Some of Qantas' pain is self-inflicted

ALAN Joyce likes to say Qantas is fighting with one hand behind its back in its battle with rival Virgin.

That may be true, but using its free hand to repeatedly slap itself in the face hasn't helped the airline.

Though there is a somewhat perverse way in which its self-inflicted wounds may help Qantas to ultimately win its battle.

With the two carriers locked in a vicious, profit-draining battle, Mr Joyce has been heavily criticised for his airline's stubborn insistence on preserving its roughly 65 per cent market share at any cost.

He doubled down on the controversial strategy, announcing plans to increase domestic capacity another three to four per cent in the next six months.

There are reasons for him to do so: Qantas and Jetstar draw significant competitive advantages from their combined market share, which is one reason Qantas has been a standout financial performer in the global aviation industry in the past.

But does having a lower cost base and strategic advantages over your rival matter all that much if you are both losing money by the truckload?

Qantas unveiled a $252 million underlying half year loss on Thursday and Virgin is expected to announce a poor result on Friday.

The difference between the two is Virgin can dig into the deep pockets of three foreign airlines - Etihad, Singapore Airlines and Air New Zealand - who collectively own around two thirds of the carrier.

Foreign ownership of Qantas, meanwhile, is restricted by the Qantas Sale Act, and its borrowing costs have been pushed up recently after major ratings agencies downgraded its credit rating to junk status.

That's where Qantas's self-flagellation in the capacity war could ultimately be to its benefit.

The carrier appears to have gotten itself into bad enough shape to make what was previously unthinkable from a political perspective - foreign ownership of the former national airline - a very real prospect.

If the Abbott government successfully presses ahead with changes to the Qantas Sale Act it will deliver the airline's management a very big win.

However, whether greater access to foreign funds helps Qantas deliver a decisive blow to its rivals or whether the airline just starts slapping itself with both hands remains to be seen.

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Sunshine Coast on measles alert

QUEENSLAND'S Sunshine Coast is on measles alert after an adult was diagnosed with the highly infectious disease upon returning from southeast Asia.

Health authorities are still trying to trace people, including staff and patients at two Sunshine Coast hospitals, who might have come into contact with the infected adult.

Queensland Health says the unvaccinated adult likely acquired the virus during a recent trip to Vietnam.

Sunshine Coast Health Unit public health specialist Dr Andrew Langley says residents should be wary of unusual rashes and seek advice from their GP if in doubt.

A red, spotty rash and other measles symptoms, including a fever, cough and runny nose, usually appear 10 days after infection.

"Also, anyone intending to travel overseas should ensure they are up to date with their measles vaccination," Dr Langley said.

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Bishop spiked rhino program, hearing told

FOREIGN Minister Julie Bishop has spiked plans by the former Labor government to help save the Sumatran rhinoceros.

In June 2013, then foreign minister Bob Carr said Australia would provide $3 million over three years to help Indonesian authorities protect the species, of which there are estimated to be fewer than 200 remaining.

But the program did not and would not begin, Department of Foreign Affairs and Trade spokesman Rod Brazier told a Senate estimates hearing on Thursday.

"The current foreign minister has decided not to proceed with the program," he said.

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Qantas cuts 5000 jobs, sparks debate

Qantas workers are set to find out how many of them will lose their jobs after a half year loss. Source: AAP

THE federal government has all but rejected a debt guarantee for Qantas after the airline announced a massive loss and plans to shed 5000 jobs.

The national carrier posted a $252 million half-year loss on Thursday, due to a tough fight with a cashed-up Virgin Australia in the domestic market, fierce competition on international routes and problems with Jetstar.

The airline will cut 5000 jobs, freeze wages, retire old planes, slash capital spending and cut some routes in a bid to cut $2 billion in costs over three years.

"The current position is unsustainable," Qantas chief executive Alan Joyce said.

Mr Joyce said the job cuts, most of which would occur within the first 18 months, were necessary to save the airline.

"There are many Australian companies that have failed because they were not prepared to make the hard decisions, Qantas is not one of them," he said.

He said he wants to protect as many of the 27,000 jobs remaining but could not guarantee they would all be protected indefinitely because of issues outside Qantas' control.

The cuts triggered a feisty debate in federal parliament, as Labor said it might support a debt guarantee but ruled out backing changes to legislation to allow the airline to lift its foreign ownership above 49 per cent.

Noting it was a difficult day for Qantas workers, Prime Minister Tony Abbott was cool on a debt guarantee, telling parliament the airline was not a special case.

"Why should the government do for one what it is not prepared to do for all, or what is not necessarily available for all?" he said.

Virgin Australia boss John Borghetti said if the government gave Qantas a debt guarantee, he would seek a similar pledge "within 24 hours".

Mr Abbott strongly argued for enabling Qantas to secure more foreign capital and take the fight up to its competitors.

"We want to ensure that Qantas is not competing against its rivals with a ball and chain around its leg," he said.

Opposition Leader Bill Shorten said there was no excuse for the government not to step in.

"This is the worst day for aviation people since the collapse of Ansett," he said.

Opposition transport spokesman Anthony Albanese said changing the Qantas Sale Act was a distraction for government inaction.

He said if foreign investment were an issue, the airline would already be at its 49 per cent foreign ownership limit and not the current 39 per cent.

Changing the act would have other ramifications, including thousands of jobs going offshore, rural and regional routes being dropped and the likely split of Qantas' operations into separate domestic and international companies.

Independent senator Nick Xenophon has called for a judicial inquiry into the company's financial mismanagement, particularly in relation to Jetstar, and called for Mr Joyce and the Qantas board to be sacked.

"The jobs that should have been lost are Alan Joyce and his board," he said.

But Mr Joyce believes he's the right person to take the company through the challenges it faces and has a plan to fix the business.

"Again what we are only after is a fair go for Qantas.. we don't have a fair go at the moment," he told ABC.

Transport Workers Union national secretary Tony Sheldon urged Treasurer Joe Hockey to meet airline executives.

"If Joe Hockey's not prepared to do that, then it's industrial action that the workforce should be considering," he said.

The airline plans to shed 1,500 management and non-operational roles, as well as operational positions affected by fleet and route changes and the restructure of maintenance operations.

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