Saturday, February 03, 2007

Bitten by an icon

There was a time, not so many years back, where a national airline was seen as an essential element of national identity.

For Australia that airline was Qantas, born just a stretch up the road from where your correspondent is sitting in rural Queensland.

Now ‘just a stretch up the road’ in Queensland is not a Sunday afternoon drive, you generally need to pack more than just a picnic lunch, so despite the sparse population it is a fitting place for the birth of this once proud national icon.

Qantas began with fragile biplanes carrying one or two passengers in open cockpits, and serviced the vast outback as the Queensland and Northern Territory Aerial Services Ltd.

Despite the fact that the airline has now become just an airline to many Australians, an election year is not a clever time to see it fly overseas for good into the hands of foreign investors.

Now the international group behind an $11 billion takeover bid are attempting to stare down the Howard Government as nervous backbenchers agitate for restrictions on the deal.

It is all a bit late of course, Howard signed off years ago on liberalising foreign investment, without too much pressure from the US and others.

In fact he has been a major advocate, and still is, of increased trade liberalisation – just not the family silver in and election year. But regardless of bluster it is highly unlikely the takeover can be stopped under revamped laws.

Ironically, if the flying kangaroo was to move offshore it would be a great help to Howard or his successors Australia’s trade balance widened last month, with drought being cited as a primary cause. But on the other side, purchases there is always a spike when new aircraft are bought by out various airlines.

The biggest and most expensive, of course, are the international monsters preferred by Qantas. Okay, it was only a couple of hundred million bucks, but the we are just 20 million people.

There was some irony in the other spike factor as well, oil. While Howard just shaved through on avoiding a rate hike, because of lower fuel prices it is claimed, higher oil imports added to the debt imbalance.

There are enough indications that, like the US, Australia is on treacherously thin ice economically. It is all very well to massage one indicator, but the reality soon starts leaking out of another.

Bush is not the only leader being isolated by the current trend within the new Democratic majority to jettison trade liberalisation and revert to protectionist policies, the Howard government is also caught with its pant down.

Thus exposed, those trade liberalisation policies are turning around to bite Howard on the bum, in an election year.

7 comments:

abi said...

I know what you mean about how important Quantas is to the national identity. Bostonians have experienced the same thing on a smaller scale in recent years. Venerable Boston institutions like Bank of Boston, Little-Brown publishers, Jordan Marsh deptartment store, and the Boston Globe have all been bought by outsiders.

There's something disturbing about this, but I can't articulate exactly what.

And of course, this doesn't even include trading Babe Ruth to the Yankees for No No Nanette.

Cartledge said...

I think we are becoming accustomed to the travesties of trade liberalization.
National icons or even regional icons are long gone.
As to sports, that really does bother me. How can you love a local team comprised of the best from everywhere else, or even just someone else's name brand?
The wheel does turn and we might be moving to the start of a new cycle. THe downside is that it will hurt.

Kvatch said...

Despite the fact that the airline has now become just an airline to many Australians, an election year is not a clever time to see it fly overseas for good into the hands of foreign investors.

Hmmm...the pot calling the kettle black? Seems the Australian government doesn't have a problem in this area when they are the purchasers. Wonder how the New Zealanders felt when Qantas tendered it's bid for New Zealand Air?

There are a couple of major issues for us. One is that Air New Zealand is our national carrier and our international carrier and so the Koru symbol flies around the world and it is an icon for New Zealand.

PM, 31 May 2001

Cartledge said...

Good catch there kvatch. I suspect using sensitive logo symbols might not be a god idea if the product it represents can be grabbed so easily.
Still air New Zealand has become my preferred airline because the service still reflects the home culture.
Qantas has already slid in to the corporate 'screw the customer' mode.

Kvatch said...

Still air New Zealand has become my preferred airline because the service still reflects the home culture.

I find that hard to believe given that, livery aside, they're practically one airline.

Cartledge said...

Believe froggy! From the carefully enunciated Kiwi accent (head sets comes out hid sits) virtually every part of the service is quaintly parochial.
More important was that the service reflected the down home hospitality you find anywhere in NZ.
It was anything but corporate and sophisticated and it was very welcome.
Mind you, circling LAX runways for a couple of hours sightseeing was a worry, but it was handled well.

. said...

Qantas has established the outsourcing precedent.

Hundreds of jobs moved to India.

The idiots.

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