Qantas has announced plans to ground the majority of their widebody fleet, as the COVID-19 situation tears its way through the aviation and travel industry; causing with it, enormous financial pressure.
The airline announced today in a press release that, as a result of the COVID-19 outbreak and new government restrictions, further cuts would be made to their domestic and international network, including within their low-cost carrier Jetstar.
From the end of March 2020, Qantas will cut their international capacity by around 90 percent, until at least the end of May, which largely reflects the demand impact of severe quarantine requirements on people’s ability to travel overseas and enter Australia. This revised figure is an increase from the 23 percent reduction for the fourth quarter of the 2020 financial year, which was announced last week.
Qantas has already grounded a significant portion of their Airbus A380 fleet, they are now also preparing to ground the remainder of their Boeing 747s and Airbus A330s. Also involved in international fleet planning is the request for delay for Qantas’ Airbus A350-1000 order for Project Sunrise. At this time it remains unknown if Airbus has or is willing to comply with Qantas’ request, however it is likely.
Just like international flights, domestic flying is seeing a cut of around 60 percent, compared to the 2020 financial year five percent reduction announced last week. This is due to the rapid decline in forward travel, as a result of the recently announced government containment measures, as well as corporate travel bans and general public pullback from everyday activities across the nation.
The total aircraft grounded within Qantas Group now equates to roughly 150 aircraft, including almost all wide bodies. Qantas notes that previously announced cuts, in place from end-May through to mid-September, will remain in place and are likely to be increase, depending on demand.
Freighter aircraft will continue to operate at their full potential, as per usual; to maintain critical goods transport some passenger aircraft will be used for freight-only flights, to replace lost capacity from regular schedules services.
Route-by-route details are currently being worked on within the airlines and will be announced to the public in coming days, allowing for greater trip planning and cancellation/adjustment times.
Employee Impact
With the massively reduced demand impacting the bottom line, for weeks or even months to come, Qantas Group staff are taking measures to ensure finances remain in manageable territory.
Qantas expects its entire workforce, of 30,000, to feel the effect of COVID-19 during the crisis and are working to ensure the best for everyone. The use of paid and unpaid leave, as well as other measures, including three months of no pay for the CEO, Alan Joyce, and their Chairman, Richard Goyder. The rest of executive management, including board members, will see significant pay cuts, as well as the cancellation of annual bonuses and an off-market buy back; in a bid to reduce the strain on the airline and its finances.
Passenger Impact
Just like all airlines around the world, the demand to cancel or adjust flights is growing rapidly; as such, call centres and online communications are maxed out.
Customers with existing bookings on any domestic or international flight, until the 31st of May, are eligible to cancel their flight if they do not wish to travel. In return a travel voucher with the credit of the cancelled flight will be offered, which must be processed by the 31st of March 2020.
Customers who make a new domestic or international booking, then later decide they do not wish to travel, can cancel their flight and retain the value of the booking as a Qantas or Jetstar travel voucher. This applies to bookings made from the 10th of March 2020 until the 31st of March 2020, for travel before the 31st of May 2020.
For passengers looking to exercise these options, Qantas has these links to follow:
- Qantas customers should visit Manage Booking on Qantas.com, select ‘Cancel’ and then ‘Voucher’.
- Jetstar customers should go to Manage My Booking on Jetstar.com.
Passengers who booked Qantas or Jetstar flights through a travel agency must contact their agency for details on flight cancellations, adjustments and/or refunds/credit.