Qantas 'outsources' to London

BRITISH companies may think they can save cash by setting up operations in India and the Far East, but the Australians think London is the place to be.

Australian airline Qantas is to set up a base in the capital for 400 of its internatinoal flight attendants next year in a bid to save about A$18m (£8m) a year.

Qantas said the savings are likely to come through rostering efficiencies and reduced accommodation and overseas allowance costs. Job losses are not expected.

Qantas chief executive Geoff Dixon said the carrier had held talks with relevant trade unions and that most major issues had been ironed out.

'These savings, and others we need to continue to push through the company, are essential if Qantas is to continue to grow and prosper,' Dixon said.

While the airline has no current plans to move any more jobs offshore, Dixon said he would not rule out such a move if the carrier was convinced it would provide further cost efficiencies.

Qantas spends about A$90m a year for flight attendant accommodation and allowances.

The airline also plans to set up a base for a further 250 international flight attendants in Brisbane early next year.

Qantas operates 21 one-stop services a week to London via Singapore and Bangkok. This will increase to 27 by next year, including three new services via Hong Kong, and it will need a greater proportion of staff based in London.

Qantas has more than 4,000 international flight attendants in its global network, with around 350 currently based outside of Australia in centres such as Auckland and Bangkok.

Qantas, meanwhile, is pressing ahead with plans for a Singapore-based low cost airline. Dixon said that a name is likely to be announced within the next month.

Qantas will have a 49.9% stake in the intra-Asia budget airline it is setting up with Singaporean businessmen Tony Chew. Chew will hold a 21.1% stake and FF Wong will have 10%. Temasek Holdings, the investment arm of the Singapore government, will own the remaining 19% of the company.

Dixon said a team from the airline has been working in Singapore for about four weeks and the group continues to hope to have a fleet in the air by the end of the year.

The new budget airline will start operations with four aircraft and build a fleet of more than 20 aircraft over three years.