Australia’s Qantas airline to cut 6,000 jobs as virus hits

Qantas plans to cut at least 6,000 jobs and keep 15,000 more workers on extended furloughs as Australia’s largest airline tries to survive the coronavirus pandemic.

Qantas announced a plan Thursday to reduce costs by billions of dollars and raise fresh capital. The plan includes grounding 100 planes for a year or more and immediately retiring its six remaining Boeing 747 planes.

Chief Executive Alan Joyce said the airline has to become smaller as it braces for several years of much lower revenues. He said the furloughed workers faced a long interruption to their airline careers.

In a plan filed with the Australian stock exchange, Qantas said it would reduce costs by 15 billion Australian dollars ($10 billion) over three years and raise new equity of A$1.9 billion to help accelerate the airline’s recovery and position it for new opportunities.

Qantas employs about 29,000 people. Joyce said he expected only about 8,000 of them would be working by next month, and 15,000 by the end of the year. He said that as international routes opened back up over the next two years, he hoped the workforce would increase again to 21,000. He said the airline planned to be back to 40% of its pre-crisis domestic flying by July, but that international routes would take much longer to return.

Australian Prime Minister Scott Morrison said it wanted to help former Qantas employees suffering from the “terrible job losses” to find new work in other parts of the economy.

Qantas shares were placed into a trading halt ahead of the announcement. The airline’s shares are down just over 40% this year, but have recovered somewhat from March when they were down by as much as 70%. (AP)