Australian Express Air Freight Gets Competitive

AUSTRALIA – As predicted in our story in June it appears that the joint freight operations of national air carrier Qantas and Australia Post namely Australian Air Express (AAE) and Star Track Express, will not see any expansion in the near future as the co owners continue to debate the best way forward. As anticipated Star Track profits dropped by a third last year against the A$25 million + recorded in 2008 whilst AAE apparently saw a record rise in the six months to June this year, A$13million+ against under A$120,000 for the same period last year.

AAE and Qantas have been tight lipped about the wage increases awarded to AAE workers after negotiations with the Transport Workers Union were concluded last week, with reports stating that staff are to receive up to 21% increases over the next three years, bound to cause controversy.

Observers have long suspected that the long term aim was to amalgamate Star Express and AAE but this may prove even more difficult in the light of the wage settlement and the fact that the figures achieved by AAE are largely due to cost savings as opposed to an increase in profitability. That said, the two subsidiary companies must be competing somewhat for the same business, Star Express offer road based consolidation services as well as serving AAE’s traditional airfreight market and closer cooperation seems a natural progression with only management and labour issues being a barrier.

With 5000 jobs resting on the management decisions plus Australia Post subject to the world wide assault which electronic mail has made on all such companies expect Qantas and their partners to discuss matters further before announcing any decisions.