This morning’s baggage handler and ground staff stoppage at major Qantas domestic terminals was nothing worse than a minor inconvenience to most passengers, and unlike the concurrent long haul pilot and licensed engineer disputes had nothing to do with alleged collapsing Qantas flight safety standards through offshore maintenance outsourcing or shrinking its flag carrier operations to pursue minority owned Asia-based investments.

Qantas passengers today only had to worry about the risk, which most were spared, of missing a meeting or arriving in Brisbane to discover their checked bag had gone to Broome.

But the other disputes, which have been pushed into the background today, mean that most passengers who want to fly the flag to London for the Olympics next year won’t even get the chance to fly Qantas, as it has cut its Heathrow airport access in half, voluntarily, to twice daily A380s, to divert resources into a new brand Q airline venture somewhere in Asia, once its gets approval.

It is that dispute with the pilots, over keeping Qantas as an Australian airline flown by Australian based and trained pilots, which is much more vital to the future of the carrier, and its brand value.

No airline management has ever given away access to one of the world’s most valuable assets, London slots, in order to get richer, as Qantas recently claimed, by offshoring a Qantas-controlled single aisle airline with a silly name to a base in Kuala Lumpur, Singapore, Shanghai, Hong Kong or Manila, or anywhere without Australian labour and tax laws.

“Red Q” or FAQ or whatever far-out Q gets the nod is not a low-cost franchising operation like Jetstar in its Singapore, Vietnam and forthcoming Japan entities. It is a premium carrier with a range-challenged single-aisled jet that Qantas promises will open new connections to Europe as well as muscle in on the intra-Asian premium routes dominated by long-established Asian brands.

It is to be Australia’s version of the “new gold mountain”, as Chinese gold diggers referred to the Victorian gold fields of the 19th century. And it is frankly unbelievably naïve, and a much more material threat to the future of Qantas given the strategic choice of the current management, to downsize Qantas international in favor of a trans-border low-cost franchise in Jetstar and the new RedQ super luxury brand.

The RedQ plan, promised for the first half of next year when it was confirmed last August, has already slipped to some time in 2013, which will be on current indications the fourth year in which Qantas investors will get no dividend, and possibly slip to less than a 10% share on the Australia-international market, assisted by voluntary gifting of capacity to foreign-owned competitors.

If Qantas really wants other nation flag carrier status for brand Q in Singapore, China or Malaysia, it is inevitable that those countries will demand reciprocal privileges for their own brand Australia operations, with obvious implications for whatever is left of the Qantas network from Australia to the rest of the world.

The opportunities for such entities to totally destroy brand Q ought to be obvious, but for the general travelling public, not front of mind on a day when maybe one in 10 Qantas mainline customers has been delayed more than might be considered normal for a Tuesday morning.

Peter Fray

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