Job cuts, deferred plane orders for Qantas
Australian flag-carrier Qantas has blamed international routes and the cargo business for a sharp drop in demand that has led to reduced full-year profit forecasts of US$73-146 million, down sharpy from the $359 million the firm predicted last November.
Qantas has deferred orders for four A380s and 12 B737-800S and says it is currently in talks to delay delivery for 12 B787 Dreamliners. It will also ground 10 aircraft with a view to selling them off.
Around 500 management jobs will go at the airline, and a further 1250 full-time equivalent positions may have to go to protect Qantas' long-term viability, said the company, according to the Agence France-Presse agency.
"Market conditions have deteriorated, especially in our international business," said Qantas CEO Alan Joyce.
"We have no choice but to lower our profit forecast and make major changes to ensure Qantas can weather the current commercial environment," he added.
A fierce price war on international passenger fares has also led to Qantas delivering fewer frequencies to some international destinations. Emirates reduced its fares on routes to Australia earlier this month and the arrival of Etihad in Australia has added to the competition. Qantas will have less capacity in its passenger bellyhold for freight as a result.