December 16, 2010 – Qantas will move into the Western Australian fly-in-fly-out (FIFO) resources air charter market, with agreement reached for the airline to purchase local operator Network Aviation.
Rather than relocating the employee and their family to a town near the work site, the employee is flown to the work site where they work for a number of days and are then flown back to their home town for a number of days of rest.
Fly-in fly-out is very commonly used in the mining industry, as mines are often in areas far from towns. Usually a fly-in fly-out job involves working a long shift (e.g. 12 hours each day) for a number of continuous days with all days off spent at home rather than at the work site.
As the employee’s work days are almost entirely taken up by working, sleeping and eating, there is little need for any recreation facilities at the work site. However, companies are increasingly offering facilities such as pools, tennis courts and gyms as a way of attracting and retaining skilled staff.
Generally fly-in fly-out work sites use portable buildings as typically there is no long-term commitment to the work site (e.g. the mine will close once the minerals have been extracted). Employees like fly-in fly-out arrangements as their families are often reluctant to relocate to small towns in remote areas, due to the lack of opportunities for partner’s employment, limited educational choices for children and poor recreational facilities.
Employers prefer fly-in fly-out arrangements when the cost of establishing facilities of sufficient quality to attract families to live locally will exceed the cost of creating basic facilities for a fly-in fly-out community plus the cost of airfares.
Qantas Chief Executive Officer, Mr Alan Joyce, said the acquisition would provide a strong growth opportunity, new revenue stream and further diversification for the Qantas Group. "The Qantas Group has a very strong presence in Western Australia, operating passenger services across metropolitan and regional centers and connecting the state to its broader domestic and international networks," Mr Joyce said.
"Mining company demand for FIFO air services to transport employees to and from remote sites within the state, however, cannot be met solely by Regular Passenger Transport (RPT) services. "This is an important market, and a growth market, and Qantas will now become a key player in meeting the needs of the resources sector. This will significantly enhance the scope of what Qantas can offer the mining sector, bringing new competition to the marketplace.
"We have reached agreement with the owners of Network Aviation to purchase the business. It presents strong growth opportunities and we will immediately look at significantly growing its fleet and its operations."
Network Aviation operates a fleet of two 100-seat Fokker 100 aircraft and six 30-seat Embraer Brasilia EMB-120ER aircraft. Subject to finalization of the acquisition, Network Aviation will become a wholly-owned subsidiary of the Qantas Group.
Network Aviation will retain its current management, employees and operating structure, with the business to be aligned with Qantas’ operations in terms of safety, regulatory, people, financial and commercial governance oversight, standards and processes. "This is very much a strategic acquisition and an exciting growth opportunity for Qantas," Mr Joyce said.
