The Qantas Group will cancel international flights from late March and has effectively suspended two-thirds of employees.
In an unprecedented announcement to the ASX, the group announced:
- Qantas and Jetstar to suspend scheduled international flights from late March, following latest government travel advice; some ongoing ad hoc services possible;
- 60 per cent reduction to domestic flights, focused on cutting frequency;
- Two-thirds of employees to be temporarily stood down to preserve as many jobs as possible longer term; and
- Payment of $201 million shareholder dividend deferred until September 2020.
Chief executive Alan Joyce said, “The efforts to contain the spread of coronavirus have led to a huge drop in travel demand, the likes of which we have never seen before. This is having a devastating impact on all airlines.
“We’re in a strong financial position right now, but our wages bill is more than $4 billion a year. With the huge drop in revenue we’re facing, we have to make difficult decisions to guarantee the future of the national carrier.
“The reality is we’ll have 150 aircraft on the ground and sadly there’s no work for most of our people. Rather than lose these highly skilled employees who we’ll need when this crisis passes, we are instead standing down two-thirds of our 30,000 employees until at least the end of May.
“Most of our people will be using various types of paid leave during this time, and we’ll have a number of support options in place.
“This is a very hard set of circumstances for our people, as it is for lots of parts of the community right now.
“No airline in the world is immune to this, with the world’s leading carriers making deep cuts to flying schedules and jobs. Our strong balance sheet means we’ve entered this crisis in better shape than most and we’re taking action to make sure we can ride this out.
“Since this crisis started, there has been overwhelming support from our customers. That gives me even more confidence that we’ll get through this.”
More to follow…