, U.S. would be of interest capacity has grown in excess of 20 because we could fly into American percent. The next phase will come in Airlines’ hub, and that would prothe form of the Airbus A380 aircraft vide significant opportunities for us. that we’re starting to operate. The Obviously, we don’t build the airfirst route was Melbourne-Los An- craft, but we’re in dialogue with the geles, and Sydney-Los Angeles was manufacturers, and this is an opporadded shortly thereafter. We’ll be tunity that’s of interest. ■ BA, QANTAS EXPLORE MERGER British Airways this month confirmed merger discussions with Qantas Airways. BA in a statement said it is “exploring a potential merger with Qantas Airways Limited via a dual-listed company structure,” but warned, “There is no guarantee that any transaction will be forthcoming and a further announcement will be made in due course, if appropriate.” In addition to its newly disclosed discussions with Australia’s flag carrier, British Airways said it continues to move forward with discussions in its planned merger with Spain’s Iberia. —Jay Boehmer 14 Monday, December 15, 2008 www.BTNonline.com Business Travel News http://www.btnonline.com/airsurvey http://www.BTNonline.com
Table of Contents Feed for the Digital Edition of Business Travel News - December 15, 2008 Business Travel News - December 15, 2008 Contents Inside Track Profiles In Travel Mgmt Forum Aviation Lodging Ground Transportation Travel Management Meetings Today Washington Wire Business Travel News - December 15, 2008 Business Travel News - December 15, 2008 - Business Travel News - December 15, 2008 (Page 1) Business Travel News - December 15, 2008 - Business Travel News - December 15, 2008 (Page 2) Business Travel News - December 15, 2008 - Contents (Page 3) Business Travel News - December 15, 2008 - Inside Track (Page 4) Business Travel News - December 15, 2008 - Inside Track (Page 5) Business Travel News - December 15, 2008 - Profiles In Travel Mgmt (Page 6) Business Travel News - December 15, 2008 - Profiles In Travel Mgmt (Page 7) Business Travel News - December 15, 2008 - Profiles In Travel Mgmt (Page 8) Business Travel News - December 15, 2008 - Profiles In Travel Mgmt (Page 9) Business Travel News - December 15, 2008 - Forum (Page 10) Business Travel News - December 15, 2008 - Forum (Page 11) Business Travel News - December 15, 2008 - Forum (Page 12) Business Travel News - December 15, 2008 - Forum (Page 13) Business Travel News - December 15, 2008 - Aviation (Page 14) Business Travel News - December 15, 2008 - Aviation (Page 15) Business Travel News - December 15, 2008 - Lodging (Page 16) Business Travel News - December 15, 2008 - Lodging (Page 17) Business Travel News - December 15, 2008 - Ground Transportation (Page 18) Business Travel News - December 15, 2008 - Ground Transportation (Page 19) Business Travel News - December 15, 2008 - Travel Management (Page 20) Business Travel News - December 15, 2008 - Meetings Today (Page 21) Business Travel News - December 15, 2008 - Meetings Today (Page 22) Business Travel News - December 15, 2008 - Meetings Today (Page 23) Business Travel News - December 15, 2008 - Meetings Today (Page 24) Business Travel News - December 15, 2008 - Meetings Today (Page 25) Business Travel News - December 15, 2008 - Washington Wire (Page 26) Business Travel News - December 15, 2008 - Washington Wire (Page 27) Business Travel News - December 15, 2008 - Washington Wire (Page 28)
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