Thousands of job losses, up to 100 aircraft grounded: Qantas announces massive post-COVID shake-up
The Qantas Group has announced a three-year plan to accelerate its recovery from the COVID-19 crisis, including some very deep cuts to the business.
The plan is expected to save the company $15 billion over three years, in line with reduced flying activity including fuel consumption savings, and deliver $1 billion per annum in ongoing cost savings from FY23 through productivity improvements.
A key action of the plan includes reducing the group’s pre-crisis workforce by at least 6,000 roles across all parts of the business and continuing the stand-down for 15,000 employees, particularly those associated with international operations, until flying returns.
Of the Qantas Group’s 29,000 staff, around 8,000 are expected to have returned to work by the end of July.
The company anticipates this will increase to around 15,000 by the end of calendar year 2020 in line with the opening up of domestic flying, and increase further during calendar 2021 and 2022 as the international network returns, reaching 21,000 active employees by June 2022.
Qantas will also retire its six remaining 747s immediately, six months ahead of schedule, as well as grounding up to 100 aircraft for up to 12 months (some for longer), including most of its international fleet.
The company expects the majority to ultimately go back into service, but it warned some leased aircraft “may be returned as they fall due”. Qantas’ A321neo and 787-9 fleet deliveries have been deferred to meet the group’s requirements.
The cost of implementing the plan is estimated at $1 billion, with most of this to be realised during FY21.
Qantas is also launching an equity raising of up to $1.9 billion to accelerate recovery and position for new opportunities.
Subsequent phases of Qantas’ plan focus on the increasing ramp-up of flying and pursuing new opportunities, including its ambition for more non-stop international flights.
At the board’s request, Alan Joyce has agreed to remain as Qantas Group’s CEO as the recovery plan is implemented and through to at least the end of FY23.
In announcing the plan, Qantas Group CEO Alan Joyce said the company entered the coronavirus crisis in a better position than most airlines, and has some of the best prospects for recovery, “especially in the domestic market”.
“But it will take years before international flying returns to what it was,” he conceded.
“We have to position ourselves for several years where revenue will be much lower, and that means becoming a smaller airline in the short term.”
Joyce said most airlines will have to restructure in order to survive, resulting in leaner and more competitive carriers.
“For all these reasons, we have to take action now,” he said.
“Adapting to this new reality means some very painful decisions. The job losses we’re announcing today are confronting – so is the fact thousands more of our people on stand-down will face a long interruption to their airline careers until this work returns.”
“What makes this even harder is that right before this crisis hit, we were actively recruiting pilots, cabin crew and ground staff. We’re now facing a sudden reversal of fortune that is no one’s fault, but is very hard to accept.
“This crisis has left us no choice, but we’re committed to providing those affected with as much support as we can. That includes preserving as many jobs as possible through stand downs, offering voluntary rather than compulsory redundancies where possible, and providing large severance payouts for long-serving employees in particular.”
Joyce said Qantas’ new plan gives the group flexibility under a range of scenarios, including a faster rebound or a slower recovery.
“Despite the hard choices we’re making today, we’re fundamentally optimistic about the future,” he said.
“Almost two-thirds of our pre-crisis earnings came from the domestic market, which is likely to recover fastest – particularly as state borders prepare to open.
“We have the leading full service and low fares airlines in Australia, where distance makes air travel essential, and diversified earnings through Qantas Loyalty.
“We still have big ambitions for long-haul international flights, which will have even more potential on the other side of this.”
TWU slams Qantas and government over job losses
Qantas’ job cuts have been met with fierce criticism from the Transport Workers’ Union (TWU), which said the airline should hold off until a federal government review extending JobKeeper.
“Before Qantas slashed thousands of workers’ jobs and takes more of its planes down to the pawn shop, it should be lobbying the federal government for an extension to JobKeeper and financial support to allow the airline to weather the crisis,” TWU national secretary Michael Kaine said.
“The Qantas CEO is very good at walking the halls of Canberra when it suits his agenda, yet he is quick to cut jobs and hang workers out to dry. We are demanding that he halt these redundancies until the federal government makes an announcement on JobKeeper.”
“We have been calling on the government for months to step in with a national plan for aviation and they have refused. It is because of government restrictions that aviation was grounded to a halt, yet the assistance and assurances have been paltry.
“Qantas is now making hasty decisions to slash jobs which will affect thousands of families, while Virgin is still limping along.”
Featured image: iStock/Katharina13
Email the Travel Weekly team at traveldesk@travelweekly.com.au
airline alan joyce aviation job cuts job losses qantas qantas group Transport Workers Union twuLatest News
Collette goes off the beaten track with Canyon Country tour
To be clear TW is not advocating actually walking off the beaten track. Avoid the coyotes. Stay on the beaten track.
Intrepid & Korean Tourism Organisation team up to give agents a cooking masterclass
These guys learnt that Korean cooking is more than just putting kimchi on 2-minute noodles (as we once thought).
Winner, winner! Intrepid reveals the 9 lucky agents that won $2k
Who won the incentive? Which Intrepid trip will they spend it on? What day of the week is it again? Where am I? Huh?
Corporate Traveller reports 42% increase in Easter traffic this year
Business travellers just love Easter! Expect plenty of chocolate stained documents returning to the office on Tuesday.
Turbulent year wiped $384m off Qantas brand value: Report
Meanwhile, eating tuna at your desk can damage your own personal office brand value by several thousand dollars.
FAMIL: Room-Res & Singapore Tourism Board shows agents the Lion City’s roar
Click this article to see a man very impressed by a 20-layer chocolate cake. We're not kidding, he loved it!
Oceania Cruises offers sailors free pre-cruise hotel stay
Looking for ways to make your holidays as long as possible? Look no further.
Bonza launches new website to compliment app, agent portal
Does news about an airline's website fill you with ecstasy, glee and joy? Get your hit of the good stuff here.
MTA agents attends ‘Lunch ‘n’ Learn’ with AMA Waterways
When organising the event, Lunch 'n' Learn beat out Dinner 'n' Divulge and Breakfast 'n' Banter. Understandably so.
Travelmarvel reveals 2025 South America tours
If you spot any typos in the newsletter today it is because TW became distracted Googling images of Machu Picchu.
Tourists from 5 countries could be BANNED from visiting Australia
Anthony Albanese's immigration laws could impact tourism from certain countries.
Just how many passengers will Qantas & Jetstar hop around this Easter?
Airline workers are ready for gleeful Easter travellers! Also prepared for sticky children with chocolate on their face.
Air New Zealand gets ready for bumper Easter weekend
Air NZ gears up for travelling passengers this Easter, while TW looks to beat our egg eating record. 117 here we come!
Four Seasons Yachts reveals first itineraries to the Caribbean & Mediterranean
These trips look so good we wish there were five seasons! Alright, we'll see ourselves out...
FAMIL: Travellers Choice treats top agents to the wonders of Rotorua
This one's got plenty of famil pics and no one looks shockingly hungover in them! Clearly no TW staffers were there.
European Waterways celebrates 50th anniversary with week-long founders cruise
Plan on celebrating your 50th anniversary with a bottle of Moët and fairy bread? European Waterways has better ideas.
100th route! Jetstar celebrates the launch of Brisbane-Avalon with 12 hour sale
Jetstar knocks a ton and celebrates with a sale while TW once scored a ton and celebrated with about 17 beers.
Record-breaking year for NSW as visitor expenditure soars past $50 billion
Enjoy running round the Opera House? Be prepared to elbow even more tourists out the way.
Norwegian Cruise Line makes play for solo travellers
NCL ensuring you don't have to go trawling Tinder to find a cruise partner. Thank goodness, we were sick of catfishing.
Entire Travel Group’s Canada and Europe 2024/25 brochures are out now
Entire's new brochure is bittersweet; it both informs your clients and makes you envious of the holiday they'll take.
Malaysia Airlines adds 3 new destinations & A330neo seats
More seats means cheaper airfares and more money to spend on overpriced airport sandwiches. Woohoo!
Two divine days onboard Crystal Serenity
It's only pure serenity onboard this ship. Anxiety, agitation and anguish have been rejected by the bouncer.
How the Globus Family of Brands elevates coach touring: Travel Weekly TV with Chris Fundell
Chris' here so you don't think coaches mean peeling your thighs off a sticky leather seat every time you stand up!
The Flight Centre Foundation gears up for massive 2024 with 3 new board members
The foundation looks to invest $200k this year, spurring the TW journos to figure out how to qualify as a charity.
Barking Owl Communications to head up Anantara & Avani in ANZ
Fellow PR competitors had been barking up the wrong tree even thinking of bidding for this job!
Amex GBT to purchase CWT for $871m
It's big deals like this that get a firm handshake - hence the sore hands over at the CWT and Amex GBT offices.
1000MTG’s second global conference reminds agents to ‘strive and thrive’
Alongside messages to 'strive' and 'thrive' were those to 'survive', 'drive', 'arrive' and 'jive' (when appropriate).
Qantas A330 makes “loud bang”, pilots forced to shut down one engine
Qantas refusing to let Boeing have all the headlines in aviation world today!
GX Community Tourism Summit 2024 location revealed!
The new location has arrived and it'll blow your socks off! Time for another trip to Target for more socks then.
Visiting the destination my Mum didn’t want me to
Yet again, this journo has been a stress to his mother. Discover how this trip spurred his mother's anxiety here.
Agents come out of their shells at P&O’s turtle hatchery event
For some, it's a few glasses of bubbles to lure them out of their shell. For these agents, it was a bit more literal.
Boeing cleanout: CEO, chair to go as safety crisis plagues the manufacturer
CEOs are falling thick and fast these days. We should have started up a bingo game with their headshots in the office.
Virgin looks to swap MAX 10 order for MAX 8s amid Boeing delays: Reports
Virgin has changed its order for something smaller. Much like we have to at Maccas following a worrying doctor's visit.
Club Med unveils newest luxury yacht for 2024/25 early bird sale
This yacht is preserved for the early birds! Night Owls may also get onboard depending how late they stay up.
Abercrombie & Kent 2024 Asia Portfolio is here
Round up the family and get planning an Asia jaunt. Or, if they're hard to handle, brush them all and go it alone!
Elevate your earnings: Final days to secure double commission with Inspiring Vacations’ March offer
What could inspire you to sell more Inspiring Vacations? Double commission of course! That's all the inspiration needed.