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- Qantas Group (QAN) has announced it will not be running international flights from the end of March
- The announcement comes after the government recommending against overseas travel
- The suspension will run until at least the end of May
- Qantas will continue flights until the end of March to help Aussie travellers come home
- Following the cancellations, Qantas has stood down two-thirds of its staff
- Staff will be forced to use their annual and long service leave
- CEO Alan Joyce said it is in talks with Woolworths to provide temporary job opportunities
- Meanwhile, $201 million in dividend payments for shareholders has been deferred until September
- Qantas is down 8.89 per cent on the market this morning and is selling shares for $2.31 apiece
Qantas Group (QAN) has announced it will not be running international flights from the end of March.
Earlier this week, Qantas and Jetstar announced they would cut 90 per cent of international flights and 60 per cent of domestic trips.
However, with the Federal Government now advising against all overseas travel from Australia, the major airline has decided to drop all of its international flights.
“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,” CEO Alan Joyce said.
Regularly scheduled international flights will continue until late March to help oversea’s Australians come home. The suspension of international flights will be at least until the end of May.
As the national carrier, Qantas is in ongoing discussions with the Federal Government about the continuation of some strategic links.
Due to the international cancellations and domestic cuts, Qantas will be temporarily standing down two-thirds of its employees.
“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,” Alan said.
During the stand-down, employees will be able to use their annual and long service leave. Additional support mechanisms will be introduced, including leave at half pay and early access to long service leave.
Employees with low leave balance will be able to access four weeks of leave in advance.
However, periods of leave without pay for some employees will be inevitable. Qantas said it is in talks with Woolworths about temporary job opportunities.
“The reality is we’ll have 150 aircraft on the ground and sadly there’s no work for most of our people,” Alan told the market.
“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,” he explained.
Qantas will also defer its $201 million shareholder dividend payments until September 2020.
Alan said that no airline in the world is immune to COVID-19, 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,” he said.
“Since this crisis started, there has been overwhelming support from our customers. That gives me even more confidence that we’ll get through this,” he added.
Qantas is down 8.89 per cent on the market this morning and is selling shares for $2.31 apiece at 11:17 am AEDT.
