The Guardian 11 June, 2008
Qantas axes jobs,
routes in cost-cutting frenzy
Bob Briton
Qantas has wasted no time following through on recent threats of cuts to jobs and services. Last week the airline announced the scrapping of several services to Japan and South-East Asian destinations and the closing of its pilot base in Cairns. Some Qantas flights are being discontinued and replaced by Jetstar ones with pilots and crew on less pay and with inferior conditions.
Qantas is remaining tight-lipped about exact figures for job losses but company CEO Geoff Dixon said that the latest swipe would add only a "small number" to the those flagged previously, which he said would be "in the low hundreds".
Once again, fuel prices are said to be the motive for the axe wielding. Qantas claims that, despite previous boasts of effective hedging arrangements, its fuel bill will rise by $2 billion next year and that maintaining its present flight schedule to Japan would result in losses of $100 million.
Australian Tourism Export Council chief Matthew Hingerty has said that small businesses in the affected region will need $50 million in grants to be able to trade out of the trouble caused by Qantas’ cutbacks. Tourism was already suffering a downturn due to the high cost of the Aussie dollar and regional competition. The reduction in inbound flights could push many small businesses in Tropical North Queensland over the edge.
Qantas will no longer fly to Indonesia. Jetstar will carry those passengers. The previously scheduled 14 weekly Cairns-Tokyo flights will be replaced by a daily Jetstar service. Jetstar will no longer fly out of Cairns to Osaka and Nagoya and will drop its Sydney/Kuala Lumpur service. Qantas flights from Sydney to Los Angeles will be cut from 17 to 15 per week once the airline takes delivery of its new A380 aircraft for the route.
Suspicions remain high that Qantas is actually engaged in a wage-cutting restructure rather than simply responding to rising fuel costs. Executive General Manager John Borghetti has confirmed that the induction of 2,000 long-haul flight attendants for its new fleet of Airbus A380 super-jumbos and Boeing 787s will go ahead. They will be hired under an Enterprise Bargaining Agreement signed last November and work 30 percent more hours on 25 percent less pay than Qantas’ existing long-haul crews.
Meanwhile, Qantas engineers are keeping up their campaign for pay justice. Overtime bans are starting to bite as the Australian Licensed Aircraft Engineers Association continues to press for a 5 percent pay increase rather than the 3 percent on offer from Qantas. The less-than-inflation deal would be a pay-cut in real terms. Qantas has threatened to move major maintenance offshore in recent weeks as part of their cost-cutting drive.