Qantas adds to job cuts by outsourcing 2,000 roles

Qantas will outsource more than 2,000 ground staff roles in an effort to limit its financial losses.

The job cuts are on top of 6,000 roles already announced by Australia’s flag carrier earlier this year.

Qantas announced a $2bn (£1bn) loss in August due to Covid-19 and associated border restrictions.

“Unfortunately, Covid has turned aviation upside down,” said Andrew David, the airline’s domestic and international chief executive.

“Airlines around the world are having to make dramatic decisions in order to survive and the damage will take years to repair,” he added.

Qantas hopes to save about $74m annually, based on pre-Covid levels of flying, by switching to third-party providers instead of handling its own ground services.

It also expects to save $59m over five years by avoiding new spending on ground handling equipment such as aircraft tugs and baggage loaders.

Affected employees will be entitled to a redundancy package and given support to transition to new jobs, the airline said.

Turbulence ahead
There has been some good news for the airline’s recovery, with domestic routes starting to recover as state governments lift interstate travel restrictions.

But Qantas is still predicting bleak times ahead, with more losses next year due to a drop in revenue of $7.4bn.

It does not expect to fly internationally until late in 2021 – with the exception of a potential travel bubble with New Zealand.

The airline has also taken on an additional $1.1bn debt in order to keep operating.

It’s not alone. The International Air Transport Association (IATA) predicts airlines globally are on course to lose $157bn this year and next.

Passenger numbers are expected to drop to 1.8bn this year from 4.5bn in 2019.

IATA says those numbers will recover only partially to 2.8bn next year.