Qantas A380. File Photo/edward90918, CARNOC.com

Former Australia Civil Aviation Safety Authority chairman Dick Smith -- also one of the country's most controversial and outspoken entrepreneurs -- has infuriated airline unions by predicting that Qantas International will go bankrupt unless it moves its operating base to Asia.

Speaking with The Australian, Smith warned that high wages and government policies that have opened up routes to/from Australia to too many carriers have put QF's mainline international operations in danger. He claimed that QF was in a similar position to manufacturers forced to move offshore because of an inability to compete with lower-cost competitors.

Smith told The Australian that servicing on aircraft in Singapore was 50% cheaper than in Australia, and many airlines were operating at much lower costs than QF. "I feel sorry for [Qantas CEO] Alan Joyce, I feel sorry for the pilots and I totally blame the government," he said. "The politicians have decided that we should have this open skies [regime] where you have to compete with completely different wage scales and salary scales. If they [QF] don't move virtually everything [pertaining to international operations] up into Asia, they will go broke."

Joyce will announce major structural changes to QF Aug. 24 with many services to be cut or restructured. There are also strong indications that QF will set up an Asian-based, full-service airline.

Smith's comments angered pilot and engineers unions worried about job security and poised to take industrial action. Responding, Australian Licensed Aircraft Engineers Assn. Federal Secretary Steve Purvinas told The Australian, "Anyone can get a cheap fix done on a car-unfortunately, in our game, when something is missed, it tends to resurface at 30,000ft."

Australian and International Pilots Assn. VP Richard Woodward slammed Smith, saying he had never worked as a professional pilot or at an airline. "Sure, things are tough out there, but there are other international carriers making significant amounts of money right now in these difficult times," Woodward said.