Should Geoff Dixon, CEO of Qantas resign…..

Wouldn’t any CEO running a major company that was experiencing such massive ongoing problems as Qantas is currently experiencing, been given the chop or fallen on his or her sword by now?  

It is quite amazing to behold in Qantas that Geoff Dixon, CEO of Qantas is still firmly ensconced in his office, while the flying kangaroo appears to be hopping firmly down the engineering, safety, security and reputation gurgler, with one German traveller telling The Mole yesterday that she and her colleagues travelling to Australia from Germany had decided not to fly Qantas because it was too risky! 

And this was on on the day Tourism Australia launched its biggest and what some consider to be its highest risk campaign ever, backing all its global marketing funds on the about to be released movie Australia, with Qantas a key partner.

Isn’t it also rather galling for Qantas staff that Mr Dixon has just received a 100% increase in his remuneration package taking him up to $A12m and other senior managers getting similar increases, when the people that appear to make this airline really work are told they are going to be restrained to 3% and more jobs to go.

Mr Dixon was also CEO when the debacle sale of Qantas was slammed on the table, leaving the company many millions worse off and its reputation badly tarnished.

The Mole is known for saying it the way it is, but what do you think?

Is this a classic Neroesque scenario, with Mr Dixon fiddling away watching his own pay package swell to bursting point, while 60% of Australians in a recent survey saying they had lost faith in the carrier, and a consensus continually growing that Qantas is not the airline it was?

While it appears that shareholder value is now the only criteria, many people around the world still think Qantas is all or partly government owned and are amazed, rightly or wrongly that the Australian Government is allowing this to happen.

Shareholder value is about to be further dramatically impacted by the announcement yesterday that Qantas may have to pay out tens of millions of dollars in compensation for their latest debacle earlier this week, with another ageing Qantas aircraft suffering what now appears to be a major computer malfunction, risking the lives of hundreds of passengers.

A source inside Qantas, where morale is at an all time low, told The Mole that Mr Dixon’s arrogance is not new and is exemplified by an ABC interview back in 2001 between Mr Dixon and ABC reporters Kerry O’Brien and Alan Kohler – click here to see what he had to say then: –

http://www.abc.net.au/7.30/content/2001/s438078.htm

What a great morale booster that was for Qantas staff then, with nothing changing by 2008, in fact the position appears to be dramatically worse.

A report this week in the Age puts the tin lid on Mr Dixon’s position and the Board’s apparent blindness to what is going on

Qantas chief gets sky-high package

October 7, 2008 – The Age

DEPARTING Qantas chief Geoff Dixon will step down next month as the world’s second highest-paid airline boss, beaten only by the head of America’s second-largest airline, United Airlines.

Mr Dixon’s package of almost $12 million this year dwarfs the salaries of his European counterparts and all but one of those in the US.

The revelations are galling for Qantas staff, who have faced a management intent on capping wage rises at 3% a year and that will lay off 1,500 workers by Christmas.

Mr Dixon’s package is beaten only by that of Glenn Tilton, the boss of UAL Corp, whose largest subsidiary is United Airlines. Mr Tilton took home $US10.3 million ($13.69 million) in 2007, including a $US850,000 base salary and $US4.7 million in share awards.

UAL’s board has been under attack from United Airlines pilots to reduce Mr Tilton’s pay at the same time as the carrier slashes its workforce and grounds a fifth of its planes.

Mr Dixon’s package of $11.92 million for the year to June included a $3 million cash bonus and almost $6.4 million in share-based payments, Qantas’ annual report shows.

It is a huge rise on the year before, when he was awarded $6.5 million.

Three months before the $11.1 billion private equity raid on Qantas was made public in November 2006, Mr Dixon also had almost $8 million tipped into his super account when he renewed his contract.

Qantas declared in May this year that it was freezing senior executive pay in response to high fuel prices, just two months before the airline announced the job cuts.

Mr Dixon’s latest salary beats even the pay packet of Gerard Arpey, the head of AMR Corporation, which runs the world’s largest commercial carrier, American Airlines, with Mr Arpey’s total pay $US4.6 million in 2007, including a base salary of $US656,000 and stock awards of $US3.1 million.

The Australian also trumps the $US7.73 million Northwest Airlines paid its boss, Douglas Steenland, in 2007, and the $US7.31 million Continental gave its chief executive, Larry Kellner.

US Airways, the fifth-largest airline in the US, paid CEO and chairman Douglas Parker a package of $US5.4 million, including a base salary of $US550,000.

The pay of European airline executives is modest in comparison with that for Mr Dixon or the Americans.

“It is an absolute double standard.”  â€œHow shareholders and the board let this happen, you have to wonder,” Australian Services Union assistant national secretary Linda White said yesterday.”  “Rewarding one of those at the top doesn’t mean you have the best airline in the world.”

British Airways’ boss Willie Walsh pocketed £701,000 ($A1.57 million) for the year to March and he turned down a £700,000 bonus after a disastrous opening of Heathrow’s Terminal 5 in London.

Air France-KLM paid chief executive and chairman Jean-Cyril Spinetta €1.39 million ($A2.5 million) for the year to March, which included €750,000 salary.

Europe’s second-largest airline, Lufthansa, gave its chief, Wolfgang Mayrhuber, €2.4 million in 2007, including a €1.4 million bonus.

Singapore Airlines paid its boss, Chew Choon Seng, about $S3.5 million ($A3.2 million) for the year to March 31.

Mr Dixon steps down as chief executive on November 28 but will remain a consultant until March.

Qantas would not comment yesterday.

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So, Mr Dixon in the land of the “fair go”, isn’t it fair to say that you have had enough of a “fair go” with many saying more than enough – and things ain’t looking too good!

What about doing the right thing, you’ve made more than enough out of Qantas over the years, your successor has been appointed and he’s sitting in or probably actually on the wings ready to go………..isn’t it time to fall on your sword by resigning? 

Oh and while you are doing it, why don’t you go even better than Willie Walsh by refusing to accept last years 100% increase in your package and turning down the ongoing consultancy – even better, tell the Board they can give your dosh to the workers, the ones that really run Qantas. 

Now this would really show your true colours and what you claim to be your committment and loyalty to Australia’s airline in the true “Spirit of Australia”

Oh, and Mr Dixon, as someone inside Qantas told me yesterday, “If Geoff Dixon needs a sword to fall on, there plenty of people inside Qantas from very senior management, right down to the guys on airport aprons right across Australia and outside Qantas who will let him have one quick smart!”

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A report by The Mole