It seems making a loss for Qantas has really hit the airline hard. With CEO Alan Joyce forgoing his bonus and pay rise, and making a net loss of of A$244m ($256m; £161m) for the year ending 30 June, Qantas will be forgoing its first 35 Boeing 787-9 Dreamliners.
The move for cancelling the order is to reduce spending, with the impact of high fuel prices, previous industrial action, and the ailing International business
By cancelling the order for 35 aircraft, this would reduce capital expenditure commitments by US$8.5 billion (at list prices)
CEO Alan Joyce said:
“In the context of returning Qantas International to profit, this is a prudent decision. The B787 is an excellent aircraft and remains an important part of our future. However, circumstances have changed significantly since our order several years ago.”
Qantas however has retained its options with Boeing for 50 Boeing 787-9 which will allow delivery from 2016 if needed.
The Qantas group has also retained the first 15 Boeing 787-8’s for Jetstar, allowing Qantas to cascade the Jetstar’s A330’s to Qantas – and allow withdrawal of the Boeing 767 fleet.
Qantas’s future hopes for its international unit now rely on its negotiations with Emirates, with the cost containment exercise that is going on down under.
Alas, I think there’s going to be more pain for the Qantas group before things start improving for them in any sense of the word…