Qantas Statement on Qantas Sale Act

6 August 2002

Qantas Chief Executive Officer Geoff Dixon said today that removal of foreign investment limits from the Qantas Sale Act would ensure Qantas remained globally competitive and enhance, not diminish, the airline's ability to provide even more services to regional Australia.

"The point has been reached where the overall limitation on foreign ownership in Qantas is restricting the airline's ability to reach its full potential," Mr Dixon said. "It also imposes an artificial ceiling on our share price and so increases our cost of capital.

"No other Australian company is subject to legislation that limits its access to foreign equity capital in this way. We believe that it should be sufficient to rely on the Foreign Investment Review Board to determine what is in the national interest, like every other company in the country."

Mr Dixon stressed that Qantas would retain its Australian identity and icon status if the foreign investment limits were removed from the Qantas Sale Act.

"Qantas would remain an Australian company with an Australian Board and headquarters, operating out of Australia and employing tens of thousands of Australians," he said.

"Foreign investors, including foreign airlines, would not be allowed to control Qantas. This would ensure that Qantas continues to satisfy the requirements of bilateral agreements that allow it to fly to other countries.

"This is about increasing Qantas' access to equity capital, not permitting greater investment in Qantas by foreign airlines."

Mr Dixon said that, unlike many other international carriers owned or propped up by their Governments, Qantas could not survive without an internationally competitive and efficient cost of capital. He said few people realised that 37 international passenger airlines flew into Australia each week.

He said Qantas had grown its regional operations substantially over the past five years, and by almost 30 per cent since the collapse of Ansett. QantasLink now operates more than 2,500 flights each week to more than 55 destinations across Australia. This year, Qantas had invested in an additional five Dash 8 and six Boeing 717 aircraft for its regional operations, taking the total fleet to 63 and creating hundreds of jobs.

"Qantas is keenly aware of the importance of air services to regional Australia and it is completely wrong to suggest that removal of the foreign investment cap would diminish in any way our proven and ongoing commitment to regional Australia," he said. 

Mr Dixon said it would be extraordinary if opportunities for Qantas to grow - opportunities that would create jobs and boost tourism both within Australia and into and out of Australia - were curtailed by short term concerns over a possible further selldown of Telstra.