In an attempt to limit its financial losses, Qantas will outsource more than 2,000 ground staff roles. The job losses come on top of 6,000 layoffsitrevealed earlier this year by Australia’s flagship carrier.
Due to Covid-19 and border constraints, Qantas announced a $2bn loss in August.Unfortunately, the domestic and international chief executive of the airline, Covid has turned aviation upside down.
Andrew David, the domestic and international chief executive of the airline, stated “Covid has turned aviation upside down”.
“World-wide airlines must make dramatic choices to survive and it takes years for their damage to repair,” he added.
Qantas expects to save about $74 million annually by moving to third-party suppliers rather than managing its own ground services, based on pre-covid flying levels. By avoiding new investment on ground handling equipment such as aircraft tugs and luggage loaders, it also plans to save $59m over five years.
The workers affected will be eligible for a redundancy plan and will receive assistance for the transition to the new jobs, the airline said.
Meanwhile, there seems to be some positive news for the recovery of the airline, with domestic flights beginning to recover as state governments loosen restrictions on interstate travel.
Yet Qantas continues to expect tough times ahead, with more losses next year due to a $7.4billion decline in sales. It is not planned to fly abroad until late 2021, with the possibility of a possible New Zealand travel bubble.
In order to keep going, the airline has also taken on an estimated $1.1 billion debt. The International Air Transport Association (IATA) forecasts that this and next year, airlines worldwide are on track to lose $157bn. Passenger numbers are projected to drop from 4.5bn in 2019 to 1.8bn this year. IATA says those figures will only partly rebound to 2.8bn next year.