Qantas slashes flights further, adopts cost-saving measures

Qantas Cutting Capacity, Grounding Most A380

The Qantas Group will reduce the international capacity for Qantas and Jetstar flights by 23 per cent year-on-year, till mid-September 2020, due to a sharp decline in bookings amid the Covid-19 outbreak.

Such longer-range capacity cuts help to reduce costs and provide more certainty for the group’s stakeholders, said CEO Alan Joyce.

Qantas has been heavily affected by the drop in demand for global and domestic travel due to Covid-19

Asian destinations took the biggest hit from the cuts; flight capacity on these routes is set to decrease by 31 per cent year-on-year. Flight capacity to and from the US, the UK, and New Zealand will also be cut by 19 per cent, 17 per cent and 10 per cent, respectively.

Routes affected under Qantas include Sydney-Shanghai, which will be suspended till mid-July; as well as Brisbane-San Francisco and Melbourne-San Francisco, which will be suspended from April 18 to mid-September.

As well, Qantas will postpone the launch of its new Brisbane-Chicago service from April 15 to mid-September.

Due to strong demand on the Perth-London service, the Sydney-Singapore-London service will be re-routed temporarily to become a Sydney-Perth-London service from April 20.

For Jetstar Airways, flights on its Singapore-Taipei, Singapore-Osaka and Melbourne-Bangkok routes will be suspended. Nearly half its flights from Australia to Japan and Vietnam will also be cut.

On the domestic front, Qantas and Jetstar flight capacities will be reduced by five per cent through mid-September 2020.

For customers flying internationally, the carriers will offer an alternative flight on another day, on the same day via another capital city, or on a partner airline.

In the meantime, the group has said that it will bring forward maintenance work and encourage the team to use their paid leave or take unpaid leave. “We know the coronavirus will pass and we want to avoid job losses whenever possible,” said Joyce.

The group’s management will also participate in cost reduction measures. Annual management bonuses for FY2020 will be set to zero. For the rest of FY2020, the Qantas chairman will take no fees and the group CEO will receive no salary.

In light of travel restrictions and changed plans amid the continued spread of the Covid-19 virus, the Qantas group will also waive charges for one date change in international bookings. This follows the introduction of similar policies by other airlines, including Qatar Airways and SIA.

Qantas and Jetstar customers must have made the booking between March 10 and March 31 for a flight commencing on or before June 30, and they must make the change at least three days before departure.

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