Qantas halts all overseas flights, 30,000 workers affected

SYDNEY: Qantas Airways Ltd furloughed most of its 30,000-strong workforce and scrapped all international flights as travel demand dries up due to the coronavirus.

Qantas and low-cost unit Jetstar will suspend overseas services from late March until at least the end of May, the Australian airline said Thursday.

Domestic operations will also be cut 60%. Some 150 planes will be grounded.

“Demand has evaporated,” Qantas Chief Executive Officer Alan Joyce said in a note to employees.

“We have no work for most of our people. We have to make difficult decisions to guarantee the future of the national carrier.”

Drastic measures became inevitable for Qantas after the Australian government advised against any overseas travel and banned domestic mass gatherings.

Airlines are struggling to cope with a near complete halt in bookings as the virus sweeps across the world and triggers flying bans.

Two-thirds of Qantas’s workers will be temporarily idled. While some will use accrued leave, or be given holidays in advance, it’s inevitable that others won’t be paid when they’re not working, the airline said.

Qantas stock slumped 15% to A$2.14 at the close in Sydney as the company deferred payment of a previously announced shareholder dividend until September.

Qantas has tumbled 70% this year.

Delta Air Lines Inc earlier joined peers grounding more aircraft. The company is parking about half its fleet as it cuts flying capacity 70%, it said Wednesday.

Other US airlines have taken similar steps.

The global airline industry needs government aid and bailout measures totalling between US$150 billion and US$200 billion if it’s to survive the crisis, according to the International Air Transport Association.

Qantas also deepened top-level pay cuts. Senior management executives and the company’s directors won’t be paid until at least the end of the financial year ending June.

CEO Joyce had already forgone his salary.