ATW Daily News

Qantas to slash 1,500 jobs, reduce planned FY09 capacity growth to 0%

Monday July 21, 2008

Qantas on Friday said it will cut 1,500 jobs by Dec. 31 and cancel a planned 8% boost in capacity for its 2009 fiscal year starting July 1 "in response to the sustained high oil prices and changing economic conditions."

The carrier did, however, reach an accord "in principle" Friday with its mechanics on a new four-year labor contract, likely ending a dispute that had led to rolling work stoppages that disrupted QF's flight schedule in recent weeks.

Regarding job cuts, CEO Geoff Dixon said that while "every effort" would be made to achieve the reductions through voluntary programs, "some compulsory redundancies will be necessary, which we regret." He said most cuts would come in "nonoperational areas, although operational positions will also go." More than 20% of management and head-office support positions will be slashed. He said the workforce reductions are necessary to "protect the great majority of over 36,000 jobs and enable us to grow profitably when conditions improve."

Dixon said capacity growth will be flat for the coming fiscal year and "up to 22 older aircraft" will be retired "including announcements previously made." Based on previous announcements, QF will retire one 737-400, two 767-300ERs, four 747-300s and one Jetstar Airways A320 as well as cancel delivery of one Jetstar A321 (ATWOnline, May 29). He did not detail which aircraft not previously revealed could be grounded or precisely when the retirements would come.

The company also is canceling plans to hire a further 1,200 employees in the coming fiscal year to support the formerly planned capacity growth.

Dixon told Australian media that he hoped the cuts announced Friday are "the end of it" but conceded that further job reductions and other measures may be necessary in the future. "I can't sit here and predict the oil price," he said.

by Aaron Karp

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