Qantas flights cleared for take-off

Australia’s air safety authority cleared Qantas Airways to resume flying today, after it grounded its entire fleet amid a bitter union dispute.

A flight from Sydney to Jakarta, Indonesia, took off shortly after the "Flying Kangaroo", as the airline is known, received the all-clear.

Civil Aviation Safety Authority spokesman Peter Gibson said the agency had given the Australian flag carrier the green light to return to the air.

Qantas chief executive Alan Joyce said the first of the grounded aircraft was expected to fly this morning, British time.

The world’s 10th-largest airline grounded its entire fleet on Saturday following weeks of strikes by its workers.

The move stranded thousands of passengers across the world and prompted the government to order an emergency court hearing.

An arbitration court yesterday ordered an end to the strikes and cancelled a staff lockout by the company.

The three-day grounding disrupted the travel plans of tens of thousands of people across the world and Qantas passengers were gathering at airports in Australia and Los Angeles in the hope of finally getting to their destinations.

The arbitration court ruling was a major victory in the airline’s battle with unions representing pilots, aircraft mechanics, baggage handlers and caterers, whose rolling strikes have forced the cancellation of 600 flights in recent months, disrupted travel for 70,000 passengers and cost Qantas AUS$70m (€53m).

But some aviation experts said the surprise grounding of all 108 planes on Saturday, at a cost of €14.2m million a day, has hurt the Australian flagship carrier’s reputation around the world.

Moody’s Investors Service said it could downgrade the airline’s credit ratings as the weekend’s events could hurt bookings, profits and the value of the Qantas brand.

Still, the stock market welcomed the weekend developments as allowing the airline to focus on its long-term strategy. Qantas shares jumped almost 5% to 1.62 AU dollars on the stock exchange in Sydney today.

Henry Harteveldt, an airline industry analyst in San Francisco, predicts the shutdown will do long-term damage to the Qantas name by hurting its reputation for reliability.

“A lot of travellers won’t take a chance and will book away to Virgin Australia, Air New Zealand and other airlines,” he said. “Brand loyalty in the airline business is very low, and there is so much competition.”

Before the court ruling, Virgin Australia said it was scheduling extra flights and offering 20% fare discounts to help stranded Qantas passengers through Thursday.

If Qantas loses customers, that could also hurt partners in its alliance of global airlines, including American Airlines. A rival alliance that includes Air New Zealand and is led by United Continental Holdings could benefit, as could a third group of airlines that includes several major Asian carriers and is led by Delta Air Lines and Air France-KLM.

Mr Joyce praised the court ruling, which prevents unions from taking any further strike action over their demands for pay hikes and job security clauses under news contracts being negotiated. The strikes have been blamed for a sharp decline in the airline’s future bookings.

“The important thing is that all industrial action is now over and we have certainty,” Mr Joyce told reporters in Sydney. “We will be returning to business as usual over the next 24 hours.”

Australia’s prime minister Julia Gillard had described the grounding as “extreme”, while transport minister Tony Albanese sharply criticised Mr Joyce for giving the government only three hours’ notice of his plans.

The government, angered by a lack of warning of the grounding, called an emergency court hearing on Saturday to end the work bans for the sake of the national economy.

The three judges heard more than 14 hours of evidence from the airline, the government and unions. Workers have held rolling strikes and refused overtime for weeks, fearing some of Qantas’ 32,500 jobs would be moved overseas in a restructuring plan.

The unions wanted the court to temporarily suspend the employee lockout so that strike action could resume if negotiations in the labour dispute failed to progress. But the airline said the strikes had devastated the airline’s reputation for reliability and that the threat needed to be removed permanently before customers would return.

Tribunal president Geoffrey Giudice said the panel decided that a temporary suspension would still risk Qantas’ grounding its fleet in the future and would not protect the tourism and aviation industries from damage.

Qantas is the largest of Australia’s four national domestic airlines, and the grounding affected 108 planes in 22 countries.

About 70,000 passengers fly Qantas daily, and would-be fliers this weekend were stuck at home, hotels or airports, or even had to suddenly deplane when Qantas suspended operations.

More than 60 flights were in the air at the time but continued to their destinations, and Qantas was paying for passengers to book other flights.