Outback carriers unite in world’s first air franchise

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2/03/2004

Outback carriers unite in world’s first air franchise

The world’s first airline franchise was launched yesterday, bringing Airnorth, Airlines of South Australia and Emu Airways under a single banner: RegionalLink Airlines.

The airlines, each of which are owned by the Darwin-based Capiteq group, will operate under a single brand and will share core functions such as reservations, purchasing, yield management, airport services and information technology.

The group made the announcement following its latest acquisition - Emu Airways - and said it aimed to attract a range of regional airlines to its franchise chain by the end of 2004.

Other carriers including Mt Gambier’s O’Connor Airlines are believed to be in discussions with the group.

“Regional aviation in Australia is at a significant crossroads, and carriers need a fresh approach to ensure their ongoing viability,” Capiteq ceo Michael Bridge said.

“This industry is comprised largely of independent carriers, each facing significant costs and challenges, and many lacking the funds to invest in the latest and most efficient airline technology, such as latest yield management systems or reservations centres.”

Bridge said the aim of RegionalLink Airlines was to bring stability, sustainability and profitability to the regional air transport sector by reducing costs for member airlines and improving efficiency through sharing of resources and group investment in new technology.

Former Qantas executive Ian Mitchell has been appointed ceo of RegionalLink.

Mitchell has 31 years’ experience in the aviation and tourism industries - having worked as Qantas group general manager Australia sales, and as managing director and ceo of the Northern Territory Tourist Commission.

Bridge said RegionalLink would not operate aircraft in its own right but would be the owner of the group brand and provider of core services.

It would also provide a single flight designation code, to be used by all member airlines, and negotiate the procurement of supplies and services for members.

At a launch ceremony at Adelaide Airport yesterday, RegionalLink unveiled the first two aircraft in its new blue and silver colour scheme.

“Although RegionalLink partners will paint their aircraft in a group colour scheme, all aircraft in the group will carry the logos of the participating airlines, continuing to keep alive the strong heritage and branding upon which these carriers have been built,” Bridge said.

“The most important outcome will be more viable air services for rural and regional Australia, and a strong single brand, as members of the RegionalLink Airlines group begin to reduce their operating costs and reap the benefits of a combined approach.”

Bridge said Airlines of South Australia had achieved reductions of more than 20 per cent on fuel and insurance costs since its acquisition by Airnorth last October.

“This is just the start,” he said.

“Reductions of this size by combining the requirements of just two regional airlines demonstrate clearly the significant potential savings and efficiency gains to be achieved when many more carriers unite under the RegionalLink Airlines brand.”

Airnorth has a fleet of nine aircraft – six 30-seat Embraer Brasilia and three 19-seat Metroliner 23s - and operates scheduled services across northern Australia from its Darwin hub to six NT destinations and internationally to Dili, East Timor.

Airlines of South Australia operates six aircraft – one 30-seat Embraer Brasilia, two 15-seat Embraer Bandeirantes and three nine-seat Piper Chieftains – on scheduled services from Adelaide to Port Lincoln and Port Augusta.

It also operates significant charters throughout South Australia for major commercial clients, as well as the world’s longest mail run through the South Australian and NSW outback as far as the Queensland border.

2 March 2004

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