MIAMI – The Qantas Group has today announced temporary reductions to flights across Asia in response to lower demand due to Coronavirus. The announcement came as part of the Group’s Half Year Financial Results, showing net-profit losses between $100 million to $150 million for FY20.
Although other key parts of the Qantas International network, such as the US and UK, remain unaffected, a 5 percent reduction in Qantas and Jetstar’s flights between Australia and New Zealand, in addition to a 2 percent reduction of total Group domestic Australian flights, are being made.
Customers with existing bookings on the above-mentioned routes will be contacted directly and offered alternatives, resulting in changes in arrival and departure times for most domestic bookings. For international bookings, customers can move flights to another date or connect through another Australian city.
Below are the network changes:
Qantas International will cut 16 percent of Asia capacity until at least the end of May, impacting flights from Australia to mainland China, Hong Kong, and Singapore.
- Sydney-Shanghai (the airline’s sole route to mainland China) – will remain suspended
- Sydney-Hong Kong – reduced from 14 return flights per week to 7
- Brisbane-Hong Kong – reduced from 7 return flights per week to 4
- Melbourne-Hong Kong – reduced from 7 return flights per week to 5
- Melbourne-Singapore – flights to be operated by Boeing 787s instead of larger Airbus 380s (approx. 250 fewer seats per flight)
Qantas will also reduce flights across the Tasman by 6 percent with cancellations on Sydney-Auckland, Melbourne-Auckland, and Brisbane-Christchurch. Jetstar will reduce its Tasman flying by 5 percent.
Jetstar Group will cut its capacity to Asia by 14 percent until at least the end of May, impacting flights from Australia to Japan and Thailand, and intra-Asia flights.
- Cairns-Tokyo (Narita), Cairns-Osaka, Gold Coast-Tokyo (Narita) and Melbourne & Sydney-Phuket will each be reduced by up to two return flights per week.
- Each of the Jetstar airlines in Asia – Jetstar Asia (Singapore), Jetstar Japan and Jetstar Pacific (Vietnam) – have suspended flights to mainland China and are reducing flights across the region. In particular, Jetstar Asia is reducing total seats by 15 percent.
- The Group is looking at transferring an A320 aircraft from Jetstar to QantasLink to meet increased demand from the resources sector in Western Australia.
Qantas and Jetstar will reduce total domestic capacity by 2.3 percent for the second half of the financial year to better match demand.
Most of these changes have already been published. To minimized customer impact, cancellations are largely focussed on travel between Australia’s major cities.
Conversely, recently announced routes will start as planned, including Sydney-Ballina (Byron Bay), Sydney-Mildura, Tamworth-Brisbane, and Sydney-Orange as well as additional flights from Adelaide to Kangaroo Island and from Sydney to Bendigo.
Jetstar’s new Melbourne-Busselton (Margaret River) flights are also unaffected.
Qantas CEO weighs in on the reductions
Qantas Group CEO Alan Joyce said the airlines were taking action now to limit exposure to softening markets.
Joyce said, “Coronavirus resulted in the suspension of our flights to mainland China and we’re now seeing some secondary impacts with weaker demand on Hong Kong, Singapore and to a lesser extent Japan. Other key routes, like the US and UK, haven’t been impacted.
“We’ve also seen some domestic demand weakness emerging, so we’re adjusting Qantas and Jetstar’s capacity in the second half,” said the CEO.
Joyce added, “What’s important is that we have flexibility in how we respond to Coronavirus and how we maintain our strategic position more broadly. We can extend how long the cuts are in place, we can deepen them or we can add seats back in if the demand is there. This is an evolving situation that we’re monitoring closely.”
“We know demand into Asia will rebound. And we’ll be ready to ramp back up when it does.”
“These past few months have been extraordinarily difficult for the tourism industry and we’ve tried to minimize the impact of our capacity reductions as much as possible. About half of Qantas’ domestic cancellations are between Sydney, Melbourne, and Brisbane, and we’re avoiding any route exits,” continued Joice.
“The capacity we’re taking out is the equivalent of grounding 18 aircraft across Qantas and Jetstar until the end of May, which in turn impacts about 700 full-time roles. To avoid job losses we’ll be using leave balances across our workforce of 30,000 and freezing recruitment to help ride this out. We’ll also take advantage of having some aircraft on the ground by bringing forward planned maintenance,” concluded Mr. Joyce.
In its statement, Qantas said it would launch today a Double Status Credits offer for all fares booked between 20-25 February on all Qantas operated flights, while Jetstar having a number of sales planned, with every domestic and international destination to be on sale over the next month.