Alan Joyce’s time is up as CEO, but it is unlikely there will be major changes at Qantas.
On Tuesday, Qantas announced Mr Joyce will be replaced by the airline’s chief financial officer Vanessa Hudson in November.
Ms Hudson’s appointment received a resounding endorsement from Mr Joyce, who labelled her an “outstanding executive with outstanding leadership skills”.
The incoming CEO joined Qantas in 1994, and has held a variety of positions encompassing commercial, customer and finance roles.
This wide-ranging experience may be just what Ms Hudson needs to be successful as CEO, said Tony Webber, Airline Intelligence & Research CEO and former Qantas chief economist.
A Qantas CEO will face pressure on multiple fronts – from shareholders, customers, and from the politics of representing Australia as a national carrier, he said.
“She’s going to have to understand marketing. She’s going to have to understand customer experience. She’s going to have to understand operational aspects of the job,” Dr Webber said.
“She’ll rely on others, of course, but she’ll have to have her eyes across all of those things.”
It is Ms Hudson’s significant experience in finance as the CFO since 2019 that might have been her most appealing quality as a CEO, given the typically slim profit margins of airlines.
Griffith University researchers Russell Wilson and Gui Lohmann published a study in 2019 that found the larger the airline, the more likely it will have a CEO with a finance background, with this being the case for half of the top 10 airlines at the time.
Next moves for Qantas
Greg Bamber, professor at Monash University’s Monash Business School and co-author of Up in the Air, told TND Qantas is currently at a crossroads after delivering a record $1.43 billion half-year profit in February while facing heavy criticism from customers and workers.
Although Qantas passengers this year have not experienced the same level of disruptions in the form of lost baggage, flight delays and security lines as seen in 2022, workers and irate former workers continue to have difficulties with management.
Rivet refuellers walked off the job at Melbourne Airport in April after Qantas refused to meet to resolve a fair enterprise agreement.
Meanwhile, High Court hearings will be held next week in the ongoing case of Qantas outsourcing 1700 ground worker jobs, the Transport Workers Union said.
Dr Bamber said Qantas will need to address customer, worker and union complaints – these will be one of Ms Hudson’s biggest challenges when she starts as CEO.
“Qantas has outsourced its baggage handling and most of its call centres, which often give poor customer service,” he said.
“If Qantas were to bring these key services back in house again and to retrain them well, they are more likely to deliver better customer service to customers, which should lead to more satisfied customers and more repeat business for Qantas.”
Dr Webber said the layoffs have led to further strife for the airline, which has since struggled to fill vacant positions as workers are wary of being burned again.
However, it’s unlikely Ms Hudson will digress far from Mr Joyce’s playbook.
When speaking about her appointment, she said that she had spent a lot of time with Mr Joyce during the first three years of COVID-19.
The decisions he made weren’t for the faint-hearted but they were the right ones, Ms Hudson said.
“At this stage, it does not seem that Vanessa Hudson is likely to shake things up,” Dr Bamber said.
“Since she is an inside appointment, having been with Qantas for nearly three decades, she [will] most likely continue along the current lines.”
Signs of progress
Endorsing Mr Joyce’s controversial decisions, Ms Hudson said she is looking forward to developing a constructive relationship based on “mutual trust” with union leaders.
TWU national secretary Michael Kaine said the TWU’s door is open to meet the CEO and establish a succession plan that would treat workers as “an essential investment rather than a cost”.
“Over a decade, Alan Joyce has systematically splintered his workforce and driven down standards to the point where Qantas is a shadow of what it once was,” Mr Kaine said.
“Vanessa Hudson must be courageous enough to steer Qantas back to its core purpose: High-quality service for passengers and investment in the hard-working people who built the spirit of Australia,” he said.
Ms Hudson has the benefit of starting with Qantas already in a strong position.
“Last year we were very upfront in terms of recognising that the customer experience was not where we wanted it, and we’ve invested an enormous amount of money – $200 million – this year in getting the performance back to where it needs to be,” she said.
“And it is back [to] where we were pre-COVID.”
As for what’s next in the Qantas pipeline, she singled out the airline’s heavy investment in upgrading its lounge network and renewing the aircraft fleet to deliver growth and the highly anticipated Project Sunrise.
Project Sunrise will offer direct flights from Australia to New York and London from late-2025, and become one of the longest direct flights offered in the world, with flights between Melbourne and Sydney and New York City and London set to clock in at more than 19 hours.
