Qantas has flagged that it now expects a $2 billion loss for FY 2021. Not surprising as the airline had been hit harder than any other Australian company by COVID-19. Qantas estimates 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.
Qantas was dealt a blow when the Government announced its timeline for significantly reopening international borders had shifted to mid-2022 in the May Budget. The airline remains hopeful of returning to long-haul operations this year when and if travel bubbles will be established once the vaccine rollout is complete.
Qantas has announced that it will shed more staff and is seeking voluntary redundancies from international cabin crew as part of additional cost-cutting measures. Alan Joyce is hopeful no further jobs would have to go from the airline, which has already farewelled close to 8500 people. Another 6000 remained stood down, while 16,000 had returned to work.
Further cost cutting measures announced include a 2-year wage freeze for staff as part of new enterprise agreements and cuts for commissions to travel agents on international ticket bookings from 5 per cent to 1 per cent starting from July 2022. Both the unions and the Australian Federation of Travel Agents (AFTA) expressed disappointment in Qantas’s respective decisions.
Australia’s competition watchdog (ACCC) is set to try to block a deal struck between Qantas and Japan Airlines to co-ordinate flights. The regulator argued that it would ruin competition on travel routes between Melbourne, Sydney, and Tokyo.
However, there is some good news for Qantas. The company appears to be back on track with cash earnings from domestic and freight operations are now making inroads into Qantas’ debt. The main driver is the rebound of domestic travel, which now looks like it will be bigger than it was pre-COVID, at least until international borders reopen. Qantas has now unveiled 45 new domestic routes in response to the growing demand for regional travel since the beginning of the pandemic.
Source: ACCC denies Qantas and Japan Airways deal to coordinate flights by Gerard Cockburn The Australian May 6th, Qantas announces job cuts, two-year wage freeze by Robyn Ironside The Australian May 12th, Qantas delays international restart again by Robyn Ironside The Australian May 20th.