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Mon 31 Oct 2011 07:30 AM

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Qantas back in skies after government steps in

Gulf carriers pick up business after Australian airline grounds fleet amid labour dispute

Qantas back in skies after government steps in
Qantas grounded its fleet in protest at ongoing labour disputes with its staff

Australia's Qantas Airways scrambled to get back in the air
on Monday, having grounded its entire fleet over the weekend in a bold tactic
to force the government to intervene in the nation's worst labour dispute in a
decade.

Qantas had taken the drastic step to ground all flights on
Saturday, disrupting around 70,000 passengers and spurring the government and
its labour-market regulator into action to seek an immediate end to hostilities
between the airline and unions.

At the government's instigation, Australia's labour tribunal
stepped in and ordered Qantas to resume flights and also banned trade unions,
which have waged a long and damaging campaign of industrial action, from
staging any more strikes.

Qantas CEO Alan Joyce, dubbed a "kamikaze" by a
newspaper for effectively staging his own strike against the unions at the
weekend, welcomed the tribunal's ruling, which gives both sides 21 days to
settle the dispute or submit to binding arbitration.

"That was the only way we could bring that to a
head," a bleary-eyed Qantas Chief Executive Alan Joyce told reporters on
Monday as shares in the airline jumped 6 percent on the ruling.

Qantas,
Australia’s largest airline, has lost nearly A$68m ($72m) this year from the
conflict with unions representing long-haul pilots, engineers and baggage
handlers. Its stock has fallen 39 percent in the year-to-date.

Joyce had complained of "death by a thousand cuts"
and said the future of the 90 -year-old airline was at stake.

Qantas said flights were set to resume on Monday afternoon,
on a limited schedule and subject to regulatory clearance. The airline hoped to
return to normal in 24 hours.

Gulf
carriers said Sunday they had seen a rise in traffic on their Australia routes
as passengers scrambled to find alternative seats.

Abu
Dhabi’s Etihad Airways said it would be working closely with its partner
carrier Virgin Australia to aid Qantas passengers stranded as a result of the
strike action

"We
are already looking at a range of options to support Virgin Australia in its
home market by freeing up additional capacity if required,” said CEO James
Hogan. “We also stand ready to assist Qantas passengers who are stranded
overseas and need to travel home.”

Contingency
plans included operating a shuttle service between Sydney and Melbourne on
certain days of the week using Etihad aircraft, and operating a daily flight
between Sydney and Bangkok.

Emirates,
the largest international airline said Sunday it had not amended its flight
schedule to Australia, but travel agents reported a jump in bookings on the carrier’s
routes.

Basel
Abu Alrub, managing partner of Dubai’s U-travel, said the agency had seen a
rise in bookings on Emirates flights to Singapore, as travellers looked for
alternative routes in and out of Australia, and on Cathay Pacific flights
between the Gulf and Singapore.

Prices
had remained stable as other carriers moved in to fill the gap left by Qantas,
he said.

Based on
its August traffic figures, the Sydney-based carrier flew more than 63,000
passengers on average each day. Unions have stepped up action since Qantas
announced plans in August to eliminate 1,000 jobs, reduce routes and establish
new ventures in Southeast Asia and Japan.

“If this
action continues as the unions have promised, we will have no choice but to
close down Qantas part by part,” said CEO Alan Joyce. “The airline will be
grounded as long as it takes to reach a conclusion.”

Etihad
Airways CEO James Hogan said in August that the state-backed carrier hoped to
capitalise on the void left by Qantas slashing routes on its international
operations.

''They
[Qantas] don't have the network they had of 15 years ago,'' Hogan said. “If
they [Qantas] do dilute or marginalise their international flying that's a
great opportunity for us … and we're happy to fill the gap.''

Etihad
operates 24 weekly flights from Australia to the Britain, Europe, the Middle
East and North America through its hub in Abu Dhabi. It offers connections to
and from other Australian cities and towns in conjunction with its partner
Virgin Australia.

Gulf
passengers have also been hit by five-day strike action by Air France employees.
Scheduled Air France flights to and from Dubai, Amman and Saudi Arabia are
operating normally, but flights to and from Abu Dhabi have been impacted. Alternative
connecting flights through Amsterdam are being offered online.

Air
France has been able to operate over 80 percent of its flights, in line with
the levels forecast by the company on Thursday, the Paris-based carrier said in
a statement on Saturday.

*With
agencies

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