Qantas says its future is in China, the world's second biggest and fastest growing aviation market, but the Australian icon needs its staff to embrace radical change to succeed.

Speaking at the Australia Pacific Aviation Outlook Summit in Sydney yesterday Qantas chief executive Alan Joyce warned "out of touch union leaders" who were resisting change that the airline's costs were 25 per cent above those of its competitors such as Singapore Airlines.

"Globalisation continues to change our world in profound ways and it is still changing the ways we work, consume and engage, and it is still driving relentless competition," Mr Joyce said.

"Globalisation is not optional and it is not over."

Mr Joyce said China was already home to seven of the world's top 20 airports by capacity.

"By 2020, China will have 15 cities with bigger populations than Sydney and the region will be home to 2.6 billion people," he said.

"And by 2030 the country expects to have at least three globally recognised international airline hubs, 10 national and regional hubs and at least 244 airports."

But to capitalise on the booming China and Asia market, Qantas needed significant change, Mr Joyce warned.

"Change is always tough," he said. "But the competitive challenges we face make major change essential and our commitment to the change process is absolute," Mr Joyce said.

He highlighted that Qantas subsidiary Jetstar was Asia's biggest and fastest-growing low fares network.

"That is an amazing achievement for an Australian airline," he said.

Mr Joyce is adamant that there is a future for Qantas in Asia.

"Research on affluent Chinese travellers, for example, shows they are strongly influenced by prestige brands and considerations of safety," he said.

Qantas will announce on August 24 a new premium joint venture for Qantas in Asia to be based in either Malaysia, China or Singapore.

The West Australian

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