Qantas cutting domestic capacity by 5%

[justinbrett]

It's not strict-strict, I've got a colleague booked to arrive on QF12 connecting onto 1431 (the 1:40 connection) on a single ticket next week.

There might have been leeway to book that connection from the call centre given the cancellation of the original connecting flight and the horrid wait time until the next one after 1431.

I'm on the same flight pair but my SYD-CBR is a separate ticket so I had problems changing that.

If we miss our connecting flight we'll probably just hire a car and drive back to Canberra rather than wait for the next flight 5 hours later.

I’m not sure if there’s an exception for CBR but I had a 1:45 connection to OOL that has now blown out to 5+ hours as it’s no longer legal. It was legal when it was booked.

 

[FlyingKangaroo]

My employer (large asx) is pushing the less travel card. No Policy as such, just continued comments around waste and is the trip even worth it, these comments came from the CEO on a recent town hall. You would be surprised how much some companies spend by having certain people travelling around the place just to showcase their ego. I do can without those visits from these people to my office!

Similar story at mine, a large US tech company. My partner works for a mid-sized AU-based subsidiary of a Japanese conglomerate and they've formally pulled back only to essential travel. They also enslave themselves to Qantas despite having no exclusive corporate contract with them and paying the premium, which apparently will now be even higher. Make it make sense.

There's nothing more delightful than "leaders" travelling around the world on corporate junkets to give buzzword-laden lectures to the masses about responsible travel spend. A tale as old as the Corporations Act, now modernly seasoned with AI slop.

 

[PERLHR]

My employer (large asx) is pushing the less travel card. No Policy as such, just continued comments around waste and is the trip even worth it, these comments came from the CEO on a recent town hall. You would be surprised how much some companies spend by having certain people travelling around the place just to showcase their ego. I do can without those visits from these people to my office!

Can't agree more. I remember when in the UK we had over many years some form of travel restriction and even bans (so it's nothing new), but somehow head quarters/ office individuals always seemed to be arriving just to disrupt our working day(s). As far as inter state goes I often don't see the point of wasted days travel, time differences sometimes as much as the flight itself and what really needs to be done F2F compared to a teams call...(Unless the travel is for say 5 days consecutive work). My other half now just travels away on a Sunday to work destination for a couple of days of meetings. She seems to have lost the reality check that Sunday is actually part of weekend that she is not paid for to be travelling for work!
As for the reduction in routes/timetables etc...i see it as simply something the airlines are doing on thin or multiple routes where they can use fuel costs as an excuse to stop/reduce/amalgamate without bad press!

 

[FlyingKangaroo]

As for the reduction in routes/timetables etc...i see it as simply something the airlines are doing on thin or multiple routes where they can use fuel costs as an excuse to stop/reduce/amalgamate without bad press!

And of course raise fares. As this thread has noted, demand is down as both consumer and business confidence plummets, so restricting demand is a great way to help push those fares up even higher, while also setting the stage for shareholders re: yields, "efficiency", "right-sizing", etc.

I get it. Fuel is very expensive which rationally necessitates higher costs and justifies reductions as demand falls. I also get that this is a company that is very good at using bad circumstances to exploit them even further for its own gain. "Never waste a crisis." Good for shareholders; bad for everyone else.

 

[Quickstatus]

Frequent flyer status extension/retension?

so restricting demand is a great way to help push those fares up even higher, while also setting the stage for shareholders re: yields, "efficiency", "right-sizing", etc.

Stay profitable by cutting as much costs as possible

 

[Laptop Jockey]

I've noticed a lot of flights getting the aircraft scaled down too, Dash 8s on routes normally 737/A220, 737s in lieu of A330 etc. presumably because of lower fuel burn and maximising Loadout.
Just had a bunch of CBR-MEL flights changed to dash 8s which is a pain due to the restrictions,.

 

[Rabs97]

Perhaps QF believes the reductions in routes/frequencies will only be temporary, and presumably it needs staff (flight deck/cabin and others) to operate Project Sunrise, but it's a bit surprising it hasn't announced redundancies or incentives to retire/resign.

A five per cent cut to domestic flying is significant.

You only make redundancies if there’s a long term forecasted drop in flying. Redundancy payouts are usually 12-18 months, so you need to ensure that the forecasted drop in flying is going to go on much longer than that to justify redundancy packages.

This war started on Feb 28 and not even 6 weeks later is closer to the end than the start. Within a week or two there should be a longer ceasefire and an agreement to restart oil flow through Hormuz. It may take 2-3 months for fuel shipments to get back into place, and for oil prices to drop to pre war levels.

Also give it a few months post war and people would’ve probably forgotten about the attacks on Dubai and Qatar, and start rebooking on QR and EK. Whilst international performance may be strong for this northern summer it’s very unlikely to continue after that.

So by August the war may be over and the industry may return to a pre war state. You don’t make staff redundant now if you need them in 4 months time. To recruit, hire and train a pilot alone takes 8-10 months. The last thing they want is to be caught short like after Covid, the so called V shaped recovery

 

[Himeno]

I've noticed a lot of flights getting the aircraft scaled down too, Dash 8s on routes normally 737/A220, 737s in lieu of A330 etc. presumably because of lower fuel burn and maximising Loadout.
Just had a bunch of CBR-MEL flights changed to dash 8s which is a pain due to the restrictions,.

I had a dash 8 on BNE-CBR before (QF2567, Nov 2013). I hope that doesn't happen again.

I've also had a dash 8 on CBR-MEL at some point (also had a 767 once on that route, but mostly 717s and A220s)

 

[Quickstatus]

Before redundancies. Encouraging staff to take paid leave, then unpaid leave, then standing down workers is the usual path before termination.

When Qantas workers were stood down during Covid, they still had employment when work became available but they could not access sick leave

 

[Saab34]

New Hires might be dropped if they have barely or not started training, those on the verge of retirement might be pushed a bit sooner. Recruitment likely put on hold for a period also. That is more for ME based carriers who don’t have labour laws as tight as here.

Qantas has many pilots it can keep drawing from its academy, the great thing about that program is it’s not internal anymore, so they can pull people from the pool as they wish, and turn the tap off if required. The provider is FTA who still makes a profit by pumping graduates out, the student pilots still rack up a huge debt, and the airline can go fishing whenever it pleases without carrying what was in prior programs, cadets on the payroll.

I am fairly sure it was the the QF group is still short of pilots in its subsidiaries so cutting capacity wont likely impact the current pool of pilots.

 

[clifford]

This is all good banter, but surely what Qantas is really doing is to conserve fuel (with a few side benefits). If it can't guarantee fuel supplies after mid-May, then all bets are off.

 

[Melburnian1]

You only make redundancies if there’s a long term forecasted drop in flying. Redundancy payouts are usually 12-18 months, so you need to ensure that the forecasted drop in flying is going to go on much longer than that to justify redundancy packages.

This war started on Feb 28 and not even 6 weeks later is closer to the end than the start. Within a week or two there should be a longer ceasefire and an agreement to restart oil flow through Hormuz. It may take 2-3 months for fuel shipments to get back into place, and for oil prices to drop to pre war levels.

Also give it a few months post war and people would’ve probably forgotten about the attacks on Dubai and Qatar, and start rebooking on QR and EK. Whilst international performance may be strong for this northern summer it’s very unlikely to continue after that.

So by August the war may be over and the industry may return to a pre war state. You don’t make staff redundant now if you need them in 4 months time. To recruit, hire and train a pilot alone takes 8-10 months. The last thing they want is to be caught short like after Covid, the so called V shaped recovery

I don't share your optimism about a longer ceasefire coming within a week or two.

 

[Quickstatus]

but surely what Qantas is really doing is to conserve fuel

The other explanation is that forward airline bookings have collapsed reduced or expected to reduce, rather than an altruistic attempt at fuel conservation. Qantas does not store jetfuel.

 

[clifford]

Qantas does not store jetfuel.

But somebody does. And when its gone its gone (even for Qantas).

 

[Saab34]

Virgin out today with a 1% cut to capacity and only a $30m hit to its fuel bill, however earning are still expected to be higher over last year. Sadly that’s where the good news ends as they mentioned they will be exposed from next FY.

 

[clifford]

Virgin out today with a 1% cut to capacity and only a $30m hit to its fuel bill, however earning are still expected to be higher over last year. Sadly that’s where the good news ends as they mentioned they will be exposed from next FY.

Sounds good, but I'd rather believe Qantas' take rather than VA. After all, Virgin is run by a bunch of foreigners adept in double speak.

 

[Rabs97]

I don't share your optimism about a longer ceasefire coming within a week or two.

Either the war ends soon, or the war is escalated beyond tit for tat missile strikes into a full blown ground invasion with thousands of casualties.

The former option is more likely.

 

[Rabs97]

This is all good banter, but surely what Qantas is really doing is to conserve fuel (with a few side benefits). If it can't guarantee fuel supplies after mid-May, then all bets are off.

There’s no benefit to conserve fuel now to save it for future months. Fuel is purchased as you need it, the price is locked with hedging but there’s no guaranteed supply for each airline they may be forced to ration.

If the were it would be public knowledge, and we’d definitely have private vehicle fuel restrictions first. Australia has good leverage to secure supply from a lot of our neighbours.

 

[AuSammy]

While people might like to sink the boot into Qantas, fuel costs and availability is a world wide problem with the current conflict and airlines are fighting for their businesses to remain sustainable.

Europe traditionally imports more than 60% of its jet fuel from the ME. Lufthansa intends mothballing up to 40 jets and cutting capacity by up to 5%. SAS has cancelled 1000flights in April alone. Most EU are implementing immediate fuel surcharges.

Regardless of the price pressures, the EU has jet fuel confirmed for only around 5 weeks.

Elsewhere outside of EU, some examples Vietnam cutting by 20%, AirAsia by 10%, see another thread on FJ, Korean T’way is furloughing staff for 2 months on no pay, Myanmar Airlines stopping some routes, Bamboo Airlines cutting capacity. Philippines has declared a national emergency. Korean Air, Asiana, Cathay, Air anew Zealand are trimming capacity and cancelling flights

I would not be so certain of some people’s expectations they they will be going to the EU on holidays in early northern Summer without issues arising with scheduling etc.

 

[Franky]

There’s no benefit to conserve fuel now to save it for future months. Fuel is purchased as you need it, the price is locked with hedging but there’s no guaranteed supply for each airline they may be forced to ration.

If the were it would be public knowledge, and we’d definitely have private vehicle fuel restrictions first. Australia has good leverage to secure supply from a lot of our neighbours.

So how about you tell us who they are, where they are, and how much of THEIR fuel resouurces are they going to sell to us in the current situation????