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Qantas to restructure network due to low profits

Published: 16/02/2012 - Filed under: News »

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Qantas has announced several network changes and capacity adjustments in light of reduced profits for the second half of 2011, in order to return the carrier’s “international performance to profitability in the short term,” said chief executive Alan Joyce.

The carrier will drop its unprofitable Singapore-Mumbai and Auckland-Los Angeles routes from May 6 onwards, which are in addition to the previously reported cessation of the carrier’s Hong Kong-London and Bangkok-London routes (see story here). 

Additionally, the carrier will deploy different aircraft on existing routes in order to align demand with capacity supply. On May 6, the carrier will increase capacity on the Los Angeles-New York route by replacing an Airbus A330 with a Boeing B747 aircraft. On June 10, the A330 aircraft currently operating one of the daily services from Sydney to Tokyo will be replaced with a B747, meaning the route will be served by the bigger aircraft on a daily basis.

Also on June 10, capacity on the Sydney-Bangkok flight will be reduced by using an A330 instead of a B747.

The Qantas Group announced a profit of A$202 million (US$215million) for the half-year that ended on December 31, 2011, a decrease of A$215million (US$229million) from the same period in 2010. The drop in profits are attributed to the industrial action that beleaguered the carrier last year (see story here), increased jet fuel prices and global economic volatility, stated Joyce.

However, despite this, Joyce claims he remains “cautiously optimistic about the demand environment, both domestically and in the Asia-Pacific region.” With regards to the Asian-based premium airline that Qantas announced last year (see story here), Joyce stated that the group will “continue to evaluate the options.”

For more information, visit www.qantas.com.au 

Alisha Haridasani

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COMMENTS » 

PaulRWoods - 22/02/2012 01:50

First leaving 78,000 passengers stranded and leaving ticketholders wondering if they will actually see their families come christmas and now showing reduced profits. I told Qantas in writing that my flight Brisbane-Singapore-London just before the holiday season would be my last fligth with them since I don't like being scared by anybody. Coming back in January was by Malaysian Airlines Business Class. I am not feeling sorry for Qantas as a company, but for their staff (except for that greedy Irish man at the very top) I expect a grim future.

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