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Annual Report

Annual Report 2010-2011

The year in review by Chairwoman, Dr Jill Walker

This annual report marks the nineteenth year of operations of the International Air Services Commission. I joined the Commission as the Chairwoman in early 2011.  It is my pleasure to provide an overview of the activities of the Commission for the past twelve months.

 

2010–11 was a good year for the international aviation industry with passenger movements in and out of Australia growing by around eight percent.  The International Air Transport Association however recently reported that the 2011–12 industry profit outlook has been nearly halved as airlines manage the impact of volatile oil prices and local demand shocks.

 

During this period, Australian international airlines have dealt with the impact of volcanic ash in both the northern and southern hemispheres, and earthquakes in Japan and New Zealand.  These natural disasters have all affected consumer demand.

 

During 2010–11 a substantial proportion of the Commission’s work involved applications by Australian international airlines to use capacity in joint services with other airlines.  The Commission considered applications to use capacity in joint services on numerous routes including the following: Fiji; Japan; New Zealand; South Africa; Thailand and the United States.

 

Also during the year, the Commission considered a contested application, as one or more Australian international airlines sought to obtain capacity which was originally applied for by a different airline.  The application by Qantas for capacity on the Indonesia route was contested by V Australia and Strategic Airlines. This complex case is the subject of a detailed case study in this annual report.  The case study provides some insight into the working of the Commission.

 

During the year Australia’s largest international airline, Qantas, obtained capacity for services by Qantas and Jetstar for use on a range of routes.  The capacity sought ranged from large amounts in the case of the Indonesia route to small amounts on the Vanuatu route (100 seats per week).  As an important part of the Qantas group, Jetstar was able to increase its services as a result of allocations from the Commission.

 

Pacific Blue Australia, the Virgin Blue Group short-haul international carrier, sought and obtained capacity from the Commission to continue expanding its services to island nations in our region including Fiji and Vanuatu.

 

V Australia, the long-haul Virgin Blue Group airline, was allocated capacity by the Commission to operate on the Bangladesh, France, Greece, Indonesia, Thailand and the United Arab Emirates routes.

 

Strategic Airlines was allocated capacity on the United States route with an unlimited allocation of passenger and cargo capacity.  They were also allocated capacity on the Thailand, China and Indonesia routes.

 

In 2010–11 the Commission granted capacity to one prospective new Australian airline, Pionair. As with all new entrant airlines, in granting capacity to Pionair, the Commission undertook a detailed analysis of its capability to implement the proposed services.  This assessment is intended to ensure, as far as practicable, that valuable capacity entitlements are not allocated to airlines which are ultimately unable to use them.  Pionair sought, and was granted, freight capacity of 12 tonnes per week on the Papua New Guinea route.

 

As we review our performance during the year, I would like to take this opportunity to thank my fellow Commissioner, Mr Stephen Bartos, for his continued commitment to the work of the Commission.  I would also like to farewell Mr Ian Smith, who completed his term with the Commission in February 2011.  Mr Smith spent three and a half years as a Commissioner and I wish him well for the future.

 

On behalf of past Chairmen of the Commission and Mr Bartos, I would like to formally farewell Mr Mike Bird, the Executive Director of the Commission for over ten years.  Mr Bird will retire from the Australian Public Service in late 2011.  He distinguished himself by always providing professional and rigorous advice to the Commission.

 

I would also like to thank the other members of Mr Bird’s small secretariat, without whom the Commission would not function smoothly, and to welcome Sue McIntosh, the new Executive Director.

 

 

 

 

Dr Jill Walker

Chairwoman

 

PDF Version

The Commission’s Annual Report is available in PDF format for easy download and printing.  The Annual Report is also avaliable in hard copy by contacting the office, the details can be found under the "Other Information" tab on this website. The document reflects the information in the hardcopy of the annual report tabled in Parliament on the 31 October 2011.

Previous IASC Annual Reports

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Last Updated: 31 October, 2011