Qantas CEO Alan Joyce says slow vaccine rollout could push international travel back into 2022

Qantas chief executive Alan Joyce has called on the federal government to convince more Australians to get vaccinated, warning the nation risks being “left behind” and will not be able to reopen its borders by the end of the year if there is a slow vaccination roll-out.

His comments came as the airline on Thursday released a trading update, revealing further job cuts for international cabin crew, a two-year wage freeze for its staff, and flagging a $2 billion expected loss.

Mr Joyce said the airline was starting to “turn the corner”, helped by aggressive cost-cutting and strong demand for domestic travel.

But he said Australia needs to “make sure that we encourage as many people as possible to get the vaccine” so the country does not face the same situation as nations such as Singapore and Taiwan that have seen a sudden and aggressive rise in COVID-19 positive cases.

He said Australia had done an amazing job in managing the COVID-19 pandemic, “but we need to build on that and get the vaccine rolled out as effectively”.

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Alan Joyce says the vaccination roll-out is ‘slower than it should be’.

He said giving people clearer education about the vaccine and its benefits would assist with the planned opening of borders by December 2021 and would ensure “more freedoms over time”.

“The vaccine does protect people significantly, nearly [a] 100 per cent lower risk of death and serious illness.”

Mr Joyce noted that the nature of travel in and out of Australia would also depend on a traffic light system rating a country in terms of COVID-case danger levels.

He said this could change by the end of next year but, for the time being, it looked like cases in the United Kingdom and the United States were falling, and Europeans had allowed some travel to resume.

He said Qantas’s plans revolved around Australia’s borders reopening by December but there was a lot of “uncertainty”.

He noted if “something thing left field happens” – such as a new variant and the vaccine is not effective — then “planning assumptions will have to change”.

Hundreds more job cuts at Qantas

About 6,000 workers remain stood down across the group. Of the 22,000 employees across the group, 16,000 are now back at work.

The company’s new voluntary redundancies announced on Thursday come on top of 8,500 roles that have already been cut from the company, including 2,500 ground-handling jobs which have been outsourced to third-party providers.

Qantas said it expects the redundancy program will generate “several hundred applications”, given the harsh impact of the COVID crisis on its international cabin crew.

Commissions to travel agents on international ticket bookings will also be lowered from 5 per cent to 1 per cent starting from July 2022.

Mr Joyce said there was still a long way to go in the airline’s recovery, but the bright spot for Qantas is domestic travel, with the airline recently unveiling 38 new domestic routes.

A plane with qantas down the side sitting on the tarmac with the sun rising behind it
Qantas planes have been grounded amid the pandemic and international travel is not expected to resume until December 2022 at the earliest. (

Supplied: Department of Foreign Affairs and Trade

)

Qantas expects to post a statutory loss before tax of more than $2 billion this financial year, following $2.7 billion of losses last year.

“We also know that the pandemic will have cost us at least $16 billion [in revenue] since the start of 2020,” Mr Joyce said.

“We clearly have a lot of repair work to do, but the business is showing all the signs of being able to achieve this.

“As far as Australians are concerned, flying is back and it shows in our figures.

“Qantas and Jetstar are on track to reach a combined 95 per cent of pre-COVID domestic capacity for the quarter ending in June this year.

“And well over 100 per cent for the next financial year, which starts in July of this year. That’s powered by leisure demand and by the continued return of corporate travel.”

Mr Joyce said thanks to the rebound in domestic travel, the airline was making inroads into reducing its massive debt bill.

Net debt levels peaked in February at $6.4 billion but are expected to be under $6.05 billion by July.

Qantas CEO Alan Joyce
Qantas chief executive Alan Joyce says doemstic travel is back and helping the airline’s recovery.(

AAP: Rebecca Le May

)

Two-year wage freeze

The two-year wage freeze for all Qantas Group employees, includes management.

But the Transport Workers’ Union (TWU) has slammed Qantas for cutting more jobs and bypassing enterprise bargaining.

“Qantas management is acting like a dictator, using public resources to shore up its position, cut jobs and impose unilateral decisions on its workforce,” TWU national secretary Michael Kaine said.

“There is a system of enterprise bargaining in place so that both sides can sit down and compromise.

Mr Kaine noted this year Qantas will have received $2 billion in Government funding.

Mr Joyce said Qantas looked after its people in good times, but it was not unreasonable to expect wage freezes given the delay in borders opening to allow international travel.

The TWU is among unions taking legal action against Qantas including a Federal Court case that would reverse the outsourcing of Qantas’s 2,000 ground workers.

The High Court will tomorrow hear a separate application from the TWU and other unions over sick Qantas workers refused their accrued leave.

And a there is another High Court challenge by the TWU and other unions involving alleged misuse of the JobKeeper wage subsidy.

Mr Joyce was also asked about Virgin Australia’s announcement to introduce more domestic routes, but said he was not worried as Virgin was more directly competing with REX airlines in the “middle market” while Qantas was targeting the premium end.

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