From huge loss to soaring profit, the Aussie airline has made a dramatic turnaround. But boss Alan Joyce never had any doubts, he tells Grant Bradley
By Grant Bradley
Alan Joyce has been at the centre of what has been described as the biggest turnaround in Australian corporate history.
And as he nears eight years as chief executive of Qantas, Joyce characteristically says he had very little doubt the airline could pull it off.
From a A$2.8 billion loss in 2013-14, the airline reported statutory net profit after tax of A$688 million for the first six months of this year. Qantas is now in a position to return close to A$1 billion to shareholders this year.
This from an airline which faced worker outrage when it grounded its fleet during a high-stakes industrial battle in 2011, whose value plunged by more than A$1 billion after a 2012 profit downgrade, leaving it a takeover target, and is in the midst of laying off 5000 workers to cut costs.
In the dark financial days, Joyce was a target for politicians, and a public petition called on him to resign.
In Auckland this week to talk to New Zealand company directors about running a volatile business, Joyce says, with a fair degree of understatement: "There's been a lot of positive and a lot of tough times."
Like Air New Zealand in this country, 96-year-old Qantas is embedded deep in the Australian psyche. Most Aussies feel a deep sense of ownership of the Red Roo and anyone who runs it is under minute scrutiny and intense pressure.
But Joyce has a thick hide. "I remember doing an interview on Australian TV and we had two commentators who had done a poll - 90 per cent said I should resign and they asked my reaction." His reply was blunt: "It's not a popularity contest." Joyce says what mattered to him was whether the board and shareholders thought the airline was on track. They did, and Qantas stuck with it.
One of those strategies is to solidify its presence in New Zealand, largely through its budget offshoot, Jetstar, which was set up under Joyce and first flew in Australia from Newcastle to Melbourne in 2003.
Jetstar, with its distinctive orange livery, has been flying across the Tasman since 2005, on main trunk routes since 2009 and now into the heartland on regional routes.
Those routes now feed into a growing international network Qantas has forged through partnerships with global giants Emirates, China Eastern and American Airlines.
The better Qantas is, the better Air New Zealand is - the consumer in New Zealand wins and that's great for everyone.
It means Kiwis can fly on a Qantas ticket from Dunedin to Dubai and on to Dublin aboard partner Emirates, and from late June, Nelson to New Orleans on American.In addition to providing cut-rate fares to leisure travellers, Joyce says that to be truly competitive in New Zealand, Qantas needs to offer a network that can appeal to corporate and government accounts (which will be up for tender later this year), as well as looking after the travel trade.
This was the rationale for the regional operation, the domestic operation and an international operation - which needs to have a transpacific component.
"We were clearly, in some parts of that, not competitive," he says. "Now we have all components of it."