Qantas warns of standowns but promises bright future

A much fitter Qantas is promising its staff huge potential but warns of possible stand-downs if the current lock-downs drag on too long. In a rallying email to staff, Qantas chief executive Alan Joyce said that now, as thousands of flights are canceled, “it might not feel like it some days, but there are lots of reasons for us to be positive.” “We are much fitter than pre-COVID and we know this business has huge potential once we’re all back in the air.” Mr. Joyce assured staff that “what we’re experiencing is temporary and unlike last winter there’s now a COVID vaccine rolling out, and that means this cycle of restrictions and lock-downs will break. In other words, there is an endpoint to all of this and it’s not far away.” The Qantas Group’s domestic flying has been slashed from 90 percent of pre-COVID levels to 60 percent off the NSW lockdown and the Victorian and South Australian lock-downs have brought that number down to just 40 percent. Intra Western Australian and Queensland flying are the shining lights and account for the majority of the rest. One of Qantas’s competitors, REX, has grounded its fleet of six 737s because of the lock-downs. Mr. Joyce told staff there were two scenarios with the first that “the outbreaks can be brought under control soon and we can bring capacity back. “We know travel demand rebounds quickly and, if the current lock-downs end when scheduled, then Group domestic capacity should be back at around 60 percent in August and up to 80-90 percent in September-October. However, the staff email was sent out before the worsening numbers in NSW and Victoria were announced which means that the second scenario outlined by Mr. Joyce of stand-downs may loom on the radar. Mr. Joyce told staff that if these lock-downs drag on for much longer than expected the airline group would be faced with continued levels of low flying. Under that second scenario, the airline expects support packages to be offered by the government to provide a basic level of income support directly to those eligible, depending on the criteria set. However, it warns that some stand-downs would be inevitable. “We can’t rule it out if multiple states keep their borders closed for extended periods,” Mr. Joyce said. Insiders at Qantas tell WestBusiness however that stand-downs are a last resort and are months away. Mr. Joyce told staff that “just as the vaccine roll-out will turn the tide on this pandemic our recovery program is changing how the Qantas Group is placed on the other side.”