Qantas Cuts Hit Not Only Jobs But Also Flights to Singapore; CEO Allan Joyce Holding on to Job (VIDEOS)
By Vittorio Hernandez | February 28, 2014 10:01 AM EST
The cost-cutting measures announced by Qantas on Thursday following its half-year loss of $252 million would result not only in the loss of 5,000 jobs, but also cut in flights.
To be affected greatly by this development are Singapore-bound travelers with the QF5/6 and QF51/52 flights from Sydney and Brisbane to Singapore to be downgraded to Airbus 330 jets from Boeing 747 aircraft by September 2014. All daily trips to Singapore from Perth would stop beginning May 12.
The Boeing 747s, although old and use a lot of fuel, were recently refitted with premium economy seats, lie-flat beds in business class and widescreen inflight video displays like those found in the A380s. While the replacement, the A330s, are newer, it has a lower grade of service with no premium economy seating.
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Qantas will also no longer push through with the orders for eight A380s which were originally scheduled for delivery from 2017 through 2025. Priced at $414 million each, the move would save the financially ailing flag carrier $3.3 billion.
The forthcoming changes would reduce Qantas's current available seat kilometres to the Australian market of 4.3 billion versus rival Virgin Australia's which had increased it to 4.5 billion after it got additional foreign capital.
Virgin Australia attributed Qantas's weak performance not because of its lack of additional foreign capital but mismanagement under Mr Joyce, whom some analysts believe should be the one axed, not the 5,000 employees. However, Mr Joyce has indicated he would hold on to his job.
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Meanwhile, the unions are not taking the job cuts sitting down. The Transport Workers Union (TWU) has threatened to strike over the planning axing of jobs, said TWU National Secretary Tony Sheldon.
"In this country, if the government won't stand up for jobs and for the Australian icon, then we will," AAP quoted Mr Sheldon who found the pay cuts announcement of Qantas executives ironic because they got 82 per cent pay hikes the third time in a row since 2010.
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