Qantas boss Alan Joyce and Prime Minister Anthony Albanese grabbed the spotlight when they stood side by side last week in a Qantas hanger to unveil the Yes campaign for the voice to parliament. But the issue has led to angry questions about who chooses the national carrier’s social policies – and whether a publicly listed company should be spending its time and money promoting a sadly divisive and increasingly political policy.
Investors are hoping incoming chief executive Vanessa Hudson will be more circumspect.
Qantas, after all, has not been state-owned for about 30 years. And it uses this point – a seemingly unfair disadvantage – continually when lobbying against rivals.
The flying kangaroo argued against government support for rival Virgin Australia when the airline was near collapse during the pandemic, and tapped the same rhetoric to encourage the government to block increased competition from oil-rich state-owned airlines such as Qatar Airways.
It did the same thing against Emirates in the early 2000s, before joining forces with them.
It was confusing, then, to see Albanese standing beside Joyce and declaring “Yes is the true spirit of Australia” while unveiling three Qantas aircraft showing off the PM’s message beside the famous kangaroo logo.
The Yes campaign has plenty of merit. But as prominent fund manager Geoff Wilson points out, so do a number of other issues, including his pet project of protecting franking credits on retirees’ dividends, which the Albanese government is looking to change.
“What about ‘Frank off Government’ on Qantas planes?” he asks. “This is a policy that is going to have a serious impact on the cost of capital and I would love to see them put that on a few of their planes.”
Adding fuel to the fire after this week’s joint press event were two revelations. One, that the PM’s son has been lolling about in Qantas’s uber-elite invite-only Chairman’s Lounge. And continuing disquiet over Transport Minister Catherine King’s decision to block rival Qatar Airways from increasing its Australian services.
As Wilson points out, there are plenty of issues “impacting the whole of Australia”.
The housing crisis is certainly one. Opposition housing spokesman Michael Sukkar has canned the national cabinet’s new housing target, and didn’t go as far as calling for “build more homes” to be stuck on Qantas tails, but did say the airline should stop meddling in politics.
“It’s entirely counterproductive for Qantas to be weighing in on political issues open for public discussion and ultimately a vote,” said Sukkar. “I suspect most Australians would like a little less virtue signalling from Qantas and more focus on having their planes take off on time, or at all.”
He may have a point. Qantas is swimming in money at the moment as record demand outstrips supply – helped of course by airlines such as Qatar not being allowed extra flights even after helping Australia and the US evacuate people from Afghanistan.
But while profits boil over, the airline has struggled with customer service, being the No.1 for complaints in the country, according to the Australian Competition & Consumer Commission’s latest quarterly report.
New data from Roy Morgan puts Qantas as the nation’s 13th most distrusted brand in the economy, making it the most distrusted airline, even compared with its low cost unit Jetstar, which was 16th most distrusted.
Sequoia Asset Management investment manager Winston Sammut says he would rather Qantas focus on problems such as on-time performance, customer service and rebuilding its fleet.
“I’d be a lot happier if he was focused on those issues,” says Sammut, who believes supporting the Yes vote will not add to the Qantas proposition. “At the moment there will be as many people who are happy as unhappy with it. Does it add to the bottom line? No. Will more people fly with Qantas? No.”
From a governance perspective, there is also a question about how much the board supported the call to push hard for the Yes campaign.
The decision to plaster “Yes” on the fuselage of the aircraft was not universally supported by the Qantas board, and while a spokesman said it did get discussed and approved at board meeting, it was not in any board paper for approval.
Mr Wilson says this kind of decision should require clear board endorsement.
“In terms of leadership, I would be very disappointed if they made those decisions without the board agreeing to it,” says Wilson, who says he is not telling people how to vote on the voice.
Politicians’ relationships with Qantas are always fraught. On one hand the airline is benefiting from restricted supply and getting away with poor service, but on the other there is an addictive quality to the Qantas Status Credits that politicians get every time they fly – usually at the front of the plane – that keeps them hungry for upgrades and lounge privileges.
For the current Labor leader, there is also the not insignificant fact that Qantas illegally fired about 2000 union-represented baggage handlers during the pandemic, although the airline is appealing this ruling.
On Friday at the Labor Conference, Albanese defended the government’s decision to block Qatar, describing Australia as “the most competitive market in the world”, which is patently untrue on most reliable measures.
“There is already an incredibly competitive international aviation market here in Australia,” Albanese told reporters as he stepped in to defend Joyce’s airline. “Qantas aren’t able to fly into any airport that they wish to. Australian airlines have limits in where they can go. That is the way that international air services agreements work.”
Those who know Hudson say the widely-liked executive will have enough on her plate without taking such an overt stance.
The incoming boss of Qantas says the airline has been working hard to improve customer service.
It also has a massive task ahead to rebuild its fleet.
Fortunately for the Red Roo, it’s tipping a bumper full year profit of about $2.48bn, which gives it plenty of cash for planes.
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