By Neena Bhandari

Sydney, 30.10.2011 (Business Standard): Australia’s flagship carrier, Qantas’ entire fleet remains grounded affecting 68,000 passengers worldwide with the cancellation of 447 flights costing millions of dollars to the national economy.

A marathon two rounds of hearing before Fair Work Australia, which is considering the Federal Government’s application for termination or suspension of industrial dispute between Qantas and the Australian Licenced Engineers Union (ALAEA), the Transport Workers Union (TWU) and the Australian and International Pilots Union (AIPA), was far away from a resolution tonight.

Defending his decision, Qantas CEO Alan Joyce said on Sky News: “A termination stops the lockout, but we have to make a decision about putting the airline back in the air. A suspension may not necessarily mean the airline gets back in the air. If it’s a suspension, we cannot put the planes back in the air without having certainty. A termination gives us certainty, a suspension, depending on what the suspension looks like, does not necessarily give us certainty.”

Qantas plans to lock out thousands of its employees from Monday night. It has announced via its Twitter feed that there will be no flights until “at least mid-day Monday. A decision on afternoon flights will be made tomorrow morning”. Unions NSW will rally Monday, in support of Qantas workers at Sydney International Airport. The unions are opposing the airline’s plan to cut a thousand local jobs and set up two new airlines in Asia. The grounding is costing Qantas about A$20 million per day.

The grounding and the protracted dispute over pay and working conditions with baggage handlers, ground staff, pilots and engineers is damaging the Qantas brand ahead of the Christmas holiday season. Qantas Chief Executive Alan Joyce said on Friday the industrial unrest had cost the carrier A$68 million to date.

CommSec chief equities economist Craig James told the Sydney Morning Herald that many Qantas shareholders would on Monday reach for the “sell” button, sending the national carrier’s share price even lower after months of languishing under the threat of strikes. The shares closed at $1.54 on Friday, down by 1.59 per cent.

Prime Minister Julia Gillard reiterated that the dispute must end. She told the media in Perth, “I believe Australians want to see this dispute settled. I want to see it settled. The government is arguing for an end to industrial action before the commission …”

The extraordinary suspension of all flights has stranded thousands of passengers, including 17 world leaders, who were attending the Commonwealth Heads of Government meeting in the Western Australian city of Perth.

“If this action continues, it will have a dire effect on Queenslanders and the Queensland economy, which relies heavily on air transport. We are particularly concerned about the impact this will have, and has already had, on our tourism and mining sectors”, said Queensland Premier Anna Bligh, who along with the Premiers of New South Wales and Victoria, is joining the Federal Government’s application to Fair Work Australia to terminate all industrial action by Qantas and its employees.

Virgin Australia, Qantas’ main competitor in Australia, has scheduled additional services to assist affected passengers over the next few days. The airline has increased staffing levels at airports and contact centers.

“As of this afternoon, Virgin Australia has helped over 20,000 affected Qantas passengers with special discounted fares. Discussions are advancing with alliance partners Etihad Airways, Singapore Airlines, Air New Zealand and Delta Air Lines in regards to adding extra capacity, This is in addition to around 3,500 seats added today and the 40,000 seats that Virgin Australia has recently added to its domestic network for travel between October 14, 2011 and January 31, 2012”, Virgin Australia said in a statement.

Singapore Airlines has been accommodating affected passengers onto many of its flights. A spokesperson for the airlines told Business Standard, “We have 92 flights each week from the five main capital cities in Australia. Demand is particularly high for our flights into Australia and no decision has been taken at this point about mounting additional flights. My understanding is that Qantas flies to Mumbai via Singapore and given our extensive network into India, passengers will have a number of alternatives available to them through Singapore Airlines.”

Qantas domestic passengers are seeking alternative means of transport, some turning to the road to reach their destination. Greyhound Australia, the country’s only national bus service that connects over 1100 destinations daily, had booking enquiry rates jump by about 60 per cent

In a statement Greyhound chief operating officer Tony Hopkins said, “We’ve been able to move most people within our existing schedule however, we have had to put additional coaches on the Adelaide to Melbourne run for tonight and tomorrow night”.

Though Australia doesn’t have high speed rail link, CountryLink has added extra seat availability and carriages on trains linking capitals cities. “As of 5pm today, CountryLink has experienced a 73 per cent increase in reservations compared to Sunday last weekend and a 94 per cent increase in telephone enquiries”, a spokesperson for RailCorp told Business Standard.

One of the leading travel agencies, Flight Centre has called extra staff to help passengers to assist with alternative travel plans.  “Our main objective is to try and rebook or re-schedule passengers where ever possible so that any negative impact is minimised.  We have passengers stranded all over the world, including India, that are eager to get on with their travel arrangements.  In many cases, this has an enormous domino effect on their travel plans, particularly if they have tours, hotels, cruises etc booked to coincide with their flight arrivals and departures”, a travel agent said.

Qantas is organising alternative flights and accommodation for stranded passengers, and refunds for people yet to travel. Qantas codeshares with a number of airlines who are continuing their operations as scheduled. Jetstar, QantasLink and JetConnect  and freight services (Express Freighters Australia and Atlas) are also continuing to operate as normal.

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