In the recent past, we've been led to believe that Qantas is facing higher fuel prices because of the high Australian dollar. It seems to me that it wasn't all that long ago that we were told that Qantas was facing higher fuel prices because of the low Australian dollar. I'm not an economist but it seems to me that one of these statements must be incorrect because, so far as I know, all world airlines pay for aircraft, aircraft parts and fuel in US Dollars - yet Qantas is an Australian company that ought to be paying all such bills with Australian dollars.
Maybe I'm missing something here but it seems to me that a high Australian dollar really should mean that the Qantas fuel bill should be less, in terms of Aussie dollars than US dollars.
Of more recent times, I have noted the following news item which has been carried by many media outlets right around the world :-
This article refers to cost savings of 20% on fuel, by an airline in Ethiopia! The latest exchange rate between the Ethiopian Birr (ETB) and US Dollar (USD), via website XE reveals that, as at today's date and a local Australian time of 12:30 PM, 1 ETB would buy slightly less than 6 US cents! Despite this, the airline can afford to buy TEN (10) such aircraft and, as a result, their fuel costs for this type of aircraft will be dramatically lower.
Contrast this with the latest statement from Qantas CEO Alan Joyce, that Qantas has cancelled their order for the same aircraft type, but will buy them for Jetstar. This suggests to me that he wants Jetstar to be more competitive than Qantas and save more money on fuel costs, as well.
Again, I'm not an economist, but this all starts to look like Qantas is being led to slaughter on the altar of world airline competition and cost savings. I begin to wonder how Ethiopian Airlines can afford such a purchase, yet Qantas cannot - especially as fuel prices seem to be an issue affecting Qantas, due to the high Australian dollar, compared to the extremely low Ethiopian Birr.
If the issue centres on the massive financial loss reported for last financial year by Qantas, this too must be questioned, I believe. I'm sure that Qantas has not made a loss for a very long time and have to wonder what happened in the past year that created such an impact on their bottom line. For quite some time now, there have been suggestions, mostly a bit muted but nonetheless expressed, that Qantas is subsidising Jetstar into profitability by paying for such items as fuel.
Maybe there will come a time when the media will start asking some real questions about these matters.
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