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Dixon and Unions on crash course
According to a report in today’s Financial Review, Qantas CEO Geoff Dixon has written to 2600 pilots over cost cutting initiatives including stopping its payments to their union.
The airline is assuming a cost base with oil prices of US$60 a barrel and plans to cut off the A$500,000 a year it traditionally pays the Australian & International Pilots Association to cover the salaries of its executives, the paper said.
“It’s about productivity and overall efficiency, not just rates of pay. Given our investment profile and the competitive nature of our business, we have no other option,” Dixon said.
Dixon is chasing cost cuts of A$3 billion by 2008 under his “sustainable future” program.
“Flight crew so far have been unaffected by these changes but when just two line items – manpower and fuel – now account for almost 60% of our cost base, there is no option but to accelerate the rate of change,” the letter read.
One can’t help but feel this will trigger a heated reaction from not only the union directly concerned but also others waiting to see where the next blowtorch will be directed.
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