Experts say Qantas is set for more losses despite an already grim prediction by its CEO after the airline struggles through the COVID-19 pandemic.
On Thursday, Qantas revealed further job cuts for international cabin crew and wage freezes while the coronavirus pandemic inhibits overseas travel and still financially batters the airline.
In a trading update, the airline unveiled a new voluntary redundancy program for international crew as part of additional cost-cutting measures. The job cuts are expected to be in the hundreds.
The redundancies are targeting cabin crew on A380s and A330s that have been taken out of service and are not expected to be revived for the next few years.
The aircraft in storage require regular maintenance and are costly to keep.
Qantas chief executive Alan Joyce said the cuts were due to a combination of factors, including the delay in international travel from October to December.
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QANTAS CEO Alan Joyce holds a market update into the airlines current positioning and future plans. Picture: Jeremy PiperSource:News Corp Australia
Mr Joyce revealed since the start of the pandemic, it has lost more than $16bn in revenue, with losses from the previous and the current financial years sitting above $4.7bn.
Roughly 6000 workers remain stood down across the group, and the new redundancies are extra job losses on top of the already 8500 roles culled from the company.
“I think it’s safe to say there’s no other company in Australia that’s had a bigger impact from COVID than the Qantas group,” he said.
Qantas flight from India touches down bringing home passengers.Source:Supplied
Aviation analyst Jordan Chong told the ABC that while domestic flights were helping, the worst is not over for the airline.
“When you lose $16 billion in revenue that suggests that its had a massive impact,” Mr Chong told Kirsten Aiken.
“Clearly with international borders closed to every one but the travel bubble with New Zealand, the domestic market isn’t going to replace all those international seats that Qantas was operating and selling prior to the coronavirus pandemic.”
He said whether the cuts were enough to keep Qantas afloat was dependant on whether it can “restart some international flying to other places through government approved travel bubbles or otherwise”.
Mr Chong predicted it could take years to return to normal but was optimistic the airline would bounce back.
“There is a need to connect again in person, the return to pre-COVID levels might take a few years but if you look at the long term trends you can’t help but think that aviation and passenger travel will eventually return”.
Shadow misiter for Infrastructure and Transport Cather King said the announcement by Qantas “shows how patchy the recovery remains.
“Pleasing to see domestic growth but too few vaccinations and no long term plan put international aviation jobs at risk,” she said.
“My thoughts are with workers and their families.”
A wage freeze is another callous move from @Qantas dictatorship. We’ve been here before, workers bailing out the airline in tough times but when things bounce back, workers still suffer while execs get big bonuses. #nationaliseqantaspic.twitter.com/QrOQjlmjEC
Qantas also announced commissions to travel agents on international ticket bookings will be lowered from 5 per cent to 1 per cent starting from July 2022.
The Australian Federation of Travel Agents (AFTA) expressed disappointment in Qantas’s decision to knock back commissions, saying it was a blow to an industry still being held back by the pandemic.
“The reality is that the ongoing paralysis of international travel to and from Australia has hit travel agents and businesses extremely hard, and this is another unwelcome blow,” AFTA said in a statement.
ABC’s business editor Ian Verrender backed Qantas’ survival, saying the airline is “is well capitalised” and “not in danger of collapse”.
“Its domestic operations are doing quite well, Jetstar appears to be making underlying profits but all those extra costs such as the redundancies that they’ve undertaken in the past year or so are weighing on the results,” he said.
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