Emirates Subsidiary Set To Reevaluate Its Australian Business

Some 4,500 jobs are at risk after following Emirates’ decision to review the Australian operations of its catering…

Emirates Subsidiary Set To Reevaluate Its Australian Business

Some 4,500 jobs are at risk after following Emirates’ decision to review the Australian operations of its catering and grounding handling subsidiary Dnata. This follows a decision by the Australian Government not to subsidize the salaries of local employees when working for a business that is 100% foreign-owned. Dnata is owned by Emirates, which is owned by the Dubai Government.

Emirates subsidiary Dnata is threatening to exit Australia. Photo: John Taggart via Wikimedia Commons.

Emirates subsidiary employs 4,500 people in Australia to provide airline support services

Dnata is at ten airports around Australia. In addition to Emirates, they provide catering and grounding handling services for 29 other airlines, including Qantas. The Emirates subsidiary services 27,000 flights annually in Australia. Their services range from frontline check-in to ramp services, baggage handling, cleaning, and catering (via their Alpha Flight Group subsidiary).

The business had previously flagged it might be forced to permanently lay off employees and wind down operations as aircraft movements collapsed over recent months. Some 4,000 of Dnata’s 4,500 Australian employees have already been temporarily stood down.

The Australian Government has started providing taxpayer monies to local businesses to keep paying workers who otherwise would have been laid off. The USD$84 billion JobKeeper program provides USD$975 per fortnight to businesses to pass onto their employees. Over 700,000 businesses have signed on.

Dnata ruled ineligible for subsidies and not happy about it

But late last week, the Australian Government excluded businesses that are 100% foreign-owned, ruling Dnata ineligible. The government’s view is that it isn’t their job to subsidize the payroll of foreign companies.

The news didn’t impress Dnata. The company told The Financial Times;

“The exclusion of Dnata from the JobKeeper scheme puts over 4,500 jobs at risk while leaving employees and their families without income with extremely short notice. As a result, we are also forced to review medium and long-term viability of Dnata’s various Australian businesses, including catering, cargo, ground handling, retail, and hospitality.”

Dnata are one of the major airline catering businesses in Australia. Photo: pxfuel.com.

Local unions representing the affected employees are also unhappy, calling the decision “outrageous” and “narrow-minded.”

Dnata says had they been eligible for the salary subsidies, the stood down employees would have been reinstated.

An under the radar problem facing airlines when they start flying again

The threat to reevaluate its Australian operations highlights an under the radar problem facing the airline industry.

While many governments are providing subsidies to keep airlines ticking over, the airlines need extensive logistical support from back-of-house businesses like Dnata to continue operating. Increasingly, airlines have contracted out core services like cleaning, baggage handling, and catering.

Without these services, flights cannot happen, and that gives businesses like Dnata some leverage. Or so many reckon.

Airlines need contracted ground and back-of-house services if they are to resume flying. Photo: Aeroprints.com via Wikimedia Commons.

“Not only will this hurt workers in Australia, it will also hamper efforts to get air travel back up and running when restrictions lift, impacting on our economy. Companies like Dnata carry out behind the scenes work at our airports which gets aircraft into the sky. Their work is vital, and thousands depend on it,” said Michael Kaine, national secretary of the Transport Workers Union this week.

Mr Kaine raises a valid point. Governments are keen on supporting airlines and keen for them to get back flying. But to fly again, the services and infrastructure that support airlines need to be maintained. The Australian Government is unlikely to bow to bluster and threats from Dnata, but the issue does highlight the need to keep those back-of-house industries that support airlines ticking over.

Source : Simple Flying More   

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American Airlines Resumes Flights To Spain

Dallas based US carrier American Airlines is cautiously rolling out a limited schedule of summer flights between the…

American Airlines Resumes Flights To Spain

Dallas based US carrier American Airlines is cautiously rolling out a limited schedule of summer flights between the USA and Europe. These include the resumption of nonstop services between Dallas Fort Worth and Madrid’s Barajas Airport this week. The flights will see American Airlines become the only carrier currently offering nonstop flights between the US and Spain.

American Airlines is resuming flights between Dallas and Madrid this week. Photo: Getty Images.

Madrid bound flights resume this week from Dallas Fort Worth

The first flight left Dallas Fort Worth today. Daily return services using a Boeing 787-8 will begin on Saturday. This will see AA36 push back from Dallas Forth Worth at 16:50 for a nine and a half hour flight over to Madrid, landing at 09:10 the following morning. The daily return flight, AA37, will depart from Madrid at 11:05 and touch down in Dallas at 14:40 on the same day after a ten and a half hour flight.

American Airlines had previously offered direct flights between Dallas and Madrid but suspended the service in mid-March after the US Government began banning most incoming arrivals from mainland Europe. But the airline has kept a daily flight between Dallas and London Heathrow operating. The resumption of Madrid bound services marks a small ramp-up in transatlantic services for American Airlines.

A gradual ramp-up of American Airlines’ transatlantic services to Europe

Services between Dallas Fort Worth and both Amsterdam and Frankfurth are slated to begin on 4 June. Services between Dallas Fort Worth and Dublin are set to start-up again on 7 July. Flights from New York Kennedy to London Heathrow, Los Angeles to London Heathrow, Chicago O’Hare to London Heathrow, Philadelphia to London Heathrow, and Raleigh-Durham to London Heathrow are all due to resume on 4 June.

American Airlines services from Chicago O’Hare to both Dublin and Athens will also re-commence in early June.

The Madrid bound flights will leave Dallas daily late in the afternoon. Photo: American Airlines.

These flights are a fraction of the flights American Airlines formerly sent out across the Atlantic. But it is a sign that the airline is keen to have some flights up and running in anticipation of a relaxation of travel restrictions between the USA and Europe.

The Madrid bound service also capitalizes on American Airlines’ partnership with Madrid based oneworld buddy, Iberia. The partnership allows passengers out of Dallas to be checked through to further destinations in the Iberia network.

Stringent travel restrictions remain in place

While prospective passengers in both cities might have itchy feet, it’s not a case of simply buying a ticket and jumping on board. Both the USA and Spain still have strict border controls in place. Spain has closed its land, sea, and air borders to non-residents, and restrictive lockdown regimes remain in place for Spanish residents. On the other side of the Atlantic, unless you are an American citizen or lawful permanent resident, you’ll have a hard time entering the USA after been in Spain.

American Airlines will be using a Boeing 787-8 on its Madrid flights. Photo: American Airlines.

Why does American Airlines bother flying to Europe?

With such restrictive travel regimes in place, you might ask why any airline would bother flying between the two counties?

There are several reasons. Flights like these maintain a degree of connectivity. Some people, including essential workers, still have to travel. The flights also allow for the carriage of cargo. The pandemic has seen American Airlines rediscover cargo, with current loads the biggest in more than 30 years. Finally, there’s the unspoken social contract between companies like American Airlines and its many stakeholders (that include passengers). The flights American Airlines now operates might lose money, but there’s the expectation that big businesses will keep running in bad times as well as the good times.

Bookings for the resuming American Airlines between Dallas Fort Worth and Madrid are now open and available via the airline’s website.

Source : Simple Flying More   

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