14 January 2010

Hanoi takes another potshot at Qantas

HANOI - The fractured relationship between Jetstar Pacific, part owned by Qantas, and the communist government of Vietnam shows no sign of healing.

In the last broadside from Hanoi, managers at the Vietnamese budget airline have been accused of violating maintenance regulations.

Jetstar Pacificââ¬â¢s largest shareholder is the Vietnamese government.

The Civil Aviation Administration of Vietnam (CAAV) ruled three officials made mistakes in monitoring maintenance work and had not fulfilled the company's commitment to safety, Vietnam News Agency said.

It identified the managers as former general director Luong Hoai Nam and two foreigners who headed the airline's maintenance and technical quality sections. It did not say where the foreigners were from.

"Key JPA executives have to take responsibility for these systematic mistakes," the report quoted the CAAV as saying.

Hanoi police arrested Luong Hoai Nam last week for alleged neglect of responsibility in the performance of his duty causing "serious consequences", local media reports said.

Qantas said on Friday that two of its senior executives have been ordered not to leave Vietnam as they help authorities explain how Jetstar Pacific lost $US31 million in fuel hedging.

Writing his Plane Talking blog, aviation analyst Ben Sandilands asked, ââ¬ÅâœHow much clearer does the message from Hanoi to Qantas need to be?

In October last year it told Jetstar Pacific it could no longer use the Jetstar brand on the 27% owned franchise after this October, on the expiry of the commercial agreement between Qantas and the investment arm of the Vietnamese government, which owns a 70% stake.

In December it refused to allow two Australian executives in the carrier to leave the country pending investigations into a fuel hedging loss of around $33 million.

ââ¬ÅâœThis week it is officially complaining about safety issues perpetrated, allegedly, by the carrierââ¬â¢s Australian management, which in vague terms, it described as putting ââ¬Ëœflights at riskââ¬â¢.

ââ¬ÅâœHmm. There seems to be a pattern emerging here. You canââ¬â¢t be Jetstar anymore, you are responsible for losing tens of millions of dollars, and youââ¬â¢re unsafe.

ââ¬ÅâœThe murmurings from Qantas in response to this so far would leave shareholders wondering how attuned to the fate of their $US 50 million investment in Vietnam the company really is, since it keeps expressing confidence these problems, where or if they exist, can be overcome.

ââ¬ÅâœThere has to be another side to the story, the Qantas side, which is capable of being expressed in more than vague nothings.

ââ¬ÅâœIt is obvious that the safety allegations, which were first circulated with less drama last year, have now been wheeled out as a third dose of pressure by the communist regime in Vietnam on an airline that appears to be deaf,ââ¬~ Sandilands wrote.

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• Nothing changes in Vietnam
  
  

  I lived and worked in Vietnam doing crisis and issues management in the late 90s. Nothing has changed. If you lie down with dogs you wake up with fleas and with the Vietnamese government as your partner you are not just gonna get a few flea bites but get well and truly f****d in your sleep too. One day everything is going fine and the next morning you wake up and find your JV partner is complaining in the Vietnamese media and releasing all of your commercial and in-confidence trading and financial data. Nothing has changed in Vietnam and Qantas are just plane stupid for thinking it had. If they get their aircraft and people back then that that will be a win. Vietnam, like some other Asian countries, DON'T WANT competition, despite what they say publicly - especially if it makes their own home-grown industries look inefficient.

  By John Le Fevre, Thursday, January 14, 2010