SYDNEY, 20 March 2020: Qantas and Jetstar to suspend scheduled international flights from late March, following latest government travel advice; some ongoing ad hoc services possible, the airline stated in an impact assessment report released Thursday.
The airline group confirmed a 60% reduction focused on cutting flight frequency and a 90% cut in international services.
Two-thirds of employees will stand down to preserve as many jobs as possible longer term.
A payment of AUD201 million shareholder dividend will be deferred until September 2020.
The Qantas Group outlined the customer and employee impact due to a huge drop in travel demand triggered by the public health response to the Coronavirus crisis.
Following the federal government’s recommendation against all overseas travel from Australia, regularly scheduled international flights will continue until late March to assist with repatriation and will then be suspended until at least the end of May 2020.
Qantas is in ongoing discussions with the government about the continuation of some strategic links.
More than 150 aircraft will be temporarily grounded, including all of Qantas’ A380s, 747s and B787-9s and Jetstar’s B787-8s. Discussions are progressing with airports and government about parking for these aircraft.
Essential domestic, regional and freight connections will be maintained as much as possible.
Qantas’ fleet of freighters will continue to be fully used. Some domestic passenger aircraft will also be used for freight-only flights to replace lost capacity from scheduled services.
International network changes
The Qantas Group is making the following changes:
All regularly scheduled Qantas and Jetstar international flights from Australia will be suspended from end March until at least end May 2020.
Jetstar Asia (Singapore) will suspend all flights from 23 March to at least 15 April 2020.
Jetstar Japan has suspended international flights and reduced domestic services.
Jetstar Pacific (Vietnam) has suspended international flights and will significantly cut domestic flying.
People impact
In order to preserve as many jobs as possible longer-term, Qantas and Jetstar will stand down the majority of their 30,000 employees until at least the end of May 2020.
Senior group management executives and the board have increased their salary reductions from 30% to 100% until at least the end of this financial year, joining the chairman and group CEO in taking no pay. Annual management bonuses have also been cancelled.
Shareholder impact
Given the current extraordinary circumstances, a decision has been made to defer payment of the shareholder dividend announced on 20 February from 9 April until 1 September 2020. This is in addition to the cancellation of the off-market buyback, previously announced.
Qantas Group CEO Alan Joyce: “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. We’re also talking to our partners like Woolworths about temporary job opportunities for our people.
“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.”
Customer information
Customer contact centres are currently experiencing long wait times from people seeking to change their travel plans as a result of the Coronavirus. To help manage the demand, the airline is asking that customers only call if they have travel within the next 48 hours.
To avoid further inconvenience, we’re converting all bookings on cancelled flights to a travel credit, which can be used anywhere on the network. Affected customers will be contacted directly from next Monday (23 March 2020). Any customers travelling before the end of May who wish to change their booking are also eligible to receive a travel credit instead. If flights were booked through a travel agency or third-party website (Webjet, Booking.com), customers would need to contact them directly to make changes to their booking.
