December 05, 2008
Horse 937 - The Spirit of Iberia, The British Kangaroo
This is big, really big, mega-super-eye-bleed big. Qantas, British Airways, Iberian Airways, and American Airways, are all currently staring at the prospect of forming some super-mega conglomo airline thing.
In theory it opens up the group to 270 destinations, a combined fleet of over 450 planes, frees up $6.8bn in cash immediately and saves about $1.3bn a year in overheads, maintenance costs and other incidentals.
In other words it makes good economic sense.
Dick Smith former head of CASA went on the ABC yesterday telling Richard Glover that he didn't see what advantages the merger of Qantas with British Airways would bring Australians. I ask "so what?" In all actuality it matters not an iota what advantages it brings Australians.
Qantas is a publicly listed company. When in 1993 the company was privatised, British Airways as early as then bought 25% of the shares for $665m. When all the shares had finally been disposed of by the Australian Government, 55% of then were owned by "Australian" interests, 25% by BA and 20% by foreign interests. I note that although the provisions nominally state that at least 51% of the company must be "Australian owned" there is in fact no actual off-market check as to whom those Australians actually are. If it's institutional investors then quite literally there'll be no way of knowing who it is anyway - so the arguments about foreign control and/or profits going overseas is entirely academic.
The role of any company is to make a return to its shareholders. This is an entirely amoral statement; for example, a rock which falls on a person is amoral. It is neither right nor wrong, and one cannot reasonably praise or blame the rock, as the rock does not have any moral concepts. Likewise, a company is an amoral entity; since of itself, it is a non-corporeal person, it of itself can not have moral attachments. I don't care if you happen to be Qantas, Holden, Joe's Pizzeria Pty Ltd or even OmniCorp, all of their aims is entirely the same. Qantas is not in business to confer certain adavantages to Australians except if you happen to be an Australia and a shareholder; in which case, the fact that you are an Australian is irrelevant.
My sense of moral indignation comes about because Qantas was sold by the Keating Goverment in the first place. That's where and when Australians lost any advantage they once had through Qantas. Here's me 15 years later and something which I used to own is turning a profit, but am I even seeing so much as a red cent? No. My advantage before and after the merge if it happens will be entirely the same... nothing. The flying kangaroo can jump* for all I care.
*Yes, I knew I'd get that pun in there somewhere!
Posted by Rollo at 14:31