Last week was the most turbulent week in Australian aviation since the introduction of deregulation 10 years ago.

Impulse Airlines, a new jet operator, announced $39 fares between some capital cities, Singapore Airlines (SIA) raised its stake in Air New Zealand and thus Ansett to 25% and then gave the green light to a management purge designed to rejuvenate both airlines.

The Impulse imitative sent Qantas shares tumbling on fears of a major price war despite predications that Australia's largest airline would post another record profit on the back of higher yield overseas routes.

But the biggest news was SIA sealing the deal to pay $129.76 million for 16.7% of Air NZ, held by Brierley Investments Limited (BIL).

Earlier this year, the Singapore-based airline paid $59 million for 8.30% of Air NZ, killing an attempt by Qantas to get a slice of the action.

The Singapore influence had already been felt in the corridors of power at Air NZ in Auckland with CEO Jim McCrea being forced to resign and leave on the same day last month.

SIA has played a major role in the selection of the new team, say analysts, and the airline has the right of veto for the chief executive of both Ansett and Air NZ.

Air NZ's Andrew Miller, who heads the airline's domestic operations, has taken the top job at Ansett from interim chief executive Craig Wallace.

Only three Ansett executives retained their positions in the most significant shake-up in Australian airline history.

And more departures are expected as the next tier of management, come to grips with the new colder wind blowing through the corridors of power at Air New Zealand and thus Ansett.

"The comfort zone has gone," said one executive. "Some of our management were still living in the pre-deregulation days."

"SIA is now really calling the shots - they mean business," he adds.

With the 25% shareholding SIA gets three board seats, on Air NZ, which will be taken by SIA's deputy chairman Dr Cheong Choong Kong, EVP commercial Michael Tan and chairman of the ANZ Bank in Australia, Charles Goode who is the first non-Singaporean director of SIA.

SIA, lost the battle in March 1999, to directly run Ansett, when Air NZ exercised its pre-emptive rights to acquire co-owner News Corporation's ' 50% in the airline.

However in a strange twist that only serious money can buy SIA's finds itself in control of both airlines with a mandate from BIL, to turn them around.

Air NZ took control of 100% of Ansett in June.

SIA has the backing of BIL, Air NZ's biggest shareholder with 30%, which needs a radical shake-up in Ansett to claw back market share from Qantas and bolster Air NZ's sagging share price.

Ansett's international division, Ansett International, offers the group massive growth potential with normally complex route approvals to provide more competition with Qantas a formality under Australia government's push for more competition.

Request for rights from Ansett International to fly daily flights from Sydney to Tokyo and Melbourne to Hong Kong have been lodged with regulators and it is possible that Ansett will take over Air NZ's daily Sydney-Los Angeles service.

Most urgent matters however are Ansett's sagging domestic marketshare, which sits 14% below that of Qantas.

Qantas has been able to build a significant lead over Ansett because of its aggressive competitive edge and greater flexibility with its bigger fleet.

But clouding that revamp is mounting pressure from no-frills operator Impulse Airlines, which uses Boeing 717s and is now offering one-way fares at $39 between Sydney and Melbourne.

Impulse CEO Gerry McGowan is relaxed and happy about his airline's performance, which went into profit last week on its pure-jet operations.

"We planned to move into profitability on the 717 jet operations after 20 weeks and we have done that in just nine," he says. "We are really comfortable about where we are."

But McGowan is very aware that he must increase the Impulse profile ahead of the start-up of Virgin Blue, which enjoys enormous popularity through Sir Richard Branson.

Virgin Blue is expected to be flying next month using Boeing 737-300s between Brisbane and Sydney and Melbourne.