Qantas Airways Ltd said on Tuesday it would cut its international capacity by nearly 25 percent over the next six months, including grounding most of its Airbus SE A380s, as it grapples with a plunge in demand from the coronavirus.
It will now ground the equivalent of 38 planes, up from 18 announced last month, and its CEO will take no salary for the remainder of the financial year ending June 30 and management will receive no bonuses. All staff are being asked to take paid or unpaid leave. It is also cancelling plans for a A$150 million ($98.73 million) off-market share buyback to preserve cash.
Airlines around the world are experiencing a collapse in demand due to the coronavirus, which an industry body last week estimated could lower passenger revenue by as much as $113 billion this year.
"We expect lower demand to continue for the next several months so rather than taking a piecemeal approach we are cutting capacity out to mid-September," Qantas Chief Executive Alan Joyce said in a statement. "We retain the flexibility to cut further or to put capacity back in as this situation develops." Qantas shares have fallen by 42 percent since the start of January.
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