Qantas will axe 5000 jobs after posting a $252 million first half loss

[Jessica Berry]

Qantas will axe 5000 jobs in a bid to dramatically cut costs after posting a $252million first half loss.

Over the next three years, Qantas will shed 1500 management and non-operational positions, with the remainder of the job cuts to come from changes to the fleet and network and the restructure of maintenance operations and catering facilities.

Meanwhile, wages for all employees will be frozen and the company's executives have already taken a pay cut.

RELATED: Qantas sells Brisbane Airport terminal lease

RELATED: Qantas decision short-sighted: union

The airline is attempting to save $2 billion by the 2016/17 financial year as it tries to return to profitability amid abitter, profit-draining battle with rival Virgin.

Qantas shares fell 10 cents, or almost eight per cent, to $1.17 following the announcement.

The announcement comes as the federal government weighs up the possibility of supporting the airline through a debt guarantee or changes to the Qantas Sale Act.

Chief executive Alan Joyce said the $252million underlying loss for the six months to December 31 was unacceptable and tough decisions needed to be made.

"There are many Australian companies that have failed because they were not prepared to make the hard decisions, Qantas is not one of them," Mr Joyce told reporters in Sydney.

"We will cut where we can in order to invest where we must... we will be a far leaner Qantas group."

 

"Our priorities are to protect our core businesses... that is how we will protect as many jobs as possible and return to profitability."

Mr Joyce said he would meet with unions on Friday to discuss the cuts.

He put much of the blame for the result on an"uneven playing field" with Virgin, which has the backing of three foreign airlines - Etihad, Singapore Airlines and Air New Zealand among itsowners.

"The Australian domestic market has been distorted by current Australian aviation policy," he said.

"Late last year, these three foreign airline shareholders invested more than $300 million in Virgin Australia....that capital injection has supported continued domestic capacity growth by Virgin Australia despite its growing losses."

The amount of capital Qantas can access from foreign sources is restricted by the Qantas Sale Act.

As part of its bid to save costs, Qantas willcut capital expenditure by $1 billion over the next three years.

It will also hand back its Brisbane Airport lease for $112 million, though it will retain exclusive use of most of northern end of terminal until 2018.

Meanwhile, the airline says more than 50 aircraft will be deferred or sold, with older planes like 747s to be retired early and orders of A380s and B787-8s to be delayed.

It will also axe underperforming routesincluding its Perth to Singapore service, while timing and aircraft changes will be made to other routes.

Mr Joyce also announced Qantas would suspend the expansion of the Jetstar Asia business in Singapore, which continued to face tough conditions, though he indicated the airline remained committed to finding opportunities in Asia.

"Jetstar has been a pioneer Australian brand across Asia and we continue to see major opportunities for it in the world's fastest growing aviation region," he said.

(ninemsn 27/02/14)

Edited February 27, 2014 by Jessica Berry

[jim and adel]

It's not all the fault of management, but most of the big problems facing Qantas could and should have been avoided.

 

I've watched Alan Joyce since he took over as CEO in 2008. It's been an inept performance at best and at times staggering in his mishandling. He shows classic signs of being a corporate sociopath (interesting how many such people manage to climb to the top and how boards show such faith in them ... often until it's too late!)

 

He'll be long written about in case studies of how not to do it.

[Guest BurgessFamily]

Australia is competing with Asia on productivity. It's all inevitable.

 

5000 here, 1500 there, another 800 somewhere else. These job losses would worry the UK economy with it's 70 million residents. Here with our 22 million, we just carry on as if nothing has happened.

Edited February 27, 2014 by BurgessFamily

[Petrus]

I already seen this movie, years ago, in Italy with Alitalia. And I also know the end of the story: the company has been sold to foreign investors and bye bye...

But it's the same with Holden, that's following the pathway of FIAT with job cuts and closure of plants, and many other Aussie-based companies.

 

Sometimes I think I could write a book about the future of Australian economy, just collecting past economic news of Italy and some other European countries and changing some names.

It's sad that isn't possible to learn from the past mistakes that others made, while building the future...

[adelaidenow]

Qantas CEO Alan Joyce announces 5000 jobs will be cut, after a $252 million half-year loss.. Qantas chief executive Alan Joyce announces a first-half loss of $235.It to profitability despite posting a record $252 million first half loss.

 

The only job they need to cut to get back on track is Alan Joyce.

[adelaidenow]

Australia is competing with Asia on productivity. It's all inevitable.

 

5000 here, 1500 there, another 800 somewhere else. These job losses would worry the UK economy with it's 70 million residents. Here with our 22 million, we just carry on as if nothing has happened.

 

I couldn't disagree more, please substantiate and provide evidence of your claims.

[Guest BurgessFamily]

I couldn't disagree more, please substantiate and provide evidence of your claims.

 

Just in the last few months...

 

QANTAS has chosen to send more than 300 maintenance jobs offshore rather than move them to Brisbane

 

http://www.news.com.au/finance/business/qantas-angers-unions-by-sending-300-jobs-offshore-but-says-safety-is-its-no1-priority/story-fnkgde2y-1226807073834

 

More than 10,000 overseas contractors are working for Telstra at the same time as the company slashes jobs at home to help boost profit. This represents about 26 per cent of the telco’s full-time workforce of 38,000

 

http://delimiter.com.au/2013/10/15/telstra-10000-offshore-staff/

 

Telstra's directories business Sensis is cutting 800 jobs as a result of its digital transformation. More than 500 roles are expected to be sent overseas.

 

The CPSU estimates that in the past 12 months Sensis has scrapped half its workforce with at least 600 roles being moved offshore to the Philippines and India.

 

http://www.sbs.com.au/news/article/2014/02/19/sensis-reveals-800-jobs-go

 

GM is investing $3 billion in China on top of $2 billion it had earlier announced

(GM owns Holden)

 

http://www.autocarpro.in/ap/analysis-reports/4625/gms-asia-strategy-key-growth-driver

 

UP TO 70 workers at an 80-year-old South Australian battery maker supplying all three local car-makers are likely to lose their jobs by the end of this year. However, while Marshall Power said it would send its battery-making business to the Philippines – where its parent company is based – the decision to quit Australia was not tied in with Ford and Holden’s recently announced exit plans

 

http://www.goauto.com.au/mellor/mellor.nsf/story2/BA13A93BC81D1EE4CA257C740020B279

also further afield, but still relevant...

 

https://www.toyota.co.za/articles/toyota-celebrates-r1-billion-investment-in-new-corolla-production

[adelaidenow]

And yet you say we don't care which I have asked you to quantify. It was the headlines in the news. What do you want us to do, have a rebellion like Ukraine?

 

Also, I must ask, are you actually happy, you seem only able to post negativity. If things are no good, you can always move on. There is no point being an immigrant in a country/place you don't like.

[Petrus]

What do you want us to do, have a rebellion like Ukraine?

Do you think that UE bureaucrats would be interested in financing our riots too?

[Petrus]

There is no point being an immigrant in a country/place you don't like.

It's not this the point, I think that we would prefer a different end in this country, for a story that coming from Europe we saw years ago.

[Guest BurgessFamily]

And yet you say we don't care which I have asked you to quantify. It was the headlines in the news. What do you want us to do, have a rebellion like Ukraine?

 

Also, I must ask, are you actually happy, you seem only able to post negativity. If things are no good, you can always move on. There is no point being an immigrant in a country/place you don't like.

 

? sorry, all good here, I vote for who I'm told to vote for. MPs are doing a great job.

 

Of course, if this was a democracy, I'd be asking them to ditch the carbon tax and lift the burden on a nation.

Edited February 28, 2014 by BurgessFamily

[Jessica Berry]

Just in the last few months...

 

 

 

http://www.news.com.au/finance/business/qantas-angers-unions-by-sending-300-jobs-offshore-but-says-safety-is-its-no1-priority/story-fnkgde2y-1226807073834

 

 

 

http://delimiter.com.au/2013/10/15/telstra-10000-offshore-staff/

 

 

 

 

 

http://www.sbs.com.au/news/article/2014/02/19/sensis-reveals-800-jobs-go

 

(GM owns Holden)

 

http://www.autocarpro.in/ap/analysis-reports/4625/gms-asia-strategy-key-growth-driver

 

 

 

http://www.goauto.com.au/mellor/mellor.nsf/story2/BA13A93BC81D1EE4CA257C740020B279

also further afield, but still relevant...

 

https://www.toyota.co.za/articles/toyota-celebrates-r1-billion-investment-in-new-corolla-production

 

 

Plenty of examples and I am sure there will be more to come. I often feel it is a case of deja vu when we have seen the same things happen in the UK, for example the outsourcing of call centres. I can remember the call centres being outsourced overseas in the UK, then several years later it being used as a marketing tool by some companies (when it didn't work) advertising that (insert company name here) our call centre is based in the UK.

 

One of the recruitment agencies I used to deal with here outsourced their reference checking overseas. It was a waste of time (imo), the person who did the reference checking had a functional understanding of English and could ask the questions as scripted. Their standard of English did not allow them to 'read between the lines' of what a referee might actually be saying or to move off script to clarify any information. I reckon I could have said anything and the person would have got the job!

[adelaidenow]

Plenty of examples and I am sure there will be more to come. I often feel it is a case of deja vu when we have seen the same things happen in the UK, for example the outsourcing of call centres. I can remember the call centres being outsourced overseas in the UK, then several years later it being used as a marketing tool by some companies (when it didn't work) advertising that (insert company name here) our call centre is based in the UK.

 

One of the recruitment agencies I used to deal with here outsourced their reference checking overseas. It was a waste of time (imo), the person who did the reference checking had a functional understanding of English and could ask the questions as scripted. Their standard of English did not allow them to 'read between the lines' of what a referee might actually be saying or to move off script to clarify any information. I reckon I could have said anything and the person would have got the job!

 

 

And to be quite frank, many of the POMS on here can't read or write properly either, no wonder companies go overseas for staff.....

[Guest BurgessFamily]

And to be quite frank, many of the POMS on here can't read or write properly either, no wonder companies go overseas for staff.....

 

 

There are Chinese, Indian, Australian, and Pakistani people in our office, none of them are exceptional spellers (or have great grammar) but it doesn't really matter I guess. As long as they have good math, that is what counts.

 

Edit: I did have an issue once, when an admin reset my password for a system I rarely accessed. I had trouble using the new password he'd set it to, wasn't sure if there was an issue with the case being used (upper/lower etc..). In the end I asked him how to spell the password, after some laughing at me he said... 'G..R..A..P..H..I..T..I'.

Edited March 2, 2014 by BurgessFamily

[sidestep]

And to be quite frank, many of the POMS on here can't read or write properly either, no wonder companies go overseas for staff.....

Err, that should be a full stop instead of a comma after the word "either"?

[adelaidenow]

There are Chinese, Indian, Australian, and Pakistani people in our office, none of them are exceptional spellers (or have great grammar) but it doesn't really matter I guess. As long as they have good math, that is what counts.

 

Edit: I did have an issue once, when an admin reset my password for a system I rarely accessed. I had trouble using the new password he'd set it to, wasn't sure if there was an issue with the case being used (upper/lower etc..). In the end I asked him how to spell the password, after some laughing at me he said... 'G..R..A..P..H..I..T..I'.

 

Good pun re maths and counting. But it's maths not math.

 

Anyhow it doesn't matter what job people have, the quality of English these days is appalling and getting worse. With the amount of social media and communicating we do it should get better, not worse.

 

And sidestep, I think a comma or full stop is correct, and why did you put a ? at the end of a statement?

 

And I never said my grammar is perfect, I like to think my English is good, but I make mistakes and learn from them.

[Guest BurgessFamily]

But it's maths not math..

 

 

'Maths' is British English, a sadly dying dialect. I hear most often in Australia the American abbreviation, which is 'Math'.

 

Neither abbreviation is correct or incorrect. You may hear arguments for one being superior to the other, and there are logical cases for both sides. One could argue maths is better because mathematics ends in s, and one could argue math is better because mathematics is just a mass noun that happens to end in s. In any case, English usage is rarely guided by logic, and these usage idiosyncrasies are often arbitrary.

[adelaidenow]

'Maths' is British English, a sadly dying dialect. I hear most often in Australia the American abbreviation, which is 'Math'.

 

Live and learn, I had never heard of the singular before.

 

In Australia and England we use British English, so by right, on this forum it should be Maths. The fact that many people now incorrectly use American English in Australia doesn't make them right, and shouldn't make it acceptable either.

[Guest BurgessFamily]

There are more Americanisms in Australia now, and it is ever growing. My aussie coworkers use the term 'Math', hence my usage.

 

It's a bit like when I was a kid, Father Christmas was the common reference, not Santa.

 

(don't get me started on Inquiry vs Enquiry ).

[Petrus]

How funny it is your debate, from a non native speaker POV

 

BTW, it doesn't seem to match that much with the topic the OP put on the table, isn't it?

[Guest BurgessFamily]

Yeah but we're looking (or not looking) at the opening topic in a positive light.