QANTAS will slash 5000 jobs, freeze wages and retire ageing planes after posting a $252 million first half loss.
In an attempt to save $2 billion by the 2016/17 financial year, CEO Alan Joyce has announced the airline will shed 1500 management and non-operational positions, with the remainder of job cuts to come from changes to the fleet and network and the restructure of maintenance operations and catering facilities.
Wages for all employees will be frozen and the company’s executives have already taken a pay cut.
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Chief executive Alan Joyce said the $252 million underlying loss for the six months to December 31 was unacceptable and tough decisions needed to be made.
“There are many Australian companies that have failed because they were not prepared to make the hard decisions, Qantas is not one of them,” he told reporters in Sydney.
“We will cut where we can in order to invest where we must… we will be a far leaner Qantas group.”
Qantas will also cut capital expenditure by $1 billion over the next three years.
It will also hand back its Brisbane Airport lease for $112 million, though it will retain exclusive use of most of northern end of terminal until 2018.
More than 50 aircraft will be deferred or sold, with older planes like 747s to be retired early and orders of A380s and B787-8s to be delayed.
Qantas will also axe underperforming routes including its Perth to Singapore service, while timing and aircraft changes will be made to other routes.
The announcement comes as the federal government weighs up the possibility of supporting the airline through a debt guarantee or changes to the Qantas Sale Act.
Mr Joyce said he would meet with unions on Friday to discuss the cuts.