Cockpit alert

SELF-DESCRIBED ``proud, straight-talking Aussie" Neil Staggs insisted on Qantas for the big trip to England to show off his baby daughter to the mother-in-law. He'd seen the heart-tugging television ads, and told English wife Patti he would not travel any other way.

The Annangrove couple had saved for some time for the air fares, and would make the most of Neil's long-service leave. The Staggs were shocked that instead of the royal treatment extolled in advertisements, their Qantas journey was ``a complete nightmare".

Boarding after a stopover in Singapore, the couple were told they would not be seated together and the baby would have to be nursed on the lap for the long-haul flight. This was despite having booked seats with baby facilities three months in advance. They were hastily seated on the fold-down chairs used by flight attendants as the plane taxied and took off.

``When the captain ventured out to sort out the problem, he found that Qantas staff were sitting in our booked seats having changed the details at Singapore airport via the computers," recalls Patti. The captain forced the staff to move.

That wasn't the only problem. With his daughter's feed due, Neil repeatedly pressed the service bell to have her bottle warmed. He had to literally grab a staff member to get attention.The bottle disappeared, as did the flight attendant. Much later, the exasperated father was able to track down someone else to retrieve the bottle, but the attendant plunged it straight into the baby's mouth without testing it, blistering her lips.

The memory of the trip still gets Neil hot under the collar: ``It is one of those dinner party stories you often tell."

TIME was, the flying kangaroo was a source of pride for most Australian travellers. Many went out of their way to choose the national carrier when venturing overseas - a little piece of home to ease the journey. The airline won international accolades for its service.

Now the mention of Qantas is more likely to open a floodgate of complaints about declining service and horror stories like Rob Bruce's. The Sydney marketing executive's suspicions about Qantas's attitude to customers were confirmed when he was stunned to hear a Qantas call-centre operator describe him as ``a piece of shit".

Bruce had rung to confirm his flight on a foggy day. Learning he had been incorrectly booked by Qantas on two Sydney-to-Melbourne flights that day, instead of a return Melbourne-to-Sydney trip, Bruce wanted his flights changed. Bruce says: ``Her manager then told me, `It's just an expression she uses.' " His letter of complaint about the incident went unanswered.

Stories like Bruce's clearly have Qantas worried. The airline recently hired the image consultancy firm Crosby Textor to poll customers, politicians and the general public on what they thought of the airline.

A separate straw poll yesterday on Qantas customer service by the Herald's website quickly attracted more than 130 complaints. Expatriates say they have begun avoiding the airline because of ``tired and tetchy cabin staff", while members of the frequent flyer program say they feel cheated because of the difficulty of redeeming points and gaining upgrades. Many complaints centred on sullen or ``mean-spirited staff", a lack of flexibility, food ``served in a shoe box", lost baggage, calls that went unreturned and letters of complaint unanswered.

``The reality is, it is a company that is now the . . . shadow of what made Australia distinctive in aviation," says a former university academic and long-time Qantas traveller, Des Crawley, 63.

Analyst Peter Harbison, the head of the Asia Pacific Centre for Aviation, says the people most likely to respond to surveys are those who are dissatisfied, but the negative sentiment also reflected the modern business reality of air travel.

``There is a greater level of dissatisfaction with airlines generally because everyone is cutting costs," says Harbison. ``The United States has very high levels of dissatisfaction with all services, as does Europe; Asia less so."

Mark Textor, of Crosby Textor, would not comment on his firm's research findings.

However, a Qantas spokesman, Michael Sharpe, says the research found ``there was no doubt people think very highly of Qantas in a number of areas, notably safety, operational reliability, the `national carrier' and the efforts we made following the Bali bombing". Sharpe says the Qantas survey also found ``as always, you do encounter or get people who say they have had a less than perfect experience in relation to some issues".

In response, he says, Qantas was investing in new customer service training programs for its cabin crew, and also seeking to improve its on-time performance.

Qantas points out it ranked fifth out of 120 airlines worldwide in the annual Skytrax survey of customer service recently.

The airline carried more than 27 million passengers a year ``and received many, many compliments every day", says Sharpe.

WHILE the debate about service continues, the Qantas chief executive, Geoff Dixon, is steering the airline through unprecedented turbulence.

At a press conference this week, he made a joke about what it was like at the helm when he was asked the name of the no-frills domestic airline that Qantas proposed this week to compete with Virgin Blue. ``We thought about Saviour," he said. A funny line, but there was a sting to it.

Qantas had just announced a second half-year loss of $9 million - its first since becoming a public company in 1995 - after being buffeted by terrorism and SARS.

Dixon, with a cunning knack for exploiting business circumstances after a career in marketing, was finally confirming that Virgin could no longer be ignored. Virgin's lower costs were giving it an edge in the leisure travel market.

For the past two years Dixon has crusaded on the need to cut Qantas costs and create a leaner, more flexible workforce so the airline can survive the shocks of a volatile world aviation market. He has initiated a $1 billion cost-cutting regime and put constant pressure on unions by forcing them to accept a wage freeze, 2000 job cuts and now a major boost in casual employment so Qantas can hire and fire a large proportion of its workforce at will.

But depending on which day anyone talks to Dixon, he is Dr Gloom or Dr Boom. He talks up prospects when it suits him to say that Qantas is the most profitable airline in the world and has weathered the storms well. ``I'm not going to sit here and say we're out of the woods, but in some ways I'm quite bullish on what we're seeing at the moment," he said on Thursday. Mostly, though, Dixon paints the picture of an airline in constant crisis in a depressed market as he tries to increase leverage on unions to accept major changes. Earlier this month, he told staff that Qantas was not making enough profits to sustain its ``existing and future investment needs".

Qantas actually boosted its annual profit by 12 per cent once you strip away a $91 million write-down on the ageing Boeing 767-200 fleet and $115 million in redundancy costs. In the current world market, that is a remarkable result.

But the collapse of Ansett was a major windfall for Qantas and Dixon sees problems ahead.

Besides its dogfight with Virgin over local market share, Qantas is under pressure from Air New Zealand and Emirates on the trans-Tasman route. Its planned takeover of Air New Zealand is hanging in the balance and strong competition internationally is coming from Singapore Airlines, the second-largest carrier to Australia with 70 inbound flights a week. If Singapore Airlines gets the right under new free-trade rules to fly from Sydney to Los Angeles, then Qantas will be squeezed in a market that provides up to a third of its profits from the Australia/US West Coast route.

Greg Combet, the earnest ACTU secretary in charge of managing the union response, says that all are prepared to co-operate with the airline's management as they have so far.

But this week's admission by Dixon that he wants 25 per cent of the 34,000 workers at Qantas on casual, part-time or contract employment was hard for Combet to stomach.

With union membership continuing to decline nationally, he says the growth of low-paid casual jobs in Australia only further contributes to job insecurity and inflicts lower living standards on people. Now he is witness to one of Australia's biggest unionised companies suddenly dumping its commitment to permanency as a preferred mode of employment.

Combet claims that Qantas's real target for casualising the workforce is as high as 45 per cent. This figure is disputed by Qantas, but Combet claims it has been raised in discussions with airline executives and he uses as evidence a draft proposal by management which used 45 per cent as a maximum allowed for casual contract labour.

Combet is obviously worried, too, that the new discount airline proposed by Dixon would give Qantas a free hand. It could employ as many casuals as it wanted from day one and pay them bargain basement wages substantially lower than rates paid by the main Qantas carrier.

``This will touch a lot of people because they know that the future is pretty bleak in the employment market," Combet says. ``They know for their kids - what do they have to look forward to but a casual job?"

Unions claim there is plenty of room to negotiate over staffing with Qantas on issues such as more efficient rostering and limiting overtime without having to undermine job permanency.

But Dixon appears determined. He believes wage levels are too high and a big boost in casual employment will give Qantas the flexibility it needs to adjust quickly to market demands. The decision this week by Qantas to introduce baggage handlers at Melbourne Airport on casual labour hire contracts in the full knowledge that unions were likely to resist and cause major disruptions for passengers is an indication of Dixon's drive. He even had 40 to 50 managers trained specially in Los Angeles to operate ramp equipment and move baggage in the event that unions walked out.

At this stage unions are unwilling to respond to what they regard as provocation by playing into Qantas's hands and escalating strike action to such a level that the whole airline is grounded.

Combet will strive to avoid a confrontation running out of control that could put unions at risk of massive damages and other legal penalties.

But managing the union mood will be a test - Qantas is looking ruthless.