Qantas says COVID outbreaks set it back three months

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January 14, 2021
Qantas
Qantas boss Alan Joyce. Photo: Steve Creedy

Domestic border restrictions between Australian states have forced Qantas to revise estimates of how quickly it will get its network up and running.

The airline had originally estimated it would hit 80 percent of capacity by March but Qantas chief executive Alan Joyce told the Reuters Next conference he now expected this to be delayed by three months.

Joyce said there had been massive pent-up demand before a recent outbreak of COVID clusters that had prompted a huge increase in frequency on interstate markets and significant growth in passenger volumes.

He said the Qantas had been confident would return to more than 80 percent of capacity by March and even 100 percent for low-cost offshoot Jetstar’s domestic operations.

READ: More airlines could fail as forward bookings stall.

“It was a very rapid recovery,’’ he said. “This latest outbreak has probably set us back three months.

“So our forecast now is that for the third quarter for us in the financial year, which is January to March, we’ll be at 60 percent of pre-COVID domestic capacity ….  and for the final quarter of the financial year, which ends at June 30, we’ll be back to 80 percent.”

Joyce also conceded that the airline’s guess that international travel will restart from July onwards could change.

The airline has started selling tickets from July, a move that prompted the Australian government to warn that the opening of borders was a government decision.

“It could be a bit later, it could be around then,’’ he said. “We just have the capacity to manage that schedule depending on what the government decision is going to be at the time.

“But it’s likely within the next year, from all of the indications that we have with the roll-out of vaccines worldwide, that there will be an opening of the international borders.”

Joyce said border openings may be in stages and could initially involve countries that were more advanced in rolling out the vaccine.

But given how Australia was positioned, the airline had confidence borders would open “at least some time in 2021 and hopefully in the middle of 2021.”