Qantas has posted another big loss in the first half of the financial year and outlined plans to cut up to 5,000 jobs in a bid to turn itself around.
The airline posted losses before tax of $252 million for the six months to 31 December 2013, which CEO Alan Joyce said was “unacceptable and unsustainable”.
The carrier aims to make $2 billion in cost savings by the end of this financial year. To do that up to 5,000 Qantas staff, mostly back office will lose their jobs.
Qantas did not respond to requests about how the job cuts will affect the marketing division.
The airline will also cut $1 billion of capital expenditure over the next two years and make changes to its fleet plans and network including selling off up to 50 aircraft.
Joyce said the airline must make "hard decisions" to continue operating in the “toughest conditions ever faced” but claimed that it will continue to invest in customers and service would not be compromised.
“It’s clear that the market Qantas operates in has changed, with structural economic shifts exacerbated by an uneven playing field in Australian aviation policy. We have met these challenges head on. Over the past four years, we have been carrying out the biggest transformation since Qantas was privatised … But this is not enough for the circumstances we now face.
“We must take actions that are unprecedented in scope and depth to strengthen the core of the Qantas Group business. We have already made tough decisions and nobody should doubt that there are more ahead,” he said.
The cuts come after the airline already announced 1,000 job cuts in December last year.
The Jetstar Group reported a loss of $16 million, down from profit of $128 million in 1H13.
Qantas Loyalty offered some good news. The unit posted earnings of $146 million in the half year. Billings are up 9% and Loyalty claimed “record advocacy” levels. The program currently has 9.8 million members, expected to reach 10 million by the end of the year.
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